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United States Government Accountability Office: 
GAO: 

Report to Congressional Addressees: 

2012 Annual Report: Opportunities to Reduce Duplication, Overlap and 
Fragmentation, Achieve Savings, and Enhance Revenue: 

February 2012: 

GAO-12-342SP: 

United States Government Accountability Office: 
Washington, DC 20548: 

February 28, 2012: 

Congressional Addressees: 

This is GAO's second annual report to Congress in response to the 
statutory requirement that GAO identify and report annually on federal 
programs, agencies, offices, and initiatives, either within 
departments or governmentwide, which have duplicative goals or 
activities.[Footnote 1] This body of work can help to inform 
government policymakers as they address the fiscal pressures facing 
our national government. The first report in this series, issued in 
March 2011,[Footnote 2] presented 81 opportunities to reduce potential 
government duplication, achieve cost savings, or enhance revenue. 

This report for 2012 presents 51 areas where programs may be able to 
achieve greater efficiencies or become more effective in providing 
government services. Like our March 2011 publication, this report 
identifies government duplication, overlap, and fragmentation as well 
as other cost savings and revenue enhancement opportunities. Its 
findings involve a wide range of government missions and touch 
virtually all major federal departments and agencies. 

Federal agencies and Congress have taken or planned a number of 
actions that respond to issues we raised in our March 2011 report. 
Consistent with the commitment expressed in that report, we have 
continued to monitor developments in the 81 areas we identified. In a 
companion publication, Follow-up on 2011 Report: Status of Actions 
Taken to Reduce Duplication, Overlap, and Fragmentation, Save Tax 
Dollars, and Enhance Revenue,[Footnote 3] which we are releasing 
concurrently with this report, we describe the extent to which 
progress has been made to address the actions we identified a year 
ago. In summary, GAO's specific assessment of progress as of February 
10, 2012, showed 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.[Footnote 4] In addition, the 
Office of Management and Budget (OMB) instructed agencies to consider 
areas of duplication or overlap identified by GAO and others in their 
fiscal year 2013 budget submissions and management plans. 

What GAO Found: 

This report is divided into two sections. Section I presents 32 areas 
in which we found evidence of duplication, overlap, or fragmentation 
among federal government programs. Section II of this report 
summarizes 19 additional 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. 

To find areas where duplication might exist, GAO's work begins, in 
many cases, by identifying fragmentation--that is, those circumstances 
in which more than one federal agency (or more than one organization 
within an agency) is involved in the same broad area of national 
interest. In some instances of fragmentation, we find overlap--that 
is, programs that have similar goals, devise similar strategies and 
activities to achieve those goals, or target similar users. 
Duplication occurs when two or more agencies or programs are engaged 
in the same activities or provide the same services to the same 
beneficiaries. In many cases, the existence of unnecessary 
duplication, overlap, or fragmentation can be difficult to estimate 
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 
improve the accuracy and accessibility of information about program 
operations, performance, and results. 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. 
However, the areas discussed in the first section of this report 
identify instances where multiple government programs or activities 
have led to inefficiencies, and we determined that greater 
efficiencies or effectiveness might be achievable. Further, we have 
expanded the scope of our work this year to look for areas where a mix 
of federal approaches is used, such as tax expenditures, direct 
spending, and federal grant or loan programs. 

Among the 32 areas where we found evidence of duplication, overlap, or 
fragmentation, this report describes a range of conditions. As the 
"Actions Needed" presented in this report show, addressing our varied 
findings will require careful deliberation and tailored, well-crafted 
solutions. 

We have found that agencies can often realize a range of benefits, 
such as improved customer service, decreased administrative burdens, 
and cost savings from addressing the issues we raise in this report. 
Cost savings related to reducing or eliminating duplication, overlap, 
and fragmentation can be difficult to estimate in some cases because 
the portion of agency budgets devoted to certain programs or 
activities is often not clear. In addition, the implementation costs 
that might be associated with consolidating programs, establishing 
collaboration mechanisms, or reducing activities, facilities, or 
personnel, among other variables, are difficult to estimate, or needed 
information on program performance or costs is not readily available. 

Section II of this report summarizes 19 additional 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. Collectively, this report shows that, if 
actions are taken to address the issues raised herein, as well as 
those from our 2011 report, the government could potentially save tens 
of billions of dollars annually, depending on the extent of actions 
taken. 

GPRA Modernization Act Provides Opportunities to Address Duplication, 
Overlap, and Fragmentation: 

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.[Footnote 5] 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 governmentwide 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. Aspects of 
several of these goals--including Science, Technology, Engineering, 
and Math (STEM) Education, Entrepreneurship and Small Businesses, Job 
Training, Cybersecurity, Information Technology Management, 
Procurement and Acquisition Management, and Real Property Management--
are discussed in this report or in our March 2011 report. 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. OMB officials stated that 
their approach to responding to this requirement will address 
fragmentation among federal programs. 

These requirements provide a much needed basis for more fully 
integrating a wide array of potentially duplicative, overlapping, or 
fragmented federal activities as well as a cohesive perspective on the 
long-term goals of the federal government focused on priority policy 
areas. It could also be a valuable tool for decision makers when 
reexamining existing programs and considering proposals for new 
programs. 

GAO's Systematic Examination of Federal Programs and Activities: 

This annual report 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 issues based 
on GAO work that has not yet been published or those that update prior 
GAO work, we provide additional information on the methodologies used 
in that ongoing work or update in the section of each issue area 
titled "How GAO Conducted Its Work." For additional information on our 
approach to preparing the overall report, see appendix II. 

Appendix III includes lists of federal programs or other activities 
related to issues in this report, and their fiscal year 2010 
obligations data, where such information was available.[Footnote 6] 
Where information is being reported on for the first time in this 
report, GAO sought comments from the agencies involved and 
incorporated those comments as appropriate. In most cases, agencies 
provided technical comments. Written comments are reproduced in 
appendix IV. 

While the areas identified in our annual reports are not intended to 
represent the full universe of duplication, overlap, or fragmentation 
within the federal government, we will have conducted a systematic 
examination across the federal government to identify major instances 
of potential duplication, overlap, and fragmentation governmentwide by 
the time we issue our third annual report in fiscal year 2013. 
[Footnote 7] This examination involves a multiphased approach. First, 
to identify potential areas of overlap, we examined the major budget 
functions and subfunctions of the federal government as identified by 
OMB. This was particularly helpful in identifying issue areas 
involving multiple government agencies. Second, GAO subject matter 
experts examined key missions and functions of federal agencies--or 
organizations within large agencies--using key agency documents, such 
as strategic plans, agency organizational charts, and mission and 
function documents. This further enabled us to identify areas where 
multiple agencies have similar goals, or where multiple organizations 
within federal agencies are involved in similar activities. Next, we 
canvassed a wide range of published sources--such as congressional 
hearings and reports by the Congressional Budget Office, OMB, various 
government audit agencies, and private think tanks--that addressed 
potential issues of duplication, overlap, and fragmentation. Lastly, 
we have work under way or planned in the coming year to evaluate major 
instances of duplication, overlap, or fragmentation that we have not 
yet covered in our first two annual reports. 

This report was prepared under the coordination of 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 summary. 

Signed by: 

Gene L. Dodaro: 
Comptroller General of the United States: 

[End of section] 

Report at a Glance: 

This report presents 51 areas where programs may be able to achieve 
greater efficiencies or become more effective in providing government 
services. The findings in this report involve a wide range of 
government missions and touch on virtually all major federal 
departments and agencies. 

Section I of this report presents 32 areas in which we found evidence 
of duplication, overlap, or fragmentation among federal government 
programs. 

Table 1: Duplication, Overlap, and Fragmentation Areas Identified in 
This Report: 

Mission: Agriculture; 

Area 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; 
Page: 14. 

Mission: Defense; 

Area Identified: 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; 
Page: 21. 

Area Identified: 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; 
Page: 26. 

Area Identified: 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; 
Page: 33. 

Area Identified: 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; 
Page: 39. 

Area Identified: 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; 
Page: 45. 

Mission: Economic development; 

Area Identified: 7. Support for Entrepreneurs: Overlap and 
fragmentation among the economic development programs that support 
entrepreneurial efforts require OMB and other agencies to better 
evaluate the programs and explore opportunities for program 
restructuring, which may include consolidation, within and across 
agencies; 
Page: 52. 

Area Identified: 8. Surface Freight Transportation: Fragmented federal 
programs and funding structures are not maximizing the efficient 
movement of freight; 
Page: 62. 

Mission: Energy; 

Area 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; 
Page: 69. 

Area Identified: 10. Nuclear Nonproliferation: Comprehensive review 
needed to address strategic planning limitations and potential 
fragmentation and overlap concerns among programs combating nuclear 
smuggling overseas; 
Page: 73. 

Mission: General government; 

Area 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; 
Page: 79. 

Area Identified: 12. Cybersecurity Human Capital: Governmentwide 
initiatives to enhance cybersecurity workforce in the federal 
government need better structure, planning, guidance, and coordination 
to reduce duplication; 
Page: 84. 

Area Identified: 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; 
Page: 89. 

Mission: Health; 

Area 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; 
Page: 96. 

Area Identified: 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; 
Page: 102. 

Mission: Homeland security/Law enforcement; 

Area 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; 
Page: 110. 

Area Identified: 17. Homeland Security Grants: The Department of 
Homeland Security needs better project information and coordination 
among four overlapping grant programs; 
Page: 120. 

Area Identified: 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; 
Page: 128. 

Mission: Information technology; 

Area 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; 
Page: 132. 

Mission: International affairs; 

Area 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; 
Page: 139. 

Area Identified: 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; 
Page: 146. 

Mission: Science and the environment; 

Area Identified: 22. Coordination of Space System Organizations: 
Fragmented leadership has led to program challenges and potential 
duplication in developing multibillion-dollar space systems; 
Page: 150. 

Area Identified: 23. Space Launch Contract Costs: Increased 
collaboration between the Department of Defense and the National 
Aeronautics and Space Administration could reduce launch contracting 
duplication; 
Page: 157. 

Area Identified: 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; 
Page: 162. 

Area Identified: 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; 
Page: 169. 

Area Identified: 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; 
Page: 175. 

Mission: Social services; 

Area Identified: 27. Social Security Benefit Coordination: Benefit 
offsets for related programs help reduce the potential for overlapping 
payments but pose administrative challenges; 
Page: 180. 

Area Identified: 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; 
Page: 185. 

Mission: Training, employment, and education; 

Area 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; 
Page: 193. 

Area Identified: 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; 
Page: 203. 

Area Identified: 31. Science, Technology, Engineering, and Mathematics 
Education: Strategic planning is needed to better manage overlapping 
programs across multiple agencies; 
Page: 214. 

Area Identified: 32. Financial Literacy: Overlap among financial 
literacy activities makes coordination and clarification of roles and 
responsibilities essential, and suggests potential benefits of 
consolidation; 
Page: 221. 

[End of table] 

Section II of this report summarizes 19 additional 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. 

Table 2: Other Cost Savings or Revenue Enhancement Opportunities 
Identified in This Report: 

Mission: Defense; 

Area 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; 
Page: 229. 

Area Identified: 34. Defense Headquarters: The Department of Defense 
should review and identify further opportunities for consolidating or 
reducing the size of headquarters organizations; 
Page: 233. 

Area Identified: 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; 
Page: 239. 

Area Identified: 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; 
Page: 243. 

Area Identified: 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; 
Page: 250. 

Area Identified: 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; 
Page: 255. 

Mission: Economic development; 

Area 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; 
Page: 259. 

Mission: Energy; 

Area Identified: 40. Excess Uranium Inventories: Marketing the 
Department of Energy's excess uranium could provide billions in 
revenue for the government; 
Page: 264. 

Mission: General government; 

Area 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; 
Page: 269. 

Area Identified: 42. U.S. Currency: Legislation replacing the $1 note 
with a $1 coin would provide a significant financial benefit to the 
government over time; 
Page: 273. 

Area Identified: 43. Federal User Fees: Regularly reviewing federal 
user fees and charges can help the Congress and federal agencies 
identify opportunities to address inconsistent federal funding 
approaches and enhance user financing, thereby reducing reliance on 
general fund appropriations; 
Page: 278. 

Area Identified: 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; 
Page: 285. 

Mission: Health; 

Area Identified: 45. Medicare Advantage Payment: The Centers for 
Medicare & 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; 
Page: 291. 

Area Identified: 46. Medicare and Medicaid Fraud Detection Systems: 
The Centers for Medicare & 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; 
Page: 294. 

Mission: Homeland security/Law enforcement; 

Area 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; 
Page: 298. 

Area Identified: 48. Passenger Aviation Security Fees: Options for 
adjusting the passenger aviation security fee could further offset 
billions of dollars in civil aviation security costs; 
Page: 304. 

Area Identified: 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 the Department of Homeland Security's U.S. 
Immigration and Customs Enforcement and U.S. Customs and Border 
Protection rather than using general fund appropriations; 
Page: 312. 

Mission: International affairs; 

Area 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; 
Page: 316. 

Mission: Social services; 

Area 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; 
Page: 321. 

[End of table] 

Table 3: Appendixes: 

Appendix I: List of Congressional Addressees; 
Page: 329. 

Appendix II: Objectives, Scope, and Methodology; 
Page: 331. 

Appendix III: Lists of Programs Identified; 
Page: 335. 

Appendix IV: Agency Comments; 
Page: 388. 

[End of table] 

[End of section] 

Abbreviations: 

Auto Recovery Office: Office of Recovery for Auto Communities and 
Workers: 

ATA: Anti-Terrorism Assistance: 

ATAT: abusive tax avoidance transaction: 

BEDI: Brownfields Economic Development Initiative: 

CBO: Congressional Budget Office: 

CBP: U.S. Customs and Border Protection: 

CCDF: Child Care and Development Fund: 

CDBG: Community Development Block Grant: 

CERP: Commander's Emergency Response Program: 

CIO: Chief Information Officer: 

CMS: Centers for Medicare & Medicaid Services: 

Commerce: Department of Commerce: 

COPS: Community Oriented Policing Services: 

DHS: Department of Homeland Security: 

DI: Disability Insurance: 

DOD: Department of Defense: 

Dodd-Frank Act: Dodd-Frank Wall Street Reform and Consumer Protection 
Act: 

DOT: Department of Transportation: 

Education: Department of Education: 

Energy: Department of Energy: 

EPA: Environmental Protection Agency: 

EUL: enhanced use lease: 

FCC: Federal Communications Commission: 

FECA: Federal Employees Compensation Act: 

Federal Reserve: Board of Governors of the Federal Reserve System: 

FEMA: Federal Emergency Management Agency: 

FHA: Federal Housing Administration: 

FMS: U.S. Foreign Military Sales: 

FPS: Federal Protective Service: 

FRCP: Federal Recovery Coordination Program: 

GM: General Motors: 

GPRA: Government Performance and Results Act: 

GPRAMA: GPRA Modernization Act of 2010: 

GPS: Global Positioning System: 

GSA: General Services Administration: 

HHS: Department of Health and Human Services: 

HSPD-9: Homeland Security Presidential Directive-9: 

HUD: Department of Housing and Urban Development: 

ICASS: International Cooperative Administrative Support Services: 

ICE: Immigration and Customs Enforcement: 

IDR: Integrated Data Repository: 

IED: improvised explosive device: 

IPC: Interagency Policy Committee: 

IRAC: Interdepartment Radio Advisory Committee: 

IRS: Internal Revenue Service: 

ISC: Interagency Security Committee: 

IT: information technology: 

IWG: interagency working group: 

JAG: Edward Byrne Memorial Justice Assistance Grant: 

JIEDDO: Joint IED Defeat Organization: 

Justice: Department of Justice: 

MALD-J: Miniature Air Launched Decoy-Jammer: 

MAS: Multiple Award Schedules: 

MOU: memorandum of understanding: 

NASA: National Aeronautics and Space Administration: 

Navy: Department of the Navy: 

NGEN: Next Generation Enterprise Network: 

NIH: National Institutes of Health: 

NIST: National Institute of Standards and Technology: 

NNSA: National Nuclear Security Administration: 

NOAA: National Oceanic and Atmospheric Administration: 

NPOESS: National Polar-orbiting Operational Environmental Satellite 
System: 

NRO: National Reconnaissance Office: 

NSC: National Security Council: 

NSTC: National Science and Technology Council: 

NTIA: National Telecommunications and Information Administration: 

OJP: Office of Justice Programs: 

OMB: Office of Management and Budget: 

One PI: One Program Integrity: 

OPM: Office of Personnel Management: 

ORD: Office of Research and Development: 

OSTP: Office of Science and Technology Policy: 

OVW: Office on Violence Against Women: 

PTSD: post-traumatic stress disorder: 

RAMP: Risk Assessment and Management Program: 

RCP: Recovery Coordination Program: 

RHS: Rural Housing Service: 

SBA: Small Business Administration: 

SSA: Social Security Administration: 

SSI: Supplemental Security Income: 

State: Department of State: 

STEM: Science, Technology, Engineering, and Mathematics: 

Treasury: Department of the Treasury: 

TSA: Transportation Security Administration: 

UAS: unmanned aircraft system: 

ULA: United Launch Alliance : 

USAID: U.S. Agency for International Development: 

USDA: U.S. Department of Agriculture: 

VA: Department of Veterans Affairs: 

Wi-Fi: wireless fidelity: 

[End of section] 

Section I: Areas in Which GAO Has Identified Duplication, Overlap, or 
Fragmentation: 

This section presents 32 areas in which we found evidence of 
duplication, overlap, or fragmentation among federal government 
programs. 

[End of section] 

Section I: Areas in Which GAO Has Identified Duplication, Overlap, or 
Fragmentation: 

This section presents 32 areas in which we found evidence of 
duplication, overlap, or fragmentation among federal government 
programs. 

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. 

Why This Area Is Important: 

Agriculture is critical to public health and the nation's economy. It 
annually produces $300 billion worth of food and other farm products, 
provides a major foundation for prosperity in rural areas, and is 
estimated to be responsible for 1 out of every 12 U.S. jobs. As a 
result, any natural or deliberate disruption of the agriculture or 
food production systems can present a serious threat to the national 
economy and human health. Recognizing the vulnerability of the U.S. 
food and agriculture systems, the President issued Homeland Security 
Presidential Directive-9 (HSPD-9) in January 2004 to establish a 
national policy to defend the food and agriculture systems against 
terrorist attacks, major disasters, and other emergencies. HSPD-9 
assigns more than nine federal agencies various responsibilities to 
enhance the nation's preparedness for food and agriculture emergencies. 

What GAO Found: 

For many years, GAO has reported that federal oversight of food safety 
is fragmented and results in inconsistent oversight, ineffective 
coordination, and inefficient use of resources. In 2007, GAO added 
food safety to its list of high-risk areas that warrant attention by 
Congress and the executive branch. More recently GAO found that this 
fragmentation extends to the responsibilities across multiple agencies 
to defend food and agricultural systems against terrorist attacks and 
natural disasters. (See the table below for information on agencies' 
roles and responsibilities under HSPD-9.) Many of these activities are 
everyday functions or part of the broader food and agriculture defense 
initiative and would be difficult for the agencies to separately 
quantify. 

Figure: Federal Agency Roles and Responsibilities for Food and 
Agriculture Defense as Defined by HSPD-9: 

[Refer to PDF for image: illustrated table] 
   
Agency responsibilities: Awareness and Warning: 

Develop surveillance and monitoring systems for animal, plant, and 
wildlife disease, as well as food, public health, and water quality 
for early detection and awareness of disease, pest, or poisonous 
agents; 
Department of Homeland Security: [Empty]; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: Primary Responsibility for Task 
Execution; 
Department of the Interior: Primary Responsibility for Task Execution; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: Primary Responsibility for Task Execution;. 

Develop systems to track specific animals and plants. as well as 
specific commodities and food; 
Department of Homeland Security: [Empty]; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: Primary Responsibility for Task 
Execution; 
Department of the Interior: Primary Responsibility for Task Execution; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: Primary Responsibility for Task Execution. 

Develop nationwide laboratory networks for food, veterinary, plant 
health, and water quality that are interconnected and standardized; 
Department of Homeland Security: [Empty]; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: Primary Responsibility for Task 
Execution; 
Department of the Interior: Primary Responsibility for Task Execution; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: Primary Responsibility for Task Execution. 

Develop and enhance intelligence operations and analysis capabilities 
for agriculture, food, and water sectors; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Support Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: Support Task Execution; 
Department of the Interior: [Empty]; 
Department of Justice: Primary Responsibility for Task Execution; 
Department of Education: [Empty]; 
Central Intelligence Agency: Primary Responsibility for Task Execution; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Develop new biological threat awareness capacity to enhance defection 
and characterization of an attack; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Support Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: Support Task Execution; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: Support Task Execution. 

Agency responsibilities: Vulnerability Assessments: 

Expand and continue vulnerability assessments of the agriculture and 
food sectors; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Agency responsibilities: Mitigation Strategies: 

Prioritize, develop, and implement mitigation strategies to protect 
vulnerable critical production nodes from the introduction of 
diseases, pests, or poisonous agents; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Support Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: Support Task Execution; 
Department of the Interior: [Empty]; 
Department of Justice: Primary Responsibility for Task Execution; 
Department of Education: [Empty]; 
Central Intelligence Agency: Support Task Execution; 
White House Office of Science and Technology Policy: [Empty]; 
Other: Support Task Execution. 

Expand development of common screening procedures for agriculture and 
food items entering the United States and maximize effective domestic 
inspection activities for food items within the United States; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 
           
Agency responsibilities: Response and Recovery: 

Develop a National Veterinary Stockpile containing sufficient amounts 
of animal vaccine, antiviral, or therapeutic products to respond to 
the most damaging animal diseases affecting human health and the 
economy; 
Department of Homeland Security: Support Task Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: Support Task Execution; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Develop a National Plant Disease Recovery System capable of responding 
to a high-consequence plant disease with pest control measures and the 
use of resistant seed varieties; 
Department of Homeland Security: Support Task Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: Support Task Execution; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Enhance recovery systems to stabilize agriculture production, the food 
supply, and the economy, including disposal and decontamination 
procedures; 
Department of Homeland Security: Support Task Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: Support Task Execution; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Study and make recommendations to the Homeland Security Council for 
the use of financial risk management tools for self-protection of food 
and agriculture enterprises vulnerable to losses due to terrorism; 
Department of Homeland Security: [Empty]; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: [Empty]; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 
         
Ensure adequate federal, state, and local response capabilities to 
respond quickly and effectively to a terrorist attack, major disease 
outbreak, or other disaster affecting the national agriculture or food 
infrastructure; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Support Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: Support Task Execution; 
Department of the Interior: [Empty]; 
Department of Justice: Support Task Execution; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Develop a coordinated agriculture and food-specific standardized 
response plan to be integrated into the National Response Plan[A]; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Support Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: Support Task Execution; 
Department of the Interior: [Empty]; 
Department of Justice: Support Task Execution; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Agency responsibilities: Outreach and Professional Development: 

Establish an effective information sharing and analysis mechanism for 
agriculture and food in cooperation with appropriate private sector 
entities; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Support Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: Support Task Execution. 

Develop and promote higher education programs for the protection of 
animal, plant, and public health; 
Department of Homeland Security: Support Task Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: Support Task Execution; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Develop and promote higher education programs to address protection of 
the food supply; 
Department of Homeland Security: Support Task Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: Support Task Execution; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Establish opportunities for professional development and specialized 
training in agriculture and food protection; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Agency responsibilities: Research and Development: 

Accelerate and expand development of countermeasures against the 
intentional introduction or natural occurrence of catastrophic animal, 
plant, and zoonotic diseases; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: Primary Responsibility for Task 
Execution; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: Support Task 
Execution; 
Other: Primary Responsibility for Task Execution. 

Develop a plan to provide safe, secure, and state-of-the-art 
agriculture biocontainment laboratories to research and develop 
diagnostic capabilities for foreign animal and zoonotic diseases; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: [Empty]; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Establish university-based centers of excellence in agriculture and 
food security; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Support Task Execution; 
Department of Health and Human and Services: Support Task Execution; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Agency responsibilities: Budget: 

Submit an integrated budget plan for defense of the US. food system; 
Department of Homeland Security: Primary Responsibility for Task 
Execution; 
Department of Agriculture: Primary Responsibility for Task Execution; 
Department of Health and Human and Services: Primary Responsibility 
for Task Execution; 
Environmental Protection Agency: [Empty]; 
Department of the Interior: [Empty]; 
Department of Justice: [Empty]; 
Department of Education: [Empty]; 
Central Intelligence Agency: [Empty]; 
White House Office of Science and Technology Policy: [Empty]; 
Other: [Empty]. 

Source: GAO analysis of HSFID-9 

[A] The National Response Plan was replaced by the National Response 
Framework in 2008. 

[End of figure] 

As GAO reported in August 2011, there is no centralized coordination 
to oversee the federal government's overall progress in implementing 
the nation's food and agriculture defense policy. Because the 
responsibilities outlined in this policy (HSPD-9) are fragmented and 
cut across at least nine different agencies, centralized oversight is 
important to ensure that efforts are coordinated to overcome this 
fragmentation, efficiently use scarce funds, and promote the overall 
effectiveness of the federal government. 

Previously, the White House Homeland Security Council conducted some 
coordinated activities to oversee federal agencies' HSPD-9 
implementation by gathering information from agencies about their 
progress. In 2008, it tasked the Department of Homeland Security (DHS) 
with creating an online forum intended to enable agencies to share 
information that coordinated their HSPD-9 efforts, allowing the 
Council to efficiently view agencies' implementation progress in a 
consistent manner. However, these efforts are no longer ongoing. 
Officials from the U.S. Departments of Agriculture (USDA), Homeland 
Security, Health and Human Services (HHS) and the Environmental 
Protection Agency (EPA) told us that the Homeland Security Council's 
efforts were valuable. For example, officials from EPA told us it was 
valuable to interact with other agencies regarding HSPD-9 efforts, HHS 
officials found the Homeland Security Council's consolidation of 
information across multiple agencies to be useful. Officials from EPA 
noted that although the Homeland Security Council's and DHS's 
oversight roles have not been consistent for the past few years, EPA 
and other agencies have used multi-agency working groups to coordinate 
food and agriculture emergency activities.[Footnote 8] It is unclear 
why the Homeland Security Council no longer gathers such information, 
but officials from DHS noted that interest from agencies and the 
Homeland Security Council has decreased, and as of late 2008 or early 
2009, they no longer coordinate agencies' reporting of their HSPD-9 
implementation progress. Top-level review can help ensure that 
management's directives are carried out and determine if agencies are 
effectively and efficiently using resources. 

Moreover, without centrally coordinated oversight, agencies may not 
have sufficient direction for prioritizing responsibilities, and they 
may not have sufficient incentive to monitor progress internally. For 
example, GAO found that USDA does not have a departmentwide strategy 
for prioritizing and allocating resources to its numerous HSPD-9 
responsibilities. According to USDA officials, because food and 
agriculture defense has not been a primary focus in recent years for 
the National Security Staff--which supports the White House Homeland 
Security Council under the current administration--USDA has been less 
focused on HSPD-9 oversight and has prioritized other, more recently 
directed activities. Instead, USDA assigned its responsibilities to 
its component agencies based on their statutory authority and 
expertise and allowed individual agencies to set their implementation 
and budget priorities. 

However, USDA agencies are facing various challenges carrying out 
these responsibilities. For example, from 2005 through 2010, USDA's 
Agricultural Research Service allocated approximately $10.6 million to 
develop a system--the National Plant Disease Recovery System--to help 
the nation recover from plant disease outbreaks that could devastate 
the nation's production of economically important crops. A major part 
of this effort involved developing recovery plans that identified 
critical research gaps; however, the Agricultural Research Service 
does not have a documented, systematic process to monitor the extent 
to which research gaps are filled, calling into question the efficient 
use of these funds. In addition, from 2006 through 2010, USDA's Animal 
and Plant Health Inspection Service allocated approximately $33 
million (including about $18 million in supplemental funding) to 
develop the National Veterinary Stockpile--a stockpile containing 
resources to respond to the 17 most damaging animal diseases affecting 
human health and the economy. HSPD-9 calls for the National Veterinary 
Stockpile to leverage where appropriate the mechanisms and 
infrastructure that have been developed for HHS's Strategic National 
Stockpile--which contains medical supplies to address public health 
emergencies. Although there has been some collaboration, there appears 
to be confusion about the mission and capabilities of the stockpiles 
that could hinder USDA's and HHS's efforts to identify leveraging 
opportunities. Unless resolved, the agencies may be missing 
opportunities to more efficiently use federal resources. 

Because there is currently no centralized coordination to oversee 
agencies' HSPD-9 implementation progress, it is unclear how 
effectively or efficiently agencies are using resources in 
implementing the nation's food and agriculture defense policy. As a 
result, the nation may not be assured that agency efforts to protect 
agriculture and the food supply are well designed and effectively 
implemented. USDA officials told us that the department would benefit 
from strategic direction from the National Security Staff to help 
prioritize specific activities and funding decisions in this time of 
limited resources. GAO has previously reported that effective 
strategies help set priorities and allocate resources to inform 
decision making and help ensure accountability.[Footnote 9] Such 
priority setting and resource allocation is especially important in a 
fiscally constrained environment. 

Actions Needed and Potential Financial or Other Benefits: 

GAO recommended in August 2011 that to help ensure that the federal 
government is effectively implementing the nation's food and 
agriculture defense policy, the Secretary of Homeland Security should: 

* resume DHS's efforts to coordinate agencies' overall HSPD-9 
implementation efforts. 

In addition, the Homeland Security Council should direct the National 
Security Staff to: 

* establish an interagency process that would provide oversight of 
agencies' implementation of HSPD-9; and: 

* encourage agencies to participate in and contribute information to 
DHS's efforts to coordinate agencies' implementation of HSPD-9. 

Furthermore, to ensure that USDA is fulfilling its responsibilities to 
protect the nation's food and agriculture systems, the Secretary of 
Agriculture should: 

* develop a departmentwide strategy for implementing its HSPD-9 
responsibilities. Such a strategy would include an overarching 
framework for setting priorities, as well as allocating resources. 

Also, to help ensure that the nation is adequately prepared to recover 
from high-consequence plant diseases, the Secretary of Agriculture 
should direct the Administrator of the Agricultural Research Service, 
in coordination with relevant USDA agencies, to: 

* develop and implement a documented, systematic process to track 
research gaps identified in the National Plant Disease Recovery System 
recovery plans and monitor progress in filling these gaps. 

Moreover, to ensure the most effective use of resources and to resolve 
any confusion, the Secretaries of Agriculture and Health and Human 
Services should: 

* jointly determine on a periodic basis if there are appropriate 
opportunities for the National Veterinary Stockpile to leverage 
Strategic National Stockpile mechanisms or infrastructure as directed 
by HSPD-9. If such opportunities exist, the two agencies should 
formally agree upon a process for the National Veterinary Stockpile to 
use the identified mechanisms and infrastructure. 

By taking these actions, federal decision makers will acquire critical 
information they need to help assess how well the nation is prepared 
for major emergencies and how efficiently agencies are using federal 
resources to prepare. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its August 2011 report to DHS, HHS, USDA, EPA, 
and the National Security Staff for review and comment. DHS, HHS, and 
USDA generally agreed with GAO's recommendations. In addition, in an e-
mail received July 22, 2011, the National Security Staff's Deputy 
Legal Advisor stated that the National Security Staff agrees that a 
review of HSPD-9 is appropriate and that they will look for an 
opportunity to do so. DHS, HHS, USDA, EPA, and the National Security 
Staff also provided technical comments, which were incorporated as 
appropriate. As part of GAO's routine audit work, GAO will track 
agency actions to address these recommendations and report to Congress. 

How GAO Conducted Its Work: 

This information contained in this analysis is based on findings from 
the products in the related GAO products section. GAO reviewed key 
documents and interviewed officials from USDA, DHS, HHS, and EPA 
because these agencies have the most responsibilities under HSPD-9. 
GAO also met with an official from the National Security Staff to 
discuss any current efforts they are coordinating to oversee agencies' 
HSPD-9 implementation progress. 

Related GAO Products: 

Homeland Security: Challenges for the Food and Agriculture Sector in 
Responding to Potential Terrorist Attacks and Natural Disasters. 
[Hyperlink, http://www.gao.gov/products/GAO-11-946T] Washington, D.C.: 
September 13, 2011. 

Homeland Security: Actions Needed to Improve Response to Potential 
Terrorist Attacks and Natural Disasters Affecting Food and 
Agriculture. [Hyperlink, http://www.gao.gov/products/GAO-11-652] 
Washington, D.C.: August 19, 2011. 

Contact Information: 

For additional information about this area, contact Lisa Shames at 
(202) 512-3841 or s [Hyperlink, shamesl@gao.gov] hamesl@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Airborne electronic attack--an electronic warfare capability--involves 
use of aircraft to neutralize, destroy, or temporarily suppress enemy 
air defense and communications systems, either through destructive or 
disruptive means. These capabilities are increasingly important and 
complex as networked systems, distributed controls, and sophisticated 
sensors become ubiquitous in military equipment, civilian 
infrastructure, and commercial networks. These technological 
developments complicate the Department of Defense's ability to 
exercise control over the electromagnetic spectrum, when necessary, to 
support U.S. military objectives. Aircraft executing airborne 
electronic attack missions employ a variety of mission systems, such 
as electronic jamming pods, and weapons, such as antiradiation 
missiles and air-launched expendable decoys. These aircraft also rely 
on aircraft self-protection systems and defensive countermeasures for 
additional protection. 

All four military services within the Department of Defense are 
separately acquiring new airborne electronic attack systems. 
Department of Defense investments to develop and procure new and 
updated airborne electronic attack systems are projected to total more 
than $17.6 billion from fiscal years 2007 through 2016. With the 
prospect of slowly growing or flat defense budgets for years to come, 
the department must get better returns on its weapon system 
investments and find ways to deliver more capability to the warfighter 
for less than it has in the past. 

What GAO Found: 

GAO's ongoing review of planned airborne electronic attack systems 
found that the department is developing multiple systems to provide 
similar capabilities. Opportunities may exist for consolidating some 
current service-specific acquisition efforts. As GAO reported in March 
2011, service-driven requirements and funding processes continue to 
hinder integration and efficiency and contribute to unnecessary 
duplication in addressing warfighter needs. In the airborne electronic 
attack mission area, systems in development may overlap--at least to 
some extent--in terms of planned mission tasks. Yet, they are being 
developed as individual programs by the different services. The table 
below highlights overlap among four systems being developed to counter 
irregular warfare[Footnote 10] threats--one subset of airborne 
electronic attack. While the host platforms for each system are 
different, the missions each system performs are similar. 

Table: Potential Overlap among Communication Jamming Systems 
Supporting Ground Forces: 

System name: Service sponsor; 
Collaborative On-line Reconnaissance Provider Operationally Responsive 
Attack Link (CORPORAL): Marine Corps; 
Intrepid Tiger II: Marine Corps; 
Communications Electronic Attack with Surveillance and Reconnaissance 
(CEASAR): Army; 
MQ-9 Reaper Electronic Attack Pod: Air Force. 

System name: Host platform; 
Collaborative On-line Reconnaissance Provider Operationally Responsive 
Attack Link (CORPORAL): RQ-7B Shadow unmanned aerial vehicle; 
Intrepid Tiger II: AV-8B fixed wing aircraft[A]; 
Communications Electronic Attack with Surveillance and Reconnaissance 
(CEASAR): C-12 fixed wing aircraft; 
MQ-9 Reaper Electronic Attack Pod: MQ-9 Reaper unmanned aerial vehicle. 

System name: Mission description; 
Collaborative On-line Reconnaissance Provider Operationally Responsive 
Attack Link (CORPORAL): Communications jamming in support of ground 
forces[B]; 
Intrepid Tiger II: Communications jamming and surveillance capability 
in support of ground forces; 
Communications Electronic Attack with Surveillance and Reconnaissance 
(CEASAR): Denial and disruption of enemy communications systems and 
improvised explosive devices in support of unit-level ground 
commanders; 
MQ-9 Reaper Electronic Attack Pod: Communications and improvised 
explosive device jamming in support of combatant commander mission 
needs. 

System name: Estimated acquisition cost; 
Collaborative On-line Reconnaissance Provider Operationally Responsive 
Attack Link (CORPORAL): $54.5 million; 
Intrepid Tiger II: $76.8 million; 
Communications Electronic Attack with Surveillance and Reconnaissance 
(CEASAR): $13.8 million[C]; 
MQ-9 Reaper Electronic Attack Pod: $233.7 million. 

Source: GAO analysis of Department of Defense data. 

[A] After the AV-8B, the Intrepid Tiger II pod will be integrated onto 
additional aircraft. 

[B] CORPORAL also consists of other technologies that serve broader 
purposes. 

[C] Total excludes $26.3 million in funding from the Operations and 
Maintenance, Army budget account through fiscal year 2013. The Army 
uses these funds to (1) lease two C-12 aircraft to fly the CEASAR pod 
and (2) fund aircraft and pod sustainment costs. 

[End of table] 

According to Department of Defense officials, airborne electronic 
attack limitations in recent operations, urgent needs of combatant 
commanders, and the desire to provide ground units with their own 
locally controlled assets have all contributed to the services' 
decisions to develop their own systems to address irregular warfare 
threats. 

Requirements for most of these irregular warfare systems were derived 
from Department of Defense urgent needs processes--activities aimed at 
rapidly developing, equipping, and fielding solutions and critical 
capabilities to the warfighter in a way that is more responsive to 
urgent warfighter requests than the department's traditional 
acquisition procedures. As GAO reported in March 2011, the 
department's urgent needs processes often lead to multiple entities 
responding to requests for similar capabilities, resulting in 
potential duplication of efforts. As military operations in Iraq and 
Afghanistan wind down--and the services evaluate whether to transition 
their current urgent needs program over to the formal weapon system 
acquisition process--opportunities may exist to better consolidate 
current program activities, such as the CORPORAL and CEASAR pod 
systems that are still demonstration programs whose transitions to 
formal acquisition programs have not yet been determined. 

The potential for unnecessary duplication of efforts within the 
airborne electronic attack area is not limited to irregular warfare 
systems. Similar issues exist with airborne electronic attack systems 
designed to counter potential near-peer adversaries.[Footnote 11] Most 
notably, both the Air Force and Navy are separately evaluating options 
for acquiring advanced jamming decoys--the Air Force through an 
upgrade (referred to as Increment II) to its Miniature Air Launched 
Decoy-Jammer (MALD-J) program, and the Navy through its planned 
Airborne Electronic Attack Expendable initiative. 

The two services have held discussions with one another about 
combining efforts toward a joint solution--including a meeting between 
Navy and Air Force requirements offices and acquisition officials in 
December 2010--but they have not reached resolution on a common path 
forward. According to Navy officials, relatively minor design and 
software modifications to the Air Force's planned MALD-J Increment II 
system could produce a system that satisfies both services' mission 
requirements. However, Air Force officials stated that accommodating 
the Navy's mission requirements within the system would increase 
program costs and delay planned fielding of the Increment II system, 
essentially rendering the current program unexecutable. Subsequently, 
Air Force officials stated that unless MALD-J Increment II, as 
currently configured, sufficiently meets Navy requirements, they do 
not expect the Navy to have any formal role in the program. In July 
2011, the Air Force suspended MALD-J Increment II because of future 
funding shortfalls. This pause in the program affords an opportunity 
for continued dialogue between the two services as to potential 
benefits and drawbacks to the pursuit of a common acquisition solution. 

On the other hand, the services have shown in some instances that they 
can share information across the different efforts. For example, 
Marine Corps decisions to reuse jammer technologies from CORPORAL for 
Intrepid Tiger II have driven significant commonality in hardware and 
software for these systems, which program officials state has reduced 
technical challenges and produced cost savings. 

Pursuing multiple separate acquisition efforts to develop similar 
capabilities within the airborne electronic attack mission area can 
lead to insufficient use of resources and may contribute to other 
warfighting needs going unfilled. Leveraging resources and acquisition 
efforts across services can simplify developmental efforts, improve 
interoperability among systems, and decrease operations and support 
costs--outcomes that position the department to maximize the returns 
it gets on its airborne electronic attack investments. 

Actions Needed and Potential Financial or Other Benefits: 

To ensure investments in airborne electronic attack systems are cost-
effective and to prevent unnecessary overlap, GAO expects to recommend 
that the Secretary of Defense: 

* review the capabilities provided by the Marine Corps's Intrepid 
Tiger II pod and CORPORAL, Army's CEASAR, and Air Force MQ-9 Reaper 
Electronic Attack Pod systems and identify opportunities for 
consolidating these different efforts, as appropriate; and: 

* assess Air Force and Navy plans for developing and acquiring new 
expendable jamming decoys, specifically those services' MALD-J 
Increment II and Airborne Electronic Attack Expendable initiatives, to 
determine if these activities should be merged. 

Department of Defense analysis of airborne electronic attack programs--
both current and planned--could reduce duplication of similar 
acquisition initiatives and improve efficiencies. More analysis is 
needed by the department to determine the potential for cost savings. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to the Department of 
Defense for review and comment. The department provided technical 
comments, which were incorporated as appropriate. In its comments, the 
department noted that the Army and Marine Corps have held high-level 
discussions to collaborate on the CEASAR, Intrepid Tiger II, and 
CORPORAL programs. According to the department, discussions to share 
hardware and software technology are ongoing--an arrangement that, if 
implemented, could result in significant cost avoidance--but talks 
have not yet yielded a design or set of requirements agreeable to both 
services. As part of GAO's routine audit work, GAO will track agency 
actions to address these expected recommendations and report to 
Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section and additional 
work GAO conducted to be published as a separate product in 2012. GAO 
reviewed program documentation to identify planned capabilities, 
technical challenges, and anticipated costs for key systems. GAO also 
analyzed Department of Defense documents outlining airborne electronic 
attack-related mission requirements and acquisition needs and reviewed 
platform-specific capabilities documents, service roadmaps, and budget 
documents, which together provided insight on the department's overall 
strategy for acquiring airborne electronic attack capabilities. GAO 
conducted interviews with relevant Department of Defense officials 
responsible for managing airborne electronic attack requirements and 
programs. 

Appendix III lists the programs GAO identified that may have similar 
or overlapping objectives, provide similar services or be fragmented 
across government missions. Overlap and fragmentation may not 
necessarily lead to actual duplication, and some degree of overlap and 
duplication may be justified. 

Related GAO Products: 

Warfighter Support: DOD's Urgent Needs Processes Need a More 
Comprehensive Approach and Evaluation for Potential Consolidation. 
[Hyperlink, http://www.gao.gov/products/GAO-11-273] Washington, D.C.: 
March 1, 2011. 

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.: March 1, 
2011. 

Contact Information: 

For additional information about this area, contact Michael J. 
Sullivan at (202) 512-4841 or s [Hyperlink, sullivanm@gao.gov] 
ullivanm@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

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. 
[Footnote 12] These programs and systems can be found across DOD and 
the military services (Air Force, Army, Navy, and Marine Corps). The 
continued success of UAS on the battlefield has led to greatly 
increased demand from warfighters and the development of many new 
systems. Further, in announcing the department's new budget 
priorities, the Secretary of Defense highlighted various current and 
planned unmanned systems that are considered to be high-priority in 
terms of meeting the requirements of the new strategic guidance. 

In 2009, GAO's work highlighted the need to consider commonality in 
UAS--using the same or interchangeable subsystems and components in 
more than one subsystem to improve interoperability of systems--and 
indicated that DOD lacked an analytical approach to prioritize 
capability needs which would reduce the likelihood of redundancies in 
UAS capabilities. As GAO reported in June 2011, although the Joint 
Requirements Oversight Council is directed to ensure that trade-offs 
among cost, schedule, and performance objectives are considered as 
part of its requirements review process, it currently does not 
prioritize requirements, consider redundancies across proposed 
programs, or prioritize and analyze capability gaps in a consistent 
manner. Congress has enacted legislation requiring DOD to establish a 
policy and acquisition strategy for more common ground stations and 
payloads for manned and unmanned aircraft systems.[Footnote 13] 

The elements of DOD's planned UAS portfolio include unmanned aircraft, 
payloads, and ground control stations. Unmanned aircraft are fixed or 
rotary winged aircraft capable of flight without an onboard crew. 
Payloads are subsystems and equipment carried on a UAS configured to 
accomplish specific missions, including intelligence, surveillance, 
and reconnaissance and attack. Ground control stations handle multiple 
mission aspects such as system command and control, mission planning, 
payload control, and communications. 

What GAO Found: 

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. DOD 
currently has 15 unmanned aircraft programs which it categorizes into 
five groups according to weight, altitude, and speed. Groups 4 and 5 
contain the largest and most expensive aircraft, with weights 
exceeding 1,320 pounds. Group 5 aircraft fly higher--above 18,000 
feet--than Group 4 aircraft. DOD has spent almost $19 billion through 
fiscal year 2011 to develop and procure three aircraft in Group 5 and 
five aircraft in Group 4, where GAO found potential overlap, and 
expects to spend an additional $32.4 billion to complete these 
programs. 

Illustrative of the overlap, in Group 5, the Navy plans to spend more 
than $3 billion to develop its own variant of the Air Force Global 
Hawk--the Broad Area Maritime Surveillance UAS--rather than using the 
already fielded Global Hawk. 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 a new 
aircraft to meet the Navy's requirements versus buying more Global 
Hawks. 

If the preference for service-unique solutions persists in the absence 
of a departmentwide strategy, so will the potential for overlap in the 
future. 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. 

In addition to unmanned aircraft, DOD expects to spend about $9 
billion to buy 42 UAS payloads through fiscal year 2016. Each payload 
provides a sensor using one of three different technologies: electro-
optical/infra-red, radar, and signals intelligence. For Group 4 and 5 
aircraft, GAO identified overlap among numerous sensors being 
developed within each of the three technologies (see table below). 

Table: Overlapping Development of Sensors for UAS Payloads in Group 4 
and 5 Aircraft: 

Sensor type: Electro-optical/infra-red; 
Number of programs: 
Four Air Force programs; 
Four Army programs; 
One Navy program; 
Five multiservice programs. 

Sensor type: Radar; Three Air Force programs.
Number of programs: 
Two Army programs; 
One Navy program; 
One multiservice program. 

Sensor type: Signals intelligence; 
Number of programs: 
Four Air Force programs; 
Two Navy programs; 
Two Army programs. 

Source: GAO analysis of DOD data. 

[End of table] 

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. For 
example, the Army and Air Force are developing two separate signals 
intelligence sensors (the TSP and ASIP 2-C, respectively) that have 
similar capabilities to track ground communication and activity. 
According to a DOD-sponsored study in March 2010, the department could 
have saved almost $1.2 billion had the Air Force acquired the same 
sensor as the Army. However, since such an approach was not considered 
earlier in the program, DOD concluded there was not a business case 
for combining the programs. Instead, the study noted, the ideal time 
for such a decision would have been when requirements were being 
determined. More recently, the Navy has begun development of its own 
signals intelligence payload (the MCS-21) for the Broad Area Maritime 
Surveillance aircraft, even though the sensor's capabilities are 
similar to those of the Air Force and Army payloads. 

Through fiscal year 2016, DOD plans to spend about $3 billion to 
acquire 13 ground control stations and GAO identified overlap and 
potential duplication among 10 of these systems. Because aircraft, 
payloads and control stations are usually developed together, a unique 
ground control station therefore exists for almost every UAS that DOD 
has acquired. According to a cognizant DOD official, the associated 
software is about 90 percent duplicative because similar software is 
developed for each ground control station. Even though the 
functionality of the software is similar, a considerable amount of 
additional time and money is invested in capabilities that have 
already been paid for and can also make it difficult and costly to 
modify or upgrade. 

DOD has acknowledged that an open architecture framework could provide 
opportunities for increased competition and collaboration to satisfy 
requirements through common software solutions, among other areas. 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.[Footnote 14] 

DOD has acknowledged that it has bought many UAS systems inefficiently 
and has begun to take steps to improve outcomes as it expands these 
capabilities over the next several years. DOD continues to face 
challenges in its ability to improve efficiency and reduce the 
potential for overlap and duplication as it buys UAS capabilities: 

* GAO recommended in November 2008, among other things, that DOD 
designate a single entity to integrate all crosscutting efforts 
related to improving the management and operation of UAS, including to 
ensure that all UAS systems were designed to meet joint service 
requirements and interoperability standards. DOD did not agree, 
stating that rather than an executive agent, the combination of the 
UAS Task Force (created in 2007 to encourage initiatives for 
collaboration among the military services) and other initiatives would 
serve to address UAS challenges. Currently, the Task Force has no 
decision-making authority and cannot direct the military services' 
efforts to acquire UAS capabilities. As such, while the military 
services participate at all levels of the Task Force, they do not 
always fully support related initiatives and, therefore, do not 
achieve the potential benefits from collaboration. 

* GAO recommended in July 2009 that DOD not begin new programs until 
evaluating systems from a multiservice perspective and take an open 
systems approach to product development. While DOD concurred with this 
recommendation, it believes current practices do not encourage 
duplicative systems development. However, among future UAS aircraft, 
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. 

* Despite DOD direction, although the Air Force and the Army used the 
same contractor to procure the Predator and Gray Eagle UAS, the 
programs achieved only limited success with efforts to combine 
programs and missed an opportunity to potentially save hundreds of 
millions of dollars. The Air Force now plans to procure Reaper UAS 
rather than the Predator. 

Actions Needed and Potential Financial or Other Benefits: 

To reduce the likelihood of overlap and potential duplication in its 
UAS portfolio, GAO has made several prior recommendations to DOD which 
have not been fully implemented. While DOD generally agreed with the 
intent of those recommendations, the department has not always agreed 
with the proposed method of implementation. The overlap in current UAS 
programs, as well as the continued potential in future programs, shows 
that DOD must still do more to implement GAO's prior recommendations. 
GAO believes the potential for savings is significant and with DOD's 
renewed commitment to UAS for meeting new strategic requirements, all 
the more imperative. Specifically, DOD should: 

* re-evaluate whether a single entity would be better positioned to 
integrate all crosscutting efforts to improve the management and 
operation of UAS; 

* consider an objective, independent examination of current UAS 
portfolio requirements and the methods for acquiring future unmanned 
aircraft, including strategies for making these systems more common, 
to ensure the best return on every dollar it invests; and: 

* prior to initiating future unmanned aircraft programs, direct the 
military services to identify and document in their acquisition plans 
and strategies specific areas where commonality can be achieved, take 
an open systems approach to product development, conduct a 
quantitative analysis that examines the costs and benefits of various 
levels of commonality, and establish a collaborative approach and 
management framework to periodically assess and effectively manage 
commonality. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to DOD. DOD provided 
clarifications on individual program decisions and other technical 
comments which were incorporated as appropriate. As part of its 
routine audit work, GAO will track agency actions to address these 
recommendations and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
products listed in the related GAO products section and additional 
work GAO conducted. GAO comprehensively identified, to the extent 
possible, using a data collection instrument, DOD's UAS portfolio to 
analyze how DOD and the military services acquired this portfolio. GAO 
assessed the Office of the Under Secretary of Defense for Acquisition, 
Technology, and Logistics and military service UAS roadmaps, 
requirements, and concepts of operation. GAO conducted interviews with 
officials from the Joint Chiefs of Staff, the Office of the Under 
Secretary of Defense for Acquisition, Technology, and Logistics, 
military service laboratories and program offices, as well as UAS 
contractors. Using these data, GAO evaluated to what extent 
collaboration and coordination efforts by DOD and the military 
services resulted in--or reduced the potential for--duplication, 
fragmentation, and overlap. Appendix III lists the programs GAO 
identified that may have similar or overlapping objectives, provide 
similar services or be fragmented across government missions. Overlap 
and fragmentation may not necessarily lead to actual duplication, and 
some degree of overlap and duplication may be justified. 

Related GAO Products: 

DOD Weapon Systems: Missed Trade-off Opportunities During Requirements 
Reviews. [Hyperlink, http://www.gao.gov/products/GAO-11-502] 
Washington, D.C.: June 16, 2011. 

Intelligence, Surveillance, and Reconnaissance: Actions Are Needed to 
Increase Integration and Efficiencies of DOD's ISR Enterprise. 
[Hyperlink, http://www.gao.gov/products/GAO-11-465] Washington, D.C.: 
June 3, 2011. 

Defense Acquisitions: Opportunities Exist to Achieve Greater 
Commonality and Efficiencies among Unmanned Aircraft Systems. 
[Hyperlink, http://www.gao.gov/products/GAO-09-520] Washington, D.C.: 
July 30, 2009. 

Unmanned Aircraft Systems: Additional Actions Needed to Improve 
Management and Integration of DOD Efforts to Support Warfighter Needs. 
[Hyperlink, http://www.gao.gov/products/GAO-09-175] Washington, D.C.: 
November 14, 2008. 

Unmanned Aircraft Systems: Advance Coordination and Increased 
Visibility Needed to Optimize Capabilities. [Hyperlink, 
http://www.gao.gov/products/GAO-07-836] Washington, D.C.: July 11, 
2007. 

Defense Acquisition: Better Acquisition Strategy Needed for Successful 
Development of the Army's Warrior Unmanned Aircraft System. 
[Hyperlink, http://www.gao.gov/products/GAO-06-593] Washington, D.C.: 
May 19, 2006. 

Unmanned Aircraft Systems: New DOD Programs Can Learn from Past 
Efforts to Craft Better and Less Risky Acquisition Strategies. G 
[Hyperlink, http://www.gao.gov/products/GAO-06-447] AO-06-447. 
Washington, D.C.: March 15, 2006. 

Unmanned Aircraft Systems: DOD Needs to More Effectively Promote 
Interoperability and Improve Performance Assessments. [Hyperlink, 
http://www.gao.gov/products/GAO-06-49] Washington, D.C.: December 13, 
2005. 

Unmanned Aerial Vehicles: Changes in Global Hawk's Acquisition 
Strategy Are Needed to Reduce Program Risks. [Hyperlink, 
http://www.gao.gov/products/GAO-05-6] Washington, D.C.: November 5, 
2004. 

Force Structure: Improved Strategic Planning Can Enhance DOD's 
Unmanned Aerial Vehicles Efforts. [Hyperlink, 
http://www.gao.gov/products/GAO-04-342] Washington, D.C.: March 17, 
2004. 

Defense Acquisitions: Matching Resources with Requirements Is Key to 
the Unmanned Combat Air Vehicle Program's Success. [Hyperlink, 
http://www.gao.gov/products/GAO-03-598] Washington, D.C.: June 30, 
2003. 

Ballistic Missile Defense: More Common Systems and Components Could 
Result in Cost Savings. [Hyperlink, 
http://www.gao.gov/products/GAO/NSIAD-99-101] Washington, D.C.: May 
21, 1999. 

Unmanned Vehicles: Assessment of DOD's Unmanned Aerial Vehicle Master 
Plan. http://www.gao.gov/products/NSIAD-89-41BR. Washington, D.C.: 
December 9, 1988. 

Contact Information: 

For additional information about this area, contact Michael J. 
Sullivan at (202) 512-4841 or sullivanm@gao.gov]. 

[End of section] 

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. 

Why This Area Is Important: 

The threat of improvised explosive devices (IED) continues to be a 
major concern in Afghanistan, as well as to other areas throughout the 
world with over 500 reported IED events per month worldwide outside of 
Southwest Asia according to Department of Defense (DOD) officials. 
Further, there is widespread consensus in DOD that this threat will 
not go away and that IEDs will continue to be a weapon of strategic 
influence in future conflicts. In support of the fight against IEDs, 
Congress has appropriated over $18 billion to the Joint IED Defeat 
Organization (JIEDDO)[Footnote 15] from fiscal year 2006 through 
fiscal year 2011 to address the IED threat. In addition, other DOD 
components, including the military services, also have spent billions 
of dollars from their own funds developing counter-IED capabilities. 
For example, the Mine Resistant Ambush Protected Task Force, which 
leads DOD's efforts to produce and field Mine Resistant Ambush 
Protected vehicles to protect troops against IEDs and other threats, 
received over $40 billion from fiscal years 2005 through 2010. With 
the current fiscal challenges facing the nation, it will be important 
for DOD to coordinate its counter-IED efforts in order to use funds 
efficiently. 

As GAO reported in March 2011, there are several examples of 
duplication in DOD's counter-IED efforts and neither JIEDDO nor any 
other DOD organization had full visibility over all of DOD's counter-
IED efforts.[Footnote 16] GAO also reported in February 2012 on 
additional examples of potential duplication in DOD's counter-IED 
efforts. 

What GAO Found: 

DOD does not have full visibility over all of its counter-IED efforts. 
DOD relies on various sources and systems for managing its counter-IED 
efforts, but has not developed a process that provides DOD with a 
comprehensive listing of its counter-IED initiatives and activities. 
For example, JIEDDO has developed the JIEDDO Enterprise Management 
System to manage its own operations by collecting and reporting cost 
and other information related to JIEDDO's organizational and funds 
management, its coordination of JIEDDO-funded projects and projects 
funded by other DOD activities, its administrative activities, and its 
own counter-IED projects. However, while this system contains 
information that could be used to identify individual initiatives, it 
does not automatically separate costs directly expended on counter-IED 
initiatives from JIEDDO's overhead and infrastructure costs such as 
facilities, contractor support, pay and benefits, and travel. 
Consequently, this system does not provide an automated means to 
comprehensively and rapidly identify and list all of JIEDDO's counter-
IED initiatives. Further, even if it did collect this information, the 
system is limited to JIEDDO, and therefore would not include a 
comprehensive listing of other DOD efforts outside of JIEDDO. However, 
JIEDDO is currently developing a new information technology 
architecture and plans to develop a database for counter-IED efforts 
across DOD as part of this new architecture. This effort is in the 
conceptualization stage, and JIEDDO officials do not anticipate 
completion before the end of fiscal year 2012. Further, JIEDDO does 
not have an implementation plan that includes a detailed timeline with 
milestones to help track its progress in achieving this goal. 

Without a comprehensive listing of counter-IED initiatives, DOD 
components may be unaware of the total spectrum of counter-IED efforts 
within the department, and thereby continue to independently pursue 
counter-IED efforts that focus on similar technologies and may be 
duplicative. GAO identified three examples of potential duplication 
within DOD counter-IED efforts focusing on relatively high-cost areas. 

* Counter-IED directed energy technology: The military services have 
developed six systems that emit energy directed at IEDs to neutralize 
them.[Footnote 17] DOD has spent about $104 million collectively on 
these efforts to date. However, given the lack of a DOD-wide counter-
IED database, there could be more directed energy efforts that GAO has 
not identified. Concerns regarding duplication in DOD's directed 
energy efforts vis-à-vis counter-IEDs have risen to the highest levels 
within DOD's warfighter community. Specifically, the commander of U.S. 
Central Command, in August 2011, conveyed concern regarding issues 
including apparent "duplicity of (development) effort" in directed 
energy technology with organizations (in DOD) working different 
solutions. The correspondence called for coordination and cooperation 
by DOD on its directed energy efforts to develop a directed energy 
system that works in theater as quickly as possible given that the 
development has been under way since 2008. In response in August 2011, 
JIEDDO, as DOD's coordinating agency for these efforts, developed a 
plan and, in September 2011, brought various service program offices 
together to develop a solution as soon as possible. According to 
JIEDDO officials, the six systems will continue in development through 
fiscal year 2012, at which point, JIEDDO will determine which of the 
systems best satisfies U.S. Central Command's requirement. While this 
new approach may eliminate future unnecessary duplication of effort, 
earlier coordination and better visibility could have prevented 
duplication that may have occurred up to this point. 

* Radio-frequency jamming systems: The Army and Navy continue to 
pursue separate development of counter-IED jamming systems, which 
provide a limited radius of protection to prevent IEDs from being 
triggered by an enemy's radio signals. In 2007, DOD established the 
Navy as the single manager and executive agent for ground-based 
jamming.[Footnote 18] Under DOD Directive 5101.14, military services 
may conduct ground-based jammer research and development to satisfy 
military service-unique requirements if the requirements are 
coordinated before initiation with the DOD's single manager for 
jammers and, for any system or system modifications resulting from 
such efforts, operational technical characteristics and logistics 
plans are approved by the single manager. The Navy has developed a 
standard technology and system for ground-based jamming called JCREW 
I1B1, which DOD has designated as the ground-based jamming program for 
the entire department. However, the Army has continued to develop its 
own ground-based jamming system called Duke. 

In 2010, according to Navy officials, the Army continued to develop 
new technology for insertion into its Duke system--expected to cost 
about $1.062 billion when completed and installed--without notifying 
and coordinating with the Navy. According to Army officials, the Army 
is pursuing development of its own system because it intends to expand 
the use of this technology for purposes other than countering IEDs, 
such as jamming enemy command, control, and communication systems. 
However, according to Navy officials, the CREW system's technology has 
the flexibility and capacity to expand and provide the same additional 
functions as the Army plans for its Duke system. Moreover, according 
to Navy officials, the Navy's system is further along in its 
development. Because the Navy and Army are pursuing separate jamming 
systems, it is not clear if DOD is taking the most cost-effective 
approach. While, according to JIEDDO officials, the Office of the 
Secretary of Defense was considering how to resolve this issue, a 
decision had not been made before GAO's report was completed. 
Regardless of the final outcome, however, a more coordinated approach 
early in the process when initiating programs of this magnitude could 
prevent unnecessary duplication in costs and effort. 

* Electronic data collection systems: According to JIEDDO officials, 
JIEDDO has funded the development and support of approximately 70 
electronic data collection and analysis tools that overlap to some 
degree because they include capabilities to collect, analyze, and 
store data to help the warfighter combat the IED threat. Although 
JIEDDO recently reported that it could not verify total funding for 
its information technology investments,[Footnote 19] GAO determined 
through a review of DOD financial records that the department has 
expended at least $184 million collectively on information technology 
development for its data collection and analysis tools. 

According to JIEDDO officials, JIEDDO is aware of the redundancy 
within these electronic tools. In April 2011, the JIEDDO Deputy 
Director for Information Management raised the issue of redundancy in 
JIEDDO's information technology systems, including its counter-IED 
data collection and analysis systems and tools. Consequently, since 
April 2011, JIEDDO has worked to eliminate overlapping information 
technology capabilities where feasible, including among the 
approximately 70 analytical tools JIEDDO has funded and developed for 
use in countering IED networks. For example, on July 1, 2011, JIEDDO 
discontinued funding for one of these initiatives--Tripwire Analytical 
Capability--citing as reasons the initiative's limited purpose, high 
cost, and duplicative capabilities. 

However, in making its decision to discontinue the Tripwire Analytical 
Capability, yet continue operating the other data collection and 
analysis tools, JIEDDO had not compared and quantified all of the 
potential options to streamline or consolidate these tools to create a 
single, collective system that includes extracting data on counter-IED 
efforts across DOD. As a result, JIEDDO cannot be certain it is 
pursuing the most advantageous approach for collecting, analyzing, 
storing, and using available data for combating the IED threat. 
Further, although JIEDDO has discontinued funding the Tripwire 
Analytical Capability, the Defense Intelligence Agency is continuing 
to develop the tool for its own use, resulting in the potential for 
DOD-wide duplication between the Tripwire Analytical Capability and 
JIEDDO's other data collection and analysis tools. 

These above three examples of potential duplication are based on GAO's 
examination of selected efforts identified during its review of DOD's 
progress in developing a comprehensive DOD-wide counter-IED database. 
However, given the continued absence of a database and a process to 
identify and reduce duplication in DOD's counter-IED efforts, the 
potential exists for additional cases of duplication. 

Actions Needed and Potential Financial or Other Benefits: 

To improve visibility of its collective counter-IED expenditures and 
investments, GAO has in prior years recommended that DOD develop a 
database of all department-wide counter-IED efforts. However, after 
expending billions of dollars on developing counter-IED capabilities, 
DOD has not made progress in establishing such a database. 
Consequently, GAO recommended in February 2012 that DOD should: 

* develop an implementation plan, including a detailed timeline with 
milestones to help achieve this goal; and: 

* develop a process to use this database once it is established to 
identify and reduce duplication, overlap, and fragmentation among its 
counter-IED initiatives. 

It is essential that DOD follow-through in implementing GAO's 
recommendations to address the risk of duplication in its multibillion-
dollar counter-IED expenditures and investments. Given that JIEDDO and 
other DOD organizations have spent billions of dollars on counter-IED 
efforts, cost savings could be significant should DOD focus on 
reducing duplication across its counter-IED efforts. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its February 2012 report to DOD for review and 
comment. DOD agreed with GAO's recommendation to develop an 
implementation plan for the establishment of DOD's counter-IED 
database. The department did not agree with the recommendation to 
develop a means to identify and reduce any duplication, overlap, and 
fragmentation among counter-IED initiatives, stating that it had 
existing processes to facilitate coordination and collaboration with 
the military services and across DOD, which would address this 
recommendation. GAO agrees that existing DOD processes such as 
JIEDDO's Capabilities Development Process and DOD's Senior Integration 
Group prioritization process can be helpful in coordinating DOD's 
counter-IED efforts. However, the effectiveness of these processes has 
been limited given that they did not prevent the instances of 
potential duplication GAO identified. For example, in the case of 
DOD's directed energy counter-IED efforts where DOD has collectively 
expended $104 million, the processes cited by DOD in its response did 
not identify and resolve the potential duplication present in these 
efforts. As a result the commander of U.S. Central Command, as 
mentioned previously, protested in writing to DOD officials about 
potential duplication of efforts. Without a process to use DOD's 
counter-IED database, once it is developed, DOD will continue to lack 
assurance that it is identifying and addressing instances of potential 
duplication before making significant investments. In finalizing its 
February 2012 report, GAO modified the wording of the recommendation 
to clarify the intent that DOD establish a process to use its counter-
IED data base once it is established. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products in the related GAO products section. GAO reviewed JIEDDO 
databases on counter-IED efforts and interviewed DOD, military 
service, and JIEDDO officials to determine the degree of comprehensive 
visibility regarding DOD's counter-IED efforts. GAO identified and 
evaluated examples of potential duplication using information from 
interviews with DOD officials and data and documentation collected 
that evidenced similar capabilities and objectives among two or more 
counter-IED efforts. 

Related GAO Products: 

Warfighter Support: DOD Needs Strategic Outcome-Related Goals and 
Visibility Over Its Counter-IED Efforts. [Hyperlink, 
http://www.gao.gov/products/GAO-12-280] Washington, D.C.: February 22, 
2012. 

Warfighter Support: DOD's Urgent Needs Processes Need a More 
Comprehensive Approach and Evaluation for Potential Consolidation. 
[Hyperlink, http://www.gao.gov/products/GAO-11-273] Washington, D.C.: 
March 1, 2011. 

Warfighter Support: Actions Needed to Improve Visibility and 
Coordination of DOD's Counter-Improvised Explosive Device Efforts. 
[Hyperlink, http://www.gao.gov/products/GAO-10-95] Washington, D.C.: 
October 29, 2009. 

Warfighter Support: Challenges Confronting DOD's Ability to Coordinate 
and Oversee Its Counter-Improvised Explosive Devices Efforts. 
[Hyperlink, http://www.gao.gov/products/GAO-10-186T] Washington, D.C.: 
October 29, 2009. 

Defense Management: More Transparency Needed over the Financial and 
Human Capital Operations of the Joint Improvised Explosive Device 
Defeat Organization. [Hyperlink, 
http://www.gao.gov/products/GAO-08-342] Washington, D.C.: March 6, 
2008. 

Contact Information: 

For additional information about this area, contact Cary B. Russell at 
(404) 679-1808 or russellc@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Due to changes in the global security environment and operational 
experiences such as those in Afghanistan and Iraq, the Department of 
Defense (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. Traditionally, DOD 
has focused on its professional communities of linguists and regional 
experts to ensure that it has the language and culture capabilities it 
needs. In recent years, the department has identified the need to 
build these capabilities within the general purpose forces and has 
spent considerable time and resources to establish language-and 
culture-related plans, organizations, and activities.[Footnote 20] 

Specifically, DOD has invested millions of dollars to provide language 
and culture training to thousands of servicemembers, including those 
deploying to ongoing operations. For example, GAO 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. 
Since 2009, GAO has reported on management challenges that DOD faces 
in developing language and culture capabilities, indicating that 
opportunities exist for DOD to approach its language and culture 
training efforts more efficiently. 

What GAO Found: 

As GAO reported in May 2011, 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. However, GAO has found that the department lacks an 
approach for integrating these efforts, which has contributed to some 
fragmentation of service training efforts and overlap and potential 
duplication in some of the language and culture training products 
acquired by the services. 

To establish organizational responsibility for language-and culture-
related efforts, DOD has established the Defense Language Office and 
designated Senior Language Authorities within the Office of the 
Secretary of Defense, the Joint Staff, and the military services. 
[Footnote 21] Each military service has a dedicated organization that 
provides culture and, in some cases, language training to its 
respective forces, while the Defense Language Institute Foreign 
Language Center also provides language training to each of the 
services' forces. GAO also reported that the Office of the Secretary 
of Defense had not yet established 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. 

In the absence of an integrated approach, GAO found that DOD has not 
approached its language and culture training efforts in an efficient 
manner. In particular, DOD and the military services have not yet 
reached agreement on the common language and cultural skills that 
general purpose forces need to acquire. Without such an agreement, 
each military service has developed an individualized approach for 
language and culture training that varies in the amount, depth, and 
breadth of training. Moreover, DOD did not have a process to 
coordinate training requirements for ongoing operations, and therefore 
multiple organizations independently established varying language and 
culture training requirements. As a result, the services have expended 
considerable time and resources adjusting their language and culture 
training plans. 

In addition, 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.[Footnote 22] GAO previously reported that when 
assessing delivery options for training, agencies may achieve 
economies of scale and avoid duplication of effort by taking advantage 
of existing training content, such as sharable online courseware. 
[Footnote 23] However, GAO found that departmentwide working groups 
existed but had not been formally designated with the responsibility 
to develop training products that can be used by more than one 
service. In practice, while GAO found some individual examples where 
the services had coordinated efforts to develop or contract for 
similar language and culture training products, in most cases they did 
not take steps to coordinate these types of efforts. 

To illustrate, GAO analyzed 18 DOD language and culture training 
products and found that the content overlapped to some extent with at 
least one other training product. While all of the products are 
intended for use by the services' general purpose forces, there is 
some variance in the amount of language and cultural information 
contained within each product type. The following describes instances 
in which DOD might have increased training costs by developing or 
acquiring overlapping and potentially duplicative training products: 

* Cultural reference materials. Three of four services (the Air Force, 
Army, and Marine Corps) have used contractors to develop reference 
materials, such as "field guides" and "smart books" at a cost of about 
$1.6 million that contained similar general and country-specific 
cultural content. In addition, the Defense Language Institute Foreign 
Language Center has invested about $15 million to develop two 
products--"Countries in Perspective" and "Cultural Orientations"--that 
also offer country-specific cultural information, including some of 
the same countries addressed by the services' products. 

* Distributed learning products for culture training. According to 
service officials, DOD obligated about $15 million on contracts within 
the period of fiscal year 2008 through fiscal year 2010 for three 
computer software or web-based distributed learning culture training 
products (for the Air Force, the Army, and the U.S. Joint Forces 
Command) that provided overlapping cultural content and similar 
learning objectives. For example, each of the products contained 
training modules for Afghanistan with learning objectives focused on 
behaviors to show respect and steps to avoid gender taboos. The same 
subcontractor developed the Air Force's and the Army's products, and 
the products generally did not contain information that was unique to 
the services' primary roles and missions. At the same time, the Joint 
Staff was also developing another product that provides similar 
content as the Air Force and Army products. 

* Distributed learning products for foreign language training. The 
military services (the Air Force, Army, Marine Corps, and Navy) and 
the Defense Language Institute Foreign Language Center estimated costs 
totaling about $63 million within the period of fiscal year 2005 
through fiscal year 2011 to develop and acquire multiple computer 
software or web-based distributed learning foreign language products 
that offered some overlapping foreign languages. 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. 

Actions Needed and Potential Financial or Other Benefits: 

DOD has taken positive steps, but has not fully addressed the 
recommendations that GAO has made since 2009 regarding management 
challenges that can cause inefficiencies in DOD efforts to develop 
language and culture capabilities. For example, in February 2011, DOD 
published the Department of Defense Strategic Plan for Language 
Skills, Regional Expertise, and Cultural Capabilities (2011-2016), but 
it still needs to take additional action. GAO recommended in May 2011 
that the Office of the Under Secretary of Defense for Personnel and 
Readiness: 

* establish a clearly defined planning process with mechanisms, such 
as procedures and milestones, for reaching consensus with the military 
departments; coordinating and reviewing approval of updates to plans; 
synchronizing the development of plans with the budget process; 
monitoring the implementation of initiatives, and reporting progress, 
on a periodic basis, toward the achievement of established goals. 

Further, DOD published a September 2010 training strategy that called 
for eliminating unnecessary redundancy and duplication and leveraging 
the investments of stakeholders with similar interests to include 
identifying opportunities for shared use across DOD entities.[Footnote 
24] In one case, GAO identified actions that the Army and Marine Corps 
took to achieve efficiencies and save costs by reducing the number of 
contracts for language training products. DOD could also take steps to 
achieve greater efficiencies and maximize the use of resources by 
identifying and reducing any unnecessary overlap and duplication in 
language and culture training products. Specifically, the Office of 
the Under Secretary of Defense for Personnel and Readiness and the 
military services should: 

* 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. 

* take steps to coordinate efforts to contract for future language and 
culture training products where possible and collaborate on the 
development of new products that support co-use by more than one 
military service. 

Because multiple DOD organizations have responsibilities for planning 
and developing language-and culture-related training, and budget and 
cost information is not captured in a centralized manner, determining 
definitive costs in this area is challenging. GAO was able to 
determine that DOD is spending millions of dollars to develop and 
acquire language and culture training products and deliver related 
training, but cannot quantify the actual cost of the overlap within 
the language and culture training products GAO identified due to these 
data limitations. However, based on the level of investments that GAO 
could determine that DOD is making, it appears that DOD has 
opportunities to achieve significant cost savings if it implements the 
actions outlined above. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to DOD for review and 
comment. DOD provided technical comments, which were incorporated as 
appropriate. DOD officials generally agreed with the facts and 
findings of the analysis. Specifically, officials recognized that 
coordination is important and noted that DOD entities have, in some 
specific cases, collaborated on the development of language and 
culture training products. The officials agreed that departmentwide 
coordination efforts could be improved and noted that GAO's analysis 
would be useful in targeting specific areas for improvement. DOD 
officials also noted that a certain degree of overlap among training 
products can serve to prevent gaps and accommodate the differing 
missions and training needs of the military services. However, DOD 
officials recognized that, to avoid duplication and maximize available 
resources, the department needs to evaluate its existing language and 
culture training products and plans for future investments to ensure 
that limited resources are being utilized on quality products. GAO 
recognizes that some overlap in training products may be warranted to 
meet the unique mission needs of the military services, but by 
establishing an integrated approach, the department would be better 
positioned to reach consensus with the military services on the 
language and culture skills needed by general purpose forces as well 
as the content of related training products. Such an approach would 
also assist the department in evaluating the overlap in existing 
language and culture training products and eliminating any unnecessary 
duplication. As part of its routine audit work, GAO will track the 
extent to which progress has been made to address the identified 
actions and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted. GAO examined language and culture 
training investments for general purpose forces; missions, roles, and 
responsibilities among key DOD organizations involved in language and 
culture training; and the content of language and culture training 
products. GAO reviewed key documents, such as directives and training 
programs of instruction; analyzed language and culture products used 
to train general purpose forces; and interviewed relevant DOD and 
service officials. GAO obtained and analyzed budgetary and contracting 
information, where available, for language and culture training 
support provided to DOD's general purpose forces. For example, GAO 
estimated the costs for this training for fiscal years 2005 through 
2011. 

Related GAO Products: 

Language and Culture Training: Opportunities Exist to Improve 
Visibility and Sustainment of Knowledge and Skills in Army and Marine 
Corps General Purpose Forces. [Hyperlink, 
http://www.gao.gov/products/GAO-12-50] Washington. D.C.: October 31, 
2011. 

Military Training: 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. 

Military Training: Continued Actions Needed to Guide DOD's Efforts to 
Improve Language Skills and Regional Proficiency. [Hyperlink, 
http://www.gao.gov/products/GAO-10-879T] Washington, D.C.: June 29, 
2010. 

Military Training: DOD Needs a Strategic Plan and Better Inventory and 
Requirements Data to Guide Development of Language Skills and Regional 
Proficiency. [Hyperlink, http://www.gao.gov/products/GAO-09-568] 
Washington, D.C.: June 19, 2009. 

Contact Information: 

For additional information about this area, contact Sharon Pickup at 
(202) 512-9619 or pickups@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The Department of Defense (DOD), Department of State (State), and the 
U.S. Agency for International Development (USAID) have been heavily 
involved in stabilization and reconstruction efforts in both wartime 
and peacetime environments to re-establish security, strengthen 
governance, rebuild infrastructure, and improve social and economic 
well-being in foreign countries. These efforts have cost the U.S. 
government a substantial amount of money--about $72 billion since 2002 
for programs to secure, stabilize, and develop Afghanistan, and about 
$62 billion since 2003 for relief and reconstruction in Iraq. DOD's 
role in stabilization and reconstruction efforts has increased, with 
several new programs emerging in recent years, including the 
Commander's Emergency Response Program (CERP), DOD's Task Force for 
Business and Stability Operations, and the Afghanistan Infrastructure 
Fund. DOD's efforts are often similar in nature to State and USAID 
efforts, and thus interagency coordination is critical for avoiding 
unnecessary overlap, wasted resources, or fragmentation. 

What GAO Found: 

DOD has been conducting stabilization and reconstruction efforts that 
are similar to those of USAID and State; and the three agencies face 
challenges in project evaluation and information sharing which, if not 
addressed, could result in the potential for unnecessary overlap, 
wasted resources, and a fragmented approach to U.S. assistance efforts. 

As the table below illustrates, DOD has expanded its programs over the 
past several years. In fiscal year 2011, Congress made available a 
total of $950 million for CERP, DOD's Task Force for Business and 
Stability Operations, and the Afghanistan Infrastructure Fund. State 
and USAID have also pursued a variety of efforts to help rebuild 
Afghanistan, including projects to construct roads, develop water and 
electrical infrastructure, and build the capacity of its government. 
In Iraq, State and USAID projects have involved education, health, 
water and sanitation facilities, and building the capacity of the 
Iraqi ministries. Outside of Iraq and Afghanistan, funding for DOD's 
peacetime humanitarian assistance efforts has also increased. 

Table: Key DOD Stability, Reconstruction, and Humanitarian Assistance 
Efforts: 

Program (Key agencies involved): Commander's Emergency Response 
Program (CERP); (DOD); 
Description: This program began in 2003 and has enabled commanders to 
respond to urgent humanitarian relief and reconstruction needs in 
Iraq, Afghanistan, and the Philippines. It has evolved in terms of 
project cost and complexity. Projects include new construction or 
rehabilitation of existing infrastructure, ranging from small scale 
projects like water wells to dormitories and roads. DOD uses some CERP 
funds to increase agricultural production with projects focused on 
irrigation systems, wells, and ditches; canal cleanup; and water 
sanitation; 
Estimated program funding: At least $7.9 billion made available for 
FYs 2004-2011. 

Program (Key agencies involved): Security and Stabilization Assistance 
Program (also known as the Section 1207 Program); (DOD, State); 
Description: Created in 2006, this program authorized DOD to transfer 
funds to State for nonmilitary assistance related to stabilization, 
reconstruction, and security. Activities could include removing 
unexploded ordnance or reforming extremist educational programs. The 
authority for the program expired in 2010, but Congress authorized a 
similar program for DOD and State in fiscal year 2012, called the 
Global Security Contingency Fund; 
Estimated program funding: Over $350 million provided by DOD to State 
for FYs 2006-2009; at least $250 million made available in FY 2012 for 
the new fund. 

Program (Key agencies involved): Task Force for Business and Stability 
Operations; (DOD); 
Description: Established in June 2006, the Task Force supports 
economic stabilization efforts, first in Iraq and now in Afghanistan. 
Activities include developing businesses, creating jobs, and 
attracting foreign investment in sectors such as agriculture, energy, 
banking and finance, and communications and technology; 
Estimated program funding: $828 million made available to the Task 
Force for FYs 2007-2012. 

Program (Key agencies involved): Afghanistan Infrastructure Fund; 
(DOD, State); 
Description: Established in 2011, the fund supports a joint DOD/State 
program for high-priority, large-scale infrastructure projects that 
support the U.S. military-civilian effort in Afghanistan; 
Estimated program funding: $800 million for FYs 2011-2013. 

Program (Key agencies involved): Peacetime Humanitarian Assistance 
Programs; (DOD); 
Description: DOD's two key programs are the Overseas Humanitarian, 
Disaster, and Civic Aid-funded humanitarian assistance program and the 
Humanitarian and Civic Assistance program. Activities, which are 
typically performed outside of war or disaster environments, include 
renovating schools and hospitals, drilling wells, providing basic 
health care, and providing training to prepare for natural disasters. 
From fiscal years 2005 through 2010 DOD obligated about $328.4 million 
to support the Overseas Humanitarian, Disaster, and Civic Aid-funded 
humanitarian assistance program, which represented an increase in 
obligations of about 60 percent over the time period (figures in 
constant FY 2011 dollars); 
Estimated program funding: $383 million obligated for FYs 2005-2010 
outside of Iraq and Afghanistan. 

Source: GAO analysis of data from DOD, the Special Inspector General 
for Afghanistan, relevant legislation, and GAO's prior work. 

Note: While direct comparison among dollar figures cannot be made, the 
table is intended to highlight examples of various programs and 
estimated funding associated with them. 

[End of table] 

In some cases, especially during the early stages of a wartime 
environment, it may be advantageous for DOD to conduct stabilization 
and reconstruction efforts because it can provide its own security. 
However, questions have been raised as to DOD's role in performing 
some of these efforts given that DOD efforts can overlap with those of 
State and USAID. For example, officials in State, USAID, and DOD have 
questioned whether DOD's Task Force for Business and Stability 
Operations, which has funded economic stabilization efforts in Iraq 
and Afghanistan, should continue to reside in DOD or be transitioned 
to another federal agency, such as USAID, whose role includes 
providing economic, development, and disaster response assistance 
around the world in support of U.S. foreign policy and development 
goals. In 2011, Congress directed that State, USAID, and DOD jointly 
develop a plan to transition the Task Force's activities in 
Afghanistan to State, with a focus on potentially transitioning 
activities to USAID. To that end, DOD has requested that an outside 
organization conduct a study that would develop, describe, and assess 
organizational options for a continued Task Force for Business and 
Stability Operations for the U.S. government in Afghanistan through 
2014 and beyond. According to the Task Force director, as of January 
2012, the transition plan was still being developed and will 
incorporate the results of the outside study, which is due to be 
completed in February 2012. 

As GAO reported in February 2012, some DOD humanitarian assistance 
efforts outside of Iraq and Afghanistan potentially overlap with those 
of State and USAID in areas such as health care, infrastructure, 
disaster preparation, and education. For example, both DOD and USAID 
have provided basic medical care in Yemen, built schools and education 
facilities in Azerbaijan, and upgraded and rehabilitated water wells 
in Pakistan. GAO found that it can be difficult to determine whether 
DOD's projects necessarily or unnecessarily overlap with those of the 
other agencies and suggested that Congress consider the role of DOD in 
providing humanitarian assistance and clarify the relevant legislation 
of DOD's largest humanitarian assistance program, taking into account 
the roles and similar types of efforts performed by the civilian 
agencies.[Footnote 25] 

In addition to potentially overlapping efforts, GAO also found that 
DOD, State, and USAID face challenges in monitoring and evaluating 
stabilization, reconstruction, and humanitarian assistance efforts--
which makes it difficult to determine whether projects are effective 
at meeting their goals. According to Standards for Internal Control in 
the Federal Government,[Footnote 26] U.S. agencies should monitor and 
assess the quality of performance over time, and GAO has reported that 
key practices for enhancing interagency collaboration include 
developing mechanisms to monitor, evaluate, and report on the results 
of collaborative programs.[Footnote 27] However, several challenges 
exist with monitoring and evaluation, including: 

* As GAO reported in July 2011, DOD's Task Force for Business and 
Stability Operations had not developed written guidance, including 
monitoring and evaluation processes, to be used by its personnel in 
managing Task Force projects. According to the Task Force director, 
program management guidance was issued in January 2012 to address this 
issue. While this is a positive step, until the guidance is fully 
implemented, it is unknown whether improvements will be made to DOD's 
project monitoring and evaluation. 

* As GAO reported in February 2012, DOD was not consistently 
evaluating its peacetime humanitarian assistance efforts to determine 
whether they were meeting their intended goals. Specifically, GAO 
estimated that DOD had not completed 90 percent of evaluations 
required 1 year after projects were completed, and had also not 
conducted about half of the evaluations required after 30 days for 
those programs. GAO also found that DOD had not assessed its 
evaluation process or requirements to determine whether changes were 
needed to employ a more risk-based evaluation approach in order to 
strategically allocate resources. 

Another theme that has emerged from GAO's work relates to challenges 
the agencies face in sharing information with each other about their 
respective efforts. Information sharing is a critical tool in national 
security, but GAO's work has shown several instances of fragmented 
information sharing among DOD, State, and USAID that could lead to 
poor coordination, wasted resources, and potentially duplicative 
efforts. For example: 

* As GAO reported in November 2010, USAID had not fully implemented a 
centralized database to provide information on all U.S. government 
development projects in Afghanistan--a challenge that is still not 
fully resolved. Thus, U.S. agencies lacked access to project data from 
other agencies, including DOD, that could contribute to better project 
planning, eliminate potential overlap, and allow agencies to leverage 
each other's resources more effectively. 

* As GAO reported in February 2012, DOD, State, and USAID had various 
initiatives under way to improve information sharing on humanitarian 
and development assistance efforts outside of Iraq and Afghanistan but 
that no framework, such as a common database, existed to enable 
agencies to readily access information on each other's efforts to help 
them leverage these efforts and to avoid unnecessary overlap. The 
agencies agreed, stating that they are or will be engaging each other 
to determine how best to develop a common information-sharing 
mechanism. 

Without enhancements to information sharing, agencies do not have full 
visibility over each other's efforts, which could lead to "stove-
piped" agency planning, potential for overlap, and an inefficient use 
of resources. Moreover, improved information sharing could identify 
opportunities for synergy and avoid potential duplication among 
agencies. 

Actions Needed and Potential Financial or Other Benefits: 

Stabilization, reconstruction, and humanitarian assistance efforts 
have the potential to provide tangible benefits to foreign populations 
and advance U.S. interests. While the agencies have taken steps to 
address some of GAO's recommendations, additional actions are still 
needed to improve information sharing and project evaluations. 

USAID, along with DOD and other relevant agencies still need 
information on all U.S. government development projects in 
Afghanistan. Progress has been made, but further effort is needed to 
ensure that information is accessible and used by all U.S. government 
agencies involved in U.S.-funded development projects in the country. 

As GAO recommended in February 2012, the Secretaries of Defense and 
State as well as the Administrator of USAID should: 

* jointly develop a framework, such as a common database, to formalize 
their information sharing on humanitarian or development assistance 
efforts outside of wartime or disaster environments. 

As GAO recommended in February 2012, the Secretary of DOD should also: 

* employ a risk-based approach to review and modify its humanitarian 
assistance project evaluation requirements to measure the long-term 
effects of the projects. 

Congress may wish to consider DOD's role in conducting peacetime 
humanitarian assistance efforts. As GAO recommended in February 2012, 
Congress should: 

* consider amending the legislation that supports the Overseas 
Humanitarian, Disaster, and Civic Aid-funded humanitarian assistance 
program--DOD's largest humanitarian assistance program--to more 
specifically define DOD's role in humanitarian assistance, taking into 
account the roles and similar types of efforts performed by the 
civilian agencies. 

Addressing these issues could lead to a more efficient use of the 
billions of dollars devoted to U.S. stabilization and reconstruction 
efforts abroad. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its November 2010 report to DOD and USAID and 
its February 2012 report to DOD, State, and USAID for review and 
comment. DOD and USAID generally agreed with GAO's November 2010 
recommendations to improve planning and coordination of water sector 
projects in Afghanistan, with DOD noting that a centralized U.S. 
government database for U.S. development efforts in Afghanistan, if 
designed to allow easy data access and sharing among partners, would 
make a positive contribution. GAO notes that progress has been made in 
designating a database since GAO's report was issued but that the 
agencies need to ensure that the database is accessible and used by 
all U.S. government agencies involved in U.S.-funded development 
projects in Afghanistan. 

DOD generally agreed with GAO's February 2012 recommendations to 
review and modification project evaluation requirements for its 
peacetime humanitarian assistance efforts to measure long-term effects 
and ensure compliance with the requirements. DOD noted that it is 
developing an appropriate method to encourage compliance with the new 
project evaluation requirements. However, as noted earlier, DOD 
acknowledged that the absence of project evaluation data will require 
that it take at least a year to collect data in order to formulate a 
significant and reliable risk-based approach to project evaluations 
requirements. 

DOD, State, and USAID agreed with GAO's February 2012 recommendation 
that they should jointly develop a framework to formalizing their 
information sharing on peacetime humanitarian and development 
assistance efforts. DOD stated that it will engage State and USAID to 
determine what mechanisms could be used to enhance information sharing 
among the agencies. State noted that it is currently in discussions 
with DOD and USAID about broadening one particular information-sharing 
mechanism it uses to include DOD efforts, and USAID said that it will 
continue to explore opportunities to share information with the other 
agencies. As part of its routine audit work, GAO will track agency 
actions to address the extent to which progress has been made to 
address the identified actions and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products in the related GAO products section. GAO generally 
analyzed agency documentation and interviewed cognizant agency 
officials. For example, GAO interviewed DOD and USAID officials, 
including Army units that had returned from Afghanistan about the type 
of management and oversight that exists for CERP. GAO analyzed 
documents and interviewed officials in Washington, D.C., Afghanistan, 
and Iraq as appropriate. GAO analyzed funding, project evaluations, 
and other program data and documents, and interviewed officials at 
DOD, State, USAID, nongovernmental organizations, and U.S. embassies. 

Related GAO Products: 

Humanitarian and Development Assistance: Project Evaluations and 
Better Information Sharing Needed to Manage the Military's Efforts. 
[Hyperlink, http://www.gao.gov/products/GAO-12-359] Washington, D.C., 
February 8, 2012. 

Afghanistan's Donor Dependence. [Hyperlink, 
http://www.gao.gov/products/GAO-11-948R] Washington, D.C., September 
20, 2011. 

DOD Task Force for Business and Stability Operations: Actions Needed 
to Establish Project Management Guidelines and Enhance Information 
Sharing. [Hyperlink, http://www.gao.gov/products/GAO-11-715] 
Washington, D.C.: July 29, 2011. 

Afghanistan: Actions Needed to Improve Accountability of U.S. 
Assistance to Afghanistan Government. [Hyperlink, 
http://www.gao.gov/products/GAO-11-710] Washington, D.C.: July 20, 
2011. 

Afghanistan Development: U.S. Efforts to Support Afghan Water Sector 
Increasing, but Improvements Needed in Planning and Coordination. 
[Hyperlink, http://www.gao.gov/products/GAO-11-138] Washington, D.C.: 
November 15, 2010. 

International Security: DOD and State Need to Improve Sustainment 
Planning and Monitoring and Evaluation for Section 1206 and 1207 
Assistance Programs. [Hyperlink, 
http://www.gao.gov/products/GAO-10-431] Washington, D.C.: April 15, 
2010. 

Military Operations: Actions Needed to Improve Oversight and 
Interagency Coordination for the Commander's Emergency Response 
Program in Afghanistan. [Hyperlink, 
http://www.gao.gov/products/GAO-09-615] Washington, D.C.: May 18, 2009. 

Interagency Collaboration: Key Issues for Congressional Oversight of 
National Security Strategies, Organizations, Workforce, and 
Information Sharing. [Hyperlink, 
http://www.gao.gov/products/GAO-09-904SP] Washington, D.C. September 
25, 2009. 

Military Operations: Actions Needed to Better Guide Project Selection 
for Commander's Emergency Response Program and Improve Oversight in 
Iraq. [Hyperlink, http://www.gao.gov/products/GAO-08-736R] Washington, 
D.C.: June 23, 2008. 

Contact Information: 

For additional information about this area, contact John H. Pendleton 
at (202) 512-3489 or pendletonj@gao.gov: 

[End of section] 

7. Support for Entrepreneurs: 

Overlap and fragmentation among the economic development programs that 
support entrepreneurial efforts require OMB and other agencies to 
better evaluate the programs and explore opportunities for program 
restructuring, which may include consolidation, within and across 
agencies. 

Why This Area Is Important: 

Economic development programs that effectively provide assistance to 
entrepreneurs may help businesses develop and expand, and thus 
contribute to the nation's economic growth. The Departments of 
Commerce (Commerce), Housing and Urban Development (HUD), and 
Agriculture (USDA), and the Small Business Administration (SBA) 
administer 53 such programs that focus on supporting 
entrepreneurs.[Footnote 28] These programs, which typically fund a 
variety of activities in addition to supporting entrepreneurs, spent 
an estimated $2.6 billion in enacted appropriations on economic 
development efforts in fiscal year 2010.[Footnote 29] 

As GAO reported in March and May 2011, the majority of the economic 
development programs had missions related to supporting entrepreneurs. 
Programs with overlapping missions can result in inefficiencies, such 
as requiring recipients to fill out applications to multiple agencies 
with varying program requirements, as well as compromising the 
government's ability to effectively provide the desired service and 
meet the shared goals of the programs. While collaboration is one way 
to overcome overlap among agencies when providing similar services, 
opportunities for program restructuring, which include consolidation, 
may also exist. GAO has ongoing work that will be issued later this 
year to continue examining issues beyond those identified in the March 
and May 2011 reports. This document reports GAO's findings to date. 

What GAO Found: 

Based on a review of the missions and other related program 
information for these 53 programs, GAO determined that these programs 
overlap based not only on their shared purpose of serving 
entrepreneurs but also on the type of assistance they offer. The 
programs generally can be grouped according to at least one of three 
types of assistance that address different entrepreneurial needs: help 
obtaining (1) technical assistance, (2) financial assistance, and (3) 
government contracts. Many of the programs can provide more than one 
type of assistance, and most focus on technical and/or financial 
assistance:[Footnote 30] 

* Technical assistance: Thirty-six programs distributed across the 
four agencies provide technical assistance, including business 
training and counseling and research and development support. 

* Financial assistance: Thirty-three programs distributed across the 
four agencies support entrepreneurs through financial assistance in 
the form of grants and loans. 

* Government contracting assistance: Seven programs distributed 
between two of the four agencies support entrepreneurs by helping them 
qualify for federal procurement opportunities. 

The table below illustrates overlap among programs that provide 
entrepreneurial assistance in terms of the type of assistance they 
provide. For example, 13 programs across 3 of the agencies provide 
financial assistance only. SBA and USDA both have 5 programs that only 
provide financial assistance, while HUD has 3. 

Table: 53 Programs That Support Entrepreneurs, by Type of Assistance, 
as of September 30, 2011A: 

Technical assistance only; 
HUD: 2; 
SBA: 6; 
USDA: 5; 
Commerce: 4; 
Total[B]: 17. 

Financial assistance only; 
HUD: 3; 
SBA: 5; 
USDA: 5; 
Commerce: [Empty]; 
Total[B]: 13. 

Technical and financial assistance only; 
HUD: 7; 
SBA: 3; 
USDA: 4; 
Commerce: 2; 
Total[B]: 16. 

Government contracting assistance only; 
HUD: [Empty]; 
SBA: 2; 
USDA: [Empty]; 
Commerce: [Empty]; 
Total[B]: 2. 

Technical and government contracting only; 
HUD: [Empty]; 
SBA: 1; 
USDA: [Empty]; 
Commerce: [Empty]; 
Total[B]: 1. 

Financial and government contracting only; 
HUD: [Empty]; 
SBA: 2; 
USDA: [Empty]; 
Commerce: [Empty]; 
Total[B]: 2. 

Technical, financial, and government contracting assistance; 
HUD: [Empty]; 
SBA: [Empty]; 
USDA: [Empty]; 
Commerce: 2; 
Total[B]: 2. 

Total; 
HUD: 12; 
SBA: 19; 
USDA: 14; 
Commerce: 8; 
Total[B]: 53. 

Source: GAO analysis of information provided by Commerce, HUD, USDA, 
and SBA. 

[A] Some of the programs may not have received funding in fiscal year 
2011. 

[B] The 36 technical assistance programs include those in the 
following categories: technical assistance only; technical and 
financial assistance only; technical, financial, and government 
contracting assistance; and technical and government contracting 
assistance only. The 33 financial assistance programs include those in 
the following categories: financial assistance only; technical and 
financial assistance only; technical, financial, and government 
contracting assistance; and financial and government contracting 
assistance only. The seven government contracting assistance programs 
include those in the following categories: government contracting 
assistance only, technical and government contracting assistance only, 
financial and government contracting assistance only, and technical, 
financial, and government contracting assistance. 

[End of table] 

Much of the overlap and fragmentation among these 53 programs is 
concentrated among programs that support economically distressed and 
disadvantaged areas and programs that assist disadvantaged and small 
businesses. As the figure below shows, of the 36 programs that provide 
technical assistance (that is, programs that either provide only 
technical assistance or those that provide technical assistance in 
addition to financial and government contracting assistance), 

* Commerce's Economic Development/Technical Assistance program and 
SBA's 7(j) Technical Assistance program are among the 33 programs that 
assist businesses located in economically distressed areas.[Footnote 
31] 

* HUD's Hispanic Serving Institutions Assisting Communities and USDA's 
Rural Business Opportunity Grants programs are among the 23 that can 
assist businesses operating in areas that are disadvantaged,[Footnote 
32] 

* SBA's Small Business Development Centers and Commerce's Minority 
Business Centers are among the 27 programs that support disadvantaged 
businesses,[Footnote 33]and: 

* USDA's Rural Business Enterprise Grant program and SBA's 8(a) 
program are among the 32 programs that serve small businesses. 

Overlap and fragmentation are also evident among programs that provide 
more specific forms of assistance. For example, technical assistance 
programs that provide business training and counseling include SBA's 
Small Business Development Centers, Women's Business Centers, SCORE 
(formerly, Senior Core of Retired Executives) programs; Commerce's 
Minority Business Centers program; and USDA's Rural Business 
Enterprise Grants program. In addition, many of these economic 
development programs also operate in both urban and rural areas. 
[Footnote 34] 

Figure: Programs That Provide Technical and Financial Assistance, by 
Type of Business and Community Served, as of September 30, 2011: 

[Refer to PDF for image: horizontal bar graph] 

Programs that can serve: All; 
Technical assistance programs: 36; 
Financial assistance programs: 33. 

Programs that can serve: Economically distressed areas; 
Technical assistance programs: 33; 
Financial assistance programs: 31. 
   
Programs that can serve: Disadvantaged communities; 
Technical assistance programs: 23; 
Financial assistance programs: 21. 
    
Programs that can serve: Disadvantaged businesses; 
Technical assistance programs: 27; 
Financial assistance programs: 18. 
    
Programs that can serve: Small businesses; 
Technical assistance programs: 32; 
Financial assistance programs: 29. 

Source: GAO analysis. 

Note: Some of the programs may not have received funding in fiscal 
year 2011.  

[End of figure] 

The number of programs that support entrepreneurs--53--and the overlap 
among these programs raise questions about whether a fragmented system 
is the most effective way to support entrepreneurs. By exploring 
alternatives, agencies may be able to determine whether there are more 
efficient ways to continue to serve the unique needs of entrepreneurs, 
including consolidating various programs. In ongoing work, GAO plans 
to examine the extent of potential duplication among these programs. 

In addition, in order to effectively evaluate and oversee the services 
being provided, Congress and the agencies need meaningful performance 
information such as evaluation studies and performance measures. This 
information is needed to help decision makers identify ways to make 
more informed decisions about allocating increasingly scarce resources 
among overlapping programs. Specifically, performance measures can 
provide information on an agency's progress toward meeting certain 
program and agencywide strategic goals, expressed as measurable 
performance standards. For example, while some of the financial 
assistance programs track measures that include number of businesses 
assisted and dollar value of loans obtained, they could begin to track 
measures like defaults, prepayments, and number of loans in good 
standing to better report how businesses fare after they participate 
in these programs. In contrast, program evaluations are systematic 
ways to assess a broader range of information on program performance. 
As a result, evaluation studies can help identify which programs are 
effective or not, explain why goals were not met and identify 
strategies for meeting unmet goals, and estimate what would have 
occurred in the absence of the program. 

Based on preliminary results, GAO found that while most (45) of the 53 
economic development programs that support entrepreneurs have 
reasonable performance measures and tend to meet their annual 
performance goals, few evaluation studies have been completed and 
little evaluative information exists to assess programs' 
effectiveness. For 39 of the 53 programs, the four agencies have 
either never conducted a performance evaluation or have conducted only 
one in the past decade. For example, while SBA has conducted recent 
periodic reviews of 3 of its 10 programs that provide technical 
assistance, the agency has not reviewed its other 9 financial 
assistance and government contracting programs on any regular basis. 
[Footnote 35] Moreover, Commerce, HUD, and USDA have not routinely 
conducted program evaluations for the majority of their economic 
development programs. 

Without results from program evaluations and performance measurement 
data, agencies lack the ability to measure the overall impact of these 
programs, and decision makers lack information that could help them to 
identify programs that could be better structured and improve the 
efficiency with which the government provides these services. 
Moreover, the federal government has recently required the Office of 
Management and Budget (OMB) to coordinate with agencies to ensure that 
they better track the results of their programs. Specifically, the 
GPRA Modernization Act of 2010 (GPRAMA) requires OMB to work with 
agencies to, among other things, develop outcome-oriented goals for 
certain crosscutting policy areas and report annually on how these 
goals will be achieved.[Footnote 36] Other GPRAMA requirements could 
lead to improved coordination and collaboration among agencies. For 
instance, GPRAMA requires each agency to identify the various 
organizations and program activities--both within and external to the 
agency--that contribute to each agency's goals. In ongoing work, GAO 
plans to determine reasons why the agencies (1) do not conduct more 
routine evaluations of these programs and (2) have not established and 
do not track performance measures for 8 of the 53 programs. In 
addition, GAO plans to determine the ongoing and planned efforts of 
OMB and the agencies to address the provisions contained in GPRAMA. 

Actions Needed and Potential Financial or Other Benefits: 

Based on ongoing work, GAO expects to recommend the following: 

Congress may wish to consider: 

* ways to tie funding more closely to a program's demonstrated 
effectiveness. One way to increase accountability and elevate the 
importance of program evaluation activities is to tie these factors to 
funding decisions. Therefore, Congress may want to consider requiring 
agencies to provide greater support for funding requests and requiring 
information on demonstrated results of program effectiveness. 

Agencies should: 

* improve program evaluation and performance metrics. In order to 
identify options to better structure these programs for the Congress 
to consider, SBA, Commerce, HUD, and USDA should conduct program 
evaluations and collect data on performance measures. 

OMB and the agencies should: 

* explore opportunities to restructure programs through means such as 
consolidation, elimination, and collaborative mechanisms, both within 
and across agencies. As OMB works with the agencies to identify 
programmatic areas that should be better coordinated and tracked, the 
agencies should look for ways to consolidate programs or opportunities 
for greater collaboration. In addition, to better ensure the most 
efficient and effective delivery method for federal assistance to 
entrepreneurs, SBA, Commerce, HUD, and USDA should individually, and 
collectively, explore options for restructuring programs that target 
particular types of businesses or communities and report the results 
of their efforts to the Congress. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report to OMB, Commerce, HUD, SBA, and 
USDA for review and comment. Commerce and HUD provided written 
comments. OMB, HUD, SBA, and USDA provided technical comments, which 
were incorporated where appropriate. All written comments are 
reprinted in appendix IV. 

OMB stated that the Administration has taken a number of steps to 
increase coordination among economic and entrepreneurial development 
programs, provide better service to businesses seeking federal 
services, and improve performance evaluation. For example, OMB stated 
that a new website will be publicly launched for entrepreneurs and 
business owners in February 2012 named BusinessUSA; the website is 
intended to provide a virtual one-stop shop for small businesses and 
enable them to access the wide array of federal programs and services 
available to them across the government regardless of where they are 
located. According to OMB, BusinessUSA, while still in its early 
stages, will help remedy many of the coordination and fragmentation 
issues identified in the GAO report. OMB also stated that the 
President has proposed to consolidate the federal government's primary 
business and trade agencies and programs into a new more efficient 
agency that will promote competitiveness, exports and American 
business. OMB noted that more than half of the programs identified in 
GAO's recent report on duplication in federal economic development 
programs would be consolidated into the new department under the 
Administration's proposal, and the new department would more 
fundamentally address the issues raised in GAO's report. As GAO 
continues work in this area, it plans to further monitor and assess 
OMB's efforts to work with Commerce, HUD, USDA, and SBA to increase 
coordination among economic development programs, provide better 
service to businesses under the programs, and improve program 
evaluation. 

Commerce stated that prior GAO reports have focused on the types of 
investments made without considering the goals of each program, and 
GAO may be incorrectly identifying duplication where none exists as a 
result. For this report, GAO examined the missions, goals, services 
provided, and targeted beneficiaries and areas for 53 programs that 
fund entrepreneurial assistance. GAO's report states that these 
programs overlap based not only on their shared purpose of serving 
entrepreneurs but also on the type of assistance they offer; it does 
not state that duplication exists among these programs. As GAO 
continues its work, GAO plans to examine the extent of potential 
duplication among these overlapping programs. Commerce also stated 
that GAO's report presents premature actions needed and that the 
report does not recognize the significant advances that Commerce's 
Economic Development Agency has made to improve program evaluation 
with the development of a performance management improvement logic 
model. GAO recognizes the action that the Economic Development Agency 
has taken to develop its new performance management model. However, 
because the Economic Development Agency has not completely designed 
its new model or provided sufficient information to explain how 
results of program evaluations will be included in the model, this 
action does not change GAO's findings. In this report, GAO identified 
areas of concern related to the extent that Commerce, HUD, SBA, and 
USDA conduct performance evaluations for their economic development 
programs. Recent legislation also requires OMB to work with agencies 
to ensure that they better track the results of their programs. GAO 
believes that the actions needed presented in this report are 
consistent with its findings and recent legislation. As GAO continues 
work in this area, it also plans to further monitor and assess the 
efforts the four agencies undertake to improve program evaluation and 
performance metrics. 

HUD's Deputy Assistant Secretary for Grant Programs stated that GAO 
should reduce the number of economic development programs identified 
as being administered by HUD. First, she recommended that five of the 
Community Development Block Grant (CDBG) programs be identified as one 
CDBG program. She noted that the five programs may have separate 
Catalog of Federal Domestic Assistance numbers, but the programs are 
funded from a single source within HUD's annual appropriation, the 
economic development activities CDBG grantees carry out under the five 
programs are all subject to the same statutory and regulatory 
requirements, and CDBG grantees generally cannot obtain assistance 
under more than one of the five programs. Because GAO relies on the 
executive branch's definition of these programs, which separates them 
into five distinct programs, we disagree that the five programs should 
be identified as one CDBG program. The Catalog of Federal Domestic 
Assistance defines federal programs based on legal authority, 
administering office, funding, purpose, benefits, and beneficiaries; 
also, the catalog may define a program separately regardless of 
whether it is identified as a separate program by statute or 
regulation. While GAO would be receptive to actions the executive 
branch may take to better define programs, using the Catalog of 
Federal Domestic Assistance GAO initially identified 80 federal 
programs administered by Commerce, SBA, USDA, and HUD that can fund 
economic development activities. For this report, GAO focused its 
analysis on 53 of these programs across the four agencies that support 
entrepreneurial efforts, including the five programs HUD noted. 
Second, the Deputy Assistant Secretary recommended that GAO delete the 
Brownfields Economic Development Initiative (BEDI) as one of HUD's 
active programs that can fund economic development activities. She 
noted that HUD did not request funding nor did Congress appropriate 
funding for the BEDI program in fiscal years 2011 and 2012.[Footnote 
37] She further noted that HUD will continue to administer existing 
BEDI grants, but the department is unlikely to request program funding 
for fiscal year 2013. She added that the activities authorized under 
the BEDI program can be funded under other CDBG programs. GAO 
disagrees that the BEDI program should be removed from the list of HUD 
programs because the department is actively administering grants under 
the program. 

USDA stated that GAO's report does not emphasize the significant 
difference in agencies and programs. For example, USDA stated its 
Rural Business Service administers programs that are unique and not 
duplicative because of the agency's mission to provide assistance to 
businesses in rural communities. USDA acknowledged that other 
agencies' programs may provide assistance to businesses in rural 
areas, but the Rural Business Service's programs are focused in these 
areas. USDA also stated that the Rural Business Service delivers its 
programs through an expansive field structure of state and local 
offices. According to USDA, federal agencies such as SBA do not 
utilize a similar field structure to deliver programs. As previously 
noted, GAO's report does not state that duplication exists among the 
53 economic development programs that support entrepreneurial efforts; 
it states that overlap and fragmentation are evident based on GAO's 
review of the missions and other related program information for these 
programs. For example, GAO's report states that USDA administers many 
of the economic development programs that serve rural areas. However, 
GAO also determined that there was overlap because other agencies' 
economic development programs can provide assistance to entrepreneurs 
in rural areas. GAO plans to examine the extent of potential 
duplication in GAO's ongoing work. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section and additional 
work GAO conducted that will be published as a separate product in 
2012. GAO focused its analysis on the 53 economic development programs 
at Commerce, HUD, USDA, and SBA that fund entrepreneurial assistance 
because these programs appeared to overlap the most. GAO examined the 
extent to which the federal government's efforts to support 
entrepreneurs overlap among these numerous, fragmented programs by 
examining their missions, goals, services provided, and targeted 
beneficiaries and areas. GAO also collected information on performance 
measures that the agencies collect to track the performance of each of 
the 53 programs, and any evaluation studies conducted or commissioned 
by the agencies evaluating the effectiveness of these programs. This 
process included meeting with agency officials to corroborate the 
publicly available information. GAO also determined the reasonableness 
of the performance measures by assessing each measure against agency 
strategic goals and specific program missions to determine the extent 
to which they are aligned. GAO plans to issue a report evaluating (1) 
the support that the programs provide to entrepreneurs, and the types 
of information available on this support; (2) the extent to which 
federal agencies collaborate on the provision of counseling, training, 
and related services to entrepreneurs; and (3) the extent to which 
programs that support entrepreneurs overlap or are fragmented, the 
extent to which these programs have met their performance goals, and 
the information that is available on their effectiveness. 

Appendix III lists the programs GAO identified that may have similar 
or overlapping objectives, provide similar services or be fragmented 
across government missions. Overlap and fragmentation may not 
necessarily lead to actual duplication, and some degree of overlap and 
duplication may be justified. 

Related Products: 

Efficiency and Effectiveness of Fragmented Economic Development 
Programs Are Unclear. [Hyperlink, 
http://www.gao.gov/products/GAO-11-477R] Washington, D.C.: May 19, 
2011. 

List of Selected Federal Programs That Have Similar or Overlapping 
Objectives, Provide Similar Services, or Are Fragmented Across 
Government Missions. [Hyperlink, 
http://www.gao.gov/products/GAO-11-474R] Washington, D.C.: March 18, 
2011. 

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.: March 1, 
2011. 

Small Business Administration: Additional Guidance on Documenting 
Credit Elsewhere Decisions Could Improve 7(a) Program Oversight. 
[Hyperlink, http://www.gao.gov/products/GAO-09-228] Washington, D.C.: 
February 12, 2009. 

Small Business Administration: Additional Actions Are Needed to 
Certify and Monitor HUBZone Businesses and Assess Program Results. 
[Hyperlink, http://www.gao.gov/products/GAO-08-643] Washington, D.C.: 
June 17, 2008. 

Small Business Administration: Additional Measures Needed to Assess 
7(a) Loan Program's Performance. [Hyperlink, 
http://www.gao.gov/products/GAO-07-769] Washington, D.C.: July 13, 
2007. 

Rural Economic Development: More Assurance Is Needed That Grant 
Funding Information Is Accurately Reported. [Hyperlink, 
http://www.gao.gov/products/GAO-06-294] Washington, D.C.: February 24, 
2006. 

Economic Development Administration: Remediation Activities Account 
for a Small Percentage of Total Brownfield Grant Funding. [Hyperlink, 
http://www.gao.gov/products/GAO-06-7] Washington, D.C.: October 27, 
2005. 

Contact Information: 

For additional information about this area, contact William B. Shear 
at (202) 512-4325 or shearw@gao.gov. 

[End of section] 

8. Surface Freight Transportation: 

Fragmented federal programs and funding structures are not maximizing 
the efficient movement of freight. 

Why This Area Is Important: 

The movement of freight is critical to the economy and the livelihood 
of Americans who rely on freight transportation for food, clothing, 
and other essential commodities. Freight shipments move predominantly 
over vast networks of highways, railroads, and waterways and often are 
transported by more than one mode before reaching their final 
destination. System performance is essential for the timely 
transportation of freight from its sources and manufacturers to the 
customer. Congress authorized around $43 billion in fiscal year 2010 
for Department of Transportation programs that can benefit surface 
freight transportation.[Footnote 38] However, the Department of 
Transportation is just one of many stakeholders that are involved in 
freight movement--all with complex and varied roles, but none are 
responsible for the entire system. Federal funds in the form of 
grants, loans, and tax incentives are provided to state and local 
governments and the private sector, all of whom play major roles in 
ensuring freight mobility. Specifically, public sector transportation 
agencies at the federal, state, and local levels have a significant 
role in developing and managing some modes of the freight 
transportation system--such as highways and waterways--while private 
sector entities--such as railroads--finance and manage their own 
infrastructure. According to the Department of Transportation, in 
2007, the surface freight transportation system, which crosses 
multiple surface modes, connected an estimated 8 million businesses 
and 116 million households moving $12 trillion in goods. Federal 
leadership can help assure that projects that facilitate movement of 
freight, which can be high-cost and cross jurisdictional lines, are 
undertaken. 

While freight transportation has some issues that are similar to the 
surface transportation issues that GAO identified in its first annual 
report to Congress on federal programs with duplicative goals or 
activities,[Footnote 39] inefficiencies affecting freight 
transportation such as poor roads and the lack of intermodal 
connections can impact the nation's economy. Freight volumes are 
closely linked to the gross domestic product--increases in freight 
shipments closely coincide with economic growth. However, freight 
vehicles often compete with non-freight vehicles, such as on the U.S. 
highway system, which consists of mixed-use facilities where passenger 
and freight vehicles operate in the same stream of traffic on the same 
facilities. Systems that cannot adequately accommodate both freight 
and non-freight vehicles can become congested, leading to delays in 
freight movements, lost revenues, and increased carbon emissions--all 
of which can increase transportation costs and, consequently, the 
price of goods, hurting businesses that rely on freight transportation 
infrastructure. 

What GAO Found: 

As GAO previously reported, federal goals in surface transportation 
are numerous and roles are unclear, and the federal government does 
not maximize opportunities to promote the efficient movement of 
freight, despite a clear federal interest, the billions of dollars 
provided, and the importance of freight transportation to the national 
economy. There is currently no separate federal freight transportation 
program, only a loose collection of many freight-related programs that 
are embedded in a larger surface transportation program aimed at 
supporting both passenger and freight mobility. This fragmented 
structure makes it difficult to determine the types of freight 
projects that are funded and their impact on overall freight mobility. 
As GAO reported in January 2008, the need for the federal government 
to reassess its role and strategy in funding, selecting, and 
evaluating transportation investments, including those for freight 
transportation. 

Department of Transportation administrations that have a role in 
freight transportation include the Federal Highway Administration, 
Federal Railroad Administration, Federal Motor Carrier Safety 
Administration, and the Maritime Administration (see table below). 
There also is an Office of Freight Management and Operations within 
the Federal Highway Administration that administers programs, develops 
policies, and undertakes research that promotes freight movement 
across the nation and its borders. However, the office does not 
coordinate federal actions related to freight mobility, specifically. 
In addition, the U.S. Army Corps of Engineers in the Department of 
Defense is responsible for planning, constructing, operating, and 
maintaining the nation's waterways. Department of Transportation 
administrations also coordinate freight issues with other federal 
agencies including the Department of Commerce, Department of Homeland 
Security, and Environmental Protection Agency. The various federal 
agencies and modal administrations play key roles in planning, 
designing, constructing, maintaining, and regulating freight 
transportation. GAO could not determine the total amount spent on 
freight transportation projects because it is not separately tracked 
from other transportation investments. According to Federal Highway 
Administration officials, isolating freight transportation 
expenditures is not possible at this time because the vast majority of 
the nation's highway system is used by both passenger and freight 
vehicles, and most highway projects benefit both. 

Table: Number of Department of Transportation Programs GAO Identified 
That Provide Funding for Freight Surface Transportation Infrastructure: 

Department of Transportation administration: Federal Highway 
Administration; 
Number of programs identified: 48. 

Department of Transportation administration: Federal Motor Carrier 
Safety Administration; 
Number of programs identified: 2. 

Department of Transportation administration: Federal Railroad 
Administration; 
Number of programs identified: 2. 

Department of Transportation administration: Maritime Administration; 
Number of programs identified: 2. 

Department of Transportation administration: Office of the Secretary 
of Transportation; 
Number of programs identified: 1. 

Source: GAO analysis of Department of Transportation information. 

[End of table] 

These programs' structures for funding freight transportation projects 
include: 

* grants (such as the National Highway System program, which funds 
projects that benefit both freight and passenger travel and, since 
2009, the Transportation Investment Generating Economic Recovery--
TIGER--programs, which use a criteria-based, competitive process to 
fund projects serving national and regional priorities); 

* loans (such as the Railroad Rehabilitation and Improvement Financing 
program, which directs federal loans and loan guarantees to finance 
the development of railroads); and: 

* tax credits (such as the exemption from federal taxes on interest 
earned from state and local government bonds for general 
transportation purposes and tax credits for certain expenditures on 
railroad track maintenance, which can create incentives for the 
investment of private sector funds on transportation improvements). 

These programs are administered by different agencies and modal 
administrations with different missions, oversight, and funding 
requirements; do not necessarily coordinate with each other; and at 
times may overlap. As a result, funds have not always been allocated 
based on need or condition of the infrastructure carrying freight. For 
instance, highway funds are distributed to states through formulas 
that are not linked to performance or need. Examples of programs that 
may overlap include loan programs such as the Federal Railroad 
Administration's Railroad Rehabilitation and Improvement Financing 
Program and the Federal Highway Administration's Transportation 
Infrastructure Finance and Innovation Act Program. Both may be used 
for freight rail facilities and infrastructure. Additionally, certain 
state and local governments issue tax-exempt bonds for financing 
infrastructure projects. 

Although the current federal structure of loans, tax credits, and 
grants (including formula grants and congressionally directed funds) 
is beneficial, opportunities may exist to return greater national 
public and private benefits. Furthermore, intermodal considerations 
may not be evaluated in considering beneficial freight solutions for a 
given corridor, which may result in funding projects across multiple 
modes without regard for how each works toward meeting a common goal. 
Current law generally ties transportation funding to a single mode, 
limiting the ability of state and local transportation planning 
agencies to use federal funds for intermodal projects. Further, 
Department of Transportation administrations and state and local 
transportation agencies are organized by mode--reflecting the 
structure of funding programs--resulting in an organizational 
structure that the department's own assessments acknowledge can impede 
intermodal coordination. In addition, collaboration between the public 
and private sectors can also be challenging; for example, private-
sector interests in airport, rail, and freight (such as freight 
shippers and carriers) have historically not participated in the 
regional planning process. 

The federal government's fragmented approach also has resulted in a 
situation where the users of each freight mode are not equally bearing 
the costs those modes impose on society. When looking at the three 
categories of social costs borne by freight transportation services--
private costs (labor, equipment, and fuel), public costs (paid out of 
government budgets and can be funded through taxes and fees), and 
"external" costs (congestion, accidents, health, and environmental 
impacts), GAO reported in January 2011 that freight trucking costs 
that were not passed on to consumers of that service were at least 6 
times greater than rail costs, and at least 9 times greater than 
waterways costs. Therefore, public and private investment choices may 
be distorted, and there may be misallocation of scarce government 
resources to one mode over another. 

Constrained freight mobility could have negative economic, 
environmental, and health implications. Because of the growth in 
freight and passenger demand, there has been an increase in truck and 
rail congestion that is particularly pronounced in major urban areas 
that contain important freight hubs such as ports, airports, border 
crossings, and rail yards. Congestion results in increased delays, 
carbon emissions, and fuel and labor costs, among other things. 

Since the expiration of the last surface transportation authorization 
in 2009, Congress has funded transportation programs through a series 
of temporary extensions; the most recent will expire on March 31, 
2012. Comprehensive legislative action has not been taken to 
fundamentally reexamine the nation's surface transportation policies; 
however, several legislative committees have approved bills to 
reauthorize and reform surface transportation programs. For example, 
the Senate Environment and Public Works Committee approved a bill on 
November 9, 2011 reauthorizing the highway portion of the surface 
transportation program.[Footnote 40] This bill contains measures to 
increase accountability for results by entities receiving federal 
funds and consolidate federal programs. In addition, the House 
Transportation and Infrastructure Committee approved a bill on 
February 2, 2012 that includes consolidating or eliminating a number 
of programs.[Footnote 41] When we completed our work for this report, 
floor action was pending in the Senate. GAO is evaluating the extent 
to which ongoing legislative actions better define federal roles and 
goals, incorporate accountability for results, emphasize return on 
federal investment, and ensure fiscal sustainability. 

Actions Needed and Potential Financial or Other Benefits: 

Although there is a clear federal interest in freight transportation, 
there is no strategy or clearly defined federal role in freight 
transportation or mechanism to implement the strategy, complete with 
defined national and regional transportation priorities, to achieve 
the highest return on federal investments. As noted, federal funding 
for freight-related infrastructure is based on discrete programs' 
objectives, not on a national freight policy, and it is currently not 
possible to identify program costs associated with only freight. 
Further, the Department of Transportation does not have a national 
freight strategy to guide its different operating administrations' 
freight programs. In addition, oversight and funding requirements by 
the different modal administrations can make it difficult for planners 
to develop and implement intermodal freight projects which could 
result in more efficient freight movement. 

In recent years, GAO has recommended or proposed for congressional 
consideration the following actions. The Department of Transportation 
has agreed to consider the following recommendations, but they have 
yet to be implemented, in large part because the authorization for 
surface transportation programs expired in 2009, and existing programs 
subsequently have been funded through temporary extensions. 

GAO recommended in June 2007 that the Secretary of Transportation: 

* direct one operating administration or office--such as the Federal 
Highway Administration's Office of Freight Management and Operations--
to take the lead in coordinating intermodal activities for freight at 
the federal level by improving collaboration among operating 
administrations and the availability of intermodal guidance and 
resources. 

GAO recommended in January 2008 that the Secretary of Transportation: 

* develop with Congress and public and private stakeholders a 
comprehensive national strategy to transform the federal government's 
involvement in freight transportation projects, including defining 
federal and nonfederal stakeholder roles and using new or existing 
federal funding sources and mechanisms to support a targeted, 
efficient, and sustainable federal role. 

GAO proposed in February 2009 that Congress, in considering the 
reauthorization of federal surface transportation programs, 

* consider defining the federal role in surface transportation in 
accordance with national and regional transportation priorities, 
implementing a criteria-based, competitive project selection process, 
and working with the Secretary of Transportation to develop 
enhancements to ensure the highest return on federal investments. 

Congressional reauthorization of transportation programs presents an 
opportunity to address GAO recommendations and matters for 
congressional consideration that have not been implemented. By 
promoting and coordinating solutions across jurisdictional lines, the 
federal government could increase the effectiveness of localities, 
states, and regional governments and planning organizations in 
overcoming freight-related challenges. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to the Department of 
Transportation for review and comment. The Department of 
Transportation provided technical comments, which were incorporated as 
appropriate. Department officials informed GAO that the department is 
working with Congress to address prior GAO recommendations as part of 
efforts to reauthorize the federal surface transportation programs. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. Appendix III 
lists the programs GAO identified that may have similar or overlapping 
objectives, provide similar services or be fragmented across 
government missions. Overlap and fragmentation may not necessarily 
lead to actual duplication, and some degree of overlap and duplication 
may be justified. 

Related GAO Products: 

Surface Transportation: Competitive Grant Programs Could Benefit from 
Increased Performance Focus and Better Documentation of Key Decisions. 
[Hyperlink, http://www.gao.gov/products/GAO-11-234] Washington, D.C.: 
March 30, 2011. 

Surface Freight Transportation: A Comparison of the Costs of Road, 
Rail, and Waterways Freight Shipments That Are Not Passed on to 
Consumers. [Hyperlink, http://www.gao.gov/products/GAO-11-134] 
Washington, D.C.: January 26, 2011. 

Surface Transportation: Clear Federal Role and Criteria-Based 
Selection Process Could Improve Three National and Regional 
Infrastructure Programs. [Hyperlink, 
http://www.gao.gov/products/GAO-09-219] Washington, D.C.: February 6, 
2009. 

Freight Transportation: National Policy and Strategies Can Help 
Improve Freight Mobility. [Hyperlink, 
http://www.gao.gov/products/GAO-08-287] Washington, D.C.: January 7, 
2008. 

Intermodal Transportation: DOT Could Take Further Actions to Address 
Intermodal Barriers. [Hyperlink, 
http://www.gao.gov/products/GAO-07-718] Washington, D.C.: June 20, 
2007. 

Railroad Bridges and Tunnels: Federal Role in Providing Safety 
Oversight and Freight Infrastructure Investment Could be Better 
Targeted. [Hyperlink, http://www.gao.gov/products/GAO-07-770] 
Washington, D.C.: August 6, 2007. 

Contact Information: 

[End of section] 

For additional information about this area, contact Phillip Herr at 
(202) 512-2834 or herrp@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The Department of Energy (Energy) spends 90 percent of its annual 
budget--which totaled $27 billion for fiscal year 2011--on the 
contractors that carry out its diverse missions and operate its sites 
nationwide. These management and operating contractors--which include 
corporations, universities, and others--also provide sites' support 
functions such as procuring needed goods and services; recruiting and 
hiring workers; managing health and retirement benefits; and 
maintaining facilities and infrastructure. GAO reviewed support 
functions at the 7 national laboratory and nuclear production and 
testing sites overseen by the National Nuclear Security Administration 
(NNSA)[Footnote 42] and the 10 national laboratories overseen by the 
Office of Science. The total annual cost of support functions at NNSA 
and Office of Science sites increased from about $5.0 billion in 
fiscal year 2007 to about $5.5 billion (nominal) in fiscal year 2009. 
[Footnote 43] Previously, GAO has recommended that Energy take actions 
to manage cost growth in certain support functions and related costs. 
Since that time, however, some of these costs have continued to grow. 

What GAO Found: 

Because each site has historically had its own unique contractor--as 
part of Energy's longstanding model for research and nuclear weapons 
production--the sites have also differed in how support functions are 
organized and carried out. This decentralized, or fragmented, approach 
has sometimes led to inefficiencies in support functions. For example, 
sites have long procured goods and services independently of each 
other, sometimes buying from the same vendors in an uncoordinated 
manner and limiting Energy's ability to leverage sites' buying power. 
Similarly, Energy's fragmented approach to prioritizing and funding 
upgrades to sites' aging facilities and infrastructures has made it 
difficult to leverage the resources needed to modernize its 
facilities. For example, some facilities cannot support vibration-free 
environments or other requirements of modern research tools. 

As GAO reported in January 2012, Energy and contractors at its 17 NNSA 
and Office of Science sites have been carrying out a variety of 
efforts, since 2007, to streamline and reduce the costs of sites' 
support functions. For example: 

* In 2007, NNSA began operating a central Supply Chain Management 
Center to reduce fragmentation in procurement and better leverage 
purchasing power across its seven sites. This center applies 
"strategic sourcing" techniques, aggregating and analyzing NNSA sites' 
procurement spending data to identify opportunities to coordinate 
sites' purchases and negotiate better prices for goods and services. 
One such analysis revealed that the sites were purchasing most of 
their laboratory supplies and equipment from the same set of 38 
vendors through individual contracts negotiated by each site. The 
center was able to negotiate a single contract for all the sites, 
saving an estimated $22 million, or 17 percent, over the contract's 3-
year term, according to a center official. 

* Also that year, the Office of Science adopted a less fragmented 
approach to upgrading facilities and infrastructure at its 10 national 
laboratories by using a centrally managed process to prioritize 
funding for modernizing the sites' facilities. According to Office of 
Science officials, this approach has helped tie modernization efforts 
more closely to mission needs, while lowering the costs and shortening 
the lead times for upgrading facilities at sites. 

In addition, GAO found that contractors at sites have undertaken their 
own streamlining and cost-reduction efforts, ranging from automating 
hiring, training, or other human resources activities to reducing 
employee health care and pension costs. As GAO reported in September 
2011, while not all site-led efforts were aimed at reducing 
inefficiencies of Energy's fragmented approach, some of the efforts 
appeared to incorporate key practices for streamlining and improving 
the efficiency of federal programs and functions identified. 

While these efforts have been made, there are additional opportunities 
to streamline support functions. For example: 

* In an August 2010 memorandum, the Deputy Secretary of Energy called 
for expanding Energy's use of strategic sourcing and cited NNSA's 
Supply Chain Management Center, with its centralized approach to 
procuring goods and services for NNSA sites, as a possible model for 
leveraging Energy's and sites' buying power. 

* NNSA is considering whether to consolidate certain support services, 
such as payroll and finance, at all seven NNSA sites. In a March 2011 
white paper, NNSA concluded that a centralized approach was 
technically feasible and could lead to cost savings. 

* In a July 2011 draft solicitation to industry, Energy and NNSA 
proposed having a single contractor manage and operate two NNSA sites. 
Energy and NNSA estimated that the new approach would save around $895 
million (nominal) over the next 10 years, largely through efficiency 
gains and other improvements to the sites' business systems and 
support functions. 

Energy and contractor officials noted that further assessment of the 
appropriateness of these and other potential efforts is warranted, as 
each can present challenges. For example, in response to the Deputy 
Secretary's August 2010 memo, the Office of Science expressed 
reluctance to implement a more centralized approach to procurement, 
citing the efficiencies of its current approach. Others in Energy 
noted, however, that similar concerns were expressed during prior 
streamlining efforts, including NNSA's own implementation of a 
centralized approach, and can be addressed through further assessment. 
In addition, a centralized approach may not always be more efficient 
or effective, but that determination can benefit from further 
assessment. For example, as GAO reported in September 2011, the 
anticipated cost savings from NNSA's proposal to consolidate 
management and operating contracts for two of its sites were 
uncertain, and NNSA's own analysis suggested that efficiencies could 
instead be achieved under its existing contracts through improved 
management practices. 

Actions Needed and Potential Financial or Other Benefits: 

Energy and contractors at NNSA and Office of Science sites have taken 
steps, and are identifying further opportunities, to streamline 
support functions and reduce costs. As fiscal environments become more 
constrained, Energy needs to ensure that streamlining efforts will be 
effective. This includes understanding when it is appropriate to use a 
more centralized approach and addressing any challenges to further 
streamlining. As a result, GAO recommended in January 2012 that the 
Secretary of Energy should: 

* assess whether all appropriate efforts are being taken to streamline 
support functions at NNSA and Office of Science sites and to address 
implementation challenges. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its January 2012 report to Energy for review 
and comment. Energy generally agreed with the findings and 
recommendations from the report. As part of its routine audit work, 
GAO will track the extent to which progress has been made to address 
the identified action and report to Congress. 

How GAO Conducted Its Work: 

The information in this analysis is based primarily on findings from 
the products listed in the related GAO products section. GAO reviewed 
documents and data and spoke with Energy, NNSA, and Office of Science 
officials and with contractors at eight sites--the four largest sites 
by budget from NNSA and Office of Science. 

Related GAO Products: 

Department of Energy: Additional Opportunities Exist to Streamline 
Support Functions at NNSA and Office of Science Sites. [Hyperlink, 
http://www.gao.gov/products/GAO-12-255] Washington, D.C.: January 31, 
2012. 

Streamlining Government: Key Practices from Select Efficiency 
Initiatives Should be Shared Governmentwide. [Hyperlink, 
http://www.gao.gov/products/GAO-11-908] Washington, D.C.: September 
30, 2011. 

Modernizing the Nuclear Security Enterprise: The National Nuclear 
Security Administration's Proposed Acquisition Strategy Needs Further 
Clarification and Assessment. [Hyperlink, 
http://www.gao.gov/products/GAO-11-848] Washington, D.C.: September 
20, 2011. 

Contact Information: 

For additional information about this area, contact Gene Aloise at 
(202) 512-3841 or aloisee@gao.gov. 

[End of section] 

10. Nuclear Nonproliferation: 

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

Why This Area Is Important: 

The proliferation of nuclear weapons represents one of the greatest 
threats to U.S. and international security. As little as 25 kilograms 
of weapon-grade highly enriched uranium or 8 kilograms of plutonium 
could be used to build a nuclear weapon. If terrorists or other 
nations were to acquire and use a nuclear weapon, the results could 
have far-reaching and long-lasting social, financial, and health 
impacts. The United States has pursued a range of nuclear 
nonproliferation programs to address this threat through the 
Department of Energy's (Energy) National Nuclear Security 
Administration (NNSA). In addition to NNSA, other U.S. government 
agencies--including the Departments of Defense (DOD), State (State), 
and Homeland Security (DHS)--support programs and activities to reduce 
proliferation concerns around the world. National Security Council 
(NSC) staff have the principal role in coordinating the implementation 
of NNSA, DOD, State, and other agency nonproliferation programs. 

What GAO Found: 

GAO reported in December 2011 on issues relating to the coordination 
of federal programs involved in preventing and detecting nuclear 
smuggling overseas. GAO identified and reviewed 21 U.S. government 
programs and offices under five federal agencies--NNSA, DOD, State, 
DHS, and the Department of Justice (Justice)--that play a role in 
preventing and detecting smuggling of nuclear materials and illicit 
trafficking of related technologies overseas. These include programs 
that (1) conduct research and development on radiation detection 
technologies; (2) deploy radiation detection equipment along foreign 
borders and points of transit; (3) train and equip foreign customs and 
border security officials to identify and interdict illicit nuclear 
materials or technology transfers; (4) assist foreign governments in 
the development of export control systems; (5) enhance and coordinate 
with foreign antismuggling law enforcement and prosecutorial 
capabilities; and (6) analyze potential foreign nuclear smuggling 
cases and incidents. 

Among other things, GAO found that none of the existing strategies and 
plans for coordinating federal efforts to prevent and detect nuclear 
smuggling and illicit nuclear transfers overseas incorporates all of 
the desirable characteristics of national strategies. GAO also 
identified potential fragmentation and overlap among some programs 
working in this area, especially those providing equipment and 
training in foreign countries to counter nuclear smuggling. 
Furthermore, there is no single recognized agency responsible for 
leading and directing federal efforts to combat nuclear smuggling. 
However, State is taking steps to enhance one of the principal 
interagency coordinating mechanisms. 

Regarding strategic planning to combat nuclear smuggling overseas, GAO 
found that existing interagency strategies to coordinate efforts 
governmentwide lacked some of the desirable characteristics of a 
national strategy, such as identifying financial resources needed and 
monitoring mechanisms to be used to determine progress and make 
improvements. For example, the 2010 Global Nuclear Detection 
Architecture Strategic Plan--developed jointly by DHS, DOD, Energy, 
State, Justice, the intelligence community, and the Nuclear Regulatory 
Commission--did not identify the financial resources needed to achieve 
the strategic plan's objectives or the monitoring mechanisms that 
could be used to determine programmatic progress and needed 
improvements. Similarly, implementation guidelines for international 
nuclear and radiological border security efforts issued by NSC in 2005 
did not establish priorities, identify measures to track progress, or 
define the resources needed to effectively implement the strategy. 

GAO also identified potential fragmentation and overlapping functions 
among some of these programs implemented by these federal agencies. 
Specifically, GAO identified six programs providing training to 
improve the capabilities of foreign border security and customs 
officials to prevent smuggling and illicit nuclear shipments: (1) 
NNSA's Second Line of Defense program, (2) International 
Nonproliferation Export Control Program, and (3) Cooperative Border 
Security Program;[Footnote 44] (4) State's Export Control and Related 
Border Security program; and (5) DOD's Weapons of Mass Destruction-
Proliferation Prevention Program and (6) International 
Counterproliferation Program. Similarly, GAO identified four programs 
that are involved in providing equipment to foreign governments to 
enhance the ability of their customs and border security organizations 
to detect nuclear smuggling: (1) NNSA's Second Line of Defense 
program, (2) State's Export Control and Related Border Security 
program, (3) DOD's Weapons of Mass Destruction-Proliferation 
Prevention Program, and (4) DOD's International Counterproliferation 
Program. In prior reports on nuclear nonproliferation programs, GAO 
has found that consolidating programs sharing common goals and 
implementing similar projects can maximize limited resources and may 
achieve potential cost savings or other programmatic and 
administrative efficiencies. 

In raising the issue of potential fragmentation and overlap, agency 
officials representing these programs told GAO that not all of them 
have the same focus, that some concentrate on specialized niches, and 
that many are complementary. For instance, in the area of training, 
NNSA officials told GAO that the Second Line of Defense program is 
focused on training in the use and long-term sustainment of the 
radiation detection equipment provided by the program, whereas the 
International Nonproliferation Export Control Program concentrates on 
training foreign customs and border guard personnel at official points 
of entry to detect illicit weapons of mass destruction-related 
commodity transfers and assisting border security officials to detect 
illicit trafficking of weapons of mass destruction-related items in 
"green border" areas between official points of entry. Regarding the 
provision of equipment, NNSA, State, and DOD officials noted that the 
Second Line of Defense program tends to provide larger equipment, such 
as radiation portal monitors and cargo scanning equipment, while the 
Export Control and Related Border Security program and International 
Counterproliferation Program provide smaller-scale equipment, such as 
handheld radiation detection pagers, hazardous materials kits, and 
investigative suits to foreign customs and border security 
organizations. While the agencies noted that these programs are 
complementary to one another, in GAO's view the fragmented and 
overlapping nature of the programs nevertheless raises questions as to 
whether greater efficiency could be obtained through possible 
consolidation of such efforts. 

Furthermore, GAO found that no single federal agency has lead 
responsibility to direct federal efforts to prevent and detect nuclear 
smuggling overseas. In the past, GAO has reported that interagency 
undertakings can benefit from the leadership of a single entity with 
sufficient time, responsibility, authority, and resources needed to 
ensure that federal programs are based upon a coherent strategy, are 
well coordinated, and that gaps and duplication in capabilities are 
avoided. For efforts to detect nuclear material smuggling into or 
movement within the United States, a 2005 presidential directive gave 
DHS's Domestic Nuclear Detection Office responsibility for developing 
the Global Nuclear Detection Architecture and managing the domestic 
portion of the global architecture. However, this directive divided 
responsibility for the international portion of the global 
architecture among State, DOD, and Energy. 

The 2010 Global Nuclear Detection Architecture Strategic Plan takes a 
step toward clarifying lead agencies responsible for different 
elements of the global architecture, including efforts overseas. 
Specifically, for the exterior layer of the global architecture--the 
portion focused on enhancing international capabilities for detecting 
nuclear and radiological materials abroad--the strategic plan 
identifies four performance goals, designating lead and supporting 
agency roles for each. However, it is unclear whether these more 
defined roles give authority to these lead agencies to provide 
direction and guidance across multiple agencies and programs. For 
instance, State and DOD officials told GAO that neither State nor any 
other federal agency has the authority to direct the activities or 
coordinate implementation of programs administered by other agencies 
involved in preventing or detecting nuclear smuggling overseas. 

Regarding interagency coordinating mechanisms, the NSC has established 
mechanisms to coordinate efforts in this area, including a Countering 
Nuclear Threats Interagency Policy Committee (IPC) and a sub-IPC for 
international nuclear and radiological border security efforts. NSC 
officials declined GAO's request to discuss various aspects of the IPC 
structure and how it coordinates U.S. efforts to combat nuclear 
smuggling overseas. However, some officials from other agencies 
expressed doubts about the value of the NSC's coordinating role. 
Notably, DOD officials told GAO that they believed NSC has played a 
negligible role in coordination of programs to counter nuclear 
smuggling. 

Coordinating groups have been established beneath the IPC structure to 
facilitate greater interagency cooperation at a working level to 
address the nuclear smuggling threat in foreign countries. One of the 
principal coordinating mechanisms for U.S. export control and related 
border security assistance activities overseas is an interagency 
working group (IWG). This IWG meets on a regular basis and officials 
at DOD, NNSA, and State told GAO the meetings are well attended and 
are useful for exchanging information--such as sharing calendars and 
information on planned program activities--and building relationships 
between program managers. However, agency officials GAO interviewed 
identified some limitations with this mechanism and its ability to 
facilitate a more cohesive national response to this threat. For 
example, NNSA and DOD officials told GAO that the coordination 
meetings are hampered by the participation of many individuals and are 
oriented toward high-level discussion, making in-depth discussion of 
specific issues affecting program implementation difficult in these 
settings. In addition, NNSA and DOD officials stated that while the 
IWG is useful for information exchange, it is not a mechanism designed 
or suitable for conducting more fundamental interagency strategic 
planning or for developing guidance and priorities for individual 
agency programs. 

State officials told GAO that they have addressed the first limitation 
by chairing executive-level and regional sub-IWG meetings. For 
example, the quarterly executive-level meetings involving senior-level 
participation at the deputy assistant secretary level, allow for high-
level discussion of agency programmatic goals and funding priorities, 
while regional sub-IWG meetings conducted at the action-officer level 
provide for more focused attention on nonproliferation capacity 
building in specific countries or regions. In addition, State 
officials told GAO that they have proposed addressing the second 
limitation by using the IWG as a means of developing common 
interagency strategies and approaches toward other countries and to 
encourage individual programs to engage or disengage in particular 
regions, countries, and functional areas. 

GAO concluded that effective coordination of federal government 
efforts to prevent and detect nuclear smuggling overseas is limited by 
shortcomings in strategic plans, potential fragmentation and overlap 
among some programs, and divided responsibilities among several 
agencies. Furthermore, it is apparent that no single agency or program 
has the authority to undertake and implement a strategic re-evaluation 
and restructuring across the government to address these concerns. 

Actions Needed and Potential Financial or Other Benefits: 

To address these concerns, GAO recommended in December 2011 that the 
Assistant to the President for National Security Affairs (NSC) should: 

* undertake--or direct and delegate an appropriate agency or agencies 
to undertake--a comprehensive review of the structure, scope, and 
composition of agencies and programs across the federal government 
involved in preventing and detecting smuggling of nuclear materials, 
equipment, and technologies overseas. Such a review should assess 
several issues, including: (1) the level of overlap and duplication 
among agencies and programs, especially in the provision of training 
and nuclear detection equipment; (2) potential for consolidation of 
these functions to fewer programs and agencies; (3) the feasibility, 
costs, and benefits of establishing a special coordinator to preside 
over the allocation of U.S. counter-nuclear-smuggling assistance to 
foreign nations and be responsible for directing the interagency 
process of development, funding, and implementation of all U.S. 
government programs related to combating nuclear smuggling overseas; 
and (4) any U.S. laws that would need to be amended by Congress in 
order to facilitate consolidation, elimination, or other changes to 
existing programs; and: 

* issue new guidance that incorporates the elements of effective 
strategic plans, including clearly delineating the roles and missions 
of relevant programs, specific priorities and objectives, performance 
measures and targets, overall program cost estimates, and projected 
time frames for program completion. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its December 2011 report to NSC for report and 
comment. NSC did not comment on these recommendations. 

GAO provided a draft of this report section to the Office of 
Management and Budget for review and comment. The Office of Management 
and Budget provided technical comments, which were considered and 
incorporated as appropriate. The Office of Management and Budget 
provided comments regarding the roles and responsibilities of other 
agencies, noting the administration has taken several steps to enhance 
and promote counter nuclear smuggling options within the national 
security agencies. These observations were addressed in conjunction 
with discussions GAO had with the other agencies during the course of 
its work. As part of GAO's routine audit work, GAO will track actions 
to address these recommendations and report to Congress. 

How GAO Conducted Its Work: 

The information in this analysis is based on findings from the product 
listed in the related GAO products section. GAO reviewed uncosted NNSA 
nuclear nonproliferation program funding, but did not specifically 
discuss funding associated with the programs where GAO identified 
potential fragmentation and overlap, and GAO did not quantify the 
potential financial savings associated with those programs. 

Related GAO Product: 

Nuclear Nonproliferation: Action Needed to Address NNSA's Program 
Management and Coordination Challenges. [Hyperlink, 
http://www.gao.gov/products/GAO-12-71] Washington, D.C.: December 14, 
2011. 

Contact Information: 

For additional information about this area, contact Gene Aloise at 
(202) 512-3841 or aloisee@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The federal government spent over $1 billion to conduct more than 2 
million personnel background investigations for government employees 
in fiscal year 2011. The Office of Personnel Management (OPM) conducts 
the majority of these investigations for federal agencies including 
the Department of Defense (DOD). DOD requests more investigations from 
OPM than any other federal agency and received over 788,000 background 
investigations that cost over $787 million in fiscal year 2011. 
Agencies use electronic case management systems to identify employees 
who need investigations and monitor the status of investigations. In 
addition, agencies use electronic adjudication systems to store 
records of the decisions that officials make based on investigations, 
such as whether an applicant is suitable for federal employment, and 
in some cases, whether the applicant is eligible for a security 
clearance, enabling him or her to access classified information. 

In light of long-standing delays in completing these processes and 
other concerns, Congress set objectives and established requirements 
for improving aspects of the personnel security clearance process in 
the Intelligence Reform and Terrorism Prevention Act of 2004.[Footnote 
45] Among other things, the act established requirements for 
reciprocity--an agency's acceptance of a background investigation or 
clearance determination completed by any authorized investigative or 
adjudicative agency, subject to certain exceptions. When agencies do 
not reciprocally accept a background investigation or clearance 
determination completed by another agency, government resources may be 
used inefficiently to conduct duplicative investigations and 
adjudications. To meet the objectives laid out in the act and oversee 
reforms of the employment suitability and security clearance 
eligibility processes, DOD and the Office of the Director of National 
Intelligence established the Joint Security Clearance Process Reform 
Team (Joint Reform Team) in 2007. In 2008, the President issued an 
executive order[Footnote 46] to ensure an efficient, practical, 
reciprocal, and aligned system for the suitability and security 
processes, among other things. The order (1) established a Suitability 
and Security Clearance Performance Accountability Council, which is 
accountable to the President to achieve the goals of reform (2) 
designated the Deputy Director for Management at the Office of 
Management and Budget (OMB) as the chair of the Council; and (3) 
outlined the responsibilities of the Council, which include 
establishing requirements for enterprise information technology. Since 
2008, the Joint Reform Team under the guidance of the Performance 
Accountability Council has encouraged agencies to automate their paper-
based case management and adjudication systems by using electronic 
systems.[Footnote 47] 

What GAO Found: 

Multiple agencies have invested in or are beginning to invest in 
potentially duplicative, electronic case management and adjudication 
systems despite governmentwide reform effort goals that agencies 
leverage existing technologies to reduce duplication and enhance 
reciprocity. The governmentwide reform effort, led by the Performance 
Accountability Council, has resulted in progress in reducing delays in 
the amounts of time needed to conduct investigations and adjudicate 
clearances. Additionally, the Joint Reform Team, under the Performance 
Accountability Council's leadership, set as a goal in its information 
technology strategy that agencies will leverage existing systems to 
reduce duplication and enhance reciprocity. 

However, of the agencies that GAO reviewed, GAO found that since 2007 
three agencies--DOD, the Department of Justice (Justice), and the 
Department of Homeland Security (DHS) have each developed and 
implemented their own electronic systems for case management and 
adjudication. In addition, GAO identified three other agencies--the 
National Reconnaissance Office,[Footnote 48] the Department of 
Veterans Affairs, and the Department of the Treasury--that are 
beginning to invest in new systems that may duplicate the systems that 
DOD, Justice, and DHS have already implemented. Moreover, OPM 
officials told GAO that OPM plans to develop a new electronic case 
management and adjudication system. See the table below for the 
agencies GAO identified that have developed or are planning to develop 
their own electronic systems for case management and adjudication and 
the amounts those agencies have invested as of fiscal year 2011. 

Table: Agency Investments in Electronic Systems That Have Potentially 
Duplicative Capabilities for Case Management and Adjudication: 

Agency: Department of Defense; 
Status: Completed; 
Investment as of FY11: $32 million. 

Agency: Department of Justice; 
Status: Completed; 
Investment as of FY11: $15 million. 

Agency: Department of Homeland Security; 
Status: Completed; 
Investment as of FY11: $6.5 million. 

Agency: National Reconnaissance Office; 
Status: In development; 
Investment as of FY11: $6.8 million. 

Agency: Department of Veterans Affairs; 
Status: In development; 
Investment as of FY11: $900,000. 

Agency: Department of the Treasury; 
Status: In development; 
Investment as of FY11: $300,000[A]. 

Agency: Office of Personnel Management; 
Status: Planned; 
Investment as of FY11: Unknown. 

Source: GAO. 

[A] According to officials at the Department of the Treasury, the 
agency seeks $300,000 to fund its system. 

[End of table] 

According to DOD officials, DOD has intended to share the technology 
for its case management and adjudication system with other agencies 
since it developed its system. According to Department of Energy 
officials, the agency piloted a part of DOD's system in 2010 and it is 
still considering whether to implement it. In addition, DOD officials 
told GAO that the Social Security Administration plans to use DOD's 
system. DOD officials estimate that to implement the DOD system, 
agencies would need to invest approximately $300,000, in addition to 
any expenses agencies could incur if they chose to customize DOD's 
system to meet specific needs. Furthermore, DOD officials estimate 
that agencies may need to spend approximately $100,000 per year for 
long-term support and maintenance of the system. Likewise, OPM 
officials told GAO that OPM plans to share the technology for any case 
management and adjudication system that it develops with the agencies 
that request investigations from OPM. 

However, the Performance Accountability Council has not developed 
specific governmentwide guidance regarding how agencies should 
leverage existing technologies to prevent agencies from making 
duplicative investments in electronic case management and adjudication 
systems. As a result, individual agencies can decide to develop their 
own new systems without evaluating whether utilizing an existing 
system would be a more cost-effective approach. Since it was 
established, the Performance Accountability Council and the Joint 
Reform Team have issued several reports detailing reform-related 
plans, including a Strategic Framework in February 2010. The Strategic 
Framework established goals, performance measures, roles and 
responsibilities, and proposed metrics for determining the quality of 
security clearance investigations and adjudications. However, the 
Council did not include specific guidance in the Strategic Framework 
about how agencies might leverage existing technologies. Without 
specific guidance regarding how agencies should leverage existing 
technologies, agencies may miss opportunities to avoid duplicative 
investments in electronic systems for case management and adjudication. 

Actions Needed and Potential Financial or Other Benefits: 

GAO recommended in February 2012 that OMB's Deputy Director for 
Management, in his capacity as Chair of the Performance Accountability 
Council, should: 

* develop additional guidance to help ensure that reform stakeholders 
identify opportunities for preventing duplication in the development 
of electronic case management and adjudication technologies in the 
suitability determination and personnel security clearance processes. 

The federal government may realize multiple potential benefits from 
taking the actions GAO describes, including improved reciprocity and 
cost savings by preventing duplication of investments in electronic 
systems. Agencies that operate the same electronic systems for case 
management and adjudication may be able to share records of personnel 
background investigations with one another more easily, which may 
improve reciprocity and result in cost savings by using existing 
investigations rather than paying for new ones to be conducted. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its February 2012 report to OMB for review and 
comment. OMB agreed with GAO's recommendation that OMB develop 
additional guidance to help ensure that reform stakeholders identify 
opportunities for preventing duplication in the development of 
electronic case management and adjudication technologies in the 
suitability determination and personnel security clearance processes. 
As part of its routine audit work, GAO will track the extent to which 
progress has been made to address the identified actions and report to 
Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products listed below. GAO 
selected agencies to review that meet a combination of one or more of 
the following criteria: (1) utilizes OPM to conduct most of its 
security clearance investigations for civilians, military, and 
industrial (contractor) personnel; (2) ranks among OPM's top 10 
largest investigation customers, by volume and/or by total 
expenditures in fiscal year 2010; and (3) is a member of the 
Performance Accountability Council. GAO also reviewed selected 
additional agencies that are developing or planning to develop an 
electronic system for case management and adjudication. GAO then 
interviewed knowledgeable officials at each of these agencies about 
the status of and their plans for investments in electronic systems 
for case management and adjudication. 

Related GAO Products: 

Background Investigations: Office of Personnel Management Needs to 
Improve Transparency of Its Pricing and Seek Cost Efficiencies. 
[Hyperlink, http://www.gao.gov/products/GAO-12-197] Washington, D.C.: 
February 28, 2012. 

High-Risk Series: An Update. [Hyperlink, 
http://www.gao.gov/products/GAO-11-278] Washington, D.C.: February 
2011. 

Personnel Security Clearances: Overall Progress Has Been Made to 
Reform the Governmentwide Security Clearance Process. [Hyperlink, 
http://www.gao.gov/products/GAO-11-232T] Washington, D.C.: December 1, 
2010. 

Personnel Security Clearances: Progress Has Been Made to Improve 
Timeliness but Continued Oversight Is Needed to Sustain Momentum. 
[Hyperlink, http://www.gao.gov/products/GAO-11-65] Washington, D.C.: 
November 19, 2010. 

DOD Personnel Clearances: Preliminary Observations on DOD's Progress 
on Addressing Timeliness and Quality Issues. [Hyperlink, 
http://www.gao.gov/products/GAO-11-185T] Washington, D.C.: November 
16, 2010. 

Personnel Security Clearances: An Outcome-Focused Strategy and 
Comprehensive Reporting of Timeliness and Quality Would Provide 
Greater Visibility over the Clearance Process. [Hyperlink, 
http://www.gao.gov/products/GAO-10-117T] Washington, D.C.: October 1, 
2009. 

Personnel Security Clearances: Progress Has Been Made to Reduce Delays 
but Further Actions Are Needed to Enhance Quality and Sustain Reform 
Efforts. [Hyperlink, http://www.gao.gov/products/GAO-09-684T] 
Washington, D.C.: September 15, 2009. 

Personnel Security Clearances: An Outcome-Focused Strategy Is Needed 
to Guide Implementation of the Reformed Clearance Process. [Hyperlink, 
http://www.gao.gov/products/GAO-09-488] Washington, D.C.: May 19, 2009. 

DOD Personnel Clearances: Comprehensive Timeliness Reporting, Complete 
Clearance Documentation, and Quality Measures Are Needed to Further 
Improve the Clearance Process. [Hyperlink, 
http://www.gao.gov/products/GAO-09-400] Washington, D.C.: May 19, 2009. 

High-Risk Series: An Update. [Hyperlink, 
http://www.gao.gov/products/GAO-09-271] Washington, D.C.: January 2009. 

Contact Information: 

For additional information about this area, contact Brenda Farrell at 
(202) 512-3604 or farrellb@gao.gov. 

[End of section] 

12. Cybersecurity Human Capital: 

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

Why This Area Is Important: 

Threats to federal information technology (IT) infrastructure and 
systems continue to grow in number and sophistication, posing a risk 
to the reliable functioning of government and highlighting the need to 
ensure that the federal and contractor workforce has the knowledge, 
skills, and abilities to maintain the security of federal IT 
infrastructure and systems. 

In discussing his 2009 Cyberspace Policy Review,[Footnote 49] 
President Obama declared the cyber threat to be "one of the most 
serious economic and national security challenges we face as a 
nation." Because of the importance of federal information systems to 
government operations, as well as continuing weaknesses in the 
information security controls over these systems, GAO has identified 
federal information security as a governmentwide high-risk area since 
1997.[Footnote 50] 

Cybersecurity professionals help to prevent or mitigate 
vulnerabilities that could allow malicious individuals and groups 
access to federal IT systems. Specifically, the ability to secure 
federal systems is dependent on the knowledge, skills, and abilities 
of the federal and contractor workforce that uses, implements, 
secures, and maintains these systems. 

What GAO Found: 

GAO's work and the work of other organizations suggest that there are 
leading practices that workforce planning for critical positions such 
as federal cybersecurity positions should address. These include 
defining roles, responsibilities, skills, and competencies for these 
positions and establishing a training and development program that 
supports the competencies an agency needs to accomplish its mission. 

The Department of Commerce's National Institute of Standards and 
Technology (NIST), Chief Information Officers (CIO) Council, Office of 
Personnel Management (OPM), and the Department of Homeland Security 
(DHS) have separate efforts intended to help agencies define roles, 
responsibilities, skills, and competencies for their cybersecurity 
workforce. However, it is unclear how or whether the aforementioned 
entities will effectively align their efforts and, if so, the 
timeframe for accomplishing that. The four efforts are discussed 
briefly below: 

* As part of its responsibilities under the Federal Information 
Security Management Act, NIST has defined cybersecurity roles and 
responsibilities in NIST Special Publications 800-16, 800-37, and 800-
50. 

* In October 2010, the CIO Council released an updated version of 11 
standard cybersecurity roles that agencies could use as a guideline in 
developing detailed position descriptions and training. For each role, 
the CIO Council plans to develop a workforce development matrix that 
lists suggestions for qualifications for entry, intermediate, and 
advanced performance levels for the role; additional sources for skill 
and competency materials; educational and professional credentials; 
and learning and development sources. While several of the NIST-
defined cybersecurity roles map to the roles defined by the CIO 
Council, others do not. As of August 2011, NIST had not indicated 
plans to modify the roles identified in NIST publications to align 
with the CIO Council roles. According to NIST, its standards and 
guidance which include its definition of cybersecurity roles and 
responsibilities were issued based on its responsibilities under the 
Federal Information Security Management Act, and as such, do not need 
to be revised to align with the CIO Council roles. However, providing 
multiple unaligned sources of guidance to federal agencies limits 
their value as a tool for agencies. 

* OPM developed a governmentwide cybersecurity competency model that 
identified the most common job series used by cybersecurity 
professionals across the federal government; however, the identified 
competencies are not unique to cybersecurity work, and there is no 
mechanism in place to determine if agencies will use this model. 

* In support of the National Initiative for Cybersecurity 
Education,[Footnote 51] DHS is developing a framework consisting of 31 
specialties across seven categories of cybersecurity work, which is 
intended to provide a common language for describing the cybersecurity 
workforce. According to DHS, once the framework has been finalized, 
other federal documents, including relevant NIST Special Publications, 
will be revised to conform to it. However, no time frame was provided 
on when this will occur and it is unclear whether or not NIST will 
revise its publications to conform to the framework. 

Although NIST guidelines are currently widely used throughout the 
federal government, it is unclear whether or how the results of the 
efforts of the CIO Council, OPM, or DHS will be used governmentwide. A 
more consolidated effort to develop one framework defining roles, 
responsibilities, skills, and competencies for the federal 
cybersecurity workforce rather than four separate efforts, would be a 
more efficient use of resources. 

In addition to efforts to define roles, responsibilities, skills and 
competencies, there are multiple governmentwide cybersecurity training 
efforts under way. In 2005, the Office of Management and Budget (OMB) 
and DHS began to collaborate on an initiative, called the Information 
Systems Security Line of Business, to address common information 
systems security needs across the government, including cybersecurity 
training. As part of this collaboration, DHS designated five agencies--
the Departments of Defense, State, and Veterans Affairs (VA), the 
National Aeronautics and Space Administration (NASA), and OPM--to be 
security training shared service centers available to all federal 
agencies so as to reduce duplication and improve the quality of 
information security training. The training courses that these 
agencies offer are organized into two training tiers: general security 
awareness training and role-based security training. While one of the 
goals of the shared program is to reduce duplication, there are 
several areas in which the training roles overlap among the agencies, 
and no process exists for coordinating or eliminating duplication 
among the efforts. For example, NASA, VA, and State all have training 
for employees in system administrator roles. Additionally, both NASA 
and VA offer training for CIOs, and NASA and State both offer training 
directed at the system owner role. However, neither the individual 
agencies nor DHS evaluate the training for duplicative content, 
effectiveness, or extent of use. 

Actions Needed and Potential Financial or Other Benefits: 

To ensure that governmentwide cybersecurity workforce initiatives are 
better coordinated, GAO recommended in November 2011 that Directors of 
OMB and OPM and the Secretaries of the Departments of Commerce and 
Homeland Security should: 

* consolidate and align efforts to define roles, responsibilities, 
skills, and competencies for the federal cybersecurity workforce. 

Regarding the Information Systems Security Line of Business 
initiative, GAO also recommended in November 2011 that the Secretary 
of DHS should: 

* implement a process for tracking agency use of training, gather 
feedback from agencies on the training's value and opportunities for 
improvement, and develop a process to coordinate training offered to 
minimize the production and distribution of duplicative products. 

Implementation of these recommendations could help the government more 
efficiently and effectively develop the federal cybersecurity 
workforce in a constrained fiscal environment. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its November 2011 report to OMB, OPM, the 
Department of Commerce, and DHS, for review and comment. OPM, the 
Department of Commerce, and DHS generally agreed with GAO's 
recommendation to consolidate and align efforts to define roles and 
responsibilities, skills, and competencies for the federal 
cybersecurity workforce. OMB provided technical comments, which were 
incorporated as appropriate. In addition, DHS officials agreed with 
GAO's recommendations regarding improvements to the Information 
Systems Security Line of Business and stated that the department is 
developing a mechanism for gathering input to address GAO's 
recommendation and will work with other shared service centers to 
ensure that they align with the National Initiative for Cybersecurity 
Education activities and findings. As part of GAO's routine audit 
work, GAO will track agency actions to address these recommendations 
and report to Congress. 

GAO provided a draft of this report section to OMB for review and 
comment. OMB provided additional technical comments. However, GAO did 
not revise its findings based on these comments. In one instance, OMB 
indicated that GAO's statement that the CIO Council released an 
updated version of 11 standard cybersecurity roles in October 2010 was 
not completely accurate and that the CIO Council document we 
referenced did not update the 11 roles. GAO disagrees. The CIO 
document clearly shows that the roles were updated on October 29, 
2010. OMB also noted that the October 2010 CIO Council document 
contained additional information discussing efforts at NIST and the 
National Initiative for Cybersecurity Education. GAO was not provided 
this additional information at the time of its review, but to the 
extent this information supports better coordination of federal 
cybersecurity workforce development efforts, this is a positive step. 
Furthermore, OMB commented that it is intended that NIST will account 
for the cybersecurity workforce framework developed by the National 
Initiative for Cybersecurity Education in its follow on work. Any 
steps OMB and NIST take to better coordinate federal cybersecurity 
efforts will be helpful. Nevertheless, we continue to believe that 
consolidating and aligning efforts to define roles, responsibilities, 
skills, and competencies for the federal cybersecurity workforce will 
help the government more efficiently and effectively develop the 
workforce in a fiscally constrained environment. 

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 identified 
governmentwide initiatives based on interviews with subject matter 
experts at federal agencies and private organizations, and a review of 
publicly released information on the initiatives. GAO reviewed plans, 
performance measures, and status reports. GAO also interviewed 
officials at agencies responsible for these initiatives, such as NIST, 
OPM, the National Science Foundation, and OMB. GAO assessed the status 
and plans of these efforts against GAO's prior work on strategic 
planning, training and development, and efficient government 
operations. 

Related GAO Product: 

Cybersecurity Human Capital: Initiatives Need Better Planning and 
Coordination. [Hyperlink, http://www.gao.gov/products/GAO-12-8] 
Washington, D.C.: November 29, 2011. 

Contact Information: 

For additional information about this area, contact Gregory C. 
Wilshusen at (202) 512-6244 or wilshuseng@gao.gov] or Valerie C. 
Melvin at (202) 512-6304 or melvinv@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The radio frequency spectrum is a natural resource that is used to 
provide wireless communications services critical to the U.S. economy 
and a variety of government functions, such as national defense, 
homeland security, and other vital public safety activities. The 
federal government controls the use of spectrum by authorizing federal 
agencies' requests for spectrum and issuing licenses to nonfederal 
users. As the nation continues to experience significant growth in 
commercial wireless broadband services, the demand for spectrum has 
increased and additional capacity will be needed to accommodate future 
growth. 

Since most spectrum has already been allocated for federal, 
nonfederal, or shared uses, a number of initiatives are under way to 
identify previously assigned spectrum that can be repurposed for 
commercial wireless broadband. When spectrum is repurposed for 
commercial use, an auction may be held to distribute licenses through 
a bidding process. Since the first auction in 1994, auctions have 
generated nearly $52 billion for the U.S. Treasury and have provided 
additional spectrum for new commercial applications. In addition, some 
spectrum is available for unlicensed use, meaning an unlimited number 
of users can share the spectrum on a non-interference basis. 
Unlicensed spectrum supports a variety of technologies, including 
wireless fidelity (Wi-Fi) networks, and regulators are attempting to 
make more unlicensed spectrum available in the hopes of fueling 
innovation and economic growth. Spectrum management decisions require 
that regulators weigh the potential economic and technological 
benefits of increased spectrum availability against the need for 
federal agencies to use spectrum to achieve their missions. 

Over the past 10 years, GAO has identified weaknesses in spectrum 
management--which is fragmented between the Department of Commerce's 
National Telecommunications and Information Administration (NTIA) and 
the Federal Communications Commission (FCC)--that could impact the 
nation's ability to meet the growing demand for spectrum. In addition, 
GAO identified FCC's spectrum management as a major governmental 
challenge, specifically citing the need to balance competing demands 
for limited spectrum. 

What GAO Found: 

Spectrum management in the United States is fragmented between NTIA 
and FCC.[Footnote 52] NTIA is responsible for managing the federal 
government's use of spectrum, and FCC regulates spectrum use by 
nonfederal entities, such as television broadcasters, wireless service 
providers, and state and local public safety officials. A number of 
other entities also play a role in spectrum management. For example, 
the Interdepartment Radio Advisory Committee (IRAC), which consists of 
19 agencies that hold over 90 percent of all federally assigned 
spectrum, coordinates federal use of spectrum and provides NTIA policy 
advice on spectrum issues. In addition, the Office of Management and 
Budget (OMB) is involved in spectrum management through the federal 
budget process and has issued a circular (OMB Circular A-11) that 
provides guidance for the use of spectrum-dependent systems by federal 
agencies. 

Given the fragmented federal approach, coordination is essential to 
ensure that NTIA and FCC take a holistic approach to efficiently and 
effectively manage spectrum use. As GAO reported in March 2006, 
changes that affect existing users of spectrum can cause contentious 
stakeholder conflicts that cross the jurisdictions of both agencies 
and can lead to protracted negotiations. 

As GAO reported in November 2011, coordination challenges between NTIA 
and FCC were one of four factors contributing to delays in efforts to 
repurpose spectrum for new commercial uses. Efforts to repurpose 
spectrum require that NTIA and FCC coordinate to determine what 
spectrum is suitable for new commercial uses, and the extent to which 
federal agencies will be affected by efforts to relocate or modify 
their current spectrum assignments. Repurposed spectrum that can be 
auctioned for new commercial uses can generate significant revenues 
for the U.S. Treasury, and GAO and the National Commission on Fiscal 
Responsibility and Reform have supported the continued use of auctions 
to assign spectrum licenses. 

While NTIA and FCC have taken steps to improve coordination and are 
collaborating on efforts to make spectrum available for wireless 
broadband, the extent to which they are effectively coordinating and 
will be able to quickly meet growing demands for spectrum is unclear 
due, in part, to a lack of transparency in their joint planning 
efforts. In 2003, NTIA and FCC signed a Memorandum of Understanding 
(MOU) that stated the Assistant Secretary for Communications and 
Information at NTIA and the Chairman of FCC would meet twice a year to 
conduct joint spectrum planning activities, as required by the NTIA 
Act, to ensure spectrum is used for its "highest and best 
purpose."[Footnote 53] According to the MOU, the joint spectrum 
planning is to include considerations of the future spectrum 
requirements of public and private users, with the goal of promoting 
efficient use of spectrum that reflects the economic and national 
security interests of the nation. 

However, according to NTIA and FCC officials, these meetings did not 
occur regularly during one prior FCC Chairman's term. FCC officials 
also told us that the results of the meetings are not publicly 
available because they contain pre-decisional information. In 
addition, NTIA and FCC have not jointly developed a strategic spectrum 
plan encompassing federal and nonfederal spectrum use, despite 
statutory requirements and a 2004 Presidential Memorandum to do so. In 
fact, when GAO asked which documents comprise the national spectrum 
strategy, NTIA and FCC officials identified different documents. 

As GAO reported in November 2011, 62 of 71 experts and stakeholders we 
surveyed strongly or somewhat agreed that there is a need to maintain 
an ongoing strategic spectrum plan. GAO has also reported on the 
importance of transparency and oversight in spectrum management 
decisions. Lacking information on the extent to which NTIA and FCC are 
coordinating to strategically manage spectrum, Congress and 
stakeholders have no assurance that spectrum is being used for its 
highest and best purpose, and it is difficult to assess whether NTIA 
and FCC are fulfilling the intent of the NTIA Act and the MOU. 

Furthermore, as GAO reported in April 2011, NTIA relies heavily on 
federal agencies to self-evaluate and determine their current and 
future spectrum needs, with limited oversight or emphasis on holistic 
spectrum management to ensure that spectrum is being used efficiently 
across the federal government. NTIA has explained that because federal 
agencies use spectrum for a variety of applications and missions, it 
must rely on the agencies' expertise when reviewing spectrum 
assignments. However, prior GAO reports found that such a fragmented, 
decentralized approach proves problematic, since agency use of 
spectrum may not reflect the economic value of spectrum for the 
following reasons: 

* Agencies focus on mission requirements--not an underlying, 
systematic consideration of spectrum efficiency--when making 
investments in spectrum technologies. 

* Agencies do not pay for the spectrum they receive (outside of an 
administrative fee to NTIA). While OMB's Circular A-11 requires that 
agencies consider the economic value of spectrum when purchasing 
spectrum-dependent systems, the requirements only apply to new 
procurements. 

* Agencies receive no economic benefit from freeing up spectrum that 
can be auctioned for other uses and potentially generate revenue for 
the U.S. Treasury. In May 2004, GAO recommended that NTIA develop a 
pilot to implement incentives for agencies to use spectrum more 
efficiently, and NTIA undertook a review to identify potential 
incentives. However, according to NTIA, it did not carry out the 
studies recommended by the review due to limited resources and other 
strategic priorities. Some experts GAO spoke with noted the need to 
better incent agencies to use spectrum more efficiently, and a 
subcommittee of the Department of Commerce's Spectrum Management 
Advisory Committee made recommendations on this issue in a January 
2011 report. NTIA officials told us that NTIA has also highlighted the 
need to amend the Commercial Spectrum Enhancement Act[Footnote 54] to 
provide agencies with up-front funding to cover their planning costs 
associated with future spectrum reallocations, as well as covering the 
costs of sharing spectrum and enabling agencies to upgrade their 
technology. 

* Agencies might not have the up-front resources needed to invest in 
new technologies, which could result in the agencies using outdated, 
inefficient equipment. GAO has noted that OMB has experience managing 
a dedicated governmentwide fund that supports the up-front costs of 
improving efficiency in certain programs, such as improving the 
administrative efficiency of federal assistance programs. Although 
this fund is not spectrum-related, OMB officials noted that one of the 
benefits of having a centralized multiyear source of dedicated funding 
for efficiency projects is the ability to enhance agencies' abilities 
to undertake efficiency issues that need to be reviewed over time or 
that are affected by multiple federal agencies.[Footnote 55] 

With respect to using incentives to encourage more efficient spectrum 
use among non-federal users, GAO found that FCC has taken steps to 
rely more heavily on market mechanisms, such as auctions, to dictate 
the allocation of spectrum, and recommended Congress consider 
extending FCC's auction authority.[Footnote 56] FCC is also pursuing 
additional approaches to expand economic incentives, such as incentive 
auctions--in which an existing user could receive a portion of the 
proceeds from the auction--however, some of these approaches require 
congressional approval and face mixed support among stakeholders. 

Actions Needed and Potential Financial or Other Benefits: 

In its previously issued reports, GAO has consistently noted that 
spectrum management is not guided by a long-range holistic vision 
encompassing federal and nonfederal users. A Presidential Memorandum 
required NTIA and FCC to collaborate to make more spectrum available 
for wireless broadband. NTIA and FCC are also working together to 
accommodate more flexible and efficient models of spectrum use. These 
efforts could lead to additional spectrum auctions, which could 
generate increased revenues for the U.S. Treasury and provide spectrum 
for new commercial applications. Enhanced transparency in NTIA and 
FCC's joint spectrum management efforts could aid Congress' oversight 
and ensure that the agencies are on the path to efficient and 
effective spectrum management. In addition, GAO, the Department of 
Commerce, and an FCC task force have noted the need to develop 
incentives that encourage agencies to use spectrum more efficiently. 

To improve transparency in national spectrum policy decisions, assure 
coordination between managers of government and privately-owned 
spectrum, and help ensure that spectrum is used for its highest and 
best purpose, the Assistant Secretary for Communications and 
Information at NTIA and the Chairman of the FCC should: 

* report periodically to Congress on their joint spectrum planning 
activities and their consultation with other relevant government 
agencies. The report should include information on estimated future 
spectrum requirements for public and private uses, the spectrum 
allocation actions necessary to accommodate those uses, and any 
actions taken to promote the efficient use of spectrum. 

To improve spectrum efficiency among federal agencies, Congress may 
wish to consider: 

* evaluating what incentive mechanisms could be used to move agencies 
toward more efficient use of spectrum, which could free up some 
allocated for federal use spectrum to be made available for other 
purposes. OMB's experience managing governmentwide efficiency programs 
could prove helpful in this evaluation. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to the Department of 
Commerce, FCC, and OMB for review and comment. The Department of 
Commerce, FCC, and OMB provided technical comments, which were 
incorporated as appropriate. The Department of Commerce stressed that 
spectrum management is a difficult, complex undertaking with multiple 
growing demands from commercial and governmental users, requiring that 
regulators balance regulatory certainty for existing users against 
flexibility to accommodate new users. The Department of Commerce added 
that NTIA and FCC will need to continue to improve their processes to 
meet competing demands for spectrum, specifically noting the need to 
develop a regulatory basis for spectrum sharing. The Department of 
Commerce stated that if so directed by Congress, NTIA would work with 
FCC to report on planning activities, but cautioned against over-
simplifying the complexity of spectrum management, noting that it is 
impossible to simply calculate a number that represents how much 
spectrum each user requires. GAO acknowledges the complexity of such 
decisions, but believes that increased transparency in NTIA and FCC's 
statutorily-required joint planning efforts would prove useful for 
Congress and stakeholders. With respect to applying market incentives 
to encourage more efficient federal spectrum use, the Department of 
Commerce noted potential difficulties with applying such incentives. 
For example, the Department of Commerce stated that federal agencies 
seldom have exclusive spectrum access and a band of spectrum may be 
used to support a variety of technologies and operations. Thus, 
providing incentives to one federal user to use less spectrum may not 
mean that other federal users in the same spectrum will do the same. 
However, the Department of Commerce stated that NTIA would do its best 
to ensure the implementation of any efficiency requirements ultimately 
specified by Congress, and would fully consider any proposals to fund 
efficiency gains such as those carried out by OMB in other fields. 

FCC noted that it has increased strategic planning for spectrum 
designated for commercial use, and has worked to ensure greater 
transparency in FCC's planning efforts. FCC also provided some 
information on its efforts to expand the use of market incentives to 
encourage efficient spectrum use among commercial users, which were 
incorporated as appropriate. 

OMB disagreed with GAO's recommendation that NTIA and FCC report 
periodically to Congress on their joint spectrum planning activities 
and their consultation with other relevant government agencies. OMB 
stated that since NTIA and FCC have distinct missions and serve 
discrete populations of spectrum users, additional public reporting 
would not likely appreciably enhance spectrum management efforts. OMB 
also noted that NTIA and FCC are collaborating with one another and 
with other federal agencies to identify spectrum that can be made 
available for wireless broadband, and that NTIA periodically reports 
on the progress of these efforts. GAO recognizes that NTIA and FCC are 
collaborating to make additional spectrum available for broadband. 
However, GAO has previously noted that coordination challenges between 
NTIA and FCC have delayed efforts to repurpose spectrum for new 
commercial uses, and changes that affect existing users of spectrum 
can cause contentious stakeholder conflicts that cross the 
jurisdictions of both agencies and can lead to protracted 
negotiations. Given that NTIA and FCC have not jointly developed a 
national strategic spectrum plan, despite being statutorily required 
to do so, and did not, during one prior Chairman's term, hold 
statutorily-required spectrum-planning meetings, GAO believes that 
increased transparency in NTIA and FCC's coordination efforts would 
prove useful in maintaining coordination between the agencies. In its 
comments, OMB also stated that the Administration has put forth 
proposals to encourage more efficient use of spectrum, such as 
providing FCC with new authority to conduct incentive auctions, and 
modifying existing law to provide federal agencies with up-front 
funding to plan for spectrum reallocations and allowing support for 
upgrading agency communication capabilities. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO reports section as well as 
additional work GAO conducted. GAO interviewed NTIA and FCC officials, 
as well as academic experts and think tank representatives. 

Related GAO Products: 

* Commercial Spectrum: Plans and Actions to Meet Future Needs, 
Including Continued Use of Auctions. [Hyperlink, 
http://www.gao.gov/products/GAO-12-118] Washington, D.C.: November 23, 
2011. 

* Streamlining Government: Key Practices from Select Efficiency 
Initiatives Should Be Shared Governmentwide. [Hyperlink, 
http://www.gao.gov/products/GAO-11-908] Washington, D.C.: September 
30, 2011. 

* Spectrum Management: NTIA Planning and Processes Need Strengthening 
to Promote the Efficient Use of Spectrum by Federal Agencies. 
[Hyperlink, http://www.gao.gov/products/GAO-11-352] Washington, D.C.: 
April 12, 2011. 

* Telecommunications: Options for and Barriers to Spectrum Reform. 
[Hyperlink, http://www.gao.gov/products/GAO-06-526T] Washington, D.C.: 
March 14, 2006. 

* Telecommunications: Strong Support for Extending FCC's Auction 
Authority Exists, but Little Agreement on Other Options to Improve 
Efficient Use of Spectrum. [Hyperlink, 
http://www.gao.gov/products/GAO-06-236] Washington, D.C.: December 20, 
2005. 

* Spectrum Management: Better Knowledge Needed to Take Advantage of 
Technologies That May Improve Spectrum Efficiency. [Hyperlink, 
http://www.gao.gov/products/GAO-04-666] Washington, D.C.: May 28, 2004. 

Contact Information: 

For additional information about this area, contact Mark Goldstein at 
(202) 512-2834 or goldsteinm@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The majority of federal funding for health research and related 
activities is spent by the National Institutes of Health (NIH), within 
the Department of Health and Human Services (HHS), the Department of 
Defense (DOD), and the Department of Veterans Affairs (VA).[Footnote 
57] In fiscal year 2010, NIH, DOD, and VA obligated about $40 billion, 
$1.3 billion, and $563 million, respectively, for activities related 
to health research.[Footnote 58] Applications for federal funding of 
health research are typically submitted by principal 
investigators[Footnote 59]--the lead researchers for research 
projects--through their institution, and in some cases they may submit 
applications to multiple agencies at the same time for funding 
consideration.[Footnote 60] It is common for agencies to fund health 
research on topics of common interest, such as breast cancer and post-
traumatic stress disorder (PTSD).[Footnote 61] In some cases, funding 
similar research on the same topics is appropriate and necessary, for 
example, for purposes of replicating or corroborating prior research 
results. However, without effective sharing of information among 
federal agencies about their funding decisions, they may use available 
funds inefficiently due to duplication of effort.[Footnote 62] 

What GAO Found: 

NIH, DOD, and VA each lack comprehensive information on health 
research funded by the other agencies, which limits their ability to 
identify potential areas of duplication in the health research they 
fund. NIH, DOD, and VA program managers--officials who typically 
manage agency research portfolios and may provide input to senior 
agency officials responsible for making funding decisions--told GAO 
that, when reviewing health research applications, they typically 
search publicly available databases for potentially duplicative 
research projects funded by other federal agencies.[Footnote 63] These 
databases are used by various federal agencies, including NIH, DOD, 
and VA, to maintain information on funded health research 
applications. For example: 

* To obtain information on NIH-funded research applications, DOD and 
VA program managers told GAO that they search NIH's Research Portfolio 
Online Reporting Tools Expenditures and Results, known as RePORTER, an 
electronic database that provides the public with information on the 
expenditures and results of NIH-supported health research. This 
database is also used by NIH and DOD officials to obtain information 
on some, but not all, of the health research applications funded by 
VA.[Footnote 64] 

* To obtain information on DOD-funded health research applications, 
the NIH and VA program managers GAO interviewed said that they use 
DOD's Congressionally Directed Medical Research Programs website, 
which includes a database that provides information on health research 
applications funded through these programs, though not those funded 
outside these programs, such as those funded by separately managed 
research centers.[Footnote 65] 

According to NIH, DOD, and VA officials, the information provided in 
the research databases they use to identify any potential duplication 
when making funding decisions is generally not sufficient. For 
example, NIH's public database provides basic application information 
such as the title, principal investigator name, abstract, and agency 
contact information for each application.[Footnote 66] However, 
program managers said they need more details on the aims and 
methodologies of funded applications in order to determine whether 
applications considered for funding are duplicative of funded 
research. Officials noted that even applications with identical titles 
may have different aims. In such cases, officials said they typically 
obtain information not contained in the databases by contacting 
colleagues at other federal agencies to obtain details on specific 
applications. 

Officials at NIH, DOD, and VA added that they also communicate with 
officials at other agencies through participation on joint committees 
that have members from various federal agencies. For example, NIH 
officials stated that the Interagency Breast Cancer and Environmental 
Research Coordinating Committee, a committee established in 2010 by 
NIH, facilitates exchanges of information about breast cancer 
environment and research efforts across various agencies. While DOD's 
database for applications funded through its Congressionally Directed 
Medical Research Programs provides information about applications' 
aims and methodologies, DOD's database does not provide contact 
information for the officials associated with specific applications. 
One program manager at NIH and several VA officials said that they had 
difficulty knowing who to contact at DOD to obtain further information 
on specific applications. 

Another limitation of the databases is that they do not always allow 
for efficient, comprehensive searches to identify unnecessary 
duplication of research. As stated earlier, information on health 
research funded by NIH, DOD, and VA is in different databases with 
varying types and amounts of information. DOD and VA officials told 
GAO that, in general, when searching multiple databases for potential 
duplication, the large number of funded applications on related topics 
makes comprehensive checks difficult and time-consuming. Because of 
this, officials at NIH, DOD, and VA told GAO that they often limit 
searches to principal investigators' other federally funded research 
projects, which they are generally required to list on their 
applications.[Footnote 67] To address this challenge, VA officials 
told GAO that they are working to make comprehensive searching of the 
various databases less time-consuming. VA awarded a contract for the 
development of an electronic tool to search multiple databases and 
check for potential duplication among health research applications 
funded by various agencies and other sources.[Footnote 68] According 
to VA officials, this tool, when implemented, will allow these 
officials to identify in a timely manner applications that are most 
likely to be duplicative. 

Officials at NIH, DOD, and VA acknowledged that duplication may 
sometimes go undetected. GAO performed searches on funded applications 
for breast cancer and PTSD research in NIH's database and DOD's 
Congressionally Directed Medical Research Programs' website using 
various key words frequently found in related research.[Footnote 69] 
While most of the applications identified did not appear to be 
duplicative, GAO identified two applications, one funded by VA and the 
other by DOD, that a VA program manager confirmed were duplicative as 
described in the databases. However, the databases were not updated to 
reflect modifications that had been made to the applications' aims. 
The VA official told GAO that these two applications were originally 
identical and submitted by the same principal investigator. VA funded 
one of the applications with the understanding that DOD would not fund 
the second, duplicative application. Subsequently, according to DOD 
officials, DOD funded the second application after the principal 
investigator made some modifications to its aims in order to make it 
no longer duplicative. However, VA officials did not have information 
on DOD's funding of the application or on how it had been modified. 
This example illustrates how the databases used to check for 
duplication in health research do not always provide comprehensive 
information needed to evaluate research for potential duplication 
across federal agencies during the funding decision process. 

Actions Needed and Potential Financial or Other Benefits: 

Because multiple federal agencies fund research on topics of common 
interest, there is potential for unnecessary duplication. As long as 
research on similar topics continues to be funded by separate 
agencies, it is incumbent on the agencies to coordinate effectively 
with each other. While NIH, DOD, and VA take steps to check for 
duplication in the health research they fund, the agencies have 
opportunities to improve sharing of information needed to evaluate 
research for potential duplication when making funding decisions. In 
order to do so, the Director of NIH as well as the Secretaries of DOD 
and VA should: 

* determine ways to improve access to comprehensive electronic 
information on funded health research shared among agency officials 
and improve the ability of agency officials to identify possible 
duplication. 

For example, NIH, DOD, and VA could collaborate to allow for more 
efficient, comprehensive searches to identify duplication, by, for 
example, increasing commonalities among their respective databases; 
providing additional information in their respective databases, such 
as more details on the aims and methodology of applications that may 
be useful to program managers evaluating applications for duplication; 
and ensuring contact information for agency officials associated with 
specific applications is made available in their respective databases, 
if possible. NIH, DOD, and VA could also provide program managers with 
information to help them identify when they receive similar 
applications and to monitor the funding status of these applications, 
such as which applications receive funding, and which are modified 
during the funding process. 

Determining ways to improve access to comprehensive information and to 
improve officials' ability to identify duplication could help agency 
officials in their efforts to avoid duplication when determining which 
health research applications to fund. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to HHS, DOD, and VA for 
review and comment. HHS and DOD provided written comments. DOD 
generally agreed with GAO's findings, and HHS did not state whether it 
agreed or disagreed. In its comments, on behalf of NIH, HHS provided 
more detail on NIH's policies and procedures concerning monitoring and 
managing potential overlap in funding, particularly within NIH. HHS 
also described an internal NIH database that is also available to VA 
staff and that provides more detailed information on grants than is 
included in NIH's public RePORTER database, but is not generally 
available to staff at other agencies. For this work, GAO focused on 
RePORTER because it is the NIH database that officials at other 
agencies told GAO they use when checking for information on NIH-or VA-
funded research and is available to officials at all agencies. HHS and 
VA also provided technical comments, which were incorporated as 
appropriate. All written comments are reprinted in appendix IV. As 
part of its routine audit work, GAO will track the extent to which 
progress has been made to address the identified actions and report to 
Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO reports section as well as 
additional work GAO conducted. GAO used breast cancer and PTSD 
research as examples of areas of research that are funded by these 
three agencies. Within NIH, GAO focused on the National Cancer 
Institute and the National Institute of Mental Health, because these 
entities fund the majority of breast cancer and PTSD research within 
NIH, respectively, according to NIH officials. Within DOD, GAO focused 
on the Defense Health Program and, within VA, the Office of Research 
and Development, because these entities fund the majority of health 
research within DOD and VA, according to officials with whom GAO 
spoke. GAO focused its work on coordination across federal agencies 
that impacts decisions to fund health research. GAO collected and 
analyzed documents provided by NIH, DOD, and VA officials. GAO did not 
focus its review on coordination within federal agencies. In addition, 
GAO searched the available databases containing information on 
applications funded by NIH, DOD, and VA--RePORTER and DOD's 
Congressionally Directed Medical Research Programs website--to 
identify examples of potentially duplicative research applications 
funded by these agencies. GAO searched for the terms "breast cancer" 
and "PTSD" and then searched for terms that were frequently cited in 
titles that appeared to indicate potential duplication. GAO also 
interviewed 23 officials at NIH, DOD, and VA whom it selected because 
of their involvement in coordination across federal agencies when 
determining which research applications to fund in the areas of breast 
cancer and PTSD. 

Related GAO Products: 

Defense Health: Coordinating Authority Needed for Psychological Health 
and Traumatic Brain Injury Activities. [Hyperlink, 
http://www.gao.gov/products/GAO-12-154] Washington, D.C.: January 25, 
2012. 

HHS Research Awards: Use of Recovery Act and Patient Protection and 
Affordable Care Act Funds for Comparative Effectiveness Research. 
[Hyperlink, http://www.gao.gov/products/GAO-11-712R] Washington, D.C.: 
June 14, 2011. 

VA Health Care: VA Spends Millions on Post-Traumatic Stress Disorder 
Research and Incorporates Research Outcomes into Guidelines and Policy 
for Post-Traumatic Stress Disorder Services. [Hyperlink, 
http://www.gao.gov/products/GAO-11-32] Washington, D.C.: January 24, 
2011. 

National Institutes of Health: Awarding Process, Awarding Criteria, 
and Characteristics of Extramural Grants Made with Recovery Act 
Funding. [Hyperlink, http://www.gao.gov/products/GAO-10-848] 
Washington, D.C.: August 6, 2010. 

VA Health Care: Progress and Challenges in Conducting the National 
Vietnam Veterans Longitudinal Study. [Hyperlink, 
http://www.gao.gov/products/GAO-10-658T] Washington, D.C.: May 5, 2010. 

VA Health Care: Status of VA's Approach in Conducting the National 
Vietnam Veterans Longitudinal Study. [Hyperlink, 
http://www.gao.gov/products/GAO-10-578R] Washington, D.C.: May 5, 2010. 

Contact Information: 

For additional information about this area, contact Linda T. Kohn at 
(202) 512-7114 or kohnl@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

In 2007, in reaction to media reports criticizing the deficiencies in 
the provision of outpatient services at Walter Reed Army Medical 
Center, various review groups investigated the challenges that the 
Departments of Defense (DOD) and Veterans Affairs (VA) faced in 
providing care to wounded, ill, and injured servicemembers. The review 
groups cited common areas of concern, including case management, which 
helps ensure continuity of care by coordinating services from multiple 
providers and guiding servicemembers' transitions between care 
providers, from active duty status to veteran status, or back to the 
civilian community. One of these review groups, the President's 
Commission on Care for America's Returning Wounded Warriors--commonly 
referred to as the Dole-Shalala Commission--issued a report noting 
that while the military services did provide case management, some 
servicemembers were being assigned multiple case managers, having no 
single person to monitor and coordinate their activities, which often 
resulted in confusion, redundancy, and delay in addressing 
servicemembers' health care issues.[Footnote 70] 

To elevate the response needed to address the problems associated with 
the provision of care and services for returning servicemembers, DOD 
and VA established the Wounded, Ill, and Injured Senior Oversight 
Committee (Senior Oversight Committee) in May 2007. Co-chaired by the 
Deputy Secretaries of Defense and Veterans Affairs, the Senior 
Oversight Committee was designed to be the main decision-making body 
for the oversight, strategy, and integration of DOD's and VA's efforts 
to improve seamlessness across the recovery care continuum.[Footnote 
71] The committee included the most senior decision makers from both 
departments, who met on a routine basis to ensure timely decisions and 
actions, including ensuring that the recommendations of various review 
groups were properly evaluated, coordinated, implemented, and 
resourced. 

Under the purview of the Senior Oversight Committee, DOD and VA 
jointly developed the Federal Recovery Coordination Program (FRCP) in 
response to the Dole-Shalala Commission's recommendation for an 
integrated approach to care management. Specifically, the FRCP was 
designed to assist Operation Enduring Freedom and Operation Iraqi 
Freedom servicemembers,[Footnote 72] veterans, and their families with 
access to care, services, and benefits provided through DOD, VA, other 
federal agencies, states, and the private sector. The FRCP was 
envisioned to serve "severely" wounded, ill, and injured 
servicemembers who are most likely to be medically separated from the 
military, including those who have suffered traumatic brain injuries, 
amputations, burns, spinal cord injuries, visual impairment, and post-
traumatic stress disorder.[Footnote 73] The program uses coordinators 
to monitor and coordinate both the clinical and nonclinical services 
[Footnote 74] needed by program enrollees, by serving as the single 
point of contact among all of the case managers of DOD, VA, and other 
governmental and private care coordination[Footnote 75] and case 
management[Footnote 76] programs that provide services directly to 
servicemembers and veterans. 

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 use 
coordinators 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 centrally coordinated by DOD's Office of Wounded Warrior 
Care and Transition Policy, but is implemented separately by each of 
the military services. Most of the military services have implemented 
the RCP within their existing wounded warrior programs, including the 
Navy Safe Harbor Program, the Air Force Warrior and Survivor Care 
Program,[Footnote 77] and the Marine Wounded Warrior Regiment. The 
Army Wounded Warrior Program and the U.S. Special Operations Command's 
Care Coalition also provide care coordination services using 
coordinators referred to as "advocates" that meet the requirements of 
the RCP, although they did not specifically implement the RCP program. 
Depending on how a military service's wounded warrior program is 
structured, a servicemember may receive either case management or care 
coordination services or both. For example, the Navy Safe Harbor 
Program only provides care coordination services and does not have a 
case management component, whereas the Marine Wounded Warrior Regiment 
provides all servicemembers with both case management and care 
coordination services.[Footnote 78] 

What GAO Found: 

Many recovering servicemembers and veterans are enrolled in more than 
one care coordination or case management program, and as a result, 
they may have multiple care coordinators and case managers, 
potentially duplicating agencies' efforts and reducing the 
effectiveness and efficiency of the assistance they provide. (See 
table below.) For example, although the FRCP and RCP were intended to 
serve different populations, a DOD official told GAO that shortly 
after the military services implemented the RCP, they began to provide 
assistance to servicemembers who were "severely" wounded, ill, and 
injured--individuals who may also be enrolled in the FRCP--because DOD 
officials believed these servicemembers would also benefit from having 
RCP coordinators.[Footnote 79] As a result, servicemembers may have 
care coordinators from both programs. In addition, 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. For one wounded warrior 
program--the U.S. Special Operations Command's Care Coalition--
enrollees may be dually enrolled in another wounded warrior program 
because servicemembers that are part of the Special Operations Forces 
belong to a separate military service branch.[Footnote 80] 
Servicemembers who have specialty needs also may have case managers 
affiliated with specialty programs or services, such as for polytrauma 
or spinal cord injury, during their recovery process, outside of, but 
in coordination with, wounded warrior programs. 

Table: Characteristics of Selected Department of Defense and 
Department of Veterans Affairs Care Coordination and Case Management 
Programs for "Seriously" and "Severely" Wounded, Ill, and Injured 
Servicemembers, Veterans, and Their Families: 

DOD and VA Care Coordination Program: 

Program: Federal Recovery Coordination Program; 
Severity of enrollees' injuries[A]: Severe[B]; 
Number of active enrollees (Sept. 2011): 777; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Empty]; 
Recovery plan: [Empty]. 

DOD Recovery Coordination Programs by Military Service[C]: 

Program: Navy Safe Harbor Program; 
Severity of enrollees' injuries[A]: Mild to severe; 
Number of active enrollees (Sept. 2011): 728; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Check]; 
Recovery plan: [Check]. 

Program: Air Force Recovery Care Program; 
Severity of enrollees' injuries[A]: Mild to severe; 
Number of active enrollees (Sept. 2011): 946[D]; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Check]; 
Recovery plan: [Check]. 

Program: Marine Wounded Warrior Regiment's Recovery Coordination 
Program; 
Severity of enrollees' injuries[A]: Serious to severe; 
Number of active enrollees (Sept. 2011): 1,020[E]; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Check]; 
Recovery plan: [Check]. 

Other DOD Care Coordination Programs by Military Service: 

Program: Army Warrior Care and Transition Program: Army Wounded 
Warrior Program[F]; 
Severity of enrollees' injuries[A]: Severe; 
Number of active enrollees (Sept. 2011): 9,144[G]; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Check]; 
Recovery plan: [Check]. 

Program: U.S. Special Operations Command's Care Coalition Recovery 
Program[H]; 
Severity of enrollees' injuries[A]: Serious to severe; 
Number of active enrollees (Sept. 2011): 115[I]; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Check]; 
Recovery plan: [Check]. 

DOD Case Management Programs by Military Service: 

Program: Army Warrior Care and Transition Program: Warrior Transition 
Units and Community Based Warrior Transition Units[F]; 
Severity of enrollees' injuries[A]: Serious to severe; 
Number of active enrollees (Sept. 2011): 9,778[G]; 
Type of services provided: 
Clinical: [Check]; 
Nonclinical: [Check]; 
Recovery plan: [Check]. 

Program: Air Force Wounded Warrior Program; 
Severity of enrollees' injuries[A]: Serious to severe; 
Number of active enrollees (Sept. 2011): 1270[D]; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Check]; 
Recovery plan: [Empty]. 

Program: Marine Wounded Warrior Regiment[J]; 
Severity of enrollees' injuries[A]: Serious to severe; 
Number of active enrollees (Sept. 2011): 1,020[E]; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Check]; 
Recovery plan: [Empty]. 

Program: U.S. Special Operations Command's Care Coalition; 
Severity of enrollees' injuries[A]: Mild to severe; 
Number of active enrollees (Sept. 2011): 3,615[I]; 
Type of services provided: 
Clinical: [Empty]; 
Nonclinical: [Check]; 
Recovery plan: [Empty]. 

VA Case Management Program: 

Program: VA Operation Enduring Freedom/Operation Iraqi Freedom Care 
Management Program; 
Severity of enrollees' injuries[A]: Mild to severe; 
Number of active enrollees (Sept. 2011): 50,256; 
Type of services provided: 
Clinical: [Check]; 
Nonclinical: [Check]; 
Recovery plan: [Check]. 

Source: GAO analysis of DOD and VA program information. 

Notes: The characteristics listed in this table are general 
characteristics of each program; individual circumstances may affect 
the enrollees served and services provided by specific programs. For 
the purposes of this report, clinical services include services such 
as scheduling medical appointments and providing outreach education 
about medical conditions such as post-traumatic stress disorder. 
Nonclinical services include services such as assisting servicemembers 
with financial benefits and accessing accommodations for families. 

Because servicemembers and veterans may be enrolled in multiple 
programs, it is difficult to determine the overall number of unique 
individuals served by these programs. Furthermore, the number of 
"seriously" and "severely" wounded, ill, and injured servicemembers in 
the Operation Enduring Freedom/Operation Iraqi Freedom conflicts is 
not known with certainty because the terms "seriously" and "severely" 
are not categorical designations used by DOD or VA medical or benefits 
programs, and determinations of the size of this population vary, 
depending on definitions and methodology. 

[A] For the purposes of this table, GAO has categorized the severity 
of enrollees' injuries according to the injury categories established 
by DOD. Servicemembers with mild wounds, illness, or injury are 
expected to return to duty in less than 180 days; those with serious 
wounds, illness, or injury are unlikely to return to duty in less than 
180 days and possibly may be medically separated from the military; 
and those who are severely wounded, ill, or injured are highly 
unlikely to return to duty and also likely to medically separate from 
the military. These categories are not necessarily used by the 
programs themselves. 

[B] Although the Federal Recovery Coordination Program (FRCP) 
enrollment criteria state that the program is for severely wounded, 
ill, and injured servicemembers and veterans, FRCP officials told GAO 
that the program enrolls or assists seriously wounded, ill, and 
injured servicemembers and veterans who need the program's care 
coordination services. 

[C] Most of the military services have implemented DOD's Recovery 
Coordination Program (RCP) within their existing wounded warrior 
programs, including the Navy Safe Harbor Program, the Air Force 
Warrior and Survivor Care Program, and the Marine Wounded Warrior 
Regiment. 

[D] About one-third (286) of the Air Force Recovery Care Program 
enrollees were also either tracked or actively assisted by the Air 
Force Wounded Warrior Program. 

[E] All servicemembers that are enrolled in the Marine Wounded Warrior 
Regiment receive care coordination and case management services. 

[F] The Army Warrior Care and Transition Program includes the Army 
Wounded Warrior Program as well as the Warrior Transition Units and 
Community Based Warrior Transition Units. The Army did not implement 
DOD's RCP. However, according to officials, the Army Wounded Warrior 
Program provides care coordination services that meet the requirements 
of the RCP. 

[G] Over 1,100 Army Wounded Warrior Program enrollees were also 
enrolled in a Warrior Transition Unit. Most Army Wounded Warrior 
Program enrollees are veterans because the program supports enrollees 
throughout their recovery and transition, even into veteran status. 

[H] The U.S. Special Operations Command did not implement DOD's RCP. 
However, according to officials, the U.S. Special Operations Command's 
Care Coalition Recovery Program provides care coordination services 
that meet the requirements of the RCP. 

[I] Enrollees of the U.S. Special Operations Command's Care Coalition 
Recovery Program also receive case management services. They may also 
be enrolled in a military service's wounded warrior program based on 
their branch of service, but the U.S. Special Operations Command's 
Care Coalition Recovery Program takes the lead for providing 
nonclinical case management. 

[J] The Marine Wounded Warrior Regiment provides nonclinical case 
management services to its enrollees. Although it does not provide 
clinical case management services, the program does facilitate access 
to medical programs and care needs that have been identified for its 
servicemembers. 

[End of table] 

GAO 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.[Footnote 81] For example, an FRCP coordinator told GAO 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 two care 
coordination programs--the FRCP and RCP--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. As outlined in the following examples, the 
departments' lack of progress illustrates their continued difficulty 
in collaborating to resolve program duplication. 

* Beginning in December 2010, the Senior Oversight Committee directed 
its care management work group[Footnote 82] to conduct an inventory of 
DOD and VA case managers and perform a feasibility study of 
recommendations on the governance, roles, and mission of DOD and VA 
care coordination. According to DOD and VA officials, this information 
was requested for the purpose of formulating options for improving DOD 
and VA care coordination. However, DOD officials stated that following 
compilation of this information, no action was taken by the committee, 
and other issues, such as responding to budget reductions, were given 
higher priority. 

* In May 2011, the Senior Oversight Committee was asked by the House 
Committee on Veterans Affairs Subcommittee on Health to develop 
options for integrating the FRCP and RCP in order to reduce 
duplication and to provide a response to the subcommittee by June 20, 
2011. On September 12, 2011--almost 3 months after the subcommittee 
requested a response--the co-chairs of the Senior Oversight Committee 
issued a joint letter following notification by the subcommittee that 
it would hold a hearing on the FRCP and RCP care coordination issue. 
The letter stated that the departments are considering several options 
to maximize care coordination resources, but these options had not 
been finalized and were not specifically identified or outlined in the 
letter. 

Nonetheless, as GAO has previously reported, 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. Without 
interdepartmental coordination and action to better align and 
integrate these programs, problems with duplication and overlap will 
persist, and perhaps worsen as the number of enrollees served by these 
programs continues to grow. Moreover, the confusion this creates for 
recovering servicemembers, veterans, and their families may hamper 
their recovery. Consequently, the intended purpose of these programs--
to better manage and facilitate care and services--may actually have 
the opposite effect. 

Actions Needed and Potential Financial or Other Benefits: 

To improve the effectiveness, efficiency, and efficacy of services for 
recovering servicemembers, veterans, and their families by reducing 
duplication and overlap, GAO recommended in October 2011 that the 
Secretaries of Defense and Veterans Affairs should 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 this population, including--but not 
limited to--the FRCP and RCP. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its October 2011 report as well as a draft of 
this report section to DOD and VA for review and comment. Although DOD 
and VA did not specifically comment on the recommendation, they 
provided technical comments, which were incorporated as appropriate. 
As part of its routine audit work, GAO will track the extent to which 
progress has been made to address the identified actions and report to 
Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted to be published as a separate product in 
2012. GAO interviewed officials from each of DOD's wounded warrior 
programs and the VA Operation Enduring Freedom/Operation Iraqi Freedom 
Care Management Program to obtain information about the services that 
they provide and their enrollees. 

Related GAO Products: 

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.: October 6, 
2011. 

Federal Recovery Coordination Program: Enrollment, Staffing, and Care 
Coordination Pose Significant Challenges. [Hyperlink, 
http://www.gao.gov/products/GAO-11-572T] Washington, D.C.: May 13, 
2011. 

DOD and VA Health Care: Federal Recovery Coordination Program 
Continues to Expand but Faces Significant Challenges. [Hyperlink, 
http://www.gao.gov/products/GAO-11-250] Washington, D.C.: March 23, 
2011. 

Contact Information: 

For additional information about this area, please contact Debra 
Draper at (202) 512-7114 or draperd@gao.gov or Randall B. Williamson 
at (202) 512-7114 or williamsonr@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Since fiscal year 2005, Congress has appropriated approximately $30 
billion for crime prevention, law enforcement, and crime victim 
services for more than 200 federal financial assistance programs that 
the Department of Justice (Justice) manages.[Footnote 83] These 
federal financial assistance programs provide funding through formula 
grants, discretionary grants, cooperative agreements, and other 
payment programs, but are all generally referred to as grants. 
[Footnote 84] In 2010, Justice awarded nearly $3.9 billion in grants 
through its three granting agencies--the Office of Justice Programs 
(OJP), the Office on Violence Against Women (OVW), and the Community 
Oriented Policing Services (COPS) Office. As established in statute, 
some of the grant programs administered by OJP, OVW, and the COPS 
Office are similar in scope and grant applicants can apply for and 
receive grant awards from more than one program. Moreover, grant 
recipients may choose to award a portion of their grant to 
subgrantees. These subgrantees may also apply directly to Justice for 
funding through other grant programs for the same or similar purposes. 
The number of grant programs and recipients, and the billions of 
dollars in funds awarded annually, present administrative challenges 
for Justice. 

As the United States experiences budgetary constraints, there is an 
ever-increasing need to ensure that governmental resources--including 
those awarded through grants and subgrants--are appropriately targeted 
and unnecessary duplication is mitigated. Further, Justice's Office of 
the Inspector General continues to include Justice's grants management 
among its list of top challenges affecting the department, and in 
previous reports, has identified fragmentation and duplication between 
Justice's granting agencies. The Inspector General noted that such 
fragmentation incurs additional cost to Justice, and recommended 
closer coordination to ensure that awards are not made to the same 
grantee for similar purposes.[Footnote 85] 

What GAO Found: 

Based on audit work with associated findings to be published in a 
forthcoming report, GAO found instances where Justice's granting 
agencies had awarded funds from different grant programs to the same 
applicants whose applications described similar--and in some cases, 
the same--purposes for using the grant funds.[Footnote 86] According 
to Justice officials, funding from multiple Justice grant programs may 
be necessary to fully implement grantees' initiatives. GAO 
acknowledges that there may be times when Justice's decision to fund 
grantees in this manner is warranted. However, GAO found that Justice 
made grant award decisions without visibility over whether the funds 
supported similar or the same purposes, thus potentially resulting in 
unnecessary and unintended duplication. Moreover, Justice has not 
assessed its grant programs to determine the extent to which they 
overlap with one another and determine if consolidation of grant 
programs may be appropriate. Further, Justice's granting agencies have 
not established consistent policies and procedures for sharing grant 
application information that could help them identify and mitigate any 
unnecessary duplication in how grantees intend to use their grant 
awards. Additionally, the granting agencies do not consider subgrant 
data, such as award amounts and project purposes, as criteria in 
making grant award decisions. As a result, Justice is at risk of 
unintentionally awarding funding from multiple grant programs to grant 
recipients in the same communities for the same or similar purposes 
because it does not consistently and routinely check for any 
unnecessary duplication in grant applications.[Footnote 87] 

GAO reviewed all 253 of Justice's three granting agencies' fiscal year 
2010 grant program solicitations, which serve as announcements of new 
grant funding available and explain areas for which funding can be 
used. These solicitations and the respective grant awards are in 
addition to grant programs that Justice continues to administer from 
prior fiscal years or more recently began administering.[Footnote 88] 
The review found evidence of overlap in the justice areas that 
Justice's grant programs aim to support. For example, as the table 
below illustrates, 56 of Justice's 253 grant solicitations--or more 
than 20 percent--were providing grant funds that could be used for 
victim assistance. Eighteen of these 56 programs were administered by 
offices other than OVW and OJP's Office for Victims of Crime, whose 
primary functions are to serve individuals who have been victims of 
crime. In addition, more than 50 percent of all grant solicitations 
provided funding that could be used in support of the same three 
justice areas--victim assistance, technology and forensics, and 
juvenile justice--indicating concentrated and overlapping efforts. The 
justice area with the least overlap was juvenile justice with 30 of 33 
grant programs administered by the Office of Juvenile Justice and 
Delinquency Prevention. 

Table: Breakdown of Fiscal Year 2010 Justice Grant Solicitations by 
Office and Justice Area: 

Component/program office: COPS; 
Justice Area: 
Victim assistance: 0; 
Technology and forensics: 1; 
Juvenile justice: 0; 
Enhancing policing: 2; 
Justice information sharing: 0; 
Courts: 0; 
Community crime prevention strategies: 3; 
Mental illness, substance abuse, and crime: 1; 
Corrections, recidivism, and reentry: 0; 
Multi-purpose[A]: 0; 
Total: 7. 

Component/program office: Joint[B]; 
Justice Area: 
Victim assistance: 0; 
Technology and forensics: 0; 
Juvenile justice: 1; 
Enhancing policing: 0; 
Justice information sharing: 0; 
Courts: 0; 
Community crime prevention strategies: 0; 
Mental illness, substance abuse, and crime: 0; 
Corrections, recidivism, and reentry: 2; 
Multi-purpose[A]: 3; 
Total: 6. 

Component/program office: OVW; 
Justice Area: 
Victim assistance: 15; 
Technology and forensics: 0; 
Juvenile justice: 0; 
Enhancing policing: 0; 
Justice information sharing: 0; 
Courts: 1; 
Community crime prevention strategies: 0; 
Mental illness, substance abuse, and crime: 0; 
Corrections, recidivism, and reentry: 0; 
Multi-purpose[A]: 1; 
Total: 17. 

Component/program office: OJP[C]; 
Justice Area: 
Victim assistance: [Empty]; 
Technology and forensics: [Empty]; 
Juvenile justice: [Empty]; 
Enhancing policing: [Empty]; 
Justice information sharing: [Empty]; 
Courts: [Empty]; 
Community crime prevention strategies: [Empty]; 
Mental illness, substance abuse, and crime: [Empty]; 
Corrections, recidivism, and reentry: [Empty]; 
Multi-purpose[A]: [Empty]; 
Total: [Empty]. 

Component/program office: BJA; 
Justice Area: 
Victim assistance: 2; 
Technology and forensics: 2; 
Juvenile justice: 0; 
Enhancing policing: 7; 
Justice information sharing: 3; 
Courts: 7; 
Community crime prevention strategies: 3; 
Mental illness, substance abuse, and crime: 6; 
Corrections, recidivism, and reentry: 7; 
Multi-purpose[A]: 5; 
Total: 42. 

Component/program office: BJS; 
Justice Area: 
Victim assistance: 5; 
Technology and forensics: 2; 
Juvenile justice: 2; 
Enhancing policing: 3; 
Justice information sharing: 6; 
Courts: 4; 
Community crime prevention strategies: 1; 
Mental illness, substance abuse, and crime: 1; 
Corrections, recidivism, and reentry: 4; 
Multi-purpose[A]: 2; 
Total: 30. 

Component/program office: CCDO; 
Justice Area: 
Victim assistance: 0; 
Technology and forensics: 0; 
Juvenile justice: 0; 
Enhancing policing: 0; 
Justice information sharing: 0; 
Courts: 0; 
Community crime prevention strategies: 2; 
Mental illness, substance abuse, and crime: 0; 
Corrections, recidivism, and reentry: 0; 
Multi-purpose[A]: 0; 
Total: 2. 

Component/program office: NIJ; 
Justice Area: 
Victim assistance: 3; 
Technology and forensics: 36; 
Juvenile justice: 0; 
Enhancing policing: 4; 
Justice information sharing: 0; 
Courts: 1; 
Community crime prevention strategies: 4; 
Mental illness, substance abuse, and crime: 0; 
Corrections, recidivism, and reentry: 5; 
Multi-purpose[A]: 8; 
Total: 61. 

Component/program office: OJJDP; 
Justice Area: 
Victim assistance: 8; 
Technology and forensics: 0; 
Juvenile justice: 30; 
Enhancing policing: 7; 
Justice information sharing: 1; 
Courts: 8; 
Community crime prevention strategies: 4; 
Mental illness, substance abuse, and crime: 0; 
Corrections, recidivism, and reentry: 0; 
Multi-purpose[A]: 3; 
Total: 61. 

Component/program office: OVC; 
Justice Area: 
Victim assistance: 23; 
Technology and forensics: 0; 
Juvenile justice: 0; 
Enhancing policing: 0; 
Justice information sharing: 0; 
Courts: 0; 
Community crime prevention strategies: 0; 
Mental illness, substance abuse, and crime: 0; 
Corrections, recidivism, and reentry: 0; 
Multi-purpose[A]: 0; 
Total: 23. 

Component/program office: SMART; 
Justice Area: 
Victim assistance: 0; 
Technology and forensics: 0; 
Juvenile justice: 0; 
Enhancing policing: 0; 
Justice information sharing: 2; 
Courts: 0; 
Community crime prevention strategies: 0; 
Mental illness, substance abuse, and crime: 0; 
Corrections, recidivism, and reentry: 2; 
Multi-purpose[A]: 0; 
Total: 4. 

Component/program office: Total solicitations; 
Justice Area: 
Victim assistance: 56; 
Technology and forensics: 41; 
Juvenile justice: 33; 
Enhancing policing: 23; 
Justice information sharing: 12; 
Courts: 21; 
Community crime prevention strategies: 17; 
Mental illness, substance abuse, and crime: 8; 
Corrections, recidivism, and reentry: 20; 
Multi-purpose[A]: 22; 
Total: 253. 

Component/program office: Total award amount (in millions)[D]; 
Justice Area: 
Victim assistance: $872; 
Technology and forensics: $325; 
Juvenile justice: $264; 
Enhancing policing: $386; 
Justice information sharing: $98; 
Courts: $77; 
Community crime prevention strategies: $77; 
Mental illness, substance abuse, and crime: $53; 
Corrections, recidivism, and reentry: $430; 
Multi-purpose[A]: $810; 
Total: $3,393[E]. 

Source: GAO analysis of Justice data. 

Notes: Solicitations in this table reflect those for direct 
assistance, such as funds Justice provides for the hiring of police 
officers, as well as those for research and data collection on the 
related justice areas. 

[A] Multipurpose solicitations were solicitations for grants that 
addressed more than one justice area within a single solicitation. 

[B] Joint refers to solicitations issued jointly by multiple program 
offices, components, or departments (e.g., Justice and the Department 
of Health and Human Services, or BJA and OJJDP). 

[C] OJP is comprised of a number of smaller bureaus and offices. BJA 
is the Bureau of Justice Assistance; BJS is the Bureau of Justice 
Statistics; CCDO is the Community Capacity Development Office; NIJ is 
the National Institute of Justice; OJJDP is the Office of Juvenile 
Justice and Delinquency Prevention; OVC is the Office for Victims of 
Crime; and SMART is the Sex Offender Sentencing, Monitoring, 
Apprehending, Registering, and Tracking Office. 

[D] Actual amount awarded to grantees in millions. 

[E] This amount excludes congressional earmarks and direct benefits 
paid to families of fallen officers from Justice's Public Service 
Pension Benefit Program. 

[End of table] 

According to Justice officials, the statutory creation of grant 
programs with similar purposes requires grant design coordination 
within and among Justice's granting agencies to limit the risk of 
unnecessary duplication from overlapping programs. Officials from all 
three granting agencies stated that they regularly meet with one 
another to coordinate the goals and objectives of their grant 
programs, especially joint grant programs that they believe are 
complementary. For example, the Bureau of Justice Assistance and the 
Office for Victims of Crime issued a joint solicitation for anti-human 
trafficking programs where each office issued separate awards based on 
coordinated proposals from collaborating police departments and 
community-based victim service organizations. Further, according to 
officials, Justice recently launched the Coordinated Tribal Assistance 
Solicitation to provide a single application for most of Justice's 
tribal grant programs. 

However, as the above table illustrates, there are a number of justice 
areas in which Justice is offering dozens of grant solicitations, yet 
Justice has not assessed the universe of grant solicitations across 
its granting agencies to identify justice purpose areas that may be 
overlapping. As a result, without this assessment, Justice lacks 
information on the extent to which unnecessary duplication in the 
administration and grantee use of funds in these areas may exist. 
Additionally, Justice's granting agencies have not established 
policies and procedures requiring consistent coordination to mitigate 
the risks of unnecessary duplication before finalizing their award 
decisions. While coordination about program goals may be occurring on 
an ad hoc basis, GAO found that the granting agencies do not 
systematically coordinate their application reviews to mitigate the 
risk of unnecessary duplication. 

According to Standards for Internal Control in the Federal Government, 
one way to ensure that program managers are effectively managing and 
efficiently using resources is to have access to all financial data--
such as grant awards, prime and subgrant recipient names, and planned 
or implemented activities. In part because Justice's granting agencies 
do not routinely share grant applicant finalist lists with one another 
before making their award decisions, GAO identified instances where 
Justice's granting agencies had awarded funds from different grant 
programs to the same grantees whose applications described similar--
and in some cases, the same--purposes for using the grant funds 
without being aware of the potential for unnecessary duplication or 
whether it was warranted. 

Specifically, after reviewing a sample of 26 grant applications from 
recipients who received funds from grant programs GAO identified as 
having similar purpose areas, GAO found instances where applicants 
were using the same or similar language to apply for multiple streams 
of funding. For example, one grant recipient applied for funding from 
both the COPS Office's Child Sexual Predator Program and OJP's 
Internet Crimes Against Children program to reduce child endangerment 
through cyber investigations. In both of these separate applications, 
the applicant stated that it planned to use the grants to increase the 
number of investigations in its state, provide training for cyber 
crime investigations, serve as a forensic resource for the state, and 
establish an internet safety program. Further, included in this 
applicant's proposed budgets for both funding streams was a plan to 
purchase equipment, such as forensic computers and the same 
specialized software to investigate internet crimes against children. 
Another grant recipient applied for funding from the aforementioned 
COPS Office and OJP programs to support the same types of 
investigations. In a third instance, an applicant received fiscal year 
2010 grant funding for planned sexual assault victim services from 
both the Office for Victims of Crime and OVW. The applicant used 
similar language in both applications, noting that it intended to use 
the funding to support child victim services through its child 
advocacy center. After reviewing a draft of this report section, 
Justice followed-up with the grant recipients in these instances and 
reported to GAO that the grantees were not using awarded funds for 
duplicative purposes. However, such follow-up for the purpose of 
assessing duplication is not a routine practice for Justice. Absent 
routine coordination among its granting agencies before awarding 
grants, Justice is not positioned to mitigate the risk of funding 
unnecessarily duplicative grants. 

In fiscal year 2010, Justice's three granting agencies awarded more 
than 11,000 prime grant awards, but officials said that they do not 
generally assess the flow of funds to subgrant recipients and in many 
instances do not know the extent to which subgrants are made and for 
what purposes and activities. Officials from Justice's granting 
agencies told GAO that they encourage applicants to apply for as many 
sources of Justice funding as possible, yet the granting agencies are 
not assessing subgrant data with the specific intent to identify any 
unnecessarily duplicative grant awards. According to the OJP 
officials, state and local communities have expansive criminal justice 
needs and therefore they encourage applicants to seek out as much 
Justice grant funding as possible, including from grant programs that 
may have similar objectives or allow for similar activities to be 
carried out. 

Justice officials reported that OVW assesses subgrant data for some of 
its formula grant programs to better understand how funding is used; 
however, officials did not provide specific examples of how such 
assessments are used to identify unnecessary duplication in funding. 
In addition, officials indicated that OVW required applicants for some 
of its fiscal year 2010 grant programs to notify OVW of the other 
federal grant programs it had either received money from or applied 
for in the same fiscal year, but GAO found that this requirement was 
not in place across all OVW programs. Further, OVW officials stated 
they intended to require that applicants for all of OVW's programs 
identify other federal funding they are receiving beginning in fiscal 
year 2012. While this is a positive step, there is no indication that 
this information would be shared with other granting agencies or 
whether other granting agencies are considering implementing a similar 
practice. 

In part because this coordination is not routinely occurring before 
grant awards are made, GAO found examples where federal funds were 
awarded to the same local communities through multiple grants 
including subawards for the same or similar uses. In one of the states 
GAO visited, a county received an Edward Byrne Memorial Justice 
Assistance Grant (JAG) program subaward and used the funding for its 
officers to conduct community policing. The county also received a 
COPS Office hiring grant and used the funding for an officer to 
conduct community policing.[Footnote 89] Additionally, the largest 
city in this county received a COPS Office Hiring grant to conduct 
community policing. Because this city received the COPS Office funding 
to conduct community policing in geographical areas that overlapped 
with areas in the county already served by JAG-funded police officers, 
three Justice grant awards were used to provide community policing to 
overlapping areas in the county. Officials from two additional 
counties in the state told GAO they received funding for drug court-
assisted substance abuse treatment and mental health counseling 
through both a JAG program subaward and a grant directly from OJP's 
Adult Drug Court Discretionary Grant Program. Officials from one of 
these counties informed GAO that they received so much Justice funding 
from the two different grant programs that they planned to return a 
portion to Justice because the funding exceeded their needs. 

State Officials from 10 of the 11 states GAO interviewed stated that 
the delivery of federal criminal justice assistance could be improved 
and the risk of unnecessary duplication limited if Justice relied more 
on their perspectives before making discretionary grant awards to 
localities in their states. In particular, officials from two of these 
states told GAO that they are better positioned than Justice to 
determine the demonstrated needs of their communities. Moreover, state 
officials reported they would prefer to receive assistance from 
Justice in the form of block grants citing reasons such as flexibility 
and reducing unnecessary duplication and fragmentation. With respect 
to state input related to discretionary grant award decisions, Justice 
officials stated that since states can compete with localities for the 
receipt of direct awards, the provision of pre-award information to 
the states or the solicitation of states for input on funding 
decisions could present a conflict of interest. With respect to block 
grants, Justice officials added that they believe the department is in 
a unique position to test, disseminate, evaluate, and foster best 
practices at a national level. 

OJP officials also stated that because programs are created by 
statute, they have little discretion related to grant program design 
and may be limited in the extent to which they can consolidate similar 
programs and solicitations.[Footnote 90] Justice officials stated that 
the timeline for reviewing applications, making recommendations on 
their merit, and processing awards each year is compressed and that it 
would be difficult to build in the extra time and level of 
coordination required to complete an intradepartmental review for 
potentially unnecessary duplication of funding prior to making awards. 
The officials added that it would take even more time if granting 
agencies were to attempt a pre-award duplication review at the 
subgrantee level. However, because OJP officials stated that previous 
and pending grant award information would be very useful when they 
make grant award decisions, they are exploring ways to make such a 
review more automated by leveraging their grant systems. 

GAO understands that the time necessary to complete annual grant 
awards makes such a review process more difficult; however, OJP 
actions to automate reviews using previous and pending grant award 
information could help overcome this challenge. Moreover, although 
statutory authorizations for grant programs may limit Justice's 
discretion over grant program design, developing agency procedures to 
avoid unnecessary grant duplication is one of the promising practices 
that the federal Domestic Working Group Grant Accountability Project 
suggested in its Guide to Opportunities for Improving Grant 
Accountability.[Footnote 91] Moreover, while assessing its programs 
might be time intensive on the front end, such a review could yield 
positive dividends for the department over the longer term. 
Specifically, Justice could improve grants management by first 
understanding the areas in which individual granting agencies may be 
awarding funds for the same or similar purposes, whether these grant 
programs appropriately channel the department's priorities, and 
whether any existing duplication is desirable. By focusing on how the 
grants align with priorities and understanding where coordination can 
be improved or the risk of unnecessary duplication reduced, Justice 
could then better target limited grant resources. 

In addition, Justice could improve its decision making before 
finalizing awards. By sharing information with one another about past 
and prospective grantees, Justice's granting agencies could better 
ensure that applicants from certain communities already receiving 
funds from one program are not then inadvertently awarded funds from 
another program for the same or similar purposes. In some instances, 
Justice may deem it appropriate for large numbers of distinct grant 
programs to serve one goal, or for the same communities to benefit 
from multiple streams of grant funding. However, unless Justice 
considers information it has available, it cannot know with certainty 
where it's funding is going, how it is being used, and whether it is 
awarding grant dollars in the most efficient way. 

Actions Needed and Potential Financial or Other Benefits: 

Based on ongoing work, GAO anticipates recommending the following: 

The Attorney General of the United States should: 

* conduct an assessment to better understand the extent to which 
Justice grant programs overlap with one another and determine if grant 
programs may be consolidated to mitigate the risk of unnecessary 
duplication. To the extent that Justice identifies any statutory 
obstacles to consolidating its grant programs, it should work with 
Congress to address them, as needed; and: 

* direct granting agencies to coordinate with one another on a 
consistent basis to review potential or recent grant awards, including 
subgrant awards reported by Justice prime grant awardees, to the 
extent possible, before awarding grants. This could help ensure an 
accurate understanding of Justice resources already provided to 
applicants and the communities they serve, as well as knowledge of 
those applicants proposing to carry out the same or similar activities 
with funds from one or more of the granting agencies' programs. 
Justice should also take steps to establish written policies and 
procedures to govern this coordination and help ensure that it occurs. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to Justice for review and 
comment. Justice provided technical comments, which were incorporated 
as appropriate. In technical comments, Justice stated that using 
funding from multiple grant programs may be necessary to fully 
implement law enforcement projects in light of limited local and 
federal resources. GAO acknowledges that there may be cases where 
funding in this manner is warranted, but without an assessment of the 
extent of overlap across Justice grant programs, combined with 
consistent and routine grant award coordination, there is an increased 
risk of unnecessary duplication in grant awards. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted to be published as a separate product in 
2012. To identify the total number of Justice grant solicitations for 
fiscal year 2010, GAO reviewed the lists posted on the OJP, COPS 
Office, and OVW websites and confirmed the currency of the information 
with Justice officials. To determine whether these solicitations were 
announcing grant funding available for similar purposes, GAO first 
established 10 categories of criminal justice areas and then sorted 
the solicitations into each. GAO developed these 10 categories after 
reviewing comparable justice areas identified within OJP's 
Crimesolutions.gov website, which OJP officials asserted also covers 
COPS Office and OVW programs; OJP's Fiscal Year 2010 Program Plan; and 
other materials from the COPS Office and OVW, such as justice program 
themes from their respective websites.[Footnote 92] After identifying 
solicitations with similar scopes, GAO reviewed a sample of successful 
grant applications that were awarded under the similar solicitations 
to identify and assess specific examples of how the recipients planned 
to use funds from multiple programs in the same or similar manner. The 
sample GAO reviewed is not generalizable to all Justice grant programs 
because GAO did not review all grant applications, including 
subgrants, but it provides evidence of the potential for unnecessary 
duplication. GAO also reviewed agency policies, procedures, and 
guidance on grant program design and award, such as the COPS Office 
Program Development Team charter and template, and the OJP Grant 
Managers Manual. Further, GAO interviewed Justice officials from the 
three granting agencies to obtain additional information on grant 
program design and award processes, and the extent to which the three 
agencies coordinate and share information. 

GAO also visited or conducted phone interviews with officials from 11 
states, including the five largest and five smallest state recipients 
of JAG funding.[Footnote 93] These officials represent the state 
administering agencies responsible for distributing JAG and other 
Justice formula block grant funds to subrecipients in California, 
Florida, New York, North Dakota, Pennsylvania, South Dakota, Rhode 
Island, Tennessee, Texas, Vermont, and Wyoming. These officials 
provided their views regarding the type and timeliness of information 
on grant awards and subawards they provide to and receive from 
Justice. GAO selected these 11 states based on the amount of JAG 
funding they receive and the existence of other recipients in their 
communities receiving Justice discretionary grants for potentially 
similar purposes. The results of these contacts are not generalizable 
to all states, but provide insight into how Justice grant funds are 
used locally and into the communication between states and Justice. 
Finally, GAO compared agency grant design and award practices against 
Standards for Internal Control in the Federal Government and promising 
practices identified in the Domestic Working Group Grant 
Accountability Project's Guide to Opportunities for Improving Grant 
Accountability. Appendix III lists the programs GAO identified that 
may have similar or overlapping objectives, provide similar services 
or be fragmented across government missions. Overlap and fragmentation 
may not necessarily lead to actual duplication, and some degree of 
overlap and duplication may be justified. 

Related GAO Products: 

Information Technology: Continued Attention Needed to Accurately 
Report Federal Spending and Improve Management. [Hyperlink, 
http://www.gao.gov/products/GAO-11-831T] Washington, D.C.: July 14, 
2011. 

Federal Grants: Improvements Needed in Oversight and Accountability 
Processes. [Hyperlink, http://www.gao.gov/products/GAO-11-773T] 
Washington, D.C.: June 22, 2011. 

Recovery Act: Department of Justice Could Better Assess Justice 
Assistance Grant Program Impact. [Hyperlink, 
http://www.gao.gov/products/GAO-11-87] Washington, D.C.: October 15, 
2010. 

Juvenile Justice: A Time Frame for Enhancing Grant Monitoring 
Documentation and Verification of Data Quality Would Help Improve 
Accountability and Resource Allocation Decisions. [Hyperlink, 
http://www.gao.gov/products/GAO-09-850R] Washington, D.C.: September 
22, 2009. 

Grants Management: Additional Actions Needed to Streamline and 
Simplify Processes. [Hyperlink, 
http://www.gao.gov/products/GAO-05-335] Washington, D.C.: April 18, 
2005. 

Contact Information: 

For additional information about this area, contact David C. Maurer at 
(202) 512-9627, or maurerd@gao.gov. 

[End of section] 

17. Homeland Security Grants: 

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

Why This Area Is Important: 

From fiscal years 2002 through 2011, the federal government 
appropriated over $37 billion to a variety of Department of Homeland 
Security (DHS) homeland security preparedness grant programs.[Footnote 
94] Of this amount, the DHS's Federal Emergency Management Agency 
(FEMA) allocated about $20.3 billion to grant recipients through four 
programs: the State Homeland Security Program, the Urban Areas 
Security Initiative, the Port Security Grant Program, and the Transit 
Security Grant Program. Through these grant programs, DHS has sought 
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. 

As GAO reported in March 2011, DHS could benefit from examining its 17 
preparedness grant programs and coordinating their application 
processes; developing measurable capability requirements and 
evaluation criteria; and eliminating redundant reporting 
requirements.[Footnote 95] GAO also reported in February 2012 on 4 of 
these 17 grant programs--the State Homeland Security Program, the 
Urban Areas Security Initiative, the Port Security Grant Program, and 
the Transit Security Grant Program--and found that multiple factors 
contributed to the risk of FEMA funding unnecessarily duplicative 
projects. These factors include overlap among grant recipients, goals, 
and geographic locations, combined with the limited project 
information that FEMA had available regarding grant funding levels, 
grant recipients, and grant purposes.[Footnote 96] 

What GAO Found: 

GAO has previously reported that overlap among government programs or 
activities can be harbingers of unnecessary duplication.[Footnote 97] 
The four DHS grant programs that GAO reported on in February 
2012[Footnote 98]--the State Homeland Security Program, the Urban 
Areas Security Initiative, the Port Security Grant Program, and the 
Transit Security Grant Program--have multiple areas of overlap. The 
grant programs have similar goals and fund similar activities, such as 
equipment and training, in overlapping jurisdictions. For instance, 
each state and eligible territory receives a legislatively mandated 
minimum amount of State Homeland Security Program funding to help 
ensure that all geographic areas develop a basic level of 
preparedness, while the Urban Areas Security Initiative grants 
explicitly target urban areas most at risk of terrorist 
attack.[Footnote 99] However, many jurisdictions within designated 
Urban Areas Security Initiative regions also apply for and receive 
State Homeland Security Program funding. Similarly, port stakeholders 
in urban areas could receive funding for equipment such as patrol 
boats through both the Port Security Grant Program and the Urban Areas 
Security Initiative, and a transit agency could purchase surveillance 
equipment with Transit Security Grant Program or Urban Areas Security 
Initiative funding. 

Further, depending on the program, other federal stakeholders in 
addition to FEMA are involved in the administration or coordination of 
some, but not all, of the four programs. The table below illustrates 
overlap in the purposes and types of projects funded by the four grant 
programs. 

Table: Federal Agencies, Purpose, and Project Type Involved in Select 
Homeland Security Grants: 

Primary federal agencies involved; 
State Homeland Security Grant Program: Federal Emergency Management 
Agency; 
Ubran Areas Security Initiative: Federal Emergency Management Agency; 
Port Security Grant Program: Federal Emergency Management Agency/U.S. 
Coast Guard; 
Transit Security Grant Program: Federal Emergency Management Agency/ 
Transportation Security Administration. 

Purpose of the grant program; 
State Homeland Security Grant Program: The State Homeland Security 
Program provides funding to support state and local efforts to 
prevent, protect against, respond to, and recover from acts of 
terrorism and other catastrophic events; 
Ubran Areas Security Initiative: The Urban Areas Security Initiative 
provides funding to high-risk urban areas to build and sustain 
regional capabilities to prevent, protect, respond to, and recover 
from acts of terrorism; 
Port Security Grant Program: The Port Security Grant Program provides 
funding to port stakeholders to mitigate against risks associated with 
potential terrorist attacks by enhancing capabilities to detect, 
prevent, respond to and recover from terrorist attacks; 
Transit Security Grant Program: The Transit Security Grant Program 
provides funds to public transit agencies to protect critical surface 
transportation infrastructure and the traveling public from acts of 
terrorism and to increase the resilience of transit infrastructure. 

Types of projects funded; 
State Homeland Security Grant Program: 
* Planning; 
* Organization; 
* Equipment; 
* Training; 
* Exercises; 
Ubran Areas Security Initiative: 
* Planning; 
* Organization; 
* Equipment; 
* Training; 
* Exercises; 
* Maritime domain awareness efforts; 
* Planning; 
Port Security Grant Program: 
* Equipment; 
* Training; 
* Exercises; 
* Supporting port resiliency and recovery; 
Transit Security Grant Program: 
* Capital infrastructure projects; 
* Operational activities; 
* Planning; 
* Equipment; 
* Training; 
* Exercises. 

Source: Federal Emergency Management Agency grant guidance. 

[End of table] 

As GAO reported in February 2012, FEMA made award decisions for all 
four programs with differing levels of information which contributes 
to the risk of funding unnecessarily duplicative projects. While GAO 
understands that some overlap may be desirable to provide multiple 
sources of funding, a lack of visibility over grant award details 
around these programs increases the risk of unintended and unnecessary 
duplication. Some of the factors that contributed to the differences 
in the information available include different administrative 
processes and information requirements. With respect to administrative 
differences, FEMA delegates some administrative duties to stakeholders 
for the State Homeland Security Program, the Urban Areas Security 
Initiative and the Port Security Grant Program, thereby reducing its 
administrative burden according to FEMA officials. However, this 
delegation also contributes to FEMA having less visibility over some 
grant applications, and in particular those funded by the State 
Homeland Security Program and the Urban Areas Security Initiative. 
These two programs are administered by state administrative agencies; 
[Footnote 100] however, some administrative functions are further 
delegated to subrecipients such as local governments or other 
entities. In contrast, Transit Security Grant Program awards are made 
directly to the final grant recipients and this more direct award 
structure, among other factors, allows FEMA to better track these 
grant awards. In delegating significant grants administration duties 
to the state administrative agencies for the larger State Homeland 
Security Program and Urban Areas Security Initiative programs, FEMA 
officials recognize the trade-off between decreased visibility over 
grant funding, subrecipients, and specific project-level data in 
exchange for their reduced administrative burden. 

Differences in information requirements also affect the level of 
information that FEMA has available for making grant award decisions. 
For example, for the State Homeland Security Program and Urban Areas 
Security Initiative, states and eligible urban areas submit investment 
justifications for each program with up to 15 distinct investment 
descriptions that describe general proposals in wide-ranging areas 
such as "critical infrastructure protection."[Footnote 101] Each 
investment justification encompasses multiple specific projects to 
different jurisdictions or entities, but project-level information, 
such as a detailed listing of subrecipients or equipment costs, is not 
required by FEMA. In contrast, Port Security Grant Program and Transit 
Security Grant Program applications require specific information on 
individual projects such as detailed budget summaries. As a result, 
FEMA has a much clearer understanding of what is being requested and 
what is being funded by these programs. 

FEMA has studied the potential utilization of more specific project-
level data for making grant award decisions, especially for the State 
Homeland Security Program and Urban Areas Security Initiative. 
[Footnote 102] Specifically, a May 2011 FEMA report recommended that 
the agency modify the investment justification format for the Urban 
Areas Security Initiative and the State Homeland Security Program 
applications to include a detailed project list.[Footnote 103] This 
project list would contain information that is currently collected 
later in the grant cycle in the post-award phase. However, while GAO's 
analysis of selected grant projects determined that this additional 
information was sufficient for identifying potentially unnecessary 
duplication for nearly all of the projects it reviewed, the 
information did not always provide the FEMA with sufficient detail to 
identify and prevent the risk of unnecessary duplication. 

Specifically, GAO reviewed the type of information that FEMA would 
have available at the applications stage if it implemented the May 
2011 report recommendation. GAO's analysis of 1,957 projects,[Footnote 
104] using post-award information as recommended in the report, 
determined that over 1,800 of the projects representing about 90 
percent of the overall funding had the detail needed to determine 
whether they were unnecessarily duplicative. However, 140 projects, or 
9.2 percent of the overall funding associated with the 1,957 projects--
about $183 million--lacked sufficient detail to determine whether they 
were unnecessarily duplicative or had involved coordination during the 
state's planning or selection processes to prevent any unnecessary 
duplication. For example, in one instance GAO identified overlap in 
the descriptions of the project types and titles of State Homeland 
Security Program, Urban Areas Security Initiative, and Port Security 
Grant Program grants that funded critical infrastructure improvements 
in a single port area. This overlap suggested that duplication could 
be occurring among the grant programs, and warranted further analysis. 

After gathering additional information from state and local grant 
recipients, however, GAO determined that none of the projects it 
reviewed were duplicative. While implementing the May 2011 report 
recommendation to better utilize more specific project-level data 
would be a step in the right direction, the Director of FEMA's Grants 
Preparedness Division reported in September 2011 that FEMA had not yet 
determined the specifics of future data requirements related to the 
report's recommendation. GAO was able to ascertain that over 90 
percent of the projects it reviewed had sufficient detail to determine 
that the projects were not likely duplicative. However, GAO believes 
that more detailed project information could be of value to FEMA in 
its grant review process since the information that would be gathered 
and considered, if the report's recommendation were implemented, would 
not always allow for the necessary differentiation between projects 
funded by the four grant programs. Moreover, DHS's Office of Inspector 
General has also concluded in recent years that FEMA should utilize 
more specific project-level data in making grant award decisions, 
especially for the State Homeland Security Program and Urban Areas 
Security Initiative, in order to identify and mitigate potential 
duplication.[Footnote 105] 

Another effort that FEMA has initiated to improve its grant 
information is the phase-in of a new consolidated grants management 
system--the Non-Disaster Grants system. Agency officials stated that 
this system, once completed, will help FEMA manage all of its 
preparedness grants, and has an explicit goal of enhancing project-
level data collection. In addition, FEMA anticipates that the Non-
Disaster Grants system will consolidate data from multiple systems and 
facilitate greater utilization and sharing of information. However, 
according to FEMA documentation, the agency has not yet determined all 
of its specific data needs for the system. As FEMA continues to 
develop the Non-Disaster Grants system, it will be important to ensure 
that it collects the level of data needed, as appropriate, to compare 
projects across grant programs to mitigate the risk of funding 
unnecessarily duplicative projects. GAO recognizes that collecting 
more detailed project information through the new system could involve 
additional costs. However, collecting additional information with this 
level of detail could help better position FEMA to ensure that it is 
using its resources effectively. 

GAO also reported in February 2012 that FEMA lacks a process to 
coordinate application reviews across the four grant programs. FEMA's 
Grants Program Directorate has divided the administration of the grant 
programs into two separate branches: The Urban Areas Security 
Initiative and State Homeland Security Program are administered by a 
Homeland Security Grant Program branch, while the Port Security Grant 
Program and Transit Security Grant Program are administered by a 
Transportation Infrastructure Security branch. The result of this 
structure is that grant applications are reviewed separately by 
program and are not compared across each other to determine where 
possible unnecessary duplication may occur. Similar findings were also 
reported by the DHS Inspector General in March 2010. 

As noted earlier, each grant program GAO reviewed has similar goals, 
allowable costs, and geographic proximity. As a result, these four 
programs share applicants as state and local entities seek to maximize 
grant dollars for their projects; however, FEMA does not compare 
applications, including the investment justifications, for these 
overlapping grant programs. As a result, neither FEMA nor an 
independent third party is positioned to determine where unnecessary 
duplication may occur. 

Because the applications for the four grant programs are being 
reviewed by two separate divisions, yet have similar allowable costs, 
GAO and the DHS Inspector General concluded that coordinating the 
review of grant projects internally would give FEMA more complete 
information about applications across the four grant programs. This 
additional information could help FEMA identify and mitigate the risk 
of unnecessary duplication across grant applications. A FEMA Grants 
Program Directorate Section Chief noted that the primary reasons for 
the current lack of coordination across programs are the sheer volume 
of grant applications that need to be reviewed and FEMA's lack of 
resources to coordinate the grant application review process. GAO 
recognizes the challenges associated with reviewing a large volume of 
grant applications, but to help reduce the risk of funding 
unnecessarily duplicative projects, FEMA could benefit from exploring 
opportunities to coordinate project reviews across grant programs 
while also taking into account the large volume of grant applications 
it must process. 

In addition, from fiscal year 2010 to 2012, appropriations for DHS's 
preparedness grant programs declined from $3.02 billion to $1.35 
billion--or about 55 percent.[Footnote 106] Further, the consolidated 
appropriations act for fiscal year 2012 combined funding for DHS's 
preparedness grant programs into a single appropriation and provided 
the Secretary of Homeland Security with the discretion to distribute 
this funding amongst the suite of preparedness grant 
programs.[Footnote 107] Specifically, the appropriations for these 
four programs declined by about $487 million--or about 20 percent--
from fiscal year 2010 to 2011. However, the fiscal year 2012 funding 
levels for these four programs are unclear at this time because the 
Secretary of Homeland Security has not yet determined how to 
distribute available funding amongst the grant programs. Given the 
significant overlap in these grant programs and the risk of 
unnecessary duplication, requiring additional information on FEMA's 
efforts to identify and eliminate overlap may be helpful to the 
Congress as it makes future decisions regarding preparedness grant 
funding. 

Actions Needed and Potential Financial or Other Benefits: 

The State Homeland Security Program, Urban Areas Security Initiative, 
Port Security Grant Program, and Transit Security Grant Program have 
similar goals and fund similar activities in overlapping 
jurisdictions. In a constrained budget environment, it is important 
for FEMA to have the information it needs about projects funded 
through these programs and to coordinate their administration to 
maximize their impacts on improving homeland security and avoid the 
risk of any unnecessary duplication. Although reviewing a large volume 
of grant applications is challenging, these reviews are important to 
better ensure that FEMA is able to identify and prevent any potential 
unnecessary duplication, and that limited grant resources are used 
effectively. 

GAO recommended in its February 2012 report that to help reduce the 
risk of unnecessary duplication by strengthening the administration 
and oversight of these programs, the FEMA Administrator should: 

* take steps, when developing the Non-Disaster Grants system and 
responding to the FEMA May 2011 report recommendations on data 
requirements, to ensure that FEMA collects project information with 
the level of detail needed to better position the agency to identify 
any potential unnecessary duplication within and across the four grant 
programs, weighing any additional costs of collecting this data; and: 

* explore opportunities to enhance FEMA's internal coordination and 
administration of the programs in order to identify and mitigate the 
potential for any unnecessary duplication. 

In addition to these recommendations to DHS from GAO's February 2012 
report, Congress may also want to consider: 

* requiring DHS to report on the results of its efforts to identify 
and prevent unnecessary duplication within and across the State 
Homeland Security Program, Urban Areas Security Initiative, Port 
Security Grant Program, and Transit Security Grant Program, and 
considering these results when making future funding decisions for 
these programs. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to DHS for review and 
comment. DHS provided technical comments, which were incorporated as 
appropriate. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. GAO took 
several actions to determine how FEMA awarded grant funds and how 
funds were distributed. GAO interviewed officials at DHS and FEMA and 
visited five urban areas that contained grant recipients for all four 
grant programs and were among the highest annual grant recipients in 
fiscal year 2010 due to their risk profile. In each of these 
locations, GAO interviewed officials responsible for administering the 
program (state and local officials for the State Homeland Security 
Program/Urban Areas Security Initiative; fiduciary agents for the Port 
Security Grant Program; and transit agency officials for Transit 
Security Grant Program). GAO also met with grant recipients and 
members of the local coordination or project selection groups (e.g., 
Urban Area Working Group for the Urban Areas Security Initiative). 
Additionally, GAO reviewed grant guidance, legislation and prior GAO 
and Department of Homeland Security Inspector General reports; 
analyzed grant awards; and reviewed state and national plans related 
to homeland security grant programs. Appendix III lists the programs 
GAO identified that may have similar or overlapping objectives, 
provide similar services or be fragmented across government missions. 
Overlap and fragmentation may not necessarily lead to actual 
duplication, and some degree of overlap and duplication may be 
justified. 

Related GAO Products: 

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.: February 28, 
2012. 

Port Security Grant Program: Risk Model, Grant Management, and 
Effectiveness Measures Could Be Strengthened. [Hyperlink, 
http://www.gao.gov/products/GAO-12-47] Washington, D.C.: November 17, 
2011. 

Urban Area Security Initiative: FEMA Lacks Measures to Assess How 
Regional Collaboration Efforts Build Preparedness Capabilities. 
[Hyperlink, http://www.gao.gov/products/GAO-09-651] Washington, D.C.: 
July 2, 2009. 

Transit Security Grant Program: DHS Allocates Grants Based on Risk, 
but Its Risk Methodology, Management Controls, and Grant Oversight Can 
Be Strengthened. [Hyperlink, http://www.gao.gov/products/GAO-09-491] 
Washington, D.C.: June 8, 2009. 

Homeland Security: DHS Improved its Risk-Based Grant Programs' 
Allocation and Management Methods, But Measuring Programs' Impact on 
National Capabilities Remains a Challenge. [Hyperlink, 
http://www.gao.gov/products/GAO-08-488T] Washington, D.C.: March 11, 
2008. 

Contact Information: 

For additional information about this area, contact David C. Maurer at 
(202) 512-9627 or maurerd@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Since the 1995 bombing of the Alfred P. Murrah Federal Building in 
Oklahoma City, Oklahoma, and the September 11, 2001, terrorist 
attacks, the federal government has made significant changes in its 
approach to protecting federal facilities and the more than 1 million 
employees and members of the public that work in and visit these 
facilities annually. However, federal facilities continue to be 
vulnerable to terrorist attacks and other acts of violence, as 
evidenced by the 2010 attacks on the Internal Revenue Service (IRS) 
building in Austin, Texas, and the federal courthouse in Las Vegas, 
Nevada, which resulted in loss of life. These attacks highlight the 
importance of protecting federal facilities by, among other things, 
conducting timely and comprehensive risk assessments, which can help 
decision makers identify and evaluate potential threats so that 
countermeasures can be implemented to help prevent or mitigate the 
facilities' vulnerabilities to those threats. 

The Department of Homeland Security's (DHS) 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 owned or 
leased by the General Services Administration (GSA).[Footnote 108] 
Risk assessments for federal facilities, which FPS refers to as 
facility security assessments, are to be completed every 3 to 5 years 
according to DHS's Interagency Security Committee (ISC) standards. 
[Footnote 109] FPS's assessments are to include a full examination of 
the facility, including a review of access points to the facility and 
the security of the facility's perimeter, such as closed circuit 
television monitoring and lighting. Its risk assessment process 
entails gathering and reviewing facility information; conducting and 
recording interviews with tenant agencies; assessing the threats, 
vulnerabilities, and consequences associated with a facility; and 
recommending appropriate countermeasures in accordance with ISC 
standards to mitigate vulnerabilities to tenant agencies. 

What GAO Found: 

GAO has found that there is duplication in the federal government's 
approach to assessing risks at some of the 9,000 federal facilities 
managed by GSA. As GAO reported in June 2008 and as it has recently 
found, 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. For 
example, an official from IRS said 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, an 
official from the Federal Emergency Management Agency (FEMA) stated 
that FEMA has assessed its own facilities for several years because of 
dissatisfaction with the security levels FPS has assigned to its 
facilities, and Environmental Protection Agency (EPA) officials said 
that EPA has conducted its own assessments based on concerns with the 
quality and thoroughness of FPS's assessments.[Footnote 110] EPA 
officials also said that the agency's assessments are conducted by 
teams of contractors and EPA employees, cost an estimated $6,000, and 
can take a few days to a week to complete. An official from the U.S. 
Army Corps of Engineers told GAO that it duplicates FPS's assessments 
at some of its regional facilities because the agency follows U.S. 
Army force protection regulations, rather than the security 
requirements followed by FPS. 

According to an FPS official, FPS planned to use its Risk Assessment 
and Management Program (RAMP) to complete assessments of about 700 
federal facilities in fiscal year 2010 and 2,500 facilities in fiscal 
year 2011. However, since November 2009, according to an FPS official, 
the agency has only completed four risk assessments using RAMP, which 
does not provide adequate assurance that FPS is utilizing an effective 
risk management approach to help protect federal facilities and may 
contribute to more agencies completing their own assessments. RAMP was 
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. As GAO reported in July 2011, 
FPS experienced cost overruns, schedule delays, and operational issues 
with developing RAMP and as a result the agency could not use it to 
complete risk assessments. Without risk assessments that identify 
threats and vulnerabilities and the resources required to achieve 
security goals, FPS has only limited assurance that programs will be 
prioritized and resources will be allocated to address existing and 
potential security threats in an efficient and effective manner. GAO 
recommended in July 2011 that FPS develop interim solutions for 
completing risk assessments while addressing RAMP's challenges. FPS 
agreed with this recommendation and is in the process of developing an 
interim assessment tool. 

As noted above, FPS charged federal agencies $236 million in basic 
security fees for risk assessments and security services in fiscal 
year 2011, although FPS has completed few risk assessments using RAMP. 
[Footnote 111] As GAO reported in May 2011, FPS does not know how much 
of the basic security fee is used for completing risk assessments of 
federal facilities. Nonetheless, FPS increased the basic security fee 
from $.66 in fiscal year 2011 to $.74 per square foot in fiscal year 
2012. GAO recommended in May 2011 that FPS make information on the 
estimated costs of key activities, as well as the basis for these cost 
estimates, readily available to affected parties to improve the 
transparency of the process for setting and using the fees. 

Actions Needed and Potential Financial or Other Benefits: 

GAO has found that multiple federal agencies are incurring additional 
costs by completing their own assessments while paying FPS to complete 
risk assessments for the same facilities. However, DHS has not taken 
any actions to address the duplication and it is not clear whether 
FPS's planned risk assessment tool will help minimize duplication. 
Achieving the financial and other benefits that may result from 
reducing duplication and increased cost that occurs in assessing risks 
at federal facilities will require additional effort on the part of 
DHS and other key stakeholders. 

GAO recommended in July 2011 that the Secretary of DHS: 

* direct the Director of FPS to develop interim solutions for 
completing risk assessments while addressing RAMP's challenges. 

GAO recommended in May 2011 that the Director of FPS: 

* make information about the estimated costs of key activities and the 
basis for these estimates available to affected parties to improve 
transparency. 

In addition, DHS should: 

* 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. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to DHS for review and 
comment. DHS agreed with GAO's previous two recommendations and has 
begun action on both. DHS did not provide comments on GAO's newly 
identified action needed. DHS also provided technical comments, which 
were incorporated as appropriate. In its response, DHS stated that 
although FPS has only completed four risk assessments using RAMP, the 
agency is collecting data, through site visits, interviews of facility 
occupants, and evaluation of countermeasures, which will be used to 
generate risk assessments when its interim assessment tool is 
implemented in spring 2012. As part of its routine audit work, GAO 
will track agency action to address these recommendations and report 
to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section and additional 
work GAO conducted to be published as a separate product in 2012. To 
update that information and identify continuing issues related to 
duplication and overlap in risk assessments for federal facilities, 
GAO interviewed officials from FPS, EPA, FEMA, GSA, Immigration and 
Customs Enforcement, IRS, U.S. Army Corps of Engineers, and the 
Department of Veterans Affairs. 

Related GAO Products: 

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. 

Budget Issues: Better Fee Design Would Improve Federal Protective 
Service's and Federal Agencies' Planning and Budgeting for Security. 
[Hyperlink, http://www.gao.gov/products/GAO-11-492] Washington, D.C.: 
May 20, 2011. 

Homeland Security: The Federal Protective Service Faces Several 
Challenges That Raise Concerns About Protection of Federal Facilities. 
[Hyperlink, http://www.gao.gov/products/GAO-08-914T] Washington, D.C.: 
June 18, 2008. 

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. 

Contact Information: 

For additional information about this area, contact Mark Goldstein at 
(202) 512-2834 or goldsteinm@gao.gov and Susan J. Irving at (202) 512-
6806 or irvings@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The Office of Management and Budget (OMB) has reported that the 
federal government spends billions of dollars on information 
technology (IT) investments each year. In fiscal year 2011, there were 
approximately 7,200 investments totaling at least $79 billion. The 
Department of Defense (DOD) reported the largest number of information 
technology (IT) investments (2,383 investments at $37 billion), 
followed by the Department of Energy (Energy) (876 investments and $2 
billion). 

According to OMB's annual budget guidance (beginning with fiscal year 
2004), agencies are required to map each IT investment to a functional 
category and sub-category within the Federal Enterprise 
Architecture.[Footnote 112] These categorizations, known as a primary 
function and subfunction are intended to enable OMB and others to 
analyze investments with similar functions, as well as identify and 
analyze potentially duplicative investments across agencies. 

What GAO Found: 

As GAO reported in September 2011, in their fiscal year 2011 budget 
submissions to OMB on IT spending, agencies reported the greatest 
number of IT investments in the information and technology management 
category (1,536 investments), followed by supply chain management (777 
investments), and human resources management (622 investments). 
[Footnote 113] Similarly, planned expenditures on investments were 
greatest in the information and technology management category, at 
about $35.5 billion. The figure below depicts the total number of 
investments governmentwide per function. 

Figure: Number of IT Investments Governmentwide by Primary Function, 
as of July 2011 (fiscal year 2011 planned expenditures, in billions): 

[Refer to PDF for image: horizontal bar graph] 

Primary function: Information and Technology Management; 
Number of IT investments (dollars in billions): 1,536 ($35.5). 

Primary function: Supply Chain Management; 
Number of IT investments (dollars in billions): 777 ($3.3).  

Primary function: Human Resource Management; 
Number of IT investments (dollars in billions): 622 ($2.4). 

Primary function: Financial Management; 
Number of IT investments (dollars in billions): 580 ($2.7). 

Primary function: Health; 
Number of IT investments (dollars in billions): 444 ($5.0). 

Primary function: General Science and Innovation; 
Number of IT investments (dollars in billions): 372 ($1.6). 

Primary function: Defense and National Security; 
Number of IT investments (dollars in billions): 358 ($9.3). 

Primary function: Administrative Management; 
Number of IT investments (dollars in billions): 301 ($0.8). 

Primary function: Planning and Budgeting; 
Number of IT investments (dollars in billions): 292 ($0.7). 

Primary function: Environmental Management; 
Number of IT investments (dollars in billions): 177 ($1.2). 

Primary function: All other functions; 
Number of IT investments (dollars in billions): 1,789 ($16.2). 

Source: GAO analysis of exhibit 53 data.  

[End of figure] 

GAO reported that OMB provides guidance to agencies on how to report 
on their IT investments, but this guidance does not ensure complete 
reporting or facilitate the identification of duplicative investments. 
Specifically, agencies differ on what investments they include as an 
IT investment; for example, 5 of the 10 agencies GAO reviewed 
consistently consider investments in research and development systems 
as IT, and 5 do not. As a result, federal agencies' annual IT 
investments are likely greater than the $79 billion reported in fiscal 
year 2011. In addition, OMB's guidance to federal agencies requires 
each investment to be mapped to a single functional category. This 
limits OMB's ability to identify duplicative investments both within 
and across agencies because similar investments may be organized into 
different categories. For example, GAO reported on a DOD financial 
management system that was identified in a different functional 
category--supply chain management.[Footnote 114] 

GAO also reported that OMB and federal agencies have undertaken 
several initiatives to address potentially duplicative IT investments. 
For example, OMB has efforts under way to consolidate similar 
functions through its Federal Enterprise Architecture initiative, 
which was developed in 1999. This initiative was intended to provide 
federal agencies with a common construct for their architectures and 
thereby facilitate the coordination of common business processes, and 
system investments among federal agencies. In 2004, we reported that 
the Federal Enterprise Architecture was a work in progress and was 
still evolving.[Footnote 115] To this point, OMB's Chief Architect 
reported that comprehensive changes to the Federal Enterprise 
Architecture are underway and planned for fiscal year 2012. In 
addition, most of the agencies GAO reviewed established guidance for 
ensuring new investments are not duplicative with existing systems. 
However, agencies do not routinely assess operational systems to 
determine if they are duplicative. Therefore, GAO reported that until 
agencies routinely assess their IT investment portfolios to identify 
and reduce duplicative systems, the government's current situation of 
having hundreds of similar IT investments will continue to exist. 

More recently, GAO conducted a review to examine the three largest 
categories of IT investments within DOD, Energy, and the Department of 
Homeland Security (DHS). Specifically, as GAO reported in February 
2012, although DOD, Energy, and DHS use various investment review 
processes to identify duplicative investments, GAO found that 37 of 
GAO's sample of 810 investments were potentially duplicative at DOD 
and Energy (see table below).[Footnote 116] These investments account 
for about $1.2 billion in IT spending for fiscal years 2007 through 
2012, for these two agencies. To identify these potentially 
duplicative investments, GAO reviewed the description of each 
investment's purpose within specific functional categories and 
subcategories to identify similarities among related investments 
within each agency. This formed the basis of establishing groupings of 
similar investments. GAO discussed the groupings with each of the 
selected agencies, and GAO obtained further information from agency 
officials and reviewed and assessed agencies' rationales for having 
multiple systems that perform similar functions. For example, GAO 
identified four DOD Navy personnel assignment investments--one system 
for officers, one for enlisted personnel, one for reservists, and a 
general assignment system--each of which is responsible for managing 
similar functions. The Department of the Navy is implementing an 
executive oversight board and a centralized review process of IT 
investments that officials reported will examine these investments to 
determine if actual duplication exists. The table below summarizes 12 
groups of potentially duplicative investments by purpose and agency, 
which GAO identified. 

Table: Potentially Duplicative Investments for DOD and Energy, as of 
January 2012: 

Department: DOD; 
Branch/bureau: Air Force; 
Purpose: Contract Management; 
Number of investments: 5; 
Planned or actual spending fiscal years 2007-2012: $41 million. 

Branch/bureau: Army; 
Purpose: Personnel Assignment Management; 
Number of investments: 2; 
Planned or actual spending fiscal years 2007-2012: $12 million. 

Branch/bureau: Navy; 
Purpose: Acquisition Management; 
Number of investments: 4; 
Planned or actual spending fiscal years 2007-2012: $407 million. 

Branch/bureau: Navy; 
Purpose: Aviation Maintenance and Logistics; 
Number of investments: 2; 
Planned or actual spending fiscal years 2007-2012: $85 million. 

Branch/bureau: Navy; 
Purpose: Contract Management; 
Number of investments: 5; 
Planned or actual spending fiscal years 2007-2012: $17 million. 

Branch/bureau: Navy; 
Purpose: Housing Management; 
Number of investments: 2; 
Planned or actual spending fiscal years 2007-2012: $5 million. 

Branch/bureau: Navy; 
Purpose: Personnel Assignment Management; 
Number of investments: 4; 
Planned or actual spending fiscal years 2007-2012: $28 million. 

Branch/bureau: Navy; 
Purpose: Promotion Rating; 
Number of investments: 2; 
Planned or actual spending fiscal years 2007-2012: $3 million. 

Branch/bureau: Navy; 
Purpose: Workforce Management; 
Number of investments: 3; 
Planned or actual spending fiscal years 2007-2012: $109 million. 

Branch/bureau: DOD-enterprisewide; 
Purpose: Civilian Personnel Management; 
Number of investments: 2; 
Planned or actual spending fiscal years 2007-2012: $504 million. 

Department: Energy; 
Branch/bureau: Energy Programs; 
Purpose: Back-end Infrastructure; 
Number of investments: 3; 
Planned or actual spending fiscal years 2007-2012: $1 million. 

Department: Energy; 
Branch/bureau: Energy Programs & Environmental and Other Defense 
Activities; 
Purpose: Electronic Records and Document Management; 
Number of investments: 3; 
Planned or actual spending fiscal years 2007-2012: $7 million. 

Department: Total; 
Number of investments: 37; 
Planned or actual spending fiscal years 2007-2012: $1.219 billion. 

Source: GAO analysis of agency data. 

[End of table] 

While GAO did not identify any potentially duplicative investments at 
DHS within GAO's sample, DHS officials have independently identified 
several duplicative investments and systems. Specifically, DHS 
officials have identified and, more importantly, reduced duplicative 
functionality in four investments, including a personnel security 
investment, time and attendance investment, human resources 
investment, and an information network investment. DHS also has plans 
to further consolidate systems within these investments by 2014, which 
is expected to produce approximately $41 million in cost savings. DHS 
officials have also identified 38 additional systems that they have 
determined to be duplicative. For example, officials identified 
multiple personnel action processing systems that could be 
consolidated. 

Officials from the three agencies offered a variety of reasons for the 
potential duplication, such as decentralized governance within the 
department and a lack of control over certain facilities. Further 
complicating agencies' ability to identify and eliminate duplicative 
investments is that investments are, in certain cases, misclassified 
by function. For example, DHS's Federal Emergency Management Agency--
Minor Personnel/Training Systems investment was initially categorized 
within the Employee Performance Management subfunction, but DHS agreed 
that this investment should be assigned to the Human Resources 
Development subfunction. Proper categorization is necessary in order 
to analyze and identify duplicative investments, both within and 
across agencies. GAO reported that until DOD, Energy, and DHS, 
correctly categorize their investments, they are limiting their 
ability to identify opportunities to consolidate or eliminate 
duplicative investments. 

GAO also reported that DHS had taken action to improve its processes 
for identifying and eliminating duplicative investments. For example, 
through reviewing portfolios of IT investments, DHS had identified 
much, and eliminated some, duplicative functionality in certain 
investments--as previously discussed. Additionally, DOD and Energy had 
recently initiated specific plans to address potential duplication in 
many of the investments GAO identified--such as plans to consolidate 
or eliminate systems. While these efforts could eventually yield 
results, DOD's and Energy's initiatives had not yet led to the 
consolidation or elimination of duplicative investments or 
functionality. For example, while DOD and Energy had documented 
milestones for improving their IT investment review processes, 
officials did not provide examples of duplicative investments that 
they had consolidated or eliminated. Therefore, GAO reported that 
until DOD and Energy demonstrate, through existing transparency 
mechanisms, that they are making progress in identifying and 
eliminating duplicative investments, it will remain unclear whether 
they are avoiding investment in unnecessary systems. 

Actions Needed and Potential Financial or Other Benefits: 

To better ensure the agencies avoid investing in duplicative 
investments, GAO recommended in September 2011 that the Director of 
OMB: 

* clarify guidance to federal agencies in reporting on their IT 
investments by specifying whether certain types of systems should be 
included; 

* require federal agencies to report the steps they take to ensure 
that their IT investments are not duplicative as part of their annual 
budget and IT investment submissions; and: 

* revise guidance to federal agencies on categorizing IT investments 
to ensure that the categorizations are clear and allow agencies to 
choose secondary categories. 

Additionally, GAO recommended in February 2012 that the Secretaries of 
DOD and Energy should 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 GAO identified, as well as any 
other duplicative investments. 

GAO also recommended in February 2012 that the Secretaries of DOD, 
Energy, and DHS should direct their Chief Information Officers to: 

* correct the miscategorizations for the investments GAO identified 
and ensure that investments are correctly categorized in agency 
submissions. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its September 2011 report to OMB for review 
and comment. OMB disagreed with the first recommendation and agreed 
with the second and third recommendations. Specifically, OMB officials 
do not plan to implement the first recommendation, because they 
believe guidance already exists on categorizing and identifying IT 
investments. However, GAO believes that the recommendation is 
appropriate because the existing guidance does not address key 
categories of IT investments where GAO found inconsistencies among 
agencies. OMB officials stated that the agency plans to address the 
second and third recommendations through updated guidance and the 
annual budget process. 

GAO provided a draft of its February 2012 report to OMB, DOD, Energy, 
and DHS for review and comment. OMB provided technical comments that 
GAO incorporated, where appropriate. DOD and DHS generally agreed with 
the recommendations, while Energy agreed with the first 
recommendation, but not the second. Specifically, Energy disagreed 
that two of the four investments GAO identified were miscategorized, 
explaining that their categorizations reflect funding considerations. 
However, OMB guidance indicates that investments should be classified 
according to their intended purpose. Consequently, GAO believes the 
recommendation is warranted. 

GAO provided a draft of this report section to OMB for review and 
comment. OMB provided technical comments, which were incorporated as 
appropriate. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. GAO analyzed 
IT investment data and OMB's guidance to federal agencies on IT 
investments, interviewed officials at the 10 federal agencies with the 
largest IT spending in fiscal year 2010[Footnote 117] to understand 
how they implement OMB guidance, and analyzed reports and interviewed 
officials on efforts to address duplicative investments. GAO also 
selected three of the largest agencies with respect to number of 
investments--DOD, Energy, and DHS to identify potentially duplicative 
investments. GAO analyzed a subset of investment data from OMB's IT 
budget data to identify investments with similar functionality. 
Specifically, GAO reviewed 810, or 11 percent, of the approximately 
7,200 IT investments federal agencies report to OMB. GAO's review 
represents approximately 24 percent of DOD's IT portfolio in terms of 
the number of investments that they report to OMB, 19 percent of 
Energy's, and 16 percent of DHS's. GAO then reviewed the name and 
narrative description of each investment's purpose to identify 
similarities among related investments within each agency (GAO did not 
review investments across agencies). This formed the basis of 
establishing groupings of similar investments. GAO discussed the 
groupings with each of the selected agencies, and GAO obtained further 
information from agency officials and reviewed and assessed agencies' 
rationales for having multiple systems that perform similar functions. 
Appendix III lists the programs GAO identified that may have similar 
or overlapping objectives, provide similar services or be fragmented 
across government missions. Overlap and fragmentation may not 
necessarily lead to actual duplication, and some degree of overlap and 
duplication may be justified. 

Related GAO Products: 

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.: February 17, 
2012. 

Information Technology: OMB Needs to Improve Its Guidance on IT 
Investments. [Hyperlink, http://www.gao.gov/products/GAO-11-826] 
Washington, D.C.: September 29, 2011. 

Information Technology: OMB's Dashboard Has Increased Transparency and 
Oversight, but Improvements Needed. [Hyperlink, 
http://www.gao.gov/products/GAO-10-701] Washington, D.C.: July 16, 
2010. 

Information Technology: Management and Oversight of Projects Totaling 
Billions of Dollars Need Attention. [Hyperlink, 
http://www.gao.gov/products/GAO-09-624T] Washington, D.C.: April 28, 
2009. 

Information Technology: OMB and Agencies Need to Improve Planning, 
Management, and Oversight of Projects Totaling Billions of Dollars. 
[Hyperlink, http://www.gao.gov/products/GAO-08-1051T] Washington, 
D.C.: July 31, 2008. 

Information Technology: Further Improvements Needed to Identify and 
Oversee Poorly Planned and Performing Projects. [Hyperlink, 
http://www.gao.gov/products/GAO-07-1211T] Washington, D.C.: September 
20, 2007. 

Information Technology: Improvements Needed to More Accurately 
Identify and Better Oversee Risky Projects Totaling Billions of 
Dollars. [Hyperlink, http://www.gao.gov/products/GAO-06-1099T] 
Washington, D.C.: September 7, 2006. 

Information Technology: Agencies and OMB Should Strengthen Processes 
for Identifying and Overseeing High Risk Projects. [Hyperlink, 
http://www.gao.gov/products/GAO-06-647] Washington, D.C.: June 15, 
2006. 

Information Technology: OMB Can Make More Effective Use of Its 
Investment Reviews. [Hyperlink, 
http://www.gao.gov/products/GAO-05-276] Washington, D.C.: April 15, 
2005. 

Contact Information: 

For additional information about this area, contact David A. Powner at 
(202) 512-9286 or pownerd@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

As of fiscal year 2011, the U.S. government employed over 23,500 
Americans overseas, including nearly 15,000 with the Department of 
State (State), at more than 250 diplomatic and consular posts. The 
operation of these posts requires a wide variety of administrative 
support services for overseas personnel, such as building maintenance, 
vehicle operations, and travel services, among others. U.S. government 
agencies may obtain these services through the International 
Cooperative Administrative Support Services (ICASS) system, the 
principal means by which the U.S. government provides and shares the 
cost of common services. ICASS is an interagency system established in 
1997 for distributing the cost of administrative services at overseas 
posts and is intended to ensure that each agency bears the cost of its 
overseas presence. The ICASS Executive Board, chaired by State and 
comprised of senior representatives from participating agencies, sets 
the strategic vision and policy for ICASS. 

State is the principal--and most often the only--administrative 
service provider at most posts worldwide, and its personnel provide 
virtually all ICASS services. The cost of ICASS, which totaled over $2 
billion in fiscal year 2011, is shared with over 40 participating 
federal agencies, of which State, the U.S. Agency for International 
Development (USAID), and the Departments of Agriculture, Commerce, 
Defense, Health and Human Services, Homeland Security, and Justice are 
the largest, accounting for nearly 95 percent of all ICASS costs. 
Participation is mostly voluntary, as agencies may obtain any or all 
of 31 different services at each overseas post or opt out of ICASS by 
providing services for themselves or obtaining them from another 
source. 

As GAO reported in September 2004, since the establishment of ICASS, 
many agencies had not signed up for ICASS services and decided instead 
to provide similar services for their own staff independently. GAO 
found that this resulted in duplicative administrative systems that 
limited ICASS's ability to achieve economies of scale and deliver 
administrative services efficiently. 

What GAO Found: 

Since 2004, State and other agencies operating overseas have made 
limited progress in reducing the cost of administrative support 
services overseas. Agencies continue to provide many services 
independently, despite economies of scale available through greater 
participation in ICASS. Furthermore, State, the primary provider of 
ICASS services, has not implemented other cost containment measures 
that would significantly reduce the need to employ American 
administrative staff overseas. 

Opting out of ICASS results in potential duplication of administrative 
services and increased costs to the U.S. government. GAO's analysis of 
ICASS data from 2011 shows that agencies continue to obtain 
administrative support services outside of ICASS at overseas posts, 
duplicating services provided through the ICASS system. GAO found that 
when customer agencies had a choice to obtain services outside of 
ICASS, they did so about one-third of the time, on average. ICASS 
participation rates vary widely by agency, but individual agency rates 
have remained relatively constant since 2005, with the exception of 
USAID. USAID has experienced a marked increase in participation since 
it began consolidating its administrative operations with State in 
2005. 

GAO directly observed duplication of administrative services during 
site visits to four overseas missions. For example, at each post 
visited, GAO found that instead of participating in the ICASS-managed 
motor pool, several agencies operated or maintained their vehicles 
independently. In addition, several agencies procured their own 
appliances or shipped their own furniture, declining to participate in 
ICASS furniture and appliance pools, where this would be done 
collectively by ICASS staff. According to the financial management 
officer in Manila, this not only reduces the opportunity to realize 
lower procurement costs through larger bulk purchases, it entails 
other hidden costs, including increased labor and wear and tear on the 
property, as furniture and appliances are removed and reinstalled when 
agency staff move in and out of embassy-managed residences. He noted 
that over a 6-month period in 2010, ICASS service providers had to 
remove and reinstall furniture and appliances at embassy-managed 
residences 67 times as a result of agency officials being replaced in 
a home by officials from a different agency. Such additional work 
would not have been necessary if all agencies subscribed to one 
furniture and appliance pool, as this property would have remained in 
the home where it was originally installed, regardless of the occupant. 

GAO's analysis of ICASS cost and workload data confirms that State and 
other agencies participating in ICASS have realized savings through 
economies of scale. For all 28 ICASS services GAO analyzed, GAO found 
that as ICASS workloads increased--for example, through increased 
participation in ICASS services or growth in staff posted overseas--
service provision became more efficient and costs per unit of output 
decreased (see table below). However, GAO was unable to estimate the 
specific cost implications for new ICASS customers, as other agencies 
that had opted out of ICASS could not provide GAO with comparable cost 
data to those which ICASS collects. 

Table: ICASS Participation Rates for 2011 and Potential Savings 
through Economies of Scale for Selected Administrative Services: 

Administrative service: Property management[A]; 
Percentage of agencies obtaining service through ICASS: 70.6%; 
Estimated change in unit cost with 10 percent increase in workload: 
-9.1%. 

Administrative service: Furniture, furnishings, and appliance pools; 
Percentage of agencies obtaining service through ICASS: 57.5; 
Estimated change in unit cost with 10 percent increase in workload: 
-8.4%. 

Administrative service: Pouch services; 
Percentage of agencies obtaining service through ICASS: 50.2; 
Estimated change in unit cost with 10 percent increase in workload: 
-7.0%. 

Administrative service: Travel services; 
Percentage of agencies obtaining service through ICASS: 70.7; 
Estimated change in unit cost with 10 percent increase in workload: 
-6.2%. 

Administrative service: Photocopying services; 
Percentage of agencies obtaining service through ICASS: 28.0; 
Estimated change in unit cost with 10 percent increase in workload: 
-6.2%. 

Administrative service: Shipment and customs; 
Percentage of agencies obtaining service through ICASS: 66.2; 
Estimated change in unit cost with 10 percent increase in workload: 
-6.1%. 

Administrative service: Administrative supply; 
Percentage of agencies obtaining service through ICASS: 56.5; 
Estimated change in unit cost with 10 percent increase in workload: 
-5.6%. 

Administrative service: Procurement services; 
Percentage of agencies obtaining service through ICASS: 75.4; 
Estimated change in unit cost with 10 percent increase in workload: 
-5.6%. 

Administrative service: Motor pool services; 
Percentage of agencies obtaining service through ICASS: 45.1; 
Estimated change in unit cost with 10 percent increase in workload: 
-4.8%. 

Source: GAO analysis of ICASS data. 

[A] Includes inventory management, warehousing, and issuance of office 
and residential furniture, furnishings, and appliances; does not 
include real property. 

[End of table] 

According to the results of GAO's survey of agency representatives, 
decisions to opt out of ICASS services are based on various factors, 
the most frequently cited of which were concerns about cost. GAO's 
survey results indicated that some agency representatives who obtained 
a specific service outside of ICASS believed that doing so was less 
expensive than obtaining this service through ICASS. However, several 
respondents indicated that their decisions to opt out of ICASS were 
not based on any formal cost analyses. Agencies also chose not to 
participate in ICASS for a variety of other reasons. In some cases, 
agency representatives said that they could obtain some services from 
their headquarters more efficiently than through ICASS. In other 
cases, officials indicated that they would be unable to fulfill their 
agency's mission if they relied on ICASS services. For example, some 
Department of Homeland Security officials said they needed to maintain 
their own vehicles to have immediate, 24 hours-a-day access for them 
to conduct investigations. Also, several USAID and Department of 
Agriculture officials noted that their missions require them to take 
extended trips to the field that the ICASS motor pool is sometimes not 
able to accommodate. 

Another frequently cited reason for opting out of ICASS was concern 
about the quality of ICASS services. While results from the annual 
ICASS survey and GAO's survey of U.S. government agency 
representatives show overall satisfaction with the quality of ICASS 
services generally, some dissatisfaction with ICASS performance still 
exists, particularly among USAID staff. Officials from USAID and other 
agencies have indicated that performance problems could affect their 
ability to achieve their respective mission efficiently and 
effectively in some cases. In particular, USAID officials have cited 
the unavailability of ICASS motor pool vehicles for travel to distant 
project sites as a major impediment to its ability to monitor 
development programs. While agencies may have valid justifications for 
not participating in ICASS services, they generally do not document 
their rationales or formally share them with ICASS service providers 
or other customer agencies. Nor do State or ICASS systematically 
request such analyses or document the reasons why agencies choose not 
to subscribe to an ICASS service. 

The voluntary nature of ICASS has permitted the continuation of 
duplicative services, as agencies often make decisions about 
participating in ICASS based on their own costs and not the costs to 
the U.S. government as a whole. GAO recommended in September 2004 that 
the ICASS Executive Board encourage greater ICASS participation. The 
board agreed and has taken some steps to reduce duplication of 
administrative services, particularly between State and USAID. 
However, according to ICASS officials, experience has shown that board 
members do not necessarily have the incentive to require their 
agencies to participate in ICASS. In this context, congressional 
action may be necessary to increase participation in ICASS. 

One of ICASS's primary goals is to contain or reduce administrative 
costs. Yet State, as the primary ICASS service provider, has made 
limited progress in containing costs by reducing the need for American 
administrative staff overseas. GAO recommended in September 2004 that, 
in addition to pursuing the elimination of duplicative administrative 
support structures, the ICASS Executive Board seek to contain ICASS 
cost by reengineering administrative processes and employing 
innovative managerial approaches through competitive sourcing, 
regionalization of services, improved technology, and adoption of 
other best practices developed by agencies and other posts. GAO 
further noted that State had undertaken several initiatives to 
increase the efficiency of ICASS services, primarily by reducing the 
need for administrative staff overseas. 

However, according to ICASS management officials, State has 
discontinued these efforts without demonstrating significant progress 
in containing costs. For example, State did not fully implement a 
pilot effort to streamline services by requiring ICASS service 
providers and ICASS Councils to rationalize administrative staffing 
levels. Moreover, State did not execute its plans to relocate some 
administrative support activities from overseas to the Florida 
Regional Center in Fort Lauderdale, which State estimated in 2004 
would save ICASS customers up to $140 million over 5 years. According 
to State and ICASS management officials, State discontinued these 
efforts because it determined that the potential cost savings did not 
outweigh the administrative burden of fully implementing them. 
Furthermore, they indicated that State has not undertaken any other 
comparable streamlining efforts that would lower costs significantly. 

State has implemented a wide variety of smaller scale innovations that 
have increased the efficiency of ICASS service delivery and reduced 
costs. For example, State established a "post support unit" to provide 
vouchering services to more than 90 posts worldwide from three central 
locations. State also implemented a global network energy management 
program, which has reportedly reduced energy costs by almost $900,000 
in its first 10 months. Other than this initiative, State has not 
identified the specific cost impacts of these innovations. State 
anticipates future cost savings from innovative approaches to 
procuring air freight pouch and mail services and information 
technology. 

The ICASS Executive Board has had limited power to effectuate 
reengineering and innovation in administrative processes, as State 
maintains control over virtually all of these processes as both the 
primary provider and customer of ICASS services. Officials from nearly 
every agency GAO met with expressed concern about State's failure to 
contain the cost of the ICASS services it provides. In particular, 
agency officials in Washington and at the overseas posts GAO visited 
commonly complained that State employed too many American staff 
overseas to provide administrative services instead of relying on much 
less expensive locally employed staff or outsourcing to local firms. 
[Footnote 118] 

Furthermore, State has not sought to maximize the cost-effectiveness 
of ICASS services by ensuring that the most appropriate agency deliver 
these services at all posts. In some instances of duplication GAO 
observed, GAO noted that USAID appeared to have more expertise in 
providing a particular service than the existing State ICASS provider, 
potentially making USAID a reasonable alternate ICASS service 
provider. For example, in Nairobi, USAID operates a copy center for 
its own staff inside the embassy compound, offering more specialized 
services, including digitization, than the ICASS copy center provides. 

State's Foreign Affairs Handbook recognizes that an agency other than 
State may be better positioned to be the principal provider of 
specific services for themselves and other agencies at a given post. 
It allows for the use of these alternate service providers in cases 
where an agency has a sufficiently large administrative support 
capability at a location and agrees to provide services to other 
agencies at that post. However, in 2006, State and USAID, in the 
interest of simplifying and expediting the consolidation of their 
administrative operations overseas, adopted a policy effectively 
restricting the establishment of new alternate ICASS service providers. 

As a result, in 2012, only seven posts had such a provider for one or 
more ICASS service, potentially limiting opportunities for ICASS to 
achieve greater efficiency and effectiveness. In 2010, Task Force 11, 
a joint State-USAID group supporting the development of the 
Quadrennial Diplomacy and Development Review,[Footnote 119] 
recommended that posts consider the use of alternate service providers 
in order to reduce costs. Task Force 11 also proposed that State and 
USAID establish a Joint Management Board and formulate a consolidation 
policy that considers the use of alternate providers. However, the 
Joint Management Board, created in August 2011, has not yet 
established such a policy. 

Actions Needed and Potential Financial or Other Benefits: 

To contain costs and reduce duplication of administrative support 
services overseas, GAO recommended in January 2012 that Congress may 
wish to consider: 

* requiring agencies to participate in ICASS services unless they 
provide a business case to show that they can obtain these services 
outside of ICASS without increasing overall costs to the U.S. 
government or that their mission cannot be achieved within ICASS. 

GAO also recommended in January 2012 that the Secretary of State 
should: 

* increase the cost-effectiveness of ICASS services by continuing to 
reengineer administrative processes and seek innovative managerial 
approaches, including those that would reduce the reliance on American 
officials overseas to provide these services. 

Furthermore, where agencies are able to demonstrate, through a 
compelling business case, that they can provide a service more 
efficiently than the existing State ICASS provider without adverse 
effects on the overall government budget, GAO recommended in January 
2012 that the Secretary of State and the Administrator of USAID should: 

* allow the creation of new ICASS service providers, in lieu of State, 
that could provide administrative services to the other agencies at 
individual posts. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its January 2012 report to State, USAID, and 
the Departments of Agriculture, Commerce, Defense, Health and Human 
Services, Homeland Security, and Justice for review and comment. 
State, USAID, and the Departments of Agriculture, Commerce, and 
Homeland Security provided written comments. The Departments of 
Defense, Health and Human Services, and Justice provided technical 
comments, which were incorporated as appropriate. State and USAID 
generally agreed with GAO's recommendations. However, while State 
agreed that continued efforts are needed to increase the cost-
effectiveness of ICASS services, it did not agree that such actions 
have not been undertaken or that such efforts would substantially 
reduce the need for the American management staff abroad. GAO added 
information about State's other cost-reduction efforts to the draft, 
noting that they were of a smaller scale than those State had 
indicated in 2004 that it would undertake. Given the relatively high 
cost of posting American staff overseas compared to engaging staff 
locally, GAO believes that even minor modifications in staffing could 
have significant cost implications and should be thoroughly explored, 
in close coordination with ICASS-participating agencies. 

The Departments of Agriculture, Commerce, and Homeland Security took 
issue with GAO's finding that nonparticipation in ICASS services 
reflects potential duplication of administrative services overseas, 
and with GAO's suggestion that Congress consider requiring agencies to 
participate in ICASS services unless they provide a business case to 
justify opting out. In particular, these agencies noted that ICASS 
customers have a variety of valid reasons for not participating in 
ICASS services and expressed concern that developing business cases to 
justify nonparticipation would be overly burdensome. GAO believes 
that, while agencies may have valid reasons for not participating in 
some ICASS services, the voluntary nature of ICASS has permitted 
agencies to opt out of the system without conducting rigorous cost 
analyses. Without such analyses, agencies are making decisions about 
participating in ICASS based on their own costs--or perceptions of 
cost--and not necessarily the overall cost to the U.S. government. GAO 
believes that if conducted in close coordination with the ICASS 
Service Center and other participating agencies, preparing business 
cases need not be overly burdensome and could lead to significant, 
long-term savings for the U.S. government that would justify the 
additional effort. As part of its routine audit work, GAO will track 
the extent to which progress has been made to address the identified 
actions and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. GAO analyzed 
data and documentation on ICASS participation and costs from 2000 
through 2011; interviewed cognizant staff at the 8 agencies with the 
largest overseas presence; and surveyed representatives from these 
agencies at posts around the world. GAO staff conducted fieldwork in 
Japan, Kenya, the Philippines, and Rwanda, where they observed 
administrative services, met with embassy management officials, and 
conducted focus groups of ICASS customers. GAO performed its work from 
August 2010 to January 2012. 

Related GAO Products: 

Embassy Management: State Department and Other Agencies Should Further 
Explore Opportunities to Save Administrative Costs Overseas. 
[Hyperlink, http://www.gao.gov/products/GAO-12-317] Washington, D.C.: 
January 31, 2012. 

New Embassy Compounds: State Faces Challenges in Sizing Facilities and 
Providing for Operations and Maintenance Requirements. [Hyperlink, 
http://www.gao.gov/products/GAO-10-689] Washington, D.C.: July 20, 
2010. 

Embassy Management: Actions Are Needed to Increase Efficiency and 
Improve Delivery of Administrative Services. [Hyperlink, 
http://www.gao.gov/products/GAO-04-511] Washington, D.C.: September 7, 
2004. 

Contact Information: 

[End of section] 

For additional information about this area, contact Michael Courts at 
(202) 512-8980 or courtsm@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Eliminating the threat of terrorist attacks continues to be a primary 
U.S. national security focus. According to the 9/11 Commission, 
constraining the mobility of terrorists is one of the most effective 
weapons in fighting terrorism. The U.S. government has identified four 
key gaps in foreign countries' capacity to prevent terrorist travel 
overseas, including a key gap in our foreign partners' ability to 
address the use of fraudulent travel documents. As a result, U.S. 
agencies have undertaken a variety of efforts to enhance our foreign 
partners' capacity to identify and interdict fraudulent travel 
documents (i.e., passports and visas). 

What GAO Found: 

As GAO reported in June 2011, seven different U.S. government entities 
across three federal agencies are involved in providing training to 
foreign government officials to detect fraudulent travel documents. 
[Footnote 120] In delivering the training, agencies have similar 
objectives and often train the same populations (e.g., immigration 
officials and law enforcement officials) to develop their skills in 
recognizing the characteristics of altered, counterfeit, or other 
fraudulent travel documents, sometimes in the same country. 

Figure: U.S. Agencies and Bureaus Involved in Providing Fraudulent 
Travel Document Recognition Training to Foreign Immigration and Law 
Enforcement Officials: 

Figure: U.S. Agencies and Bureaus Involved in Providing Fraudulent 
Travel Document Recognition Training to Foreign Immigration and Law 
Enforcement Officials: 

[Refer to PDF for image: illustration] 

Foreign Immigration and Law Enforcement Officials: 
Training provided by: 

Bureau of Diplomatic Security; 
U.S. Immigration and Customs Enforcement; 
Office of the Coordinator for Counterterrorism; 
U.S. Customs and Border Protection; 
Bureau of International Narcotics and Law Enforcement Affairs; 
Transportation Security Administration; 
Federal Bureau of Investigation. 

Sources: GAD analysis of agency data and information: Corel and Art 
Explosion (clip art). 

[End of figure] 

As GAO reported in June 2011, the federal entities in the above figure 
provided the following training to foreign officials in fraudulent 
travel document recognition: 

* The Bureau of Diplomatic Security within the Department of State 
(State) provided 458 instructor-led courses on fraudulent travel 
documents through their staff posted overseas and, in collaboration 
with State's Bureau of Counterterrorism, provided an additional 12 
courses in fraudulent travel document recognition through their Anti-
Terrorism Assistance (ATA) program. 

* Immigration and Customs Enforcement (ICE) within the Department of 
Homeland Security (DHS) provided 360 training courses, briefings, and 
outreach sessions through their attachés stationed overseas, and 
through their Office of International Affairs provided 4 additional 
courses instructed by officials traveling from Washington, D.C. 

* State's Bureau of International Narcotics and Law Enforcement 
Affairs, through the International Law Enforcement Academies, provided 
two courses specifically on fraudulent travel document recognition and 
five courses that covered this topic as part of longer, general law 
enforcement training. In addition, this State bureau provided funding 
to the U.S. Customs and Border Protection (CBP) within DHS for one 
training course and to arrange six trips of foreign officials to the 
United States through the International Visitors Program for this 
purpose and to the Organization of American States to deliver training 
in fraudulent document recognition throughout the Western Hemisphere. 

* The Transportation Security Administration within DHS funded one 
fraudulent travel document training course, as part of its Aviation 
Security Sustainable International Standards Teams. 

* CBP within DHS, through its Office of International Affairs, funded 
one course in fraudulent document recognition for law enforcement 
officials. 

* The Federal Bureau of Investigation within the Department of Justice 
did not fund or implement any such training in fiscal year 2010; 
however, in March 2011, it organized one such training session. 

Officials from State's Bureau of Counterterrorism--which coordinates 
and supports the development and implementation of all U.S. government 
policies and programs aimed at countering terrorism overseas--told GAO 
they had been unaware of how many agencies and subagencies are 
involved in providing fraudulent travel document training to foreign 
officials. They added that no mechanism existed to encourage 
coordination among all the parties involved. At the country level, 
during site visits in March 2011, GAO found that agency officials at 
two of the four posts it visited did not always collaborate on the 
delivery of fraudulent travel document recognition training. As a 
result, some planned training was duplicative and did not make an 
effective use of limited resources. 

* In Pakistan, GAO identified two agencies, State and DHS, planning to 
provide fraudulent travel document recognition training courses in 
April 2011 to Pakistani officials from the same agency without 
coordinating with one another. An attaché from DHS/ICE planned one 
course, while State's ATA program was simultaneously planning to hold 
two other fraudulent travel document courses in the same month. 
Meanwhile, the ICE attaché had been certified to be an instructor for 
fraudulent travel document recognition courses through a train-the-
trainer course provided by ICE's Forensic Document Laboratory. Since 
ATA program officials were unaware of the existence of this local 
resource, the ATA program was still attempting to find two instructors 
from ICE to travel to Pakistan to teach their planned courses. 

* In Kenya, GAO found that representatives from two U.S. agencies, 
State and DHS, deliver fraudulent travel document training but do not 
collaborate. State provides such training through its ATA program and 
through an in-country representative of their Bureau of Diplomatic 
Security, while an in-country representative of DHS's CBP also 
provided many such training courses. Despite these three 
representatives providing this similar training, a representative from 
one of the agencies stated that although he coordinated with other 
countries providing similar training in Kenya, he did not do so with 
other U.S. agencies. 

Actions Needed and Potential Financial or Other Benefits: 

GAO recommended in June 2011 that the Secretary of State should: 

² develop a mechanism to enhance coordination among the agencies 
involved in funding and implementing fraudulent travel document 
training overseas. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its June 2011 report to State for review and 
comment. State agreed with GAO's previous recommendation and reported 
that efforts to enhance such coordination have begun at the country 
level. As part of its routine audit work, GAO will track the extent to 
which progress has been made to address the identified actions and 
report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. GAO reviewed 
the strategies and documentation of U.S. agencies funding and/or 
implementing foreign capacity-building efforts to prevent terrorist 
travel overseas, including those of State, DOD, DHS, the Department of 
Justice, and the U.S. Agency for International Development. GAO met 
with these agencies and conducted field work in Kenya, Pakistan, the 
Philippines, and Thailand. 

Related GAO Product: 

Combating Terrorism: Additional Steps Needed to Enhance Foreign 
Partners' Capacity to Prevent Terrorist Travel. [Hyperlink, 
http://www.gao.gov/products/GAO-11-637] Washington, D.C.: June 30, 
2011. 

Contact Information: 

For additional information about this area, contact Charles Michael 
Johnson, Jr. at (202) 512-7331 or johnsoncm@gao.gov. 

[End of section] 

22. Coordination of Space System Organizations: 

Fragmented leadership has led to program challenges and potential 
duplication in developing multibillion-dollar space systems. 

Why This Area Is Important: 

U.S. government space systems provide a wide range of capabilities 
such as Global Positioning System, weather, climatology, meteorology, 
missile warning, and secure communications to a large number of users, 
including the Department of Defense (DOD), the intelligence community, 
civil agencies, U.S. businesses and citizens, and/or other countries. 
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--
with different program offices that oftentimes separately plan, 
acquire, and deploy individual system components. Moreover, the 
nation's satellites are put into orbit by rockets that can cost more 
than of $100 million per launch. Given these components, often costing 
billions of dollars to acquire, recent GAO studies have shown that 
costs of space programs tend to increase significantly from initial 
cost estimates. A May 2011 GAO testimony showed that estimated costs 
for the major Defense space acquisition programs have increased by 
about $13.9 billion from initial estimates for fiscal years 2010 
through 2015, almost a 286 percent increase. NASA space programs have 
also wrestled with excessive cost growth. While many of the programs 
have provided users with important and useful capabilities, GAO and 
others have reported for a number of years that, in some cases, 
problems with these systems have been so severe that acquisitions were 
either canceled or the needed capabilities were severely delayed, and 
that fragmented leadership has been a factor in some of these problems. 

What GAO Found: 

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. Past studies and reviews examining the leadership, 
organization, and management of national security space have found 
that there is no single authority responsible below the President for 
integrating space programs, and responsibilities for acquiring space 
systems are diffused across various DOD organizations--including the 
military services and the Missile Defense Agency--as well as the 
intelligence community and the National Aeronautics and Space 
Administration (NASA). A variety of other agencies, such as the 
Federal Aviation Administration, the National Oceanic and Atmospheric 
Administration (NOAA), and the Department of Homeland Security rely on 
government space systems to execute their missions. As indicated in 
these studies and reviews, each military service or agency that 
acquires space systems has its own lines of acquisition authority, 
even though many of the larger programs, such as the Global 
Positioning System and those to acquire imagery and environmental 
satellites, are integral to the execution of multiple agencies' 
missions. With multiagency space programs, success is often only 
possible with cooperation and coordination; however, successful and 
productive coordination appears to be the exception and not the rule. 

GAO previously reported on how this fragmented leadership and lack of 
coordination has contributed to problems for the development, 
acquisition, and fielding of space programs. Examples of programs 
affected and their challenges are presented in the table below. 

Table: Selected Space Programs GAO Reviewed Where Fragmentation and 
Lack of Coordination Affected Development and Acquisition: 

Program name: Global Positioning System (GPS); 
Problems resulting from a lack of coordination: The GPS program is 
currently being modernized to replace and update the aging satellite 
constellation with new GPS satellites, which will provide warfighters 
with a stronger and more secure military signal. Moreover, there is an 
interagency structure in place to help coordinate requirements and 
resolve issues related to GPS. However, modernized military user 
equipment that DOD is concurrently developing with the new satellites 
has suffered schedule delays and is not expected to be fully fielded 
to all of the military services until 2025--10 years after the new 
military signal from the satellites is expected to reach full 
operational capability. GAO previously reported in April 2009 that the 
coordination of the satellite 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. DOD has taken some steps to 
better coordinate the GPS segments. DOD created the Space and 
Intelligence Office within the Office of the Under Secretary of 
Defense for Acquisition, Technology, and Logistics to ensure that all 
three segments of GPS stay synchronized in the development and 
acquisition processes. However, that office does not have authority 
over all user equipment. DOD also conducted enterprise reviews of the 
program; however, it has not gone as far as GAO recommended to 
establish a single authority responsible for ensuring that all GPS 
segments, including user equipment, are synchronized to the maximum 
extent practicable. 

Program name: The National Polar-orbiting Operational Environmental 
Satellite System (NPOESS); 
Problems resulting from a lack of coordination: NPOESS was an attempt 
to converge defense and civil environmental monitoring requirements 
and avoid duplication through a tri-agency program office, with each 
participating agency (DOD, NOAA, and NASA) having the lead on certain 
activities but no single authority to adjudicate conflicts or set 
priorities. Along with technical and design challenges that arose from 
decisions related to requirements, the lack of an effective leadership 
structure to prioritize requirements and resolve interagency conflicts 
contributed to restructuring of NPOESS. GAO previously reported in 
June 2009 that the interagency program structure did not effectively 
fulfill its responsibilities and did not have the ability to 
effectively or efficiently oversee and direct the NPOESS program. No 
authority at a level higher than the involved agencies was charged 
with coordinating the program to ensure resources were used for the 
greatest need, and this led to significant program delays. By the end 
of fiscal year 2010, the U.S. government had spent 16 years and over 
$5 billion to develop NPOESS, but had not launched a single satellite, 
resulting in a potential capability gap for weather and environmental 
monitoring. Consequently, in February 2010, citing the program's cost 
overruns, schedule delays, and management problems, the White House 
Office of Science and Technology Policy announced that the NPOESS tri-
agency structure would be eliminated and the program would be 
restructured by splitting procurements and responsibilities.[A] Given 
this restructuring, GAO recommended in May 2010 that NOAA and DOD 
establish plans to mitigate key risks in transitioning from NPOESS to 
the successor satellite programs, including ensuring effective 
oversight of program management, and addressing cost and schedule 
implications from contract and program changes. GAO reported that both 
agencies have acknowledged these risks, but have not yet established 
plans to mitigate these risks. For example, NOAA could not provide 
firm time frames for completing its management control plan and DOD 
never formally started its follow-on space weather satellite program, 
though it was attempting to pull together key acquisition documents. 
Moving forward, it will be important for the agencies to continue 
efforts to mitigate these risks in order to ensure the success of 
their respective environmental monitoring programs. 

Program name: Space Radar; 
Problems resulting from a lack of coordination: The Space Radar 
program faced significant affordability issues, along with leadership 
and management challenges that eventually contributed to the program's 
cancellation. Started in 2003, Space Radar was a collaborative effort 
between DOD and the intelligence community to provide global, all-
weather, day and night intelligence, surveillance, and reconnaissance 
capabilities, particularly in denied areas. Space Radar was to consist 
of a constellation of satellites, a ground system, and a 
communications network that included ground-, air- , ship-, and space-
based platforms. The initial cost estimate for Space Radar was between 
$20 and $25 billion, but the program did not have long-term funding 
agreements in place or an adjudication process for prioritizing and 
resolving the tasking from various users. GAO previously reported in 
August 2007 that cooperation between DOD and the intelligence 
community on the program could face challenges and an independent 
review found that the program lacked an effective way to resolve 
disagreements between the partners. Further, the program faced 
challenges including a potentially accelerated schedule, questions 
about system affordability, and difficulty defining key requirements. 
By 2008, DOD and the intelligence community decided to stop developing 
the Space Radar program, citing affordability issues, even though 
millions of dollars had already been spent and no immediate follow-on 
effort was continued to leverage this investment. 

Program name: Space Situational Awareness; 
Problems resulting from a lack of coordination: GAO previously 
reported in May 2011 that Space Situational Awareness acquisition 
efforts experienced challenges due to a lack of governmentwide 
authority. Space Situational Awareness efforts are designed to 
mitigate threats to U.S. space systems via a variety of space-and 
ground-based sensors and systems that detect, track, and characterize 
space objects and space-related events, and forecast which assets may 
be at risk. DOD has responsibility, with support from the Director of 
National Intelligence, for the development, acquisition, operation, 
maintenance, and modernization of Space Situational Awareness 
capabilities governmentwide. The Space Situational Awareness community 
consists of a diverse and large array of stakeholders, and while the 
National Space Policy assigns Space Situational Awareness 
responsibility to the Secretary of Defense, the Secretary cannot 
direct resources to the highest priority systems if they belong to an 
agency outside DOD, or ensure that agencies are setting aside funding 
needed for Space Situational Awareness over the long term. This 
complicates program oversight and operations and presents significant 
challenges to executing and overseeing the Space Situational Awareness 
mission. GAO has reported that development efforts have been hampered 
by cost, schedule, and performance challenges, and that in the past 5 
fiscal years DOD has not delivered significant new Space Situational 
Awareness capabilities as originally expected. GAO also reported that 
the new National Space Policy increases the number of stakeholders 
that must participate in the development of planning documents that, 
among other things, identify the roles to manage national security 
space capabilities and develop specific measures for improving Space 
Situational Awareness capabilities. While identifying roles and having 
input from more Space Situational Awareness stakeholders are positive 
first steps and may result in more inclusive and robust planning 
efforts, it is too early to assess the effect of these provisions on 
managing and overseeing governmentwide Space Situational Awareness 
efforts. 

Source: GAO analysis of Department of Defense and GAO information. 

[A] The announcement accompanied the release of the President's fiscal 
year 2011 budget request. 

[End of table] 

In addition, based on preliminary ongoing work, GAO has found the 
potential for duplication among satellite operations infrastructure 
within the federal government. This preliminary work indicates that 
there are multiple stove piped ground systems and duplication of 
facilities and hardware. This preliminary work also indicates the 
potential for duplication with satellites across the government in 
certain mission areas, such as for remote sensing. GAO plans to 
further examine these efforts in more detail in the near future. 

Since late 2009, DOD has taken 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. To improve leadership over space acquisitions, DOD has 
(1) established the Defense Space Council to serve as the principal 
advisory forum to inform, coordinate, and resolve all DOD space 
issues, to include implementation of the National Security Space 
Strategy; (2) designated the Under Secretary of Defense for 
Acquisition, Technology and Logistics (USD AT&L) to serve as the 
Office of the Secretary of Defense focal point for space programs; (3) 
reaffirmed the Secretary of the Air Force as the DOD Executive Agent 
for Space, to integrate and assess DOD's overall space program, 
provide recommended adjustments to the space budget and facilitate 
increased cooperation with the Intelligence Community and (4) 
eliminated organizations believed to be redundant and/or ineffective. 
DOD officials also cite various changes at the Air Force level that 
better align and unify space acquisition. Further, the new National 
Space Policy that was issued in 2010 also takes some steps to 
clarifying responsibilities for space programs among government 
entities. These changes hold promise to strengthen unity of efforts 
across DOD's space portfolio as they seek to streamline authority for 
acquisitions, establish a process for prioritizing investments, and 
develop tools to ensure greater coordination. However, it is too early 
to determine if they resolve fragmentation that exists within DOD and 
between DOD and the intelligence community. Moreover, they do not 
extend to the space activities across the government. 

In addition, according to OMB, the administration has taken several 
steps to enhance the coordination of space activities among and 
between civil and national security agencies including (1) conducting 
Interagency Policy Committee meetings on government-wide space-related 
issues; (2) creating and supporting agency-led coordination mechanisms 
for specific space topics or programs where appropriate; and (3) 
tasking agencies to develop joint plans and responses for addressing 
cross-sector space challenges, such as improving U.S. launch 
infrastructure or enhancing space situational awareness. While these 
steps may help increase coordination among agencies, they do not 
appear to set funding priorities and it is unclear whether they will 
help to resolve the conflicts between agencies that have lead to 
management and acquisition problems. 

GAO has not made recommendations with regard to broader governmentwide 
leadership for space, but in previous reports GAO has recommended a 
number of changes to the leadership of specific sectors of the space 
community, including (1) assigning a single authority to oversee the 
development of the overall GPS capability, with authority to ensure 
DOD space, ground control, and user equipment are synchronized to the 
maximum extent practicable and (2) increasing coordination of launch 
vehicle acquisitions across federal agencies in order to increase 
efficiencies and cost savings. Several congressional commissions and 
other studies have also made recommendations for strengthening 
national security space authorities, including establishing a new 
Under Secretary of Defense for Space who would have authority over the 
planning and execution of the national security space program and a 
senior interagency group to focus on policy formulation and 
coordination of space activities. But these commissions did not look 
at the need for an authority that would also cover civilian agencies 
with space responsibilities. 

Actions Needed and Potential Financial or Other Benefits: 

GAO and others have 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 still looms 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. Working with the National Security Council, the 
Director of Office of Management and Budget should: 

* assess whether a construct analogous to the Defense Space Council 
could be applied government wide or if a separate organization should 
be established that would have greater authority for setting 
priorities than individual departments and agencies as well as 
responsibility for strategic planning. Given the complexity, 
diversity, and sensitivity of the many organizations involved in space 
and long-standing resistance to centralized leadership structures or 
even partnerships among agencies, we realize such an action could not 
be implemented quickly and would require a phased implementation 
approach. 

Having a single authority responsible for ensuring coordination and 
setting priorities between U.S. space entities could have numerous 
benefits. It could reduce the fragmentation of authority and 
leadership in the space community and thereby help ensure coordination 
between multiple players, and improve synchronization of space program 
acquisitions to help avoid the past problems of interdependent 
capabilities coming online at different times. In addition, this 
authority would be in a better position than any one department or 
agency to determine the best use of limited funds and resources by 
more effectively prioritizing the most highly needed space programs, 
and would have the authority to reduce duplication across programs. 
While the Defense Space Council could fill the role as a single high 
level authority within DOD, this same construct could be used, such as 
a National Space Council, to coordinate and set priorities across the 
government. 

Agency Comments and GAO's Evaluation: 

DOD has expressed mixed views on the need for clearer lines of 
authority for space. For example, DOD agreed with GAO's recommendation 
in April 2009 to appoint a single authority to oversee the development 
of the GPS system, including space, ground control, and user equipment 
assets, to ensure that the program is well executed, resourced, and 
that potential disruptions are minimized. But it asserted that GPS's 
current leadership structure was sufficient. Before GAO issued its May 
2011 report on space situational awareness, the administration issued 
the new National Space Policy, which has the potential to resolve 
concerns GAO identified with leadership. In responding to this 
assessment, DOD acknowledged the need for a cleaner space and 
acquisition leadership structure. DOD officials believe that space 
acquisition programs have turned a corner and are successfully 
deploying far more capable systems in almost all major space mission 
areas. NASA and the National Reconnaissance Office did not have 
comments on this assessment. 

The Office of Management and Budget agreed that coordinating space 
activities across the U.S. government has been and continues to be a 
major challenge, but is concerned that the GAO recommendation would 
add an extra layer of space bureaucracy on top of ongoing coordination 
efforts.OMB acknowledges the potential for improved coordination, but 
is concerned about additional costs and possible confusion regarding 
roles and authorities among the existing mechanisms. GAO believes that 
the recommendation is sufficiently flexible to allow for an 
implementation approach that would address these concerns. As part of 
GAO's routine audit work, GAO will continue to track agency actions to 
address these recommendations and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. In previous 
work to assess DOD's Space Situational Awareness efforts to determine 
the extent to which an integrated approach was being used to manage 
and oversee efforts to develop Space Situational Awareness 
capabilities, GAO analyzed documents and interviewed officials from 30 
organizations within the Space Situational Awareness stakeholder 
community--users and providers of Space Situational Awareness 
information represented by DOD, the intelligence community, civil 
government agencies, and commercial industry--to examine (1) 
management and oversight efforts to develop, acquire, and manage Space 
Situational Awareness capabilities; and (2) planning activities for 
Space Situational Awareness architectures, investments, and 
requirements. GAO also analyzed documentation and interviewed 
officials from DOD and commercial industry to assess the benefits and 
challenges relating to DOD's implementation of its Space Situational 
Awareness-sharing program (formerly the Commercial and Foreign 
Entities program) under which Space Situational Awareness information 
is to be shared among DOD, industry, and foreign entities for 
collision avoidance purposes. In previous work to assess GPS 
coordination efforts, GAO reviewed recent documentation regarding the 
delivery of capabilities and equipment and assessed the level of 
synchronization among satellites, ground systems, and user equipment. 

Related GAO Products: 

Space Acquisitions: Development and Oversight Challenges in Delivering 
Improved Space Situational Awareness Capabilities. [Hyperlink, 
http://www.gao.gov/products/GAO-11-545] Washington, D.C.: May 27, 2011. 

Space Acquisitions: DOD Delivering New Generations of Satellites, but 
Space System Acquisition Challenges Remain. [Hyperlink, 
http://www.gao.gov/products/GAO-11-590T] Washington, D.C.: May 11, 
2011. 

Defense Acquisitions: Assessments of Selected Weapon Programs. 
[Hyperlink, http://www.gao.gov/products/GAO-11-233SP] Washington, 
D.C.: March 29, 2011. 

Space Acquisitions: DOD Poised to Enhance Space Capabilities, but 
Persistent Challenges Remain in Developing Space Systems. [Hyperlink, 
http://www.gao.gov/products/GAO-10-447T] Washington, D.C.: March 10, 
2010. 

Global Positioning System: Challenges in Sustaining and Upgrading 
Capabilities Persist. [Hyperlink, 
http://www.gao.gov/products/GAO-10-636] Washington, D.C.: September 
15, 2010. 

Defense Acquisitions: Challenges in Aligning Space System Components. 
[Hyperlink, http://www.gao.gov/products/GAO-10-55] Washington, D.C.: 
October 29, 2009. 

Polar-Orbiting Satellites: With Costs Increasing and Data Continuity 
at Risk, Improvements Needed in Tri-agency Decision Making. 
[Hyperlink, http://www.gao.gov/products/GAO-09-772T] Washington, D.C.: 
June 17, 2009. 

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

DOD is Making progress in Adopting Best Practices for the 
Transformational Satellite Communications System and Space Radar but 
Still Faces Challenges. [Hyperlink, 
http://www.gao.gov/products/GAO-07-1029R] Washington, D.C.: August 2, 
2007. 

Contact Information: 

For additional information about this area, contact Cristina Chaplain 
at (202) 512-4841 or chaplainc@gao.gov. 

[End of section] 

23. Space Launch Contract Costs: 

Increased collaboration between the Department of Defense and National 
Aeronautics and Space Administration could reduce launch contracting 
duplication. 

Why This Area Is Important: 

The Department of Defense (DOD), the intelligence community, the 
National Aeronautics and Space Administration (NASA), and other 
government agencies rely on commercial domestic launch service 
providers to place their satellites into orbit. National policy 
generally requires that U.S. government payloads, including 
satellites, be launched on U.S. manufactured launch vehicles. National 
security space payloads, comprised of DOD, including National 
Reconnaissance Office (NRO)[Footnote 121] payloads, are primarily 
launched by the main U.S. launch provider, the United Launch Alliance 
(ULA), on its Delta IV and Atlas V vehicles. NASA payloads are 
launched on a variety of launch vehicles from multiple launch 
providers, including ULA. In fiscal year 2012, DOD plans to complete 
nine launches on Delta IV and Atlas V launch vehicles, at a cost of 
roughly about $1.8 billion. Similarly, in fiscal year 2012, NASA plans 
to complete two launches on ULA's Atlas V launch vehicle, at a cost of 
about $370 million. The government plans to spend about $15 billion on 
ULA's launch services from fiscal year 2013 through 2017. In the past 
few years, ULA's launch costs have risen, but there are currently no 
alternative launch vehicles in the commercial sector that have been 
certified to launch the larger national security satellites. 
Meanwhile, NASA, which has more options for launch providers due to 
the greater diversity of its space programs, tolerance for launch 
risk, and cooperation with international partners, typically uses ULA 
to launch a few satellites each year--averaging about two annually in 
the past few years. 

DOD is considering a new space launch acquisition strategy beginning 
in 2013 which will likely allow DOD to procure a set number of launch 
vehicles from ULA each year in an effort to control cost increases and 
stabilize the launch industrial base. However, awards of launch 
services from ULA by NASA--which are negotiated in a separate 
acquisition process with a different acquisition office--were not 
directly included in DOD's planned procurements. 

What GAO Found: 

Space launch acquisition processes for NASA and DOD are not formally 
coordinated, duplicate one another, and may not fully leverage the 
government's investment because the government is not acting as a 
single buyer. As GAO reported in September 2008 and September 2011, 
opportunities exist to reduce duplication in government contracting 
for launch services by jointly negotiating launch acquisitions, which 
could reduce the number of contracts and potentially save time and 
money. The U.S. National Space Policy[Footnote 122] directs agencies 
to work jointly to acquire space launch services, and a recently 
signed memorandum of understanding may help facilitate communication 
on launch acquisitions. However, the National Space Policy does not 
specifically direct agencies to jointly negotiate for launch services, 
and the changes to coordination resulting from the memorandum of 
understanding do not appear to be significant enough to decrease the 
duplication in how DOD and NASA procure their launch services and to 
leverage the combined buying power of DOD and NASA. 

Currently, the Air Force's Launch and Range Systems Directorate 
ensures DOD's access to space. The directorate develops and acquires 
expendable launch systems by awarding contracts to commercial firms; 
manages the launch integration, mission assurance, and launch 
campaigns; and provides range systems for space launch operations. In 
the past, launch services had been procured one at a time as needed. 
However, DOD is considering a new acquisition strategy, slated to 
begin in 2013, to provide ULA with a minimum order quantity for each 
year from DOD without the need to negotiate a new launch vehicle 
contract for each launch. This new strategy will cover DOD launches, 
but will not include NASA launches, which are negotiated separately by 
NASA under a different contract. 

NASA's Launch Services II contract is an indefinite delivery, 
indefinite quantity[Footnote 123] contract with four launch service 
providers--Lockheed Martin, Orbital Sciences, Space Exploration 
Technologies, and ULA. When a NASA mission needs to acquire launch 
services, the NASA Launch Service Program issues orders for launch 
services and generally provides the companies a fair opportunity to 
compete for each order under NASA's Launch Services II contract. 
According to launch service program officials, competition between the 
launch service providers is intended to generate lower prices, but ULA 
is currently the only provider of intermediate class launch vehicles. 

Since DOD and NASA negotiate for launch services separately, the 
current space launch acquisition environment may not leverage the 
government's overall negotiating power to get the best prices for 
launch services from ULA. There is also no current way to ensure that 
the government is not paying twice for launch overhead costs through 
the separate acquisition processes. Recently, DOD, the NRO, and NASA 
signed a memorandum of understanding outlining future cooperation in 
space launch acquisitions. In this agreement, DOD agreed to acquire 
five launch vehicle common booster cores[Footnote 124] per year for 
the next 5 years, and the NRO agreed to procure a minimum of three 
each year for the next 5 years. This large acquisition was intended to 
help control launch vehicle costs and stabilize production of launch 
vehicles. However, the agreement did not include a commitment from 
NASA to procure a minimum amount of boosters or services per year, 
though NASA will continue using its Launch Services II contract to 
procure launch services on the Atlas V launch vehicle from ULA 
separately from DOD's negotiated acquisition. NASA officials believe 
that they have been successful at awarding contracts for launch 
services through their separate acquisition process. Since NASA has a 
"most favored customer" contractual clause on its contracts with ULA 
to ensure that it does not pay a higher price for standard launch 
services than the lowest price charged to other ULA commercial or 
government customers, they do not have a strong incentive to cooperate 
in these procurements. Though this approach minimizes NASA's launch 
vehicle costs, it may not necessarily ensure the best price for the 
overall government nor does it eliminate the potential for redundant 
or unnecessary overhead costs. 

Reducing duplication in awarding contracts for space launch services 
is further hindered, in part, due to the lack of a governmentwide 
policy for space launch services acquisitions. Currently, in addition 
to launch services procurements, numerous federal agencies have 
responsibility for space activities, including the Federal Aviation 
Administration's oversight of commercial space launches; NASA's 
scientific and exploration space activities; the DOD's national 
security space launches; the State Department's involvement in 
international trade issues; and the Department of Commerce's advocacy 
and promotion of the industry. Current National Space Policy broadly 
states a goal to energize the competitive domestic space industries, 
to include space launch, and to enhance capabilities for assured 
access to space. A governmentwide launch policy could more 
specifically clarify the overall government's priorities in developing 
and introducing new launch providers and could establish guidance for 
cooperation on launch services procurements between agencies. It could 
also identify and fill gaps in federal policy concerning the 
commercial space launch industry, according to senior Federal Aviation 
Administration and Department of Commerce officials. 

According to the National Academy of Sciences, aligning the strategies 
of the various civil and national security space agencies will address 
many current issues arising from or exacerbated by the current 
uncoordinated, overlapping, and unilateral strategies. According to 
the academy, a process of alignment offers the opportunity to leverage 
resources from various agencies to address such shared challenges as 
the diminished space industrial base, the dwindling technical 
workforce, and reduced funding levels. According to senior Federal 
Aviation Administration and Department of Commerce officials, the need 
for an overall U.S. space launch policy, which includes commercial 
space launches, was being discussed within the Department of 
Transportation and across other departments as part of the 
administration's review of national space activities, but the 
development of a national policy had not yet begun. Guidance on launch 
acquisitions will, however, be included in the updated National Space 
Transportation Policy which is currently under development. 

Actions Needed and Potential Financial or Other Benefits: 

DOD, NRO, and NASA are taking steps to outline responsibilities on 
space launch services acquisitions through their recently signed 
memorandum of understanding. However, there are opportunities for the 
government to act as a single buyer to further reduce duplication in 
acquiring launch services. Specifically, the Office of Management and 
Budget should: 

* assess and adopt mechanisms to ensure formal coordination of the DOD 
and NASA acquisition processes for awarding launch services contracts 
with an eye toward leveraging the government's buying power and 
ensuring that launch prices are competitive for all U.S. government 
customers; and: 

* determine whether the government is paying twice for any overhead 
costs, and if duplication is found, develop a way to ensure that the 
government does not pay more than once for overhead costs through 
separate acquisition processes. 

Agency Comments and GAO's Evaluation: 

In September 2011, GAO recommended that DOD examine how broader launch 
issues, such as greater coordination across federal agencies, can be 
factored into future launch acquisitions to increase efficiencies and 
cost savings. DOD concurred with this recommendation. In responding to 
this paper on duplication in launch contracting, NASA agreed that the 
goal of improving efficiency and maximizing the government's buying 
power for intermediate launch vehicles is worthy, but believes that it 
is currently working with DOD in such a way as to achieve this goal 
while still allowing each agency to perform its assigned space-related 
responsibilities. GAO would encourage NASA to continue its 
coordination with DOD. Technical comments from NASA have been 
incorporated as appropriate. 

The Office of Management and Budget agrees that clear benefits can be 
gained from avoiding unnecessary contracting duplication, and points 
out that this and prior administrations have taken steps to 
consolidate launch services. OMB also cites this administration's 
current effort to develop an updated National Space Transportation 
Policy, which will include guidance on launch acquisition. OMB 
believes that the flexibility of separate acquisition approaches can 
be beneficial and that the unique mission requirements of DOD and NASA 
may not be met most efficiently by a "one size fits all" contracting 
approach. In addressing OMB, DOD, and NASA comments, GAO modified its 
original suggestion that DOD and NASA consolidate their acquisition 
processes, to a suggestion where these agencies enhance their 
coordination of launch services. GAO continues to believe that greater 
coordination efforts could help to leverage the government's buying 
power, in addition to the specific actions outlined above. For 
example, by acting as a single buyer, the government can better 
leverage its requirements for multi-year purchases of launch vehicles, 
and jointly negotiate launch acquisitions to reduce the number of 
awarded launch service contracts. 

As part of its routine audit work, GAO will track the extent to which 
progress has been made to address the identified actions and report to 
Congress. All written comments are reprinted in appendix IV. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. In addition, 
GAO reviewed the March 2011 launch vehicle agreement by the Secretary 
of the Air Force, Director of the National Reconnaissance Office, and 
the Administrator of NASA. To identify important launch issues with 
potential bearing on current and future government launch 
acquisitions, GAO reviewed DOD launch studies and interviewed study 
leaders or participants in three of the five studies; GAO analyzed 
historical launch data and expected launch vehicle demand; reviewed 
other relevant government and industry reports; interviewed DOD, NASA, 
and contractor officials; and reviewed information from NRO. 

Related GAO Products: 

Evolved Expendable Launch Vehicle: DOD Needs to Ensure New Acquisition 
Strategy is Based on Sufficient Information. [Hyperlink, 
http://www.gao.gov/products/GAO-11-641] Washington, D.C.: September 
15, 2011. 

Commercial Launch Vehicles: NASA Taking Measures to Manage Delays and 
Risks. [Hyperlink, http://www.gao.gov/products/GAO-11-692T] 
Washington, D.C.: May 26, 2011. 

Commercial Space Transportation: Industry Trends and Key Issues 
Affecting Federal Oversight and International Competitiveness. 
[Hyperlink, http://www.gao.gov/products/GAO-11-629T] Washington, D.C.: 
May 5, 2011. 

Space Acquisitions: Uncertainties in the Evolved Expendable Launch 
Vehicle Program Pose Management and Oversight Challenges. [Hyperlink, 
http://www.gao.gov/products/GAO-08-1039] Washington, D.C.: September 
26, 2008. 

Contact Information: 

For additional information about this area, contact Cristina Chaplain 
at (202) 512-4841 or chaplainc@gao.gov, or Gerald Dillingham, Ph.D. at 
(202) 512-2834 or dillinghamg@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Diesel engines play a vital role in public transportation, 
construction, agriculture, and shipping, largely because they are more 
durable and reliable than gasoline-powered engines, as well as 25 to 
35 percent more energy efficient. However, exhaust from diesel engines 
is a pervasive and harmful form of air pollution. Diesel exhaust 
contains air pollutants such as nitrogen oxides and particulate 
matter, as well as other harmful substances that affect public health 
and the environment.[Footnote 125] Since 1984, the Environmental 
Protection Agency (EPA) has implemented standards that have 
progressively lowered the maximum allowable amount of certain 
pollutants, including nitrogen oxides and particulate matter, from new 
diesel engines by more than 98 percent. However, the most stringent 
standards generally apply to diesel engines and vehicles built after 
2007, and EPA estimates that over 20 million older mobile sources of 
diesel emissions--13 million on-highway vehicles, 7 million non-road 
engines, and 47,000 locomotive and marine engines--continue to emit 
higher amounts of harmful pollutants than newer engines.[Footnote 126] 
Programs at the Department of Energy (Energy), the Department of 
Transportation (DOT), and EPA address mobile source diesel emissions 
from these older sources by providing grants and loans for projects 
that, among other things, retrofit, rebuild, or replace existing 
diesel engines or vehicles; install devices that reduce idling of 
diesel engines; and convert diesel engines and vehicles to use cleaner 
fuels, such as natural gas or propane. From fiscal years 2007 through 
2011, these programs obligated at least $1.4 billion for such 
projects.[Footnote 127] In addition, three tax expenditures, which 
resulted in at least $510 million in forgone federal tax revenue in 
fiscal year 2010, provide incentives to reduce mobile source diesel 
emissions. 

What GAO Found: 

As GAO reported in February 2012, federal grant and loan funding for 
activities that reduce mobile source diesel emissions is fragmented 
across 14 programs at Energy, DOT, and EPA. Thirteen of these programs 
provide grants, and 1 program--DOT's State Infrastructure Banks 
program--provides loans.[Footnote 128] Of the 14 programs, 1--EPA's 
Diesel Emissions Reduction Act program--has a specific purpose of 
reducing mobile source diesel emissions. The remaining 13 programs 
focus on other goals or purposes, such as supporting energy efficiency 
projects or reducing petroleum use. In addition to fragmentation 
across three agencies, each of the 14 programs overlaps with at least 
1 other program in the specific activities they fund, the program 
goals, or the eligible recipients of funding (see fig. below). 

Table: Overlapping Mobile Source Diesel Emissions Reduction 
Activities, Goals, and Eligible Recipients, by Agency and Program: 

Agency/Program: Energy; Clean Cities; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Empty]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Empty]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Check]; 
Reduce fuel use: [Check]; 
Eligible recipients: [Empty]; 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Check]; 
Transit agencies: [Check]; 
Federally recognized tribes: [Check]; 
Private or non-profit organizations: [Check]. 

Agency/Program: Energy; Energy Efficiency and Conservation Block Grant; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Check]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Check]; 
Reduce fuel use: [Empty]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Empty]; 
Transit agencies: [Empty]; 
Federally recognized tribes: [Check]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: Energy; State Energy Program; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Empty]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Check]; 
Reduce fuel use: [Check]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Empty]; 
Land management agencies: [Empty]; 
Transit agencies: [Empty]; 
Federally recognized tribes: [Empty]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: DOT[A]; 
Activities: 
Retrofit vehicle or engine: [Empty]; 
Rebuild vehicle or engine: [Empty]; 
Replace vehicle or engine: [Empty]; 
reduce vehicle idling: [Empty]; 
Use cleaner fuel: [Empty]; 
Goals: 
Reduce emissions: [Empty]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Empty]; 
Reduce fuel use: [Empty]; 
Eligible recipients: 
State governments: [Empty]; 
Local governments: [Empty]; 
Land management agencies: [Empty]; 
Transit agencies: [Empty]; 
Federally recognized tribes: [Empty]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: Federal Aviation Administration; Voluntary Airport Low 
Emissions; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Empty]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Empty]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Check]; 
Reduce pollution in areas not meeting air quality standards: [Check]; 
Increase energy efficiency: [Empty]; 
Reduce fuel use: [Empty]; 
Eligible recipients: [Empty]; 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Empty]; 
Transit agencies: [Empty]; 
Federally recognized tribes: [Empty]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: Federal Highway Administration; Congestion Mitigation 
and Air Quality Improvement; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Empty]; 
Reduce pollution in areas not meeting air quality standards: [Check]; 
Increase energy efficiency: [Empty]; 
Reduce fuel use: [Empty]; 
Eligible recipients: [Empty]; 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: 
Transit agencies: [Check]; 
Federally recognized tribes: 
Private or non-profit organizations: [Empty]. 

Agency/Program: Federal Highway Administration; Ferry Boat 
Discretionary; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Empty]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Empty]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Empty]; 
Reduce fuel use: [Empty]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Empty]; 
Transit agencies: [Empty]; 
Federally recognized tribes: [Empty]; 
Private or non-profit organizations: [Check]. 

Agency/Program: Federal Highway Administration; State Infrastructure 
Banks; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
Reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Empty]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Empty]; 
Reduce fuel use: [Empty]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Empty]; 
Land management agencies: [Empty]; 
Transit agencies: [Empty]; 
Federally recognized tribes: [Empty]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: Federal Transit Administration; Bus and Bus Facilities; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
Reduce vehicle idling: [Empty]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Empty]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Empty]; 
Reduce fuel use: [Check]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Empty]; 
Transit agencies: [Check]; 
Federally recognized tribes: [Check]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: Federal Transit Administration; Clean Fuels Grant; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Check]; 
Reduce pollution in areas not meeting air quality standards: [Check]; 
Increase energy efficiency: [Check]; 
Reduce fuel use: [Check]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Empty]; 
Transit agencies: [Check]; 
Federally recognized tribes: [Empty]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: Federal Transit Administration; National Fuel Cell Bus 
Technology Development; 
Activities: 
Retrofit vehicle or engine: [Empty]; 
Rebuild vehicle or engine: [Empty]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Check]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Check]; 
Reduce fuel use: [Check]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Empty]; 
Land management agencies: [Empty]; 
Transit agencies: [Check]; 
Federally recognized tribes: [Check]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: Federal Transit Administration; Transit in Parks; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Check]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Empty]; 
Reduce fuel use: [Empty]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Check]; 
Transit agencies: [Check]; 
Federally recognized tribes: [Check]; 
Private or non-profit organizations: [Check]. 

Agency/Program: Federal Transit Administration; Transit Investments in 
Greenhouse Gas and Energy Reduction[B]; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Check]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Check]; 
Reduce fuel use: [Check]; 
Eligible recipients: [Empty]; 
State governments: [Check]; 
Local governments: [Empty]; 
Land management agencies: [Empty]; 
Transit agencies: [Check]; 
Federally recognized tribes: [Check]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: Federal Transit Administration; Urbanized Area Formula 
Grants; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Empty]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: 
Reduce fuel use: [Check]; 
Eligible recipients: [Empty]; 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Empty]; 
Transit agencies: [Check]; 
Federally recognized tribes: [Empty]; 
Private or non-profit organizations: [Empty]. 

Agency/Program: EPA; Diesel Emissions Reduction Act Program; 
Activities: 
Retrofit vehicle or engine: [Check]; 
Rebuild vehicle or engine: [Check]; 
Replace vehicle or engine: [Check]; 
reduce vehicle idling: [Check]; 
Use cleaner fuel: [Check]; 
Goals: 
Reduce emissions: [Check]; 
Reduce pollution in areas not meeting air quality standards: [Empty]; 
Increase energy efficiency: [Empty]; 
Reduce fuel use: [Empty]; 
Eligible recipients: 
State governments: [Check]; 
Local governments: [Check]; 
Land management agencies: [Empty]; 
Transit agencies: [Check]; 
Federally recognized tribes: [Check]; 
Private or non-profit organizations: [Check]. 

Source: GAO analysis of Energy, DOT, and EPA documents and interviews. 

[A] In 2011, GAO reported that fragmentation of surface transportation 
programs led to inefficiencies. 

[B] The American Recovery and Reinvestment Act of 2009 authorized this 
program, and the program received funding through fiscal year 2011. 
The program did not receive funding for fiscal year 2012 in the 
relevant appropriations act. 

[End of table] 

In addition, GAO identified three tax expenditures--biodiesel producer 
tax credits, a diesel fuel emulsion excise tax credit, and an excise 
tax exemption for idling reduction devices--that provide incentives 
for owners and operators of diesel engines and vehicles to reduce 
emissions.[Footnote 129] GAO found overlap among the qualifying 
activities for the excise tax exemption for certain vehicle idling 
reduction devices and programs that fund idling reduction activities 
because the excise tax exemption and these programs all provide 
incentives to use idle reduction devices to reduce diesel emissions. 
According to Department of the Treasury estimates, in fiscal year 
2010, the biodiesel tax credits resulted in $510 million in forgone 
federal tax revenue.[Footnote 130] The Department of the Treasury 
estimates did not include forgone revenue from the diesel fuel 
emulsion excise tax credit or the excise tax exemption for idling 
reduction devices because the department does not report estimates for 
tax provisions that result in forgone excise tax only. 

GAO also identified several instances of duplication where more than 
one program provided grant or loan funding to the same recipient for 
the same type of activities.[Footnote 131] In one case, a state 
transportation agency received $5.4 million from DOT's Transit 
Investments in Greenhouse Gas Emissions Reduction program to, among 
other things, upgrade 37 diesel buses to hybrid diesel-electric buses, 
$3.5 million from DOT's Congestion Mitigation and Air Quality 
Improvement program to replace diesel buses with four hybrid diesel-
electric buses, and $2.3 million from DOT's Clean Fuels Grants program 
to replace four diesel buses with hybrid electric buses. In another 
case, a nonprofit organization received $1.1 million from EPA's Diesel 
Emissions Reduction Act program to install emission reduction and idle 
reduction technologies on 1,700 trucks, as well as $5.6 million from a 
state infrastructure bank established under DOT's program to equip 
trucks and truck fleets with emission control and idle reduction 
devices. 

Even with duplication among the programs, several factors make it 
difficult to precisely determine whether unnecessary duplication 
exists. First, when different programs fund the same diesel emissions 
reduction activities, it is not necessarily wasteful. For example, a 
transit agency could use funds from two different programs to replace 
two separate fleets of aging diesel buses. Second, grant recipients 
may leverage funding from more than one program to support the full 
cost of diesel emissions reduction projects. In some cases, grant 
recipients have used funding from multiple agencies, in addition to 
local matching funds, to support the cost of large projects that 
include multiple diesel emissions reduction activities. GAO previously 
reported that leveraging is generally recognized favorably by public 
and private sector officials, but leveraging funds from multiple 
agencies can be inefficient because agencies may incur costs for 
duplicative administrative activities.[Footnote 132] Third, agencies 
were often unable to provide information necessary to determine 
whether and to what extent unnecessary duplication exists among the 
programs. For example, several agencies reported that they do not 
track costs for administrative functions at the program level. 

The overall effectiveness of federal funding for activities that 
reduce mobile source diesel emissions may be limited because agencies 
generally do not collaborate. According to Energy, DOT, and EPA 
officials, the three agencies consult one another on broad issues such 
as available emissions reduction technology or emissions standards, 
but these efforts do not involve collaboration on diesel-related 
issues. This is partially due to the differing purposes and goals of 
each program, which often do not directly relate to reducing diesel 
emissions. However, GAO previously reported that, although federal 
programs have been designed for different purposes or targeted for 
different population groups, coordination among programs with related 
responsibilities is essential to efficiently and effectively meet 
national concerns.[Footnote 133] 

GAO also previously reported that uncoordinated program efforts can 
waste scarce funds, confuse and frustrate program customers, and limit 
the overall effectiveness of the federal effort. A focus on results as 
envisioned by the Government Performance and Results Act implies that 
federal programs contributing to the same or similar results should 
closely coordinate to ensure that goals are consistent, and, as 
appropriate, program efforts are mutually reinforcing.[Footnote 134] 
Also, the GPRA Modernization Act of 2010 established a new, cross-
cutting, and integrated framework for achieving results and improving 
government performance.[Footnote 135] 

In addition, few agencies collect performance information on their 
diesel emissions reduction activities. Specifically, EPA collects 
performance information on the amount and type of diesel emissions 
reductions each project achieves, Energy's three programs and three of 
DOT's programs collect some performance information related to diesel 
emissions reductions, and the remaining seven DOT programs do not 
collect performance information related to diesel emissions. This is 
partially because 13 of the 14 programs that fund these activities 
have purposes other than reducing diesel emissions. However, the 
information that would result from enhanced collaboration and outcome 
measurement is needed to determine if fragmentation, overlap, and 
duplication have resulted in ineffective or inefficient programs. 

Actions Needed and Potential Financial or Other Benefits: 

To help ensure the effectiveness and accountability of federal funding 
that reduces diesel emissions, the Secretaries of Energy and DOT as 
well as the Administrator of EPA should: 

* consistent with existing law, establish a strategy for collaboration 
in reducing mobile source diesel emissions. 

This strategy should help agencies (1) determine the performance 
measures needed, as appropriate, to assess the collective results of 
federal funding for activities that reduce diesel emissions and (2) 
identify and address any unnecessary duplication, including the 
effects of the relevant tax expenditures, among other things. In 
undertaking this effort, agencies could also assess opportunities for 
administrative cost savings. GAO will monitor the agencies' efforts on 
these issues. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to Energy, DOT, and EPA. 

Energy provided technical comments, which were incorporated as 
appropriate. In its comments, Energy questioned several of the 
findings but agreed with the action needed that GAO identified. 
Specifically, Energy stated that the findings mischaracterize the 
agency as having a statutory responsibility for diesel emissions 
reductions. The findings do not contain such a statement. Rather, they 
identify 14 programs, including 3 Energy programs, that fund 
activities with the effect of reducing diesel emissions and state that 
programs with related responsibilities should coordinate their 
efforts. Energy also stated that the findings mischaracterize Energy 
as not collaborating with other government agencies. The findings 
state that Energy collaborates with other agencies on broad issues but 
does not collaborate on diesel-related issues. In addition, Energy 
stated that the findings mischaracterize the agency as sharing 
redundant national goals with DOT and EPA. The findings do not discuss 
Energy's national goals, their relationship to those of other 
agencies, or whether they are redundant. Rather, the findings (1) 
focus on Energy programs that fund activities that result in diesel 
emissions reductions and (2) demonstrate that these programs share 
similar goals with DOT and EPA programs that fund the same activities. 
Specifically, each of these programs shares some goals, such as 
reducing emissions, increasing energy efficiency, and reducing fuel 
use. 

DOT did not provide comments on the draft findings. In its comments on 
a draft of the February 2012 report, DOT questioned several of the 
report's key findings and the report's recommendation that Energy, 
DOT, and EPA establish a strategy for collaboration among their 
programs that reduce mobile source diesel emissions. Specifically, DOT 
stated that GAO inaccurately described the Federal Transit 
Administration's programs as funding diesel emissions reduction 
activities. The report identifies Federal Transit Administration 
activities that reduce diesel emissions, including replacing existing 
diesel vehicles and installing devices that reduce idling of diesel 
engines, and identifies six Federal Transit Administration programs 
that fund these same activities. In addition, DOT questioned the 
evidence underlying our finding of fragmentation among the federal 
programs within our review. DOT stated that GAO identified independent 
programs with varying objectives that, in some cases, include similar 
activities. As GAO reported, fragmentation occurs when more than one 
federal agency, or more than one organization within an agency, is 
involved in the same broad area of national need. The report clearly 
identifies fragmentation, overlap, and duplication among the 14 
federal programs that fund diesel emissions reduction activities. 
Consistent with our established definition of fragmentation and our 
evidence, GAO stands by its finding that federal grant and loan 
funding for activities that reduce diesel emissions is fragmented 
across 14 programs. 

Regarding GAO's recommendation that Energy, DOT, and EPA establish a 
strategy for collaboration among their programs that reduce mobile 
source diesel emissions, DOT agreed that collaboration can be useful 
but questioned its usefulness in this context. As GAO reported, while 
the programs GAO reviewed have been designed for different purposes, 
coordination among programs with related responsibilities and that 
fund the same activities is essential to the efficient and effective 
use of resources. Further, uncoordinated programs can waste scarce 
funds and limit the overall effectiveness of federal spending. GAO 
therefore continues to believe that the recommendation is warranted. 
DOT also stated that the report does not effectively demonstrate that 
the recommended action will produce cost-effective investments 
appropriate for DOT that do not potentially duplicate efforts 
elsewhere in the government. GAO continues to believe that 
establishing a strategy for collaboration is an appropriate investment 
that would help ensure the effectiveness and accountability of federal 
funding for activities that reduce diesel emissions. As the report 
notes, such a strategy should help agencies identify and address any 
unnecessary duplication. 

EPA did not provide specific comments on the draft findings. However, 
in commenting on a draft of our February 2012 report, EPA stated that 
it agreed with GAO's findings and relevant recommendation. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the report listed in the related GAO products section. To determine 
the total amount of federal funding for mobile source diesel emissions 
reduction activities in fiscal year 2010, GAO obtained and analyzed 
funding data from Energy, DOT, and EPA. Appendix III lists the 
programs GAO identified that may have similar or overlapping 
objectives, provide similar services or be fragmented across 
government missions. Overlap and fragmentation may not necessarily 
lead to actual duplication, and some degree of overlap and duplication 
may be justified. 

Related GAO Product: 

Diesel Pollution: Fragmented Federal Programs that Reduce Mobile 
Source Emissions Could Be Improved. [Hyperlink, 
http://www.gao.gov/products/GAO-12-261] Washington, D.C.: February 7, 
2012. 

Contact Information: 

For additional information about this area, contact David C. Trimble 
at (202) 512-3841 or trimbled@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

From monitoring air quality and testing drinking water to responding 
to environmental disasters, the Environmental Protection Agency's 
(EPA) laboratory enterprise produces scientific research, technical 
support, and analytical services that underpin many of the policies 
and regulations the agency implements to protect human health and our 
nations' environment. In the present atmosphere of constrained 
budgets, EPA, along with its state partners, will need to more 
effectively use its scientific and laboratory resources and 
effectively integrate these activities to ensure the agency is best 
positioned to fulfill its core mission, including responsibilities for 
responding to a large-scale environmental incident. EPA's laboratory 
enterprise includes 37 laboratories that are housed in about 170 
buildings and facilities located in 30 cities across the nation. 

What GAO Found: 

As GAO reported in July 2011, EPA has an uncoordinated approach to 
managing its laboratory enterprise--including the scientific work, 
workforce, and facilities--and identified the potential for missed 
cost-savings opportunities, due in part to fragmentation and overlap 
of activities. However, GAO was not able to calculate the cost 
associated with this potential fragmentation and overlap--or the 
corresponding savings from reducing fragmentation and overlap--because 
EPA did not have sufficiently complete and reliable operating cost 
data for its laboratories. EPA also lacked information on the number 
of federal and contract employees working in its 37 laboratories and 
the related costs associated with its laboratory workforce. GAO's 
report found that EPA's uncoordinated approach is due in part to the 
lack of a top science official with the responsibility or authority to 
coordinate, oversee, and make management decisions regarding major 
scientific activities throughout the agency--including the work of all 
37 laboratories. 

EPA's laboratories operate under the direction of 15 different senior 
officials using 15 different organizational and management structures. 
EPA has also not fully addressed recommendations from a 1994 
independent evaluation by the MITRE Corporation to consolidate and 
realign its laboratory facilities and workforce[Footnote 136]--even 
though this evaluation found that the geographic separation of 
laboratories hampered their efficiency and technical operations and 
that consolidation and realignment could improve planning and 
coordination issues that have hampered its science and technical 
community for decades. We found that these problems are evident today 
and MITRE's past recommendations may still be relevant. 

Scientific work. EPA does not have a planning process that integrates 
and coordinates scientific work throughout the agency, including 
potentially overlapping functions performed by its 37 laboratories. 
Consequently, EPA has a limited ability to know if scientific 
activities are being unintentionally duplicated among the laboratories 
or if opportunities exist to collaborate and share scientific 
expertise, equipment, and facilities across EPA's fragmented 
laboratory enterprise. For example, many of EPA's 10 regional 
laboratories provide the same or similar types of analytical and 
technical support functions, such as routine and specialized testing 
of air samples. In addition, the agency's nine program laboratories 
provide their respective program offices[Footnote 137] with research 
and analytical services that may overlap with research and development 
performed by the Office of Research and Development's (ORD) 18 
laboratories. For example, an Office of Air and Radiation program 
laboratory located in Michigan does emissions testing, while a 
separate ORD laboratory located in North Carolina does emissions 
testing research. 

In addition to potential overlap in the work performed by these two 
laboratories, the fragmentation across the laboratory enterprise may 
fail to provide the agency with opportunities for laboratories to 
share subject matter expertise and scientific equipment. For example, 
both the Office of Air and Radiation and ORD laboratories utilize the 
same kind of specialized equipment, called truck dynamometers, yet 
each separately requested funding in fiscal years 2010 and 2011 that 
totaled over $4 million to expand or modify their facilities for 
emissions testing. While the agency funded only one of the two 
potentially duplicative requests, the net result is that the second 
laboratory's facility and equipment needs were not met. In addition to 
potential lost opportunities to share facilities and equipment, the 
agency may also be missing opportunities to share expertise, such as 
technical knowledge pertaining to the use of specialized equipment. 

In addition, to support the implementation of both state and federal 
environmental statutes, various state agencies and public universities 
operate over 70 separate environmental laboratories (see fig. below) 
that may perform functions similar to those performed by EPA 
laboratories. Similar to the work of some EPA regional laboratories, 
state environmental laboratories conduct regular testing of air, 
water, soil, food, and other media for signs of contamination. State 
laboratories also perform analytical and method development functions 
that may be similar to those performed by ORD laboratories. EPA has 
partnered with some state laboratories for specific programs, but to 
fully leverage these state scientific resources EPA will first need to 
integrate and coordinate the activities of its own laboratories 
agencywide. 

Figure: Potential Overlap among Federal and State Environmental 
Laboratories: 

[Refer to PDF for image: illustration] 

U.S. Environmental Protection Agency: 

Regional laboratories: 
10 regional administrators or assistant administrators. 

Program laboratories: 

Office of Enforcement and Compliance Assurance: 
1 regional administrator or assistant administrator. 

Office of Solid Waste and Emergency Response: 
1 regional administrator or assistant administrator. 

Office of Chemical Safety and Pollution Prevention: 
4 regional administrators or assistant administrators. 

Office of Air and Radiation: 
3 regional administrators or assistant administrators. 

Office of Research and Development laboratories: 

National Exposure Research Laboratory: 
6 regional administrators or assistant administrators. 

National Health and Environmental Effects Research Laboratory: 
7 regional administrators or assistant administrators. 

National Risk Management Research Laboratory: 
5 regional administrators or assistant administrators. 

State Environmental Laboratories: 
There are over 70 state environmental laboratories. 

Source: GAO. 

[End of figure] 

Workforce. EPA does not use a comprehensive planning process for 
managing its laboratories' workforce and may be missing opportunities 
to work across organizational boundaries to integrate, share, or 
coordinate laboratory workforces that perform potentially overlapping 
functions. For example, many of the 10 regional laboratories provide 
the same or similar core analytical capabilities--including a full 
range of routine and specialized chemical and biological testing of 
air, water, soil, sediment, tissue, and hazardous waste--but each 
region independently determines and attempts to address its individual 
workforce needs. EPA also lacks basic demographic information needed 
to know how many scientific and technical employees it has working in 
its laboratories, where they are located, what functions they perform, 
or what specialized skills they may have. In addition, the agency does 
not have a workload analysis for the laboratories to help determine 
the optimal numbers and distribution of staff throughout the 
enterprise. GAO believes that such information is essential for EPA to 
prepare a comprehensive laboratory workforce plan to achieve the 
agency's mission with limited resources. 

Facilities. EPA manages its laboratory facilities in a way that may 
fail to achieve operating efficiencies that could be gained by 
colocating laboratories with overlapping activities and facility 
needs. EPA manages laboratories on a site-by-site basis and does not 
make capital improvement or other decisions for each site in the 
context of all the agency's laboratory properties. Because decisions 
regarding laboratory facilities are made independently of one another, 
opportunities to improve operating efficiencies can be lost. For 
example, GAO found cases where laboratories that were previously 
colocated moved into separate space without considering the potential 
benefits of remaining colocated. In one case, GAO found that the 
relocation increased some operating costs because the laboratories 
then had two facility managers and two security contracts and 
associated personnel because of different requirements for the leased 
facility. 

Moreover, EPA lacks sufficiently complete and reliable data to make 
informed decisions for managing its laboratory facilities. Among other 
things, EPA lacks reliable information on laboratory usage, which is 
needed to inform both capital investment and property disposal 
decisions. For example, EPA does not have reliable data on space 
utilization because its data are either out of date or not based on 
objective criteria such as public and commercial space usage 
benchmarks. Instead, EPA measures laboratory usage on the basis of 
subjective interviews with local laboratory officials. 

Actions Needed and Potential Financial or Other Benefits: 

To improve cohesion and efficiency in the management and operation of 
EPA's laboratories, GAO recommended in July 2011 that the 
Administrator of EPA: 

* ensure that the agency includes alternative approaches for 
organizing the laboratories' workforce and infrastructure, including 
options for sharing and consolidation as part of any future studies of 
EPA laboratory enterprise, such as the long-term study requested in 
the President's fiscal year 2012 budget. 

To address potentially overlapping laboratory activities and achieve 
efficiencies by sharing workforce expertise, GAO recommended in July 
2011 that the Administrator of EPA: 

* establish a top-level science official with the authority and 
responsibility to coordinate, oversee, and make management decisions 
regarding major scientific activities throughout the agency, including 
the work of all program, regional, and Office of Research and 
Development laboratories; 

* develop an overarching issue-based planning process that reflects 
the collective goals, objectives, and priorities of the laboratories' 
scientific activities; and: 

* develop a comprehensive workforce planning process for all 
laboratories that is based on reliable workforce data and reflects 
current and future agency needs in overall number of federal and 
contract employees, skills, and deployment across all laboratory 
facilities. 

To identify opportunities to reduce costs associated with maintaining 
a footprint of 170 laboratory buildings and facilities that support 
organizations with potentially overlapping functions, facility, and 
equipment needs, GAO recommended in July 2011 that the Administrator 
of EPA: 

* improve physical infrastructure and real property planning and 
investment decisions by: 

* managing individual laboratory facilities as part of an interrelated 
portfolio of facilities; 

* ensuring that master plans and other facility information are up-to-
date and that analysis of the use of space is based on objective 
benchmarks; and: 

* improving the completeness and reliability of operating cost and 
other data needed to manage EPA's real property and report to external 
parties. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its July 2011 report to EPA for review and 
comment. EPA generally agreed with GAO's recommendations. In November 
2011, EPA noted that current efforts to reduce the federal budget 
deficit require EPA to more effectively use its laboratory enterprise 
to help ensure that its scientific activities respond to the agency's 
highest-priority needs. The agency also acknowledged the demand for 
sharing facilities and equipment, as well as expertise and human 
resources. EPA agreed that it should (1) include alternate approaches 
for organizing the laboratory workforce and infrastructure in any 
future studies of its laboratories, such as the long-term study for 
which the agency requested $2 million in the President's fiscal year 
2012 budget; (2) develop an overarching planning process that better 
reflects the collective goals, objectives, and priorities of its 
laboratories; (3) develop a comprehensive workforce-planning process 
for its laboratories; (4) improve physical infrastructure and real 
property planning and investment decisions by managing laboratory 
facilities as part of an interrelated portfolio of facilities; (5) 
maintain up-to-date master plans that include objective benchmarks; 
and (6) improve the completeness and reliability of operating cost and 
other data needed to manage its real property. 

In response to our recommendation to establish a top-level science 
official with the authority and responsibility to coordinate, oversee, 
and make management decisions regarding major scientific activities 
throughout the agency, EPA proposed to increase the responsibilities 
of its science advisor. However, it is not clear that this will fully 
address the issue and it may ultimately introduce additional 
challenges for EPA. We note that in 2000, the National Research 
Council reported "no single individual could reasonably be expected to 
direct a world-class research program in ORD while also trying to 
improve scientific practices and performance throughout the rest of 
the agency," stating that "these jobs are inherently different." The 
Council cautioned that "assigning agency-wide scientific authority to 
the assistant administrator for ORD might produce a conflict of 
responsibilities, because many decisions about science in the 
regulatory programs could affect ORD's budget or favor ORD's research 
over research done elsewhere." EPA managers need to ensure that there 
is sustained attention on these issues in order to assure its efforts 
are carried out and achieve the intended results. 

GAO also provided a draft of new information included in this report 
section that was not previously reported in the July 2011 report, such 
as information pertaining to state environmental laboratories, to EPA 
for review and comment. EPA provided technical comments, which were 
incorporated as appropriate. 

As part of its routine audit work, GAO will track the extent to which 
progress has been made to address the identified actions and report to 
Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. Information 
regarding state environmental laboratories is based on analysis of a 
May 2011 Environmental Council of States Green Report, a 2007 report 
on the capability and capacity of state environmental laboratories 
conducted by the Association of Public Health Laboratories, and 
information obtained from state environmental laboratory websites and 
EPA's Environmental Response Laboratory Network website. 

Related GAO Product: 

Environmental Protection Agency: To Better Fulfill Its Mission, EPA 
Needs a More Coordinated Approach to Managing Its Laboratories. 
[Hyperlink, http://www.gao.gov/products/GAO-11-347] Washington, D.C.: 
July 25, 2011. 

Contact Information: 

For additional information about this area, contact David C. Trimble 
at (202) 512-3841 or trimbled@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Economic, environmental, and health concerns have spurred interest in 
"green building"--construction and maintenance practices designed to 
make efficient use of resources, reduce environmental problems, and 
provide long-term financial and health benefits through lower 
operating costs and better indoor air quality. These practices are 
intended to help address issues posed by traditional construction and 
maintenance practices for buildings. According to the Department of 
Energy (Energy), in 2008, buildings in the United States consumed 
almost 40 percent of the nation's energy and emitted about 39 percent 
of its carbon dioxide, a greenhouse gas recognized as a major 
contributor to climate change. Also, Energy reports that the 
approximately 30 million to 35 million tons of construction, 
renovation, and demolition waste produced annually in the nation 
account for about 24 percent of municipal solid waste, although most 
of this waste could be recycled. Furthermore, according to the 
Environmental Protection Agency (EPA), exposure to indoor air 
pollutants, such as radon and formaldehyde, can lead to harmful health 
effects, from headaches to respiratory diseases. 

In response to concerns about energy consumption, among other things, 
federal laws and executive orders have directed agencies to reduce 
energy consumption and meet other green building requirements in 
federally owned or leased buildings. For buildings not subject to 
these requirements because they are owned or leased by private, state, 
local, or tribal entities, laws have also directed federal agencies to 
foster green building. GAO refers to these entities and their 
buildings as the "nonfederal sector," which accounts for most of the 
nation's buildings. 

What GAO Found: 

As GAO reported in November 2011, there are 94 federal initiatives GAO 
identified to foster green building in the nonfederal sector. In 
conducting its work, GAO sent questionnaires to the 11 agencies 
implementing the initiatives identified. As the table below indicates, 
3 of the 11 agencies--the Department of Housing and Urban Development 
(HUD), EPA, and Energy--implement about two-thirds of these 
initiatives. 

Table Number of Initiatives That Foster Green Building in the 
Nonfederal Sector, by Federal Agency: 

Agency: HUD; 
Number of initiatives: 29. 

Agency: EPA; 
Number of initiatives: 18. 

Agency: Energy; 
Number of initiatives: 17. 

Agency: U.S. Department of Agriculture; 
Number of initiatives: 8. 

Agency: Department of the Treasury; 
Number of initiatives: 8. 

Agency: Department of Transportation; 
Number of initiatives: 5. 

Agency: National Institute of Standards and Technology; 
Number of initiatives: 3. 

Agency: Department of Education; 
Number of initiatives: 2. 

Agency: Small Business Administration; 
Number of initiatives: 2. 

Agency: Department of Defense; 
Number of initiatives: 1. 

Agency: Department of Health and Human Services; 
Number of initiatives: 1. 

Total: 
Number of initiatives: 94. 

Source: GAO analysis of agency information and questionnaire responses. 

[End of table] 

According to GAO's analysis of agency questionnaire responses, the 94 
initiatives GAO identified share the broad goal of fostering green 
building. Specifically: 

* All of the initiatives foster at least one of six green building 
elements GAO identified (see table below). Three-quarters of the 
initiatives foster more than one element, and 21 initiatives across 
seven agencies foster all six elements. 

Table: Federal Initiatives Fostering Green Building Elements in the 
Nonfederal Sector: 

Green building element: Energy conservation or efficiency; 
Number of initiatives fostering each element: 83. 

Green building element: Indoor environmental quality; 
Number of initiatives fostering each element: 60. 

Green building element: Water conservation or efficiency; 
Number of initiatives fostering each element: 51. 

Green building element: Integrated design (collaborative planning at 
all stages of a building's life); 
Number of initiatives fostering each element: 48. 

Green building element: Sustainable siting or location; 
Number of initiatives fostering each element: 43. 

Green building element: Environmental impact of materials; 
Number of initiatives fostering each element: 39. 

Source: GAO analysis of questionnaire responses. 

Note: Numbers total more than 94 because many initiatives foster more 
than one element. 

[End of table] 

In addition, GAO identified similarities among these federal 
initiatives that indicate potential overlap: 

* Many initiatives provide similar types of assistance, mostly through 
grants (47 initiatives) and technical assistance (45 initiatives) but 
also through other types of assistance, such as loans (9 initiatives), 
tax credits (5 initiatives), and tax deductions (3 initiatives). 

* Agencies reported that they expect the initiatives to directly 
benefit many of the same types of recipients, such as individual 
property owners or renters (55 initiatives), local governments (49 
initiatives), businesses (47 initiatives), nonprofit organizations (45 
initiatives), and state governments (42 initiatives). 

The 94 initiatives may vary greatly in the scale of their funding. GAO 
requested funding information for all initiatives, but the information 
agencies provided was incomplete and unreliable for the purposes of 
describing the size of green building initiatives. Agency officials 
stated that many of the initiatives are part of broader programs and, 
as such, the agencies do not track green building funds separately 
from other program activities, even for initiatives that have as a 
component the direct fostering of green building. As a result, GAO did 
not report funding information for the initiatives in its November 
2011 report. 

About one-third of the 94 initiatives GAO identified have goals and 
performance measures specific to green building and about two-thirds 
do not; therefore, the results of most initiatives and their related 
investments in green building are unknown. Agency officials reported 
various reasons for not having goals and measures, such as challenges 
in gathering reliable performance data. As GAO previously reported, 
leading organizations commonly define clear goals and related 
outcomes, measure performance to gauge progress, and use performance 
information to assess the results of their efforts and the related 
investment.[Footnote 138] Achieving results for the nation 
increasingly requires that federal agencies work together to identify 
ways to deliver results more efficiently and in a way that is 
consistent with their multiple demands and limited resources.[Footnote 
139] Agencies and programs working collaboratively can often achieve 
more public value than when they work in isolation. 

GAO identified some instances in which agencies have begun to 
collaborate to assess results. For example, under the Partnership for 
Sustainable Communities, the Department of Transportation, EPA, and 
HUD plan to adopt a common set of performance measures for HUD's 
Community Challenge Planning Grants Program, which makes funds 
available to state and local governments and other entities to promote 
affordable communities through green building, among other activities. 
Furthermore, Energy chairs the Interagency Energy Management Task 
Force, which includes 10 of the 11 agencies implementing the 94 
initiatives GAO identified. Since 1988, this task force has served as 
the interagency group for collaborating on green building in the 
federal sector, measuring progress, and acting as a forum for 
addressing challenges to green building and developing common 
solutions for the federal sector. However, GAO did not identify a 
governmentwide effort to collaborate on green building issues, 
including shared goals and common performance measures, for the 
nonfederal sector that is comparable to the task force's efforts for 
the federal sector. Without such an effort, agencies with green 
building initiatives for the nonfederal sector may be missing 
opportunities to, among other things, identify the potential for 
inefficient or costly duplication, overlap, or fragmentation across 
these initiatives, and to reach agreement on governmentwide goals and 
measures for assessing the overall progress of their efforts to foster 
green building in the nonfederal sector. 

Actions Needed and Potential Financial or Other Benefits: 

Without comprehensive information about each individual initiative's 
progress toward fostering green building, and without collaboration 
across federal agencies to establish green building goals and ways to 
measure progress, Congress, agency heads, and the public have 
incomplete information about the results of individual and overall 
federal efforts to foster green building in the nonfederal sector and 
the efficiency of these efforts. Governmentwide collaboration to 
identify performance information could, among other things, help 
inform efforts to evaluate the potential for inefficient or costly 
duplication and overlap across the more than 90 federal initiatives--
implemented by 11 agencies--to foster green building in the nonfederal 
sector. To help assess the results of investments in individual 
federal initiatives to foster green building in the nonfederal sector, 
as well as their combined results, GAO recommended in November 2011 
that the Secretaries of Energy and HUD as well as the Administrator of 
EPA: 

* lead an effort with other agencies that are implementing green 
building initiatives to collaborate on identifying performance 
information, such as shared goals and common performance measures, for 
green building initiatives for the nonfederal sector. 

Such an effort could help identify opportunities for enhancing 
efficiency and reducing costs to administer these initiatives. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its November 2011 report for review and 
comment to the U.S. Department of Agriculture, the Department of 
Defense, the Department of Education, Energy, the Department of Health 
and Human Services, HUD, the Department of Transportation as well as 
EPA, the Department of the Treasury's Internal Revenue Service, the 
National Institute of Standards and Technology, and the Small Business 
Administration. Energy, HUD, and EPA agreed with the recommendation. 
HUD, the U.S. Department of Agriculture, the Department of Defense, 
the Department of Education, the Department of Transportation, the 
Internal Revenue Service, and the Small Business Administration 
provided concurrence or technical comments which were incorporated as 
appropriate. The Department of Health and Human Services and the 
National Institute of Standards and Technology did not provide 
comments on this issue. As part of its routine audit work, GAO will 
track the extent to which progress has been made to address the 
identified actions and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on the report 
listed in the related GAO product section. Appendix III lists the 
initiatives GAO identified that may have similar or overlapping 
objectives, provide similar services or be fragmented across 
government missions. Overlap and fragmentation may not lead to actual 
duplication, and some degree of overlap and duplication may be 
justified. 

Related GAO Product: 

Green Building: Federal Initiatives for the Nonfederal Sector Could 
Benefit from More Interagency Collaboration. [Hyperlink, 
http://www.gao.gov/products/GAO-12-79] Washington, D.C.: November 2, 
2011. 

Contact Information: 

For additional information about this area, contact Frank Rusco at 
(202) 512-3841 or ruscof@gao.gov or David J. Wise at (202) 512-2834 or 
wised@gao.gov. 

[End of section] 

27. Social Security Benefit Coordination: 

Benefit offsets for related programs help reduce the potential for 
overlapping payments but pose administrative challenges. 

Why This Area Is Important: 

Social Security provides old age benefits to millions of Americans, 
forming the foundation of retirement income. However, Social Security 
is more than a retirement program: it also provides benefits to 
survivors and other dependents, as well as to disabled workers. In 
2011, over 60 million Americans received $770 billion in Social 
Security benefits. While Social Security provides benefits to many 
different groups, and beneficiaries may receive benefits from more 
than one social safety net program, Social Security's design helps 
reduce overlap with other programs. The Social Security programs are 
subject to several provisions that offset benefits for individuals who 
receive both Social Security benefits and similar benefits under 
another program.[Footnote 140] However, ensuring that these provisions 
offset benefits appropriately and accurately can pose administrative 
challenges. 

As GAO reported in March 2011, the Social Security Administration 
(SSA) needed accurate information from state and local governments on 
retirees who receive pensions from employment not covered under Social 
Security to fairly and accurately apply two public pension offsets--
the Government Pension Offset, which generally applies to spouse and 
survivor benefits, and the Windfall Elimination Provision, which 
applies to retired and disabled worker benefits. GAO continues to 
believe that it is important to apply the Government Pension Offset 
and Windfall Elimination Provision consistently and equitably and 
reiterates its earlier recommendation that Congress consider giving 
the Internal Revenue Service the authority to collect the information 
that SSA needs on government pension income to administer the 
Government Pension Offset and Windfall Elimination Provision 
accurately and fairly. In this report, we focus on other offsets--
workers' compensation offsets. 

What GAO Found: 

The Social Security program's workers' compensation offsets reduce the 
potential for overlapping payments to beneficiaries who also receive 
workers' compensation benefits. However, the lack of reliable 
information on receipt of workers' compensation can result in these 
offset provisions not being administered fairly or equitably. 
Adequately addressing this issue offers the potential for cost savings 
by reducing overpayments. 

Workers' compensation consists of a complex array of programs that 
provide benefits to persons injured while working or who suffer 
occupational diseases. Employers provide workers' compensation 
insurance for their employees and report work-related injuries to the 
state workers' compensation agency. Although workers' compensation 
programs exist in all states, the programs are not federally mandated, 
administered, or regulated.[Footnote 141] Workers' compensation 
beneficiaries may also be eligible for federal program benefits, such 
as Social Security Disability Insurance (DI) and Supplemental Security 
Income (SSI). For these other programs, the law often limits access or 
reduces benefits for those receiving workers' compensation. For 
example, if a person receives both DI and workers' compensation 
benefits, and together these benefits exceed 80 percent of the injured 
worker's average current earnings, SSA generally reduces the DI 
benefit.[Footnote 142] 

In a prior report, GAO found that SSA's administration of the workers' 
compensation offset provision continued to be undermined by the lack 
of reliable information identifying the receipt of workers' 
compensation benefits by DI beneficiaries, causing payment errors. 
[Footnote 143] No national reporting system identifies workers' 
compensation beneficiaries. Instead, SSA largely relies on applicants 
and beneficiaries to report their receipt of workers' compensation 
benefits and any changes that occur in the benefit amounts--an 
approach that makes it very difficult for SSA to make accurate benefit 
payments. GAO recommended that the Commissioner of Social Security and 
the Administrator of the Centers for Medicare & Medicaid Services test 
the extent to which sharing information that identifies persons who 
are or may be receiving workers' compensation benefits improves the 
accuracy of their benefit payment.[Footnote 144] GAO also recommended 
that SSA officials meet with representatives from the workers' 
compensation insurance industry to determine whether a viable 
voluntary reporting process could be established that would provide 
the government with information that periodically identifies workers' 
compensation beneficiaries. In response, SSA met with the Centers for 
Medicare & Medicaid Services and representatives of the workers' 
compensation insurance industry. Since these meetings, SSA has been 
able to do some data sharing with states, but on a very limited basis 
due to systems limitations. Additionally, the workers' compensation 
insurance data held by privately-owned organizations is not available. 
Therefore, GAO continues to believe that this problem should be 
addressed. 

For federal workers, the Federal Employees' Compensation Act (FECA) 
program provides wage loss compensation and payments for medical 
treatment to those federal employees who are injured in the 
performance of their federal duties.[Footnote 145] A claimant can 
receive both FECA and SSA retirement benefits, although the claimant's 
FECA wage-loss-compensation payment is to be reduced by the amount of 
SSA retirement benefits attributable to federal service. Similarly, a 
claimant can receive both FECA and SSA disability benefits, although 
in such cases SSA is required to reduce the level of disability 
benefits it pays if the combined benefits exceed a certain amount. 

As GAO reported in February 2008, the FECA program is vulnerable to 
improper payments. Some overpayments occur because Labor's Office of 
Workers' Compensation Programs (OWCP), which administers the program, 
does not regularly verify whether claimants are receiving SSA 
retirement benefits, for which FECA benefits are to be reduced. GAO 
recommended that OWCP take steps to ensure that wage-loss-compensation 
payments for claimants covered by the federal retirement system are 
appropriately reduced by the amount of their SSA benefits that are 
attributable to their federal service. In response to our 
recommendation, OWCP reported that it has implemented an automated 
request to be sent to SSA when a claimant reaches retirement 
eligibility age to identify cases in which FECA payments should be 
reduced due to the receipt of Social Security retirement benefits. If 
this system functions as planned, it has the potential to reduce 
overpayments. Further, in October 2010, the SSA Office of Inspector 
General found that improper payments resulted when recipients' FECA 
compensation was not recorded or accounted for in the calculation of 
their DI and SSI benefits.[Footnote 146] The Office of Inspector 
General projected that there were approximately $43 million in 
estimated DI overpayments and approximately $603,140 in SSI 
overpayments, based on a sample of beneficiaries who received FECA 
compensation any time from June 2002 to April 2010. 

Actions Needed and Potential Financial or Other Benefits: 

In response to prior recommendations, SSA has taken steps to explore 
the possibilities of sharing information with states and the workers' 
compensation insurance industry to identify persons who might be 
receiving workers' compensation benefits. While some information 
sharing has taken place, GAO continues to believe that additional 
opportunities exist to share information. While obtaining information 
from states is difficult, these efforts may help identify workers' 
compensation beneficiaries so that benefits can be appropriately and 
accurately offset. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to the Department of Labor 
and the Social Security Administration for review and comment. Labor 
did not provide comments. SSA provided technical comments, which were 
incorporated as appropriate. As part of their comments, SSA indicated 
that as recently as 2011, they submitted draft legislation to Congress 
to require state and local governments, and any other entities that 
administer workers compensation and private disability plans, to 
provide SSA with information on payments to individuals under such 
plans. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional audit work GAO conducted. 

Related GAO Products: 

Federal Workers' Compensation: Better Data and Management Strategies 
Would Strengthen Efforts to Prevent and Address Improper Payments. 
[Hyperlink, http://www.gao.gov/products/GAO-08-284] Washington, D.C.: 
February 26, 2008. 

Supplemental Security Income: Progress Made in Detecting and 
Recovering Overpayments, but Management Attention Should Continue. 
[Hyperlink, http://www.gao.gov/products/GAO-02-849] Washington, D.C.: 
September 16, 2002. 

SSA Disability: Enhanced Procedures and Guidance Could Improve service 
and Reduce Overpayments to Concurrent Beneficiaries. [Hyperlink, 
http://www.gao.gov/products/GAO-02-802] Washington, D.C.: September 5, 
2002. 

Workers' Compensation: Action Needed to Reduce Payment Errors in SSA 
Disability and Other Programs. [Hyperlink, 
http://www.gao.gov/products/GAO-01-367] Washington, D.C.: May 4, 2001. 

Contact Information: 

For additional information about this area, contact Charles Jeszeck at 
(202) 512-7215 or jeszeckc@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The federal government has played a major role in supporting housing 
since the 1930s. It funds programs that assist homebuyers, renters, 
and state and local governments. The goals of these efforts include 
encouraging homeownership and providing affordable rental housing for 
low-income families. Millions of Americans have benefited, whether by 
taking out a federally guaranteed mortgage, deducting mortgage 
interest or real estate taxes from income, or receiving a rental 
subsidy. In fiscal year 2010, the federal government incurred about 
$170 billion for obligations for housing-related programs and 
estimated revenue forgone for tax expenditures.[Footnote 147] Tax 
expenditures represent $132 billion (about 78 percent) and may be 
viewed as spending programs channeled through the tax system because 
they are federal revenue forgone due to exclusions, credits, 
deductions, deferrals, and preferential rates.[Footnote 148] 

In the current housing crisis, support for homeownership has expanded 
dramatically with nearly all mortgage originations having direct or 
indirect federal support. The Department of the Treasury (Treasury) 
and the Board of Governors of the Federal Reserve System (Federal 
Reserve) together invested more than $1.67 trillion in Fannie Mae and 
Freddie Mac, the government-sponsored enterprises, which issue and 
guarantee mortgage-backed securities. Specifically, Treasury purchased 
about $221 billion of mortgage-backed securities issued by Fannie Mae 
and Freddie Mac and about $183 billion of senior preferred stock, and 
the Federal Reserve purchased $1.27 trillion in the debt and 
securities of Fannie Mae and Freddie Mac. The ultimate costs of these 
efforts are not yet known. The federal role also expanded through 
programs such as the Home Affordable Modification Program and the 
First-Time Homebuyer Credit. However, fiscal and budget realities call 
into question continued maintenance of 160 different efforts with 
similar goals and sometimes parallel delivery systems. 

What GAO Found: 

Twenty different entities administer 160 programs, tax expenditures, 
and other tools GAO identified that supported homeownership and rental 
housing in fiscal year 2010 (see fig. below).[Footnote 149] For 
example, 39 programs, tax expenditures, and other tools provide 
assistance for buying, selling, or financing a home, such as the 
single-family guaranteed loan program of the Department of Housing and 
Urban Development's (HUD) Federal Housing Administration (FHA), the 
Department of Agriculture's (USDA) Rural Housing Service (RHS), and 
the Department of Veterans Affairs and the capital gains exclusion on 
home sales administered by Treasury's Internal Revenue Service (IRS). 
Eight programs and tax expenditures provide assistance for rental 
property owners, such as separate project-based rental assistance 
programs provided by HUD and RHS and accelerated depreciation on 
rental housing administered by the IRS. Program overlap can occur when 
agencies and programs address the same or similar needs or target 
similar populations, and can result in fragmentation. 

Figure 6: Housing Activities/Programs by Purpose and Agency in Fiscal 
Year 2010: 

Primary purpose of activity[A]: Rental assistance for tenants; 
Number of activities/programs: 6; 
Agency/Entity: 
HUD: [Check]; 
Treas/IRS: [Empty]; 
USDA: [Check]; 
FHLB: [Empty]; 
VA: [Empty]; 
Regulators: [Empty]; 
NRC: [Empty]; 
FFIEC: [Empty]; 
CFPB: [Empty]; 
FCS: [Empty]; 
Fannie: [Empty]; 
Freddie: [Empty]; 
FarmerM: [Empty]; 
Interior: [Empty]; 
Labor: [Check]; 
FHFA: [Empty]; 
FCA: [Empty]. 

Primary purpose of activity[A]: Operation/management of rental housing; 
Number of activities/programs: 6; 
Agency/Entity: 
HUD: [Check]; 
Treas/IRS: 
USDA: [Check]; 
FHLB: [Empty]; 
VA: [Empty]; 
Regulators: [Empty]; 
NRC: [Empty]; 
FFIEC: [Empty]; 
CFPB: [Empty]; 
FCS: [Empty]; 
Fannie: [Empty]; 
Freddie: [Empty]; 
FarmerM: [Empty]; 
Interior: [Empty]; 
Labor: [Empty]; 
FHFA: [Empty]; 
FCA: [Empty]. 
                 
Primary purpose of activity[A]: Regulator of Government-Sponsored 
Enterprises; 
Number of activities/programs: 2; 
Agency/Entity: 
HUD: [Empty]; 
Treas/IRS: [Empty]; 
USDA: [Empty]; 
FHLB: [Empty]; 
VA: [Empty]; 
Regulators: [Empty]; 
NRC: [Empty]; 
FFIEC: [Empty]; 
CFPB: [Empty]; 
FCS: [Empty]; 
Fannie: [Empty]; 
Freddie: [Empty]; 
FarmerM: [Empty]; 
Interior: [Empty]; 
Labor: [Empty]; 
FHFA: [Check]; 
FCA: [Check]. 

Source: GAO. 

CFPB = Consumer Financial Protection Bureau; 
Fannie = Fannie Mae; 
FarmerM = Federal Agricultural Mortgage Corporation (Farmer Mac); 
FCA = Farm Credit Administration; 
FCS = Farm Credit System; 
FFIEC = Federal Financial Institutions Examination Council; 
FHFA = Federal Housing Finance Agency; 
FHLB = Federal Home Loan Banks Administration; 
Freddie = Freddie Mac; 
HUD = Department of Housing and Urban Development; 
Interior = Department of interior/Bureau of Indian Affairs; 
Labor = Department of Labor; 
NRC = Neighborhood Reinvestment; 
Regulators = Financial federal regulators include the Federal Reserve, 
Federal Deposit Insurance Corporation, Office of the Comptroller of 
the Currency, and National Credit Union; 
Treas/IRS = Treasury/Internal Revenue Service; 
USDA = Department of Agriculture; 
VA = Department of Veterans Affairs. 

[A] Some activities may have multiple purposes. 

[B] Activities undertaken only by the Federal Reserve, not other 
regulators. 

[End of figure] 

As GAO reported in September 2000, overlap exists between products 
offered and markets served by USDA's RHS, HUD, and others, and GAO 
questioned the need for maintaining separate programs for rural areas. 
GAO recommended that Congress consider requiring USDA and HUD to 
examine the benefits and costs of merging programs and cited RHS's and 
FHA's single-family guaranteed loan and multifamily portfolio 
management programs. In response, USDA noted that such a merger could 
be detrimental and result in rural areas losing a federal voice. In 
addition, HUD noted that without legislative changes, any efforts to 
merge the programs likely would result in a more cumbersome delivery 
system. The House Committee on Financial Services held hearings in 
2011 considering a proposal that would move management of rural 
housing programs to HUD. 

GAO's ongoing work has shown increased evidence that some RHS and FHA 
programs can be consolidated. For instance, 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 delivery structures. 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. Since GAO's 2000 report, the trend away from labor-
intensive direct loans to guaranteed loans has accelerated. 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--costs for overseeing 
and disposing of such properties, were $887 million in 2010. In 
contrast, RHS's costs for foreclosed property management are lower 
because RHS requires lenders to dispose of 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 geographic boundaries 
greatly limited communication and transportation. These limitations 
have diminished and HUD programs can be used in all areas of the 
country. 

Additionally, the two agencies offer examples of overlap in products 
offered (mortgage credit and rental assistance), functions performed 
(portfolio management and preservation), and geographic areas served. 
For instance, RHS and HUD guarantee single-family and multifamily 
loans, and offer rental subsidies using similar income eligibility 
criteria. Also, 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. 

As shown in the figure above, Treasury and 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. 
Furthermore, inadequate or missing data and difficulties in 
quantifying the benefits of some tax expenditures can impede studies 
of their efficiency, effectiveness, and equity. 

Data represent a key challenge, as the data necessary to assess who 
benefits from tax expenditures is not always collected on tax returns 
unless IRS needs the information or collection was legislatively 
mandated. For example, although IRS collects some data on the mortgage 
interest deduction (the single-largest, housing-related tax 
expenditure), the data may not contribute to analyses of its 
effectiveness. Studies by the Joint Committee on Taxation and others 
differ as to the extent to which the mortgage interest deduction 
increases homeownership. Some studies suggest that the deduction 
increases homeownership, while others suggest that the deduction 
increases the price of housing (and higher prices are negatively 
associated with homeownership rates). Furthermore, some analyses 
emphasize the need for additional data to more effectively assess the 
impact of proposed modifications to the mortgage interest deduction on 
homeownership. 

GAO recommended in September 2005 that the Office of Management and 
Budget (OMB) use information on outlay programs and tax expenditures 
to recommend to the President and Congress the most effective methods 
for accomplishing federal objectives. GAO concluded that better 
targeting by Congress and the executive branch of all federal spending 
and subsidy programs could save resources and increase economic 
efficiency. As discussed later, OMB disagreed with GAO's 2005 
recommendations. 

Actions Needed and Potential Financial or Other Benefits: 

HUD and RHS have shared beneficial practices. For example, RHS 
collaborated with HUD on restructuring multifamily mortgages, 
underwriting guaranteed loans, and making properties more energy-
efficient. In 2010, the White House's Domestic Policy Council 
established a Rental Policy Working Group to better coordinate among 
HUD, USDA, and Treasury. The agencies have been aligning rules for 
rental programs, will examine homeownership programs, and expect to 
accept each other's inspections and forms for housing programs. In 
2011, the House Financial Services Subcommittee on Insurance, Housing 
and Community Opportunity developed draft legislation and hosted 
hearings in May and September on a proposal to move management of 
rural housing programs from USDA to HUD. At the May hearing, while 
some industry experts said the consolidation plan merited further 
discussion, others stated the proposal could negatively affect USDA's 
efforts to deliver its other rural development programs. In September, 
the RHS Administrator testified that while she believed RHS and HUD 
shared an important commitment to meeting the housing needs of rural 
America, she opposed the draft legislation. She believed that RHS 
housing services uniquely served rural communities by working in 
"synergy" with other rural development programs. 

GAO recommended in September 2000 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. 
Further, GAO noted that as a first step, the Congress could consider 
requiring RHS and HUD to explore merging their single-family insured 
lending programs and multifamily portfolio management programs, taking 
advantage of the best practices of each and ensuring that targeted 
populations are not adversely affected. 

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 at HUD, USDA, and VA. According to HUD, a 
benchmarking effort associated with the task force was recently begun. 
GAO's ongoing work considers options for consolidating these programs 
and GAO expects to make additional recommendations. : 

GAO 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. Coordinated reviews of support of housing, 
which consists of tax expenditures and federal programs and 
regulations, could be useful. Specifically, GAO recommended in 
September 2005 and March 2011 that the Director of OMB, in 
consultation with the Secretary of the Treasury should: 

* develop and implement a framework for conducting performance reviews 
of tax expenditures. This includes (1) outlining leadership 
responsibilities and coordination among agencies with related 
responsibilities; (2) setting a review schedule; (3) identifying 
review methods and ways to address the lack of credible tax 
expenditure information; and (4) identifying resources needed for tax 
expenditure reviews; and: 

* require that tax expenditures be included in executive branch budget 
and performance review processes. 

OMB, citing methodological and conceptual issues, disagreed with GAO's 
2005 recommendations. To date, OMB has 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 
crosscutting areas.[Footnote 150] Such analysis could help identify 
redundancies. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to USDA, HUD, Department 
of Veterans Affairs, Treasury, the Internal Revenue Service, OMB, 
Federal Housing Finance Agency, Federal Reserve, Federal Deposit 
Insurance Corporation, Office of the Comptroller of the Currency, 
Consumer Financial Protection Bureau, Federal Financial Institutions 
Examination Council, and the Farm Credit Administration for review and 
comment. The Department of Veterans Affairs and the Consumer Financial 
Protection Bureau provided no comments. All other agencies provided 
technical comments, which were incorporated as appropriate. USDA 
reiterated the position that its rural agencies and programs, 
including the delivery system, serve a unique purpose and are vital to 
the rural communities they serve. In addition, USDA noted its recent 
efforts to streamline and improve the effectiveness of federal 
programs that serve rural communities, as part of the agency's 
involvement in the President's Rural Council. OMB stated that it 
agrees that savings might be achieved from the partial consolidation 
of guaranteed loan programs across agencies, but noted that any 
savings may be limited because USDA's decentralized field offices 
support more than loan guarantee programs. OMB also indicated that 
they will identify tax expenditures which support the achievement of a 
limited number of cross-agency priority goals along with the fiscal 
year 2013 President's Budget, as required by the GPRA Modernization 
Act of 2010. 

How GAO Conducted Its Work: 

The information in this submission is based on findings from the 
products listed in the related GAO products section and additional 
work GAO conducted. GAO reviewed prior reports as well as collected 
and analyzed preliminary information from housing industry, USDA, and 
HUD officials, on examples of overlap or fragmentation in products 
offered, functions performed, and geographic areas served by various 
federal housing programs. GAO developed a catalog of direct spending 
programs, tax expenditures, and other activities used by federal 
agencies and financial regulators to support rental housing and 
homeownership, and identified what is known about the purpose, cost, 
eligibility, and populations served. GAO reviewed the Catalog of 
Federal Domestic Assistance, agency program documentation, and 
previous studies by the Congressional Research Service, Congressional 
Budget Office, and other housing groups, and interviewed agency 
officials. GAO also reviewed the fiscal year 2012 President's Budget, 
agencies' budget justification, the Joint Committee on Taxation's 
estimates of tax expenditures, and a compendium of tax expenditures 
prepared by the Congressional Research Service to obtain information 
on obligations, full-time equivalents, credit subsidy costs, 
administrative costs, and revenue loss estimates incurred by the 
federal government in administering housing programs. Appendix III 
lists the programs GAO identified that may have similar or overlapping 
objectives, provide similar services or be fragmented across 
government missions. Overlap and fragmentation may not necessarily 
lead to actual duplication, and some degree of overlap and duplication 
may be justified. 

Related GAO Products: 

Federal Housing Administration: Improvements Needed in Risk Assessment 
and Human Capital Management. [Hyperlink, 
http://www.gao.gov/products/GAO-12-15] Washington, D.C.: November 7, 
2011. 

Tax Administration: Expanded Information Reporting Could Help IRS 
Address Compliance Challenges with Forgiven Mortgage Debt. [Hyperlink, 
http://www.gao.gov/products/GAO-10-997] Washington, D.C.: August 31, 
2010. 

Home Mortgage Interest Deduction: Despite Challenges Presented by 
Complex Tax Rules, IRS Could Enhance Enforcement and Guidance. 
[Hyperlink, http://www.gao.gov/products/GAO-09-769] Washington, D.C.: 
July 29, 2009. 

Real Estate Tax Deduction: Taxpayers Face Challenges in Determining 
What Qualifies; Better Information Could Improve Compliance. 
[Hyperlink, http://www.gao.gov/products/GAO-09-521] Washington, D.C.: 
May 13, 2009. 

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.: 
September 23, 2005. 

Rural Housing Service: Overview of Program Issues. [Hyperlink, 
http://www.gao.gov/products/GAO-05-382T] Washington, D.C.: March 10, 
2005. 

Elderly Housing: Federal Housing Programs That Offer Assistance for 
the Elderly. [Hyperlink, http://www.gao.gov/products/GAO-05-174] 
Washington, D.C.: February 14, 2005. 

Rural Housing: Changing the Definition of Rural Could Improve 
Eligibility Determinations. [Hyperlink, 
http://www.gao.gov/products/GAO-05-110] Washington, D.C.: December 3, 
2004. 

Rural Housing Service: Opportunities to Improve Management, 
[Hyperlink, http://www.gao.gov/products/GAO-03-911T] Washington, D.C.: 
June 19, 2003. 

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.: 
September 15, 2000. 

Contact Information: 

For additional information about this area, contact Mathew Scirè at 
(202) 512-8678 or sciremj@gao.gov or James White at (202) 512-9110 or 
whitej@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Millions of children under the age of 5 participate each year in 
federally funded preschool and other early learning programs or 
receive federally supported child care in a range of settings. Federal 
programs that funded early learning and child care as an explicit 
purpose received at least $13.3 billion in federal funding in fiscal 
year 2010.[Footnote 151] Research supports the importance of providing 
high-quality early learning experiences during children's formative 
years.[Footnote 152] Furthermore, as GAO reported in May 2010, 
research indicates that having reliable, high-quality child care is 
also critical to sustaining parents' ability to work. Federal support 
for early learning and child care developed over time to meet emerging 
needs. However, GAO previously reported that multiple federal agencies 
administer this important investment through numerous programs. This 
is perhaps a consequence of the different historical origins of early 
learning and child care programs, creating fragmentation of efforts, 
some overlap of goals or activities, and potential confusion among 
families and other program users. 

What GAO Found: 

The federal investment in early learning and child care is fragmented 
in that it is administered through 45 programs that provide or may 
support related services to children from birth through age 5, as well 
as five tax provisions that subsidize private expenditures in this 
area.[Footnote 153] The programs are concentrated within the 
Departments of Education (Education) and Health and Human Services 
(HHS)--the principal administrators of the federal government's early 
learning and child care programs--but are also administered by the 
Departments of Agriculture, the Interior, Justice, Labor, Housing and 
Urban Development (HUD), the General Services Administration (GSA), 
and the Appalachian Regional Commission. Some of these programs 
overlap in that they have similar goals for children under the age of 
5 and are targeted to similar groups of children. For example, five 
programs, administered by Education and HHS, provide school readiness 
services to low-income children, and programs in both Education and 
the Interior provide funding for early learning services for Indian 
children. 

Among the 45 programs, 12 have an explicit program purpose of 
providing early learning or child care services.[Footnote 154] GAO 
reported in January 2000 that although individual programs may differ 
in the exact services provided, the distinction between early learning 
and child care has blurred over time as policymakers seek to make 
educationally enriching care available to young children. As seen in 
the table below, all 12 programs serve children under the age of 5, 
and some also serve older children; however, they vary in targeted 
child population. Furthermore, they vary substantially in funding 
levels. For example, 9 of the 12 programs obligated less than $500 
million each in fiscal year 2010, while the largest program, Head 
Start, obligated $7.2 billion in that year.[Footnote 155] 

Figure: Purposes and Targeted Populations of Federal Programs That 
Have Early Learning or Child Care as an Explicit Program Purpose: 

Program name by federal agency: 

Specific child population targets: 

Explicit program purpose: 
Age group: 

Department of Education: 

Program name by federal agency: Child Care Access Means Parents in 
School; 
Explicit program purpose: 
Early learning services: Department of Education: [Empty]; 
Explicit program purpose: Child care services: [Check]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Empty]; 
Larger age group, including children under 5: [Check]; 
Other population limits: 
Low-income children: [Check]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Check]. 

Program name by federal agency: Indian Education-Grants to Local 
Educational Agencies; 
Explicit program purpose: 
Early learning services: [Check]; 
Child care services: [Empty]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Empty]; 
Larger age group, including children under 5: [Check]; 
Other population limits: 
Low-income children: [Empty]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Check]. 

Program name by federal agency: Race to the Top - Early Learning 
Challenge; 
Explicit program purpose: 
Early learning services: [Check]; 
Child care services: [Empty]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Check]; 
Larger age group, including children under 5: [Empty]; 
Other population limits: 
Low-income children: [Check]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Empty]. 

Program name by federal agency: Special Education-Grants for Infants 
and Families; 
Explicit program purpose: 
Early learning services: [Check]; 
Child care services: [Empty]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Check]; 
Larger age group, including children under 5: [Empty]; 
Other population limits: 
Low-income children: [Empty]; 
Children with disabilities: [Check]; 
Other targeted populations: [Check]. 

Program name by federal agency: Special Education-Preschool Grants; 
Explicit program purpose: 
Early learning services: [Check]; 
Child care services: [Empty]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Check]; 
Larger age group, including children under 5: [Empty]; 
Other population limits: 
Low-income children: [Empty]; 
Children with disabilities: [Check]; 
Other targeted populations: [Empty]. 

Program name by federal agency: State Fiscal Stabilization Fund - 
Education State Grants, Recovery Act; 
Explicit program purpose: 
Early learning services: [Check]; 
Child care services: [Empty]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Empty]; 
Larger age group, including children under 5: [Check]; 
Other population limits: 
Low-income children: [Empty]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Check]. 

Program name by federal agency: Striving Readers Comprehensive 
Literacy; 
Explicit program purpose: 
Early learning services: [Check]; 
Child care services: [Empty]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Empty]; 
Larger age group, including children under 5: [Check]; 
Other population limits: 
Low-income children: [Check]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Empty]. 

Department of Health and Human Services: 

Program name by federal agency: Child Care and Development Block 
Grant[A]; 
Explicit program purpose: 
Early learning services: [Empty]; 
Child care services: [Check]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Empty]; 
Larger age group, including children under 5: [Check]; 
Other population limits: 
Low-income children: [Check]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Empty]. 

Program name by federal agency: Child Care Mandatory and Matching 
Funds of the Child Care and Development Fund[A]; 
Explicit program purpose: 
Early learning services: [Empty]; 
Child care services: [Check]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Empty]; 
Larger age group, including children under 5: [Check]; 
Other population limits: 
Low-income children: [Check]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Empty]. 

Program name by federal agency: Head Start; 
Explicit program purpose: 
Early learning services: [Check]; 
Child care services: [Empty]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Check]; 
Larger age group, including children under 5: [Empty]; 
Other population limits: 
Low-income children: [Check]; 
Children with disabilities: [Check]; 
Other targeted populations: [Empty]. 

Department of the Interior: 

Program name by federal agency: Indian Child and Family Education 
(FACE); 
Explicit program purpose: 
Early learning services: [Check]; 
Child care services: [Empty]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Check]; 
Larger age group, including children under 5: [Empty]; 
Other population limits: 
Low-income children: [Empty]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Check]. 

General Services Administration: 

Program name by federal agency: The General Services Administration's 
Child Care Program; 
Explicit program purpose: 
Early learning services: [Empty]; 
Child care services: Department of Education: [Check]; 
Specific child population targets: 
Age group: 
Children under 5 primarily: [Check]; 
Larger age group, including children under 5: [Empty]; 
Other population limits: 
Low-income children: [Empty]; 
Children with disabilities: [Empty]; 
Other targeted populations: [Check]. 

Source: GAO analysis of Catalog of Federal Domestic Assistance and 
federal agency program information. 

Note: All programs included in this table are those for which early 
learning or child care is explicitly described as a program purpose, 
according to GAO's analysis of Catalog of Federal Domestic Assistance 
and other agency information. It does not include additional programs 
that either support early learning or child care or that allow such 
services. All programs GAO identified are listed in appendix III. 

[A] In combination, Child Care and Development Block Grant funds and 
Child Care Mandatory and Matching Funds are referred to as the Child 
Care and Development Fund. 

[End of table] 

However, the majority of the 45 programs GAO identified do not have 
the explicit purpose of delivering early learning or child care 
services, but rather permit use of funds for this purpose or provide 
supportive services to facilitate such care. 

* Some programs are multipurpose block grants for which early learning 
or child care is not a primary purpose but which are nevertheless 
known to provide significant funding for child care. For example, the 
Temporary Assistance for Needy Families block grant accounted for $3.5 
billion in child care funding in fiscal year 2009. 

* Other programs may allow funds to be used for early learning or 
child care, but these are not among their primary goals and such uses 
do not typically represent a significant portion of available program 
funds. For example, the Department of Justice has one program to help 
victims of violence that can provide child care as a short-term, 
ancillary service, and Title I Grants to Local Educational Agencies, 
an Education grant, spent about 2 percent of total obligations on 
early education programs in fiscal year 2009. 

* Some programs provide supportive services that can facilitate early 
learning or child care. For example, the Department of Agriculture has 
four programs whose primary purpose is to provide food and nutrition 
services to mostly school-age low-income children, though preschool 
children also receive program services in some cases.[Footnote 156] 

In addition to these federally funded programs, five federal tax 
provisions support early education and care by forgoing tax revenue to 
subsidize the private purchase of child care services. Some tax 
provisions are for families and some are for employers that provide 
child care at the workplace. These five tax expenditures accounted for 
at least $3.1 billion of forgone tax revenue for the U.S. Treasury in 
fiscal year 2010.[Footnote 157] The revenue that the government 
forgoes through tax expenditures can be viewed as spending channeled 
through the tax system, contributing to mission fragmentation and 
program overlap. As GAO previously reported in September 2005, 
coordinated reviews of tax expenditures and related programs may 
reduce fragmentation and overlap.[Footnote 158] While it may be 
possible for some families to receive benefits through both tax 
provisions and federal early learning and child care programs in a 
particular year, many families eligible to participate in federal 
programs may not have tax liabilities due to their low incomes and 
would not benefit from these tax provisions.[Footnote 159] 

Although some programs fund similar types of services for similar 
populations, differing program structures, eligibility requirements, 
and data limitations create obstacles to assessing whether actual 
duplication exists among these programs. 

* Programs are differently structured, administered, and regulated. 
For example, the two largest programs--funded under Head Start and the 
Child Care and Development Fund (CCDF)--differ significantly in their 
structure.[Footnote 160] Head Start was created in part to support 
children's early development by offering comprehensive, community-
based services to meet multiple needs and, as such, provides federal 
grants directly to community-based public and private service 
providers. CCDF, created under welfare reform, helps states reduce 
dependence on public assistance by subsidizing child care to support 
parents' involvement in the workforce and provides grants to states, 
which they in turn generally provide as subgrants to counties or other 
local entities for distribution to parents. 

* The nature of eligibility requirements also differs among programs, 
even for similar subgroups of children, such as those from low-income 
families. For example, Head Start serves primarily low-income children 
under the age of 5 whose families have incomes at or below the 
official federal poverty guidelines, while CCDF funds services to 
children under age 13 whose parents are working or in school and who 
may earn up to 85 percent of state median income. 

* For some programs, relevant programmatic information is sometimes 
not readily available. For example, Education and HHS officials were 
unable to provide GAO with information on the number of children 
served for several programs. As GAO previously reported in 2005 and 
September 2011, HHS did not collect data on working families who 
receive child care assistance directly funded by TANF, and GAO 
suggested that Congress may wish to require this data collection. 

* Inadequate or missing data, as well as difficulties quantifying the 
benefits of some tax expenditures, can make it difficult to study the 
efficiency of these expenditures.[Footnote 161] 

To the extent that programs in different agencies have similarities, 
fragmentation and program overlap can create an environment in which 
programs may not serve children and families as efficiently and 
effectively as possible. The existence of multiple programs can also 
create added administrative costs, such as costs associated with 
determining eligibility and meeting varied reporting requirements. 
However, despite some overlap in program purposes and targets, it is 
likely that service gaps exist, since these programs generally are not 
designed as entitlements that serve all eligible children. For 
example, as GAO previously reported in May 2010, about one-third or 
fewer of potentially eligible children received child care subsidies 
from CCDF, Temporary Assistance for Needy Families, and the Social 
Services Block Grant between fiscal years 2004 and 2007, according to 
GAO's review of several HHS estimates. HHS has identified improving 
program access and quality as high-priority performance goals for both 
Head Start and child care programs. 

Coordinating the administration and evaluation of early learning and 
child care programs can help mitigate the effects of program 
fragmentation and overlap and potentially help bridge service gaps; 
however, there is currently no federal interagency workgroup that 
coordinates early learning and child care efforts across all federal 
agencies with such programs. Education and HHS have numerous 
coordinating initiatives and agreements with each other, within their 
departments, and in support of state and local coordination. For 
example, Education and HHS formed an interagency policy board in 
August 2010 whose goals included improving the quality and 
effectiveness of Education and HHS early learning programs; increasing 
the coordination of research, technical assistance and data systems; 
and, in an advisory role, maximizing resources. In 2009, HHS 
established an executive-level liaison office to coordinate 
interagency efforts, and Education proposed establishing a similar 
coordination office in 2011. Education and HHS have also collaborated 
in jointly administering the Race to the Top -Early Learning 
Challenge. In addition, the two departments have supported early 
learning and child care coordination at the state and local levels, 
such as through State Advisory Councils on Early Childhood Education 
and Care and other early childhood programs.[Footnote 162] HHS has 
also established workgroups and collaborative efforts with several 
other individual federal departments, such as Agriculture, Defense, 
and HUD, to increase the availability and quality of child care or for 
other goals. However, these workgroups do not bring multiple agencies 
together, and GSA, the Departments of the Interior, Justice, Labor, 
and the Appalachian Regional Commission also have programs with some 
child care component that are not part of broader cross-agency 
initiatives but could likely benefit from the expertise of Education 
and HHS. 

The GPRA Modernization Act of 2010 (GPRAMA) could serve as a vehicle 
for furthering interdepartmental coordination of early learning and 
child care. The Act established a new, cross-cutting, and integrated 
framework for achieving results and improving government 
performance.[Footnote 163] Among other things, 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. The executive branch and 
Congress could use this process to identify and address program areas 
where strengthened interagency coordination is needed to better 
achieve results as well as areas of fragmentation, overlap and 
duplication. 

Actions Needed and Potential Financial or Other Benefits: 

As the principal administrators of the federal government's early 
learning and child care programs, and consistent with Education's and 
HHS's identification of early learning access and quality as 
priorities, the Secretaries of Education and HHS should: 

* deepen and extend their ongoing coordination efforts by including 
all the federal agencies that provide or support early learning or 
child care services in an inter-departmental workgroup that focuses on 
this population. 

Using the GPRAMA framework, workgroup goals could include mitigating 
the effects of program fragmentation (for example, through simplifying 
children's access to these services), identifying and managing service 
gaps, meeting data requirements for the coordinated operation and 
evaluation of these programs, and identifying and minimizing any 
unwarranted overlap. These efforts could also provide a vehicle to 
conduct a coordinated analysis of child care tax expenditures and 
program spending. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to Education, HHS, and 
OMB. HHS provided written comments. Education and OMB, as well as HHS, 
provided technical comments, which were incorporated as appropriate. 

All three agencies agreed on the importance of further coordination of 
the federal programs supporting early learning and child care. 
Education explicitly agreed with GAO's recommended action and 
identified an existing interagency workgroup as a means of 
coordinating early learning and child care services. This group 
currently focuses primarily on services for youth from early to late 
adolescence. HHS acknowledged but did not explicitly agree or disagree 
with the specific action GAO recommended, while OMB questioned the 
need for a new interagency working group and the efficiency of 
including agencies whose programs are not explicitly designed to 
deliver early learning or child care services. GAO believes that 
agencies with some, but not extensive, investment in early learning or 
child care might benefit greatly from such inclusion to reduce any 
effects of fragmentation. Extending interagency coordination could be 
efficiently accomplished through an existing workgroup on early 
learning and child care, for example, by establishing a subcommittee 
with representation from the additional agencies. GAO has modified the 
recommended action to clarify that inclusion of these additional 
agencies does not necessarily entail establishing a new federal 
interagency workgroup. 

HHS also highlighted information on its ongoing coordination efforts 
and noted concerns with the report's treatment of specific issues. 
Specifically, HHS stated that the report did not fully explore how 
program services may be complementary rather than duplicative, take 
into account that many states jointly administer flexible funding 
streams to provide services to children and families, or adequately 
explain the distinction between federally funded early learning and 
child care programs and federally funded programs that permit the use 
of funds for the provision of child care. As noted in this report, the 
complexity of the current service delivery system, combined with data 
limitations, form significant obstacles to assessing the extent to 
which services are complementary or duplicative. GAO's report 
acknowledges the role that states play in coordinating these programs 
but, as HHS's comments indicate, the extent to which states coordinate 
the administration of early learning and child care funding streams 
can and does vary. Moreover, the federal government also has an 
important role in program administration, necessitating a federal role 
in coordination. Further, GAO clearly distinguished between programs 
that have an explicit purpose to provide these services, like CCDF and 
Head Start, and those that permit the use of funds for these services 
or that provide supportive services to facilitate such care; however, 
it remains important to note that some of the latter group, such as 
Temporary Assistance for Needy Families nonetheless provide 
significant funding for child care. 

OMB recommended that GAO remove two programs from the list of programs 
with an explicit early learning or child care purpose; however, GAO 
did not change the program list because the programs met GAO's 
criteria. 

As part of its routine audit work, GAO will monitor the progress 
agencies make in addressing this needed action and report to Congress. 
All written comments are reprinted in appendix IV. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted. GAO searched the Catalog of Federal 
Domestic Assistance to identify federal early learning and child care 
programs; obtained supplementary information from Education, HHS, and 
other agencies; and reviewed previous GAO reports on early learning 
and child care.[Footnote 164] GAO did not conduct a separate legal 
review to identify and analyze relevant programs. In its work, GAO 
identified 45 early learning and child care programs that met its 
criteria for analysis: those that (1) fund or support early education 
or child care services; (2) are provided to children under age 5; and 
(3) deliver services in an educational or child care setting. GAO also 
identified a subset of 12 programs with early learning and child care 
as an explicit program purpose. GAO determined that the Catalog of 
Federal Domestic Assistance was sufficiently reliable for GAO's 
purposes by confirming with federal agency officials that the programs 
identified met GAO's criteria and obtaining information from agencies 
about any additional programs for GAO consideration. GAO searched the 
Congressional Research Service's 2010 Tax Expenditures: Compendium of 
Background Material on Individual Provisions to identify five tax 
expenditures that met similar criteria for early learning and child 
care.[Footnote 165] GAO obtained and analyzed descriptions of 
Education and HHS coordination efforts for early learning and child 
care programs, but assessing the effectiveness of these two particular 
agencies' coordination efforts was beyond the scope of this study. 
Appendix III lists the programs GAO identified that may have similar 
or overlapping objectives, provide similar services or be fragmented 
across government missions. Overlap and fragmentation may not 
necessarily lead to actual duplication, and some degree of overlap and 
duplication may be justified. Appendix III also lists related tax 
expenditures. 

Related GAO Products: 

Temporary Assistance for Needy Families: Update on Families Served and 
Work Participation. [Hyperlink, 
http://www.gao.gov/products/GAO-11-880T] Washington, D.C.: September 
8, 2011. 

Human Services Programs: Opportunities to Reduce Inefficiencies. 
[Hyperlink, http://www.gao.gov/products/GAO-11-531T] Washington, D.C.: 
April 5, 2011. 

Federal Education Funding: Overview of K-12 and Early Childhood 
Education Programs. [Hyperlink, 
http://www.gao.gov/products/GAO-10-51] Washington, D.C.: January 27, 
2010. 

Child Care: Multiple Factors Could Have Contributed to the Recent 
Decline in the Number of Children Whose Families Receive Subsidies. 
[Hyperlink, http://www.gao.gov/products/GAO-10-344] Washington, D.C.: 
May 5, 2010. 

Human Service Programs: Demonstration Projects Could Identify Ways to 
Simplify Policies and Facilitate Technology Enhancements to Reduce 
Administrative Costs. [Hyperlink, 
http://www.gao.gov/products/GAO-06-942] Washington, D.C.: September 
19, 2006. 

Child Care: Additional Information Is Needed on Working Families 
Receiving Subsidies. [Hyperlink, 
http://www.gao.gov/products/GAO-05-667] Washington, D.C.: June 29, 
2005. 

GAO Update on the Number of Prekindergarten Care and Education 
Programs. [Hyperlink, http://www.gao.gov/products/GAO-05-678R] 
Washington, D.C.: June 2, 2005. 

Head Start and Even Start: Greater Collaboration Needed on Measures of 
Adult Education and Literacy. [Hyperlink, 
http://www.gao.gov/products/GAO-02-348] Washington, D.C.: March 29, 
2002. 

Early Education and Care: Overlap Indicates Need to Assess 
Crosscutting Programs. [Hyperlink, 
http://www.gao.gov/products/GAO/HEHS-00-78] Washington, D.C.: April 
28, 2000. 

Early Childhood Programs: Characteristics Affect the Availability of 
School Readiness Information. [Hyperlink, 
http://www.gao.gov/products/GAO/HEHS-00-38] Washington, D.C.: February 
28, 2000. 

Contact Information: 

For additional information about this area, contact Kay E. Brown at 
(202) 512-7215 or brownke@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Nearly one in five people in the United States has a disability. 
[Footnote 166] In fiscal year 2010, the federal government obligated 
at least $3.5 billion in employment supports to help this population 
become more self-sufficient. Even so, in December 2011, the 
unemployment rate for people with disabilities was 13.5 percent, 
higher than the rate for people without disabilities (8.1 percent). 
Research has shown that people with disabilities may face multiple 
barriers to employment, including poor health or functioning; 
inadequate skills or training; lack of accessible workplaces or 
accommodations; and discrimination. Over the years, many programs 
across the federal government, including within the Departments of 
Education; Health and Human Services; Labor; and Veterans Affairs and 
other agencies, have been created or have evolved to address these 
barriers. 

For 15 years, GAO has reported on the need for better coordination 
among all disability programs to mitigate fragmentation, overlap, and 
potential for duplication. As GAO reported in September 1996, programs 
helping people with disabilities were not working together 
efficiently, and people with disabilities may have been receiving 
duplicate services or facing service gaps due to lack of coordination. 
Over a decade later, in May 2008, GAO and others recommended 
establishing a coordinating entity--perhaps under the leadership of 
the executive branch--to develop a federal strategy to integrate 
services and support for individuals with disabilities. To date, no 
coordinating entity has been established, and this lack of 
coordination was a factor in federal disability programs remaining on 
GAO's high-risk list in February 2011. 

What GAO Found: 

GAO identified 50 programs that, in fiscal year 2010, supported 
employment for people with disabilities and found that these programs 
were fragmented and often provided similar services to similar 
populations.[Footnote 167] Among these programs, GAO included six 
programs that were eliminated or are slated to end by the end of 
fiscal year 2012.[Footnote 168] The 50 programs were administered by 
nine federal agencies and were overseen by even more congressional 
committees (see figure below).[Footnote 169] More than half (30) of 
these programs served only people with disabilities, while the other 
programs served a broader population but provided special 
consideration or gave priority in service to people with disabilities 
or their employers. The definitions of disability that programs used 
varied, and 20 percent of programs reported having no specific 
definition of disability. Fragmented programs that do not coordinate 
effectively could waste scarce funds, confuse and frustrate program 
beneficiaries, and limit the overall effectiveness of the federal 
effort. 

Figure: Programs Supporting Employment for People with Disabilities, 
in Fiscal Year 2010, Were Fragmented across Nine Federal Agencies: 

Figure: Programs Supporting Employment for People with Disabilities, 
in Fiscal Year 2010, Were Fragmented across Nine Federal Agencies: 

[Refer to PDF for image: jigsaw puzzle pieces] 

Department of Labor[A]: 
Number of programs: 15. 

U.S. AbilityOne commission: 
Number of programs: 1. 

Department of Agriculture: 
Number of programs: 1. 

Internal Revenue Service[A]: 
Number of programs: 1. 

Department of Health and Human Services: 
Number of programs: 5. 

Department of Veterans Affairs: 
Number of programs: 4. 

Department of Education: 
Number of programs: 10. 

Social Security Administration: 
Number of programs: 6. 

Department of Defense[A]: 
Number of programs: 9. 

Source: GAO analysis. 

[A] The Department of Labor jointly administers the Workforce 
Recruitment Program with the Department of Defense and the Work 
Opportunity Tax Credit with the Internal Revenue Service. These 
programs are therefore included under both the Department of Labor and 
each of their respective agencies in the above graphic.  

[End of figure] 

Many of the 50 programs GAO identified overlapped in that they 
provided similar employment services to similar populations. GAO 
surveyed the programs and found that they provided a range of 
services, from employment counseling and job search assistance to tax 
credits for employers who hire people with disabilities. Overlap was 
the greatest in programs serving two distinct population groups--
veterans and servicemembers; and students and young adults. GAO 
identified 18 programs that limited eligibility to veterans and 
servicemembers, 6 that limited eligibility to students and young 
adults, and 14 programs that did not limit eligibility to any 
particular population and were potentially available to individuals in 
these groups. For example, as shown in the table, officials at five of 
the six youth programs reported that they provided employment 
counseling, assessment, and case management. At the same time, any 
youth could have received these services from nine other programs that 
did not limit eligibility to a particular population. 

Table: Programs Providing Similar Employment Services to Similar 
Populations, in Fiscal Year 2010: 

Employment-related information dissemination; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 17; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 5; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 10; 
Programs that served all people with disabilities (14 total): 10; 
Total programs offering each service (50 total): 42. 

Employment counseling, assessment, and case management; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 15; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 5; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 10; 
Programs that served all people with disabilities (14 total): 9; 
Total programs offering each service (50 total): 39. 

Job readiness skills; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 16; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 5; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 9; 
Programs that served all people with disabilities (14 total): 8; 
Total programs offering each service (50 total): 38. 

Job search or job placement activities; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 15; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 5; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 9; 
Programs that served all people with disabilities (14 total): 8; 
Total programs offering each service (50 total): 37. 

Job recruitment and referrals; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 15; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 5; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 9; 
Programs that served all people with disabilities (14 total): 7; 
Total programs offering each service (50 total): 36. 

Assistive technology and workplace accommodations; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 12; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 4; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 10; 
Programs that served all people with disabilities (14 total): 10; 
Total programs offering each service (50 total): 36. 

Job development; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 14; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 4; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 9; 
Programs that served all people with disabilities (14 total): 7; 
Total programs offering each service (50 total): 34. 

Job retention training; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 13; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 4; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 9; 
Programs that served all people with disabilities (14 total): 7; 
Total programs offering each service (50 total): 33. 

Support and services to employers of people with disabilities; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 13; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 3; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 8; 
Programs that served all people with disabilities (14 total): 8; 
Total programs offering each service (50 total): 32. 

On-the-job training; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 10; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 4; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 9; 
Programs that served all people with disabilities (14 total): 7; 
Total programs offering each service (50 total): 30. 

Occupational or vocational training; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 11; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 3; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 8; 
Programs that served all people with disabilities (14 total): 6; 
Total programs offering each service (50 total): 28. 

Work experience; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 12; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 5; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 6; 
Programs that served all people with disabilities (14 total): 4; 
Total programs offering each service (50 total): 27. 

Entrepreneurship training and support; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 10; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 3; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 7; 
Programs that served all people with disabilities (14 total): 6; 
Total programs offering each service (50 total): 26. 

Vocational rehabilitation; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 10; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 1; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 9; 
Programs that served all people with disabilities (14 total): 5; 
Total programs offering each service (50 total): 25. 

Supported employment; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 9; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 1; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 8; 
Programs that served all people with disabilities (14 total): 6; 
Total programs offering each service (50 total): 24. 

Assistance in earning a high school diploma or its equivalent; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 6; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 5; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 5; 
Programs that served all people with disabilities (14 total): 6; 
Total programs offering each service (50 total): 22. 

Remedial academic, English language skills, or basic adult literacy; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 6; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 4; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 5; 
Programs that served all people with disabilities (14 total): 4; 
Total programs offering each service (50 total): 19. 

Tax expenditures related to workers with disabilities; 
Programs that limited eligibility to service-members, veterans, and/or 
their families (18 total): 2; 
Programs that limited eligibility to students, transition age youth, 
and/or young adults (6 total )[A]: 0; 
Programs that limited eligibility to other populations or disabilities 
(12 total)[B]: 0; 
Programs that served all people with disabilities (14 total): 0; 
Total programs offering each service (50 total): 2. 

Source: GAO survey of federal programs that support employment for 
people with disabilities. 

[A] Although the Job Corps program is generally limited to youth, 
eligible people with disabilities can participate in the program at 
any age. Therefore, GAO included the Job Corps program in the 
category, "programs that served all people with disabilities." 

[B] Some programs within this category limited eligibility to similar 
populations, such as recipients of Social Security Disability 
Insurance and Supplemental Security Income, while others were unique 
in limiting eligibility to certain populations. For example, one 
program in this category limited eligibility to Native Americans, 
another limited eligibility to people who are blind, and a third 
limited eligibility to people with disabilities and their families 
engaged in production agriculture. 

[End of table] 

Some programs that provided similar services to similar populations 
had a greater potential for duplication than others. For example, the 
Department of Labor's Disabled Veterans' Outreach Program and the 
Local Veterans' Employment Representatives program both reported that 
they provided job search and placement services to veterans with 
disabilities, among other similar services. Labor officials said that 
the veterans' employment representatives were intended to reach out to 
employers and the disabled veterans' outreach specialists were 
intended to work with job seekers. However, as GAO reported in May 
2007, staff often performed the same roles in one-stop career centers 
and, in some cases, the roles were carried out by the same staff 
member. A recent law gave states the flexibility--subject to the 
approval of the Secretary of Labor--to consolidate these two programs 
in order to promote more efficient provision of services.[Footnote 170] 

In contrast, some overlapping programs have meaningful differences in 
their specific eligibility criteria or program design that could 
reduce their potential for duplication. For example, the Department of 
Labor's YouthBuild program provides disadvantaged youth with education 
and employment skills necessary in high-demand occupations, such as 
construction trades; whereas the Workforce Recruitment Program for 
College Students with Disabilities places college students and recent 
graduates with disabilities in jobs and internships with primarily 
federal employers. In addition, while GAO identified two employment-
related tax expenditures that affect veterans, the programs' 
approaches differed. The Work Opportunity Tax Credit provides a tax 
credit to employers who hire individuals from target groups, including 
disabled veterans, while VA's Compensated Work Therapy program exempts 
disabled veterans from paying federal taxes on income earned through 
the program. Finally, certain programs that provide similar services 
may have less potential for duplication because they may not have the 
capacity to serve all who apply. For instance, officials from seven 
programs reported a waiting list for their services. 

Better coordination or streamlining of agency roles and 
responsibilities may address fragmentation and potential duplication 
or unmet needs, but officials that GAO surveyed reported limited 
coordination among the 50 programs. GAO asked respondents to indicate 
whether their program coordinated with any of the other programs 
surveyed. In 8 percent of cases, two programs mutually reported 
coordinating. However, in most cases, respondents either reported not 
coordinating or inconsistently reported coordinating with other 
programs. For example, although the Department of Education's 
Vocational Rehabilitation Services program reported coordinating with 
the Department of Health and Human Services' Medicaid 1915(c) Home and 
Community Based Services Waiver program and the Department of Labor's 
Disabled Veterans' Outreach Program, only one of these two programs--
the waiver program--reported coordinating with the Vocational 
Rehabilitation Services program. GAO plans to conduct additional work 
on the extent of coordination among selected programs as part of a 
more detailed report on programs that support employment for people 
with disabilities. 

As GAO reported in October 2006, interagency collaboration can be 
enhanced when agencies work toward a common goal, establish 
complementary strategies for achieving that goal, and use common 
performance measures when appropriate.[Footnote 171] Although 82 
percent (41) of the 50 programs tracked at least one employment-
related outcome measure, the measures varied across programs. Twenty-
two programs reported that they did not track or monitor any outcome 
measures specifically for people with disabilities--mostly those that 
did not limit eligibility to this population. Only six programs 
monitored whether they helped reduce participants' reliance on federal 
cash benefits. In August 2007, experts at a GAO forum recommended that 
the federal government establish a set of program outcome indicators 
to measure the success of federal disability programs. An important 
consideration in developing such measures is the challenge of 
comparing outcomes while accounting for variations in the type and 
severity of participants' disabilities. 

Actions Needed and Potential Financial or Other Benefits: 

The federal government spends several billion dollars each year to 
help people with disabilities retain or obtain employment, a 
relatively small sum compared to the amount the government spends on 
providing cash benefits and other assistance to this population. 
Despite this federal investment, the unemployment rate among people 
with disabilities remains relatively high and very few Social Security 
disability beneficiaries earn enough to terminate federal cash 
assistance. While a low return-to-work rate among Social Security 
disability beneficiaries is not necessarily surprising, given that 
eligibility for the program is based on the inability to work, some 
beneficiaries can and do work. Even small shifts in the employment 
rate of disability beneficiaries could mean substantial savings to the 
federal government, which is particularly significant since the Social 
Security Administration's Disability Insurance trust fund is expected 
to be exhausted by 2018. In this context, the number of programs 
providing similar employment services to people with disabilities 
raises questions about the efficiency and effectiveness of the current 
structure of federal disability programs. In its February 2011 high-
risk update, GAO reported that an overall federal strategy and 
governmentwide coordination among programs is needed to align 
disability policies, services, and supports. At the same time, the 
GPRA Modernization Act of 2010 (GPRAMA) established a new, cross-
cutting, and integrated framework for achieving results and improving 
government performance.[Footnote 172] It requires the Office of 
Management and Budget (OMB) to coordinate with agencies to establish 
outcome-oriented goals covering a limited number of crosscutting 
policy areas and to develop a governmentwide performance plan for 
making progress toward achieving those goals. 

Consistent with that effort, to improve performance through greater 
coordination among the many federal programs that support employment 
for people with disabilities, OMB should: 

* consider establishing measurable, governmentwide goals for 
employment of people with disabilities. Given the number of federal 
agencies and approaches involved in supporting employment for people 
with disabilities, governmentwide goals could help spur greater 
coordination and more efficient and economical service delivery in 
overlapping program areas. To determine whether these goals are being 
met, agencies should establish related measures and indicators and 
collect additional data to inform these measures. 

Establishing governmentwide goals and measures for employment of 
people with disabilities is a critical first step in developing an 
overall federal strategy to align disability policy, services, and 
supports--a recommendation GAO first made to Congress in May 2008. 

It is difficult to recommend specific areas for cost savings or 
streamlining because there are, at present, limited data available to 
determine which programs are achieving positive outcomes for people 
with disabilities in the most cost-effective way. Nevertheless, to 
achieve the greatest efficiency and effectiveness, OMB should: 

* continue to work with executive agencies that administer overlapping 
programs to determine whether program consolidation might result in 
administrative savings and more effective and efficient delivery of 
services. Executive agencies should seek any necessary statutory 
authority to consolidate programs if there would be sufficient savings 
to merit such an action. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to OMB and the nine 
federal agencies that administer the programs within the scope of this 
report for review and comment. The Departments of Education and 
Veterans' Affairs (VA) had no comments. The Departments of Agriculture 
(USDA), Defense (DOD), Labor, Health and Human Services (HHS); the 
Internal Revenue Service; OMB; the Social Security Administration 
(SSA); and the U.S. AbilityOne Commission provided technical comments, 
which were incorporated or summarized and discussed below, as 
appropriate. Labor provided written comments. All written comments are 
reprinted in appendix IV. 

In response to GAO's recommendations, OMB noted that, in fiscal year 
2012, the Administration's Domestic Policy Council will conduct an 
internal review of ways to improve the effectiveness of disability 
programs through better coordination and alignment of priorities and 
strategies. The Council will work with agencies to explore how they 
can achieve better results for people with disabilities through 
sharing data and defining shared objectives, among other activities. 
GAO supports such efforts to improve coordination among programs, and 
looks forward to the results of the review with respect to setting 
governmentwide goals for people with disabilities and identifying 
opportunities for more efficient and effective delivery of services to 
this population. 

In addition, OMB noted that the current administration has set 
governmentwide goals for employment and inclusion of people with 
disabilities in the federal government. Specifically, in 2010, the 
President issued an executive order stating that the federal 
government should be a model for the employment of people with 
disabilities and reaffirming a goal set in 2000 to hire 100,000 
individuals with disabilities over 5 years.[Footnote 173] The 
President issued another executive order in 2011 that resulted in the 
Office of Personnel Management's Government-wide Diversity and 
Inclusion Strategic Plan.[Footnote 174] 

OMB also highlighted some specific ongoing or planned efforts to 
improve employment for people with disabilities. For example, OMB 
noted that Labor issued a proposed rule to strengthen affirmative 
action requirements for federal contractors and subcontractors, and 
that SSA has set a goal of assisting 118,000 Disability Insurance and 
Supplemental Security Income (SSI) beneficiaries obtain employment in 
2012 through the Ticket to Work program. In addition, OMB noted that 
the Promoting Readiness of Minors in SSI (PROMISE) program will 
involve several federal agencies to test interventions to improve 
outcomes--including employment outcomes--for children with 
disabilities and their families. 

In their comments, both Labor and HHS expressed concern that GAO found 
fragmentation and/or duplication without providing a more detailed 
explanation of its findings. GAO did not find duplication, but rather, 
found fragmentation and overlap among programs providing employment 
support for people with disabilities that suggests the need to look 
more closely at the potential for unnecessary duplication. GAO stated 
that some programs have a greater potential for duplication than 
others, and provided some examples. GAO plans to issue a more detailed 
report on fragmentation, overlap, and the potential for duplication 
among programs that support employment for people with disabilities in 
2012. 

Labor asserted that GAO's findings implied that one agency or program 
could address the needs of all people with disabilities. GAO agrees 
with Labor that people with disabilities have varied needs that may 
not adequately be served by one program alone. However, GAO still 
recommends that OMB and the agencies continue to work together to 
determine whether consolidating some overlapping programs might result 
in either cost savings or address service gaps through more efficient 
delivery of services. Labor also pointed out that several of the 
programs included in the scope of GAO's study were not created 
specifically to provide employment support for people with 
disabilities, and that service inclusion and integration is consistent 
with disability civil rights laws. GAO agrees and included such 
programs to provide a more comprehensive picture of the services and 
supports available to help people with disabilities stay at work or 
return to work. 

Four agencies--USDA, HHS, Labor, and SSA--highlighted unique 
characteristics of their programs, with respect to the actual services 
provided, program design used, and populations served. For example, 
USDA noted that the AgrAbility program is the only federally funded 
program that has developed expertise to accommodate disability among 
those working in agriculture. GAO revised the report to more clearly 
reflect program variation, as appropriate. 

Labor questioned whether servicemembers and veterans should be 
considered similar populations. While there are obvious distinctions, 
GAO included programs serving these populations in one category 
because most DOD programs in the scope of this review reported 
facilitating the transition of servicemembers into veteran status. In 
addition, there are a number of programs that serve both 
servicemembers and veterans, such as Labor's America's Heroes at Work 
program and REALifelines program. 

Two agencies commented on their programs' outcomes related to 
employment. SSA pointed out that a low return-to-work rate among its 
disability beneficiaries does not necessarily raise questions about 
the efficiency and effectiveness of its disability program, and also 
noted that programs that support employment for people with 
disabilities have varying definitions of disability, which may affect 
the return-to-work objectives of any given program. In addition, USDA 
noted that most participants in its AgrAbility program were able to 
continue working, and that the program has demonstrated a high return 
on investment. GAO modified language and added some additional 
information to the report to address these points. 

Finally, Labor provided examples of coordination within and among 
agencies that GAO did not identify through its survey. GAO made 
changes to the report, as appropriate, and plans to include additional 
information on coordination among selected programs in its 2012 report. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted to be published as a separate product in 
2012. GAO identified programs that support employment for people with 
disabilities by reviewing the Catalog of Federal Domestic Assistance 
and GAO's prior work and consulting stakeholders. GAO included 
programs that served only people with disabilities, as well as 
programs that served a broader population but provided special 
consideration to people with disabilities or their employers.[Footnote 
175] GAO did not conduct an independent legal analysis to identify 
relevant programs. GAO validated this list of programs with agency 
officials and fielded a web-based survey to these programs from August 
2011 to October 2011. GAO used the survey to collect information on 
programs' objectives, eligibility criteria, services offered, and 
program obligations in fiscal year 2010, among other data. When 
programs were jointly administered by two or more federal agencies, 
GAO consulted with the agencies and asked them to designate one 
official to fill out the survey for that program. GAO incorporated 
data reliability checks into the survey instrument, reviewed 
documentation, and conducted follow-up interviews, as necessary. GAO 
followed up with some survey respondents based on electronic checks of 
data submissions and other criteria. GAO determined that the data used 
in this report were sufficiently reliable for the purposes of this 
report. GAO also interviewed researchers knowledgeable about 
employment and disability issues. Appendix III lists the programs GAO 
identified that may have similar or overlapping objectives, provide 
similar services, or be fragmented across government missions. Overlap 
and fragmentation may not lead to actual duplication, and some degree 
of overlap and duplication may be justified. 

Related GAO Products: 

Social Security Disability: Ticket to Work Participation Has 
Increased, but Additional Oversight Needed. [Hyperlink, 
http://www.gao.gov/products/GAO-11-324] Washington, D.C.: May 6, 2011. 

High-Risk Series: An Update. [Hyperlink, 
http://www.gao.gov/products/GAO-11-278] Washington, D.C.: February 
2011. 

Highlights of a Forum: Actions that Could Increase Work Participation 
for Adults with Disabilities. [Hyperlink, 
http://www.gao.gov/products/GAO-10-812SP] Washington, D.C.: July 2010. 

Federal Disability Programs: More Strategic Coordination Could Help 
Overcome Challenges to Needed Transformation. [Hyperlink, 
http://www.gao.gov/products/GAO-08-635] Washington, D.C.: May 20, 2008. 

Highlights of a Forum: Modernizing Federal Disability Policy. 
[Hyperlink, http://www.gao.gov/products/GAO-07-934SP] Washington, 
D.C.: August 2007. 

Veterans' Employment and Training Service: Labor Could Improve 
Information on Reemployment Services, Outcomes, and Program Impact. 
[Hyperlink, http://www.gao.gov/products/GAO-07-594] Washington, D.C.: 
May 24, 2007. 

Federal Disability Assistance: Wide Array of Programs Needs to Be 
Examined in Light of 21st Century Challenges. [Hyperlink, 
http://www.gao.gov/products/GAO-05-626] Washington, D.C.: June 2, 2005. 

People with Disabilities: Federal Programs Could Work Together More 
Efficiently to Promote Employment. [Hyperlink, 
http://www.gao.gov/products/HEHS-96-126] Washington, D.C.: September 
3, 1996. 

Contact Information: 

For additional information about this area, contact Daniel Bertoni at 
(202) 512-7215 or bertonid@gao.gov. 

[End of section] 

31. Science, Technology, Engineering, and Mathematics Education: 

Strategic planning is needed to better manage overlapping programs 
across multiple agencies. 

Why This Area Is Important: 

Federal agencies obligated $3.1 billion in fiscal 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. However, 
research shows that despite this investment, the United States lacks a 
strong pipeline of future workers in STEM fields and that U.S. 
students continue to lag behind students in other highly technological 
nations in mathematics and science achievement. 

Over the decades, Congress and the executive branch have continued to 
create new STEM education programs, even though there is a general 
lack of assessment of how well the programs are working. Recently, 
both Congress and the administration called for a more strategic and 
effective approach to the federal government's investment in STEM 
education. The America COMPETES Reauthorization Act of 2010 requires 
the Director of the Office of Science and Technology Policy (OSTP) 
within the Executive Office of the President to establish a committee 
under the National Science and Technology Council (NSTC) to (1) 
develop a 5-year strategic plan that includes common measures to 
assess progress towards the plan's goals, (2) coordinate STEM 
education activities and programs among respective federal agencies, 
and (3) develop an inventory of federal STEM education programs and 
identify areas of duplication among those programs.[Footnote 176] 

What GAO Found: 

In fiscal year 2010, 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 
similar target groups in similar STEM fields to achieve similar 
objectives (see fig. below).[Footnote 177] Federal STEM education 
programs are also fragmented across a number of agencies. The number 
of programs each of the 13 agencies administered in 2010 ranged from 3 
to 46. Three agencies--the Department of Health and Human Services, 
the Department of Energy, and the National Science Foundation--
administer more than half of all programs--112 of 209. These programs 
range from being narrowly focused on a specific group or field of 
study to offering a range of services to students and teachers across 
STEM fields. Agencies obligated over $3 billion to STEM education 
programs in fiscal year 2010. The National Science Foundation and the 
Department of Education programs account for over half of this 
funding. Almost a third of the programs had obligations of $1 million 
or less, with 5 programs having obligations more than $100 million 
each. 

Figure 8: Overlapping Federal STEM Education Programs: 

[Refer to PDF for image: illustration] 

209 STEM education programs: 

Programs that have at least one similar target population: 
100%; 209 programs. 

Programs that have at least one similar target population and also 
provide at least one similar service: 
99%; 207 programs (2 programs do not overlap). 

Programs that have at least one similar target population and also 
provide at least one similar service and also at least one similar 
STEM field of focus: 
83%; 173 programs (34 programs do not overlap). 

Programs that have at least one similar target population and also 
provide at least one similar service and also at least one similar 
STEM field of focus and also have at least one similar program 
objective: 
83% (173 programs). 

Source: GAO analysis of survey responses. 

[End of figure] 

This complicated patchwork of fragmented and overlapping programs has 
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 STEM fields. Program 
officials reported that approximately one-third of STEM education 
programs funded in fiscal year 2010 were first funded between 2005 and 
2010. Indeed, the creation of new programs during that time frame may 
have contributed to overlap and, ultimately, to inefficiencies in how 
STEM programs across the federal government are focused and delivered. 
Overlapping programs can lead to individuals and institutions being 
eligible for similar services in similar STEM fields offered through 
multiple programs. Without information sharing, this could lead to the 
same service being provided to the same individual or institution (see 
fig. below). Fragmentation and 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. 

Many programs provided services to similar target groups, such as K-12 
students, postsecondary students, K-12 teachers, and college faculty 
and staff. The vast majority of programs (170) serve postsecondary 
students. Ninety-five programs served college faculty and staff, 75 
programs served K-12 students, and 70 programs served K-12 teachers. 
In addition, many programs served multiple target groups. In fact, 177 
programs were primarily intended to serve two or more target groups. 
In addition, as the figure below illustrates, many STEM education 
programs provide similar services. 

Figure: Services Provided by Federal STEM Education Programs: 

[Refer to PDF for image: horizontal bar graph] 

Service: Research opportunities, internships, mentorships, or career 
guidance; 
Number of programs: 167. 

Service: Short-term experiential learning activities; 
Number of programs: 144. 

Service: Long-term experiential learning activities; 
Number of programs: 127. 

Service: Outreach and recognition to generate student interest in STEM 
field(s); 
Number of programs: 137. 

Service: Classroom instruction; 
Number of programs: 124. 

Service: Student scholarships or fellowships; 
Number of programs: 75. 

Service: Curriculum development; 
Number of programs: 115. 

Service: Teacher in-service, professional development, or retention 
services; 
Number of programs: 83. 

Service: Teacher preservice or recruitment activities; 
Number of programs: 52. 

Service: Research to improve STEM education; 
Number of programs: 68. 

Service: Institutional support for management and administrative 
activities; 
Number of programs: 65. 

Service: Institutional support for infrastructure; 
Number of programs: 46; 

Service: Other; 
Number of programs: 31. 

Source: GAO analysis of survey responses. 

[End of figure] 

Furthermore, it is important to compare programs' target groups and 
academic STEM fields that are a focus of the program (a STEM field of 
focus) together to get a better picture of the potential target 
beneficiaries that could be served within a given STEM discipline. As 
the table below illustrates, many programs are designed to serve 
multiple target groups across multiple STEM fields of focus. The 
majority of programs served target groups across four or more STEM 
fields of focus, with only 23 programs focusing on one specific STEM 
field. 

Table: STEM Fields of Focus and Target Groups of Federal STEM 
Education Programs: 

Target groups: K-12 students; 
Agricultural sciences: 8; 
Biology: 40; 
Chemistry: 36; 
Computer science: 30; 
Earth sciences: 38; 
Engineering: 32; 
Mathematics: 33; 
Physics: 31; 
Social sciences: 19; 
Technology: 43. 

Target groups: Postsecondary students; 
Agricultural sciences: 22; 
Biology: 99; 
Chemistry: 85; 
Computer science: 84; 
Earth sciences: 64; 
Engineering: 89; 
Mathematics: 79; 
Physics: 76; 
Social sciences: 62; 
Technology: 87. 

Target groups: K-12 teachers; 
Agricultural sciences: 5; 
Biology: 36; 
Chemistry: 33; 
Computer science: 25; 
Earth sciences: 39; 
Engineering: 26; 
Mathematics: 28; 
Physics: 29; 
Social sciences: 17; 
Technology: 38. 

Target groups: College faculty and staff; 
Agricultural sciences: 17; 
Biology: 49; 
Chemistry: 42; 
Computer science: 43; 
Earth sciences: 35; 
Engineering: 47; 
Mathematics: 37; 
Physics: 36; 
Social sciences: 30; 
Technology: 50. 

Source: GAO analysis of survey responses: 

Note: Many STEM education programs serve multiple target groups with 
multiple STEM fields of focus. The totals cited in this table do not 
sum to 209, the number of programs in GAO's review. Earth sciences 
includes atmospheric and ocean sciences; social sciences includes 
psychology, sociology, anthropology, cognitive science, economics, and 
behavior sciences. 

[End of table] 

However, 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, there were 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. Indeed, 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. As 
NSTC develops its 5-year strategic plan, it will need to conduct more 
analysis of each program to avoid potential duplication and ensure 
that the federal investment in these programs advances the 
governmentwide goals expressed in the strategic plan. 

In addition to the fragmented and overlapping nature of federal STEM 
education programs, little is known about the effectiveness of these 
programs. Since 2005, when GAO first reported on this issue, GAO 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 could not only help to improve individual program 
performance, but could also inform agency-and governmentwide decisions 
about which programs should continue to be funded. Without an 
understanding of what is working in some programs, it will be 
difficult to develop a clear strategy for how to spend limited federal 
funds. 

Finally, although NSTC is in the process of developing a 
governmentwide strategic plan for STEM education consistent with the 
requirements of the America COMPETES Reauthorization Act of 2010, GAO 
found that agencies in its 2005 review do not use outcome measures for 
STEM programs in a way that is clearly reflected in their own 
performance plans and performance reports--key strategic planning 
documents.[Footnote 178] 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. Moving forward, 
the GPRA Modernization Act of 2010 requires agencies to identify 
program activities and other activities that contribute to each 
performance goal, and as agencies implement this provision, more 
information about STEM education efforts in performance plans and 
reports can be expected. In addition, NSTC's ongoing strategic 
planning efforts provide an opportunity to develop guidance on how to 
incorporate STEM-and program-specific education goals and measures in 
agencies' performance planning and reporting process. 

Actions Needed and Potential Financial or Other Benefits: 

GAO recommended in January 2012 that the Director of OSTP direct NSTC 
to take several actions related to STEM education programs and related 
activities. 

To ensure the federal government strategically invests limited funds 
in an efficient and effective manner that achieves the greatest impact 
in developing a pipeline of future workers in STEM fields, the 
Director of OSTP should direct NSTC to: 

* work with agencies, through its strategic planning process to 
identify programs that might be candidates for consolidation or 
elimination. Specifically, this could be achieved through an analysis 
that includes information on program overlap, similar to the analysis 
conducted by GAO in this report, and information on program 
effectiveness. As part of this effort, OSTP should work with agency 
officials to identify and report any changes in statutory authority 
necessary to execute each specific program consolidation identified by 
NSTC's strategic plan. 

To ensure NSTC's strategic planning process enhances the federal 
government's ability to assess what works and the process for 
identifying potential program consolidation includes information on 
program effectiveness, the Director of OSTP should direct NSTC to: 

* develop guidance to help agencies determine the types of evaluations 
that may be feasible and appropriate for different types of STEM 
education programs and develop a mechanism for sharing this 
information across agencies. This could include guidance and sharing 
of information that outlines practices for evaluating similar types of 
programs. 

To ensure agencies' efforts are better aligned to governmentwide STEM 
education goals and federal resources are concentrated on advancing 
those goals, the Director of OSTP should direct NSTC to: 

* develop guidance for how agencies can better incorporate each 
agency's STEM education efforts and the goals from NSTC's 5-year STEM 
education strategic plan into each agency's own performance plans and 
reports. 

To improve transparency and strengthen accountability of NSTC's 
strategic planning and coordination efforts, the Director of OSTP 
should direct NSTC to: 

* develop a framework for how agencies will be monitored to ensure 
that they are collecting and reporting on NSTC strategic plan goals. 
This framework should include alternatives for a sustained focus on 
monitoring coordination of STEM education programs if the NSTC 
Committee on STEM terminates in 2015 as called for in its charter. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its January 2012 report to OSTP and the Office 
of Management and Budget (OMB) for review and comment. OSTP provided 
technical comments, which were incorporated as appropriate. OMB stated 
it had no concerns with GAO's report. 

GAO also provided a draft of this report section to OMB and OSTP for 
review and comment. OMB provided technical comments, which were 
incorporated as appropriate. OMB stated that GAO's four 
recommendations are critical to improving the provision of STEM 
education across the federal government. OSTP provided written 
comments and noted that its analysis of overlap and duplication in 
STEM education programs identified no duplicative programs. In cases 
where it identified overlapping programs it found that some program 
characteristics differed. As an illustration, OSTP 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. GAO notes that while it may be important to serve both 
of these populations, it is not clear that two separate administrative 
structures are necessary to ensure both populations are served. OSTP 
agreed to consider program consolidation or elimination as part of its 
strategic planning process, but also said that it would consider other 
approaches such as strategic alignment of program goals, joint 
solicitations, improved program design and execution, and memoranda of 
understanding to increase efficiency and effectiveness of federal STEM 
Education spending. OSTP stated that they will address GAO's 
recommendations in the NSTC 5-Year Federal STEM Education Strategic 
Plan, which will be released in spring 2012. OMB added that joint 
administration of programs across agencies is also an effective 
measure at eliminating duplication and overlap and guaranteeing that 
the best resources are devoted to programming. As part of GAO's 
routine audit work, GAO will track agency actions to address these 
recommendations and report to Congress. All written comments are 
reprinted in appendix IV. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted. GAO reviewed relevant federal laws, 
regulations, and relevant literature and past reports. GAO interviewed 
officials from OSTP and OMB, and officials from other federal agencies 
that administer STEM education programs. In addition, to gather 
information on federal STEM education programs and to assess the level 
of fragmentation, overlap, and potential duplication, GAO surveyed 
over 200 programs across 13 agencies that met GAO's definition of a 
STEM education program, asking questions about program objectives, 
target populations, services provided, interagency coordination, 
outcome measures and evaluations, and funding. Furthermore, to gather 
information on program effectiveness, GAO reviewed evaluations 
provided by program officials, as well as agencies' annual performance 
plans and reports. Appendix III lists the programs GAO identified that 
may have similar or overlapping objectives, provide similar services 
or be fragmented across government missions. Overlap and fragmentation 
may not necessarily lead to actual duplication, and some degree of 
overlap and duplication may be justified. 

Related GAO Products: 

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.: January 20, 2012. 

Science, Technology, Engineering, and Mathematics Education: Survey of 
Federal Programs ([Hyperlink, http://www.gao.gov/products/GAO-12-
110SP] January 2012), an E-supplement to [Hyperlink, 
http://www.gao.gov/products/GAO-12-108]. Washington, D.C.: January 20, 
2012. 

Higher Education: Federal Science, Technology, Engineering, and 
Mathematics Programs and Related Trends. [Hyperlink, 
http://www.gao.gov/products/GAO-06-114] Washington, D.C.: October 12, 
2005. 

Contact Information: 

For additional information about this area, contact George A. Scott at 
(202) 512-7215 or scottg@gao.gov. 

[End of section] 

32. Financial Literacy: 

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

Why This Area Is Important: 

Financial literacy plays an important role in helping to ensure the 
financial health and stability of individuals and families, and 
economic changes in recent years have further highlighted the need to 
empower all Americans to make informed financial decisions. As GAO 
reported in March 2011, federal financial literacy activities are 
fragmented among multiple federal agencies, which increases the risk 
of inefficient, uncoordinated, or redundant use of resources. This 
year's report provides updated information on coordination activities, 
as well as additional information on areas of overlap and on the 
evolving role of the new Bureau of Consumer Financial Protection. 

What GAO Found: 

Federal financial literacy programs and resources are spread widely 
among many different federal agencies. A 2009 survey conducted by the 
Departments of the Treasury and Education, which GAO cited in its 
March 2011 report, asked federal agencies to self-identify their 
financial literacy efforts, and 56 programs related to financial 
literacy were reported by 20 federal agencies. However, GAO's 
subsequent analysis found that there was a high degree of 
inconsistency in how different agencies defined financial literacy 
programs and whether they counted related activities as one or 
multiple programs. 

Using a more consistent set of criteria, GAO has identified 15 
significant financial literacy programs or activities among 13 federal 
agencies. These efforts are defined as relatively comprehensive in 
scope or scale and include financial literacy as a key objective 
rather than a tangential goal.[Footnote 179] As seen in appendix III, 
the estimated cost for 13 of these 15 financial literacy programs or 
activities was about $30.7 million in fiscal year 2010; GAO is still 
in the process of developing cost estimates for the activities of the 
Department of Defense (DOD) and for the Bureau of Consumer Financial 
Protection, which was not created until July 2010. 

In addition, federal agencies spent about $136.6 million in fiscal 
year 2010 on housing counseling. GAO has separated out costs for 
housing counseling programs because education is only a limited aspect 
of most housing counseling, which often consists largely of one-on-one 
service and assistance to address individual situations. For example, 
foreclosure mitigation counseling typically focuses on helping 
financially distressed homeowners avoid foreclosure by working with 
lenders to remedy mortgage delinquency. 

Having multiple federal agencies involved in financial literacy 
efforts can have certain advantages. In particular, agencies may have 
deep and long-standing expertise and experience addressing specific 
issue areas or serving specific populations. For example, the 
Securities and Exchange Commission has efforts in place to protect 
securities investors from fraudulent schemes, while the Department of 
Housing and Urban Development (HUD) oversees most, but not all, 
federally supported housing counseling. Moreover, DOD may be the 
agency most able to efficiently and effectively deliver financial 
literacy programs and products to servicemembers and their families. 
However, as GAO stated in a June 2011 report, relatively few evidence-
based evaluations of financial literacy programs have been conducted, 
limiting what is known about which specific methods and strategies--
and which federal financial literacy activities--are most effective. 

In addition, fragmentation increases the risk of inefficiency and 
redundancy and highlights the need for strong coordination, or 
potential consolidation, of these efforts. In general, GAO has found 
that the coordination and collaboration among federal agencies with 
regard to financial literacy has improved substantially in recent 
years. The multiagency Financial Literacy and Education Commission 
(Commission) was created by Congress in 2003 and charged, among other 
things, with developing a national strategy to promote financial 
literacy and education, coordinating federal efforts, and identifying 
areas of overlap and duplication. Among other things, the Commission 
in concert with the Department of the Treasury, which provides its 
primary staff support, has served as a central clearinghouse for 
federal financial literacy resources--for example, it created a 
centralized federal website and has an ongoing effort to develop a 
catalog of federal research on financial literacy. The Commission's 
2011 national strategy identified five action areas, one of which was 
to further emphasize the role of the Commission in coordination. The 
strategy's accompanying Implementation Plan lays out plans to 
coordinate communication among federal agencies, improve strategic 
partnerships, and develop channels of communication with other 
entities, including the President's Advisory Council on Financial 
Capability and the National Financial Education Network of State and 
Local Governments. The Commission's success in implementing these 
elements of the National Strategy is key given the inherently 
challenging task of coordinating the work of the Commission's many 
member agencies--each of which has its own set of interests, 
resources, and constituencies. Further, the addition of the Bureau of 
Consumer Financial Protection, whose director serves as the Vice Chair 
of the Commission, adds a new player to the mix that will influence 
the Commission's success. 

GAO's review thus far shows that there is little evidence of 
duplication among existing federal financial literacy activities--that 
is, cases where two or more agencies or programs are engaging in the 
same activities and providing the same services to the same 
beneficiaries. However, GAO did identify cases in which there is 
overlap--multiple agencies or programs with similar goals and 
activities--that raise questions about the efficiency of some federal 
financial literacy and housing counseling efforts. For example, four 
federal agencies and one government-chartered nonprofit corporation 
provide various forms of housing counseling to consumers--DOD, HUD, 
the Department of Veterans Affairs (VA), the Department of the 
Treasury, and NeighborWorks America. 

* HUD obligated about $65.4 million in fiscal year 2010 for certifying 
and overseeing housing counseling agencies, training housing 
counselors, and providing counseling agencies with competitive grants. 
The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-
Frank Act) required HUD to establish an Office of Housing Counseling, 
although as of October 2011, the office had not yet been established, 
in part due to budget constraints. HUD also has 15 other active 
programs that allow some portion of their funding to be used for 
housing counseling or have some housing counseling component.[Footnote 
180] 

* The federally chartered nonprofit corporation NeighborWorks America 
received an appropriation from Congress in fiscal year 2010 that 
included $65 million for the National Foreclosure Mitigation 
Counseling Program; the organization also spent $2 million of its 
appropriated funds for other housing counseling activities. 

* VA has loan counselors that address housing issues in its Regional 
Loan Centers to help veterans facing foreclosure or other financial 
problems. VA often recommends HUD-approved housing counseling to 
veterans who are seeking VA-guaranteed loans but does not require it. 

* DOD has a foreclosure counseling program for servicemembers 
returning from active duty abroad. This program is administered 
through the Military OneSource and the Military and Family Life 
Consultant Program. 

* The Department of the Treasury's Financial Literacy and Education 
Counseling Pilot Program, created by the Housing and Economic Recovery 
Act of 2008, provided $4.15 million in grants in fiscal year 2010 for 
financial literacy counseling to prospective homebuyers.[Footnote 181] 

Another example of overlap lies in the financial literacy 
responsibilities of the Bureau of Consumer Financial Protection, 
created by the Dodd-Frank Act. The act established within the bureau 
an Office of Financial Education and charged this office with 
developing and implementing a strategy to improve financial literacy 
through activities including opportunities for consumers to access, 
among other things, financial counseling; information to assist 
consumers with understanding credit products, histories, and scores; 
information about saving and borrowing tools; and assistance in 
developing long-term savings strategies. This office presents an 
opportunity to further promote awareness, coordinate efforts, and fill 
gaps related to financial literacy. At the same time, the duties this 
office is charged with fulfilling are in some ways similar to those of 
a separate Office of Financial Education and Financial Access within 
the Department of the Treasury, a small office that also seeks to 
broadly improve Americans' financial literacy. In addition, the Dodd-
Frank Act charges the Bureau of Consumer Financial Protection with 
developing and implementing a strategy on improving the financial 
literacy of consumers, even though the multiagency Financial Literacy 
and Education Commission already has its own statutory mandate to 
develop, and update as necessary, a national strategy for financial 
literacy. As the bureau has been staffing up and planning its 
financial education activities, it has been in regular communication 
with the Department of the Treasury and with other members of the 
Financial Literacy and Education Commission, and agency staff say they 
are seeking to coordinate their respective roles and activities. 

In addition, the Dodd-Frank Act created within the Bureau of Consumer 
Financial Protection several offices that are charged by statute with 
duties that are in some ways similar to those of other federal 
agencies. For instance, the act created an Office of Service Member 
Affairs, which is responsible for developing and implementing 
initiatives for servicemembers and their families intended to educate 
and empower them to make better informed decisions regarding consumer 
financial products and services; monitoring complaints by service 
members and their families; and coordinating with federal and state 
agencies regarding consumer protection measures relating to consumer 
financial products and services offered to, or used by, service 
members and their families. These activities potentially overlap with 
those of DOD's Financial Readiness Campaign, in which Personal 
Financial Managers on military bases provide financial educational 
programs, partnerships, counseling, legal protections, and other 
resources designed to help servicemembers and their families reach 
financial goals such as reducing debt, setting up a spending plan, 
saving for college, addressing consumer protection matters, and many 
others. Staff from the Bureau of Consumer Financial Protection and DOD 
told GAO they are working closely to coordinate their efforts. 

The Dodd-Frank Act also creates within the bureau an Office of 
Financial Protection for Older Americans, which is charged with 
helping seniors recognize warning signs of unfair, deceptive, or 
abusive practices and protect themselves from such practices; 
providing one-on-one financial counseling on issues including long-
term savings and later-life economic security; and monitoring the 
legitimacy of certifications of financial advisers who advise seniors. 
Potential overlap exists with the Federal Trade Commission, which also 
plays a role in helping seniors avoid unfair and deceptive practices. 
Further, the Department of Labor and the Social Security 
Administration both have initiatives in place to help consumers plan 
for retirement, and the Securities and Exchange Commission has 
recently initiated efforts to address concerns about the designations 
and certifications used by financial advisers.[Footnote 182] Officials 
at the Bureau of Consumer Financial Protection told GAO that they have 
been discussing and coordinating their financial literacy roles and 
activities with those of other federal agencies to avoid duplication 
of effort. 

Actions Needed and Potential Financial or Other Benefits: 

GAO expects to recommend that Congress may wish to consider: 

* requiring federal agencies to evaluate the effectiveness of their 
financial literacy efforts and, if appropriate, to identify options 
for consolidating such efforts. Federal agencies could potentially 
make the most of scarce resources by consolidating financial literacy 
efforts into the activities and agencies that are most effective. In 
addition to improving effectiveness, such consolidation could have 
potential monetary savings, an issue GAO is examining as part of 
ongoing work; and: 

* monitoring the implementation of the Bureau of Consumer Financial 
Protection's efforts. As the bureau's financial literacy activities 
evolve and are implemented, it will be important to evaluate how those 
efforts are working and make appropriate adjustments that might 
promote greater efficiency and effectiveness. 

The Bureau of Consumer Financial Protection should: 

* delineate roles and responsibilities related to its new offices of 
Financial Education, Service Member Affairs, and Financial Protection 
for Older Americans. As these offices form more fully, they will need 
to continue their efforts to work with federal agencies that have 
overlapping responsibilities so as to carefully delineate their 
respective activities and avoid duplication. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to the Bureau of Consumer 
Financial Protection, the Department of the Treasury, and the 
Department of Housing and Urban Development for review and comment. 
The Bureau of Consumer Financial Protection and the Department of the 
Treasury provided written comments. The Department of Housing and 
Urban Development provided technical comments, which were incorporated 
as appropriate. GAO also provided selected portions of the draft 
report section to those agencies listed in appendix III for their 
technical review, and GAO incorporated those technical comments as 
appropriate. All written comments are reprinted in appendix IV. 

The Department of the Treasury said that it agreed that federal 
agencies should evaluate the effectiveness of their financial literacy 
efforts and, if appropriate, identify options for consolidating such 
efforts. However, the department noted that it would be necessary for 
funding to be appropriated for such evaluation. In addition, the 
department said it believed that continued and enhanced coordination 
among agencies may lead to greater effectiveness, in some cases, than 
consolidation. The Bureau of Consumer Financial Protection's written 
response highlighted the bureau's efforts to coordinate its 
activities, avoid duplication with other agencies, and promote the 
evaluation of financial literacy efforts. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section and additional 
work GAO conducted. GAO collected information on the purpose, 
beneficiaries, costs, and subject matter of federal financial literacy 
programs and activities through interviews with staff of federal 
agencies and through budget justifications, strategic plans, and other 
documents. In some cases, costs provided are estimates because 
financial literacy activities are not organized as separate budget 
line items or cost centers within an agency. GAO also reviewed the 
Financial Literacy and Education Commission's 2011 national strategy 
and implementation plan and memorandums of understanding and other 
documents related to collaborations among federal agencies. Appendix 
III lists the programs GAO identified that may have similar or 
overlapping objectives, provide similar services or be fragmented 
across government missions. Overlap and fragmentation may not 
necessarily lead to actual duplication, and some degree of overlap and 
duplication may be justified. 

Related GAO Products: 

Highlights of a Forum: Financial Literacy: Strengthening Partnerships 
in Challenging Times. [Hyperlink, 
http://www.gao.gov/products/GAO-12-299SP] Washington, D.C.: February 
9, 2012. 

Financial Literacy: A Federal Certification Process for Providers 
Would Pose Challenges. [Hyperlink, 
http://www.gao.gov/products/GAO-11-614] Washington, D.C.: June 28, 
2011. 

Financial Literacy: The Federal Government's Role in Empowering 
Americans to Make Sound Financial Choices. [Hyperlink, 
http://www.gao.gov/products/GAO-11-540T] Washington, D.C.: April 12, 
2011. 

Financial Literacy and Education Commission: Progress Made in 
Fostering Partnerships, but National Strategy Remains Largely 
Descriptive Rather Than Strategic. [Hyperlink, 
http://www.gao.gov/products/GAO-09-638T] Washington, D.C.: April 29, 
2009. 

Financial Literacy and Education Commission: Further Progress Needed 
to Ensure an Effective National Strategy. [Hyperlink, 
http://www.gao.gov/products/GAO-07-100] Washington, D.C.: December 4, 
2006. 

Highlights of a GAO Forum: The Federal Government's Role in Improving 
Financial Literacy. [Hyperlink, 
http://www.gao.gov/products/GAO-05-93SP] Washington, D.C.: November 
15, 2004. 

Contact Information: 

For additional information about this area, contact Alicia Puente 
Cackley at (202) 512-8678 or cackleya@gao.gov. 

[End of section] 

Section II: Areas in Which GAO Has Identified Other Cost Savings or 
Revenue Enhancement Opportunities: 

This section summarizes 19 additional 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. 

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. 

Why This Area Is Important: 

The Air Force has 149 main dining facilities at installations 
nationwide.[Footnote 183] According to Air Force officials, most 
installations have their own individual contracts for food service, 
ranging from full-service contracts, providing cooking, cashiering, 
and cleaning services at Air Force dining facilities, to contracts 
that cover only basic cleaning services. The cost for these contracts, 
according to Air Force officials, ranges from $725,000 to $21.4 
million per year, with a total cost of approximately $150 million per 
year for all Air Force installations. GAO has previously reported 
that, when contracting for services, properly defined requirements are 
a prerequisite to obtaining value for the department. 

As GAO reported in July 2011, 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 in the United States over the next 5 years. This Food 
Transformation Initiative is primarily designed to improve the 
quality, variety, and availability of food. In the process, however, 
according to Air Force officials, the first group of pilot 
installations achieved cost savings compared to their previous 
contracts while increasing hours in the dining facilities and serving 
an additional 500,000 meals per year. 

What GAO Found: 

The Air Force has opportunities to reduce its overall food service 
costs at installations by reviewing food service contracts and 
adjusting them, when appropriate, to better meet the needs of the 
installation, including aligning labor needs with the actual number of 
meals served by the dining facilities. The Food Transformation 
Initiative contract was awarded to Aramark, a large company 
experienced in food service. The new contractor reviewed and adjusted 
staffing levels for contractor staff at the main dining facilities to 
better meet the needs of the facilities. As GAO reported in July 2011, 
the Air Force and Aramark anticipated reducing labor hours at five of 
the six Food Transformation Initiative pilot locations and using the 
savings to offset the costs of the Food Transformation Initiative 
contract. According to Air Force officials, savings for fiscal year 
2010 were approximately 8 percent compared to the cost of the previous 
contracts. GAO compared the estimated amount of food service labor for 
which the Air Force contracted at the six pilot installations prior to 
the implementation of the Food Transformation Initiative to Aramark's 
projected work schedules under the initiative and found that, even 
with expanded hours of operation and anticipated increases in the 
number of meals served, Aramark reduced the total number of labor 
hours at five of the six pilot installations by 53 percent. For 
example, at Travis Air Force Base, the number of labor hours for the 
mess attendant contract decreased by more than half--from 
approximately 2,042 hours per week to 920 hours per week. At Elmendorf 
Air Force Base, labor hours decreased from approximately 1,350 hours 
per week to 588 hours per week. The table below shows the change in 
the number of labor hours at all six pilot locations. 

Table: Comparison of Labor Hours under Previous Contract to Labor 
Hours under the Food Transformation Initiative Contract: 

Air Force base: Elmendorf; 
Estimated weekly labor hours under the previous contract: 1,350; 
Estimated weekly labor hours under the new contract: 588. 

Air Force base: Fairchild; 
Estimated weekly labor hours under the previous contract: 979; 
Estimated weekly labor hours under the new contract: 476. 

Air Force base: Little Rock; 
Estimated weekly labor hours under the previous contract: 1,548; 
Estimated weekly labor hours under the new contract: 303. 

Air Force base: MacDill; 
Estimated weekly labor hours under the previous contract: 1,201; 
Estimated weekly labor hours under the new contract: 1,063. 

Air Force base: Patrick; 
Estimated weekly labor hours under the previous contract: 1,218; 
Estimated weekly labor hours under the new contract: 1,349. 

Air Force base: Travis; 
Estimated weekly labor hours under the previous contract: 2,042; 
Estimated weekly labor hours under the new contract: 920. 

Air Force base: Total; 
Estimated weekly labor hours under the previous contract: 8,338; 
Estimated weekly labor hours under the new contract: 4,699. 

Source: GAO analysis of Air Force data. 

[End of table] 

Patrick Air Force Base was the only pilot base where the labor hours 
were not reduced and the only one of the pilot installations where the 
previous food service contract had recently been audited. The results 
of the audit, conducted by the Air Force Audit Agency in 2009, showed 
that the food service personnel did not align with the contract 
workload estimates with actual meals served. Specifically, meal counts 
were overstated, resulting in the installation paying more for 
contracted food services than necessary. As a result of this audit, in 
October 2009, Patrick Air Force Base renegotiated its workload 
estimates and pay rates, resulting in savings of approximately $77,000 
annually. 

Although it is unclear whether the opportunity for savings at the 
pilot installations is representative of the savings that could be 
realized by other installations, the potential exists for other Air 
Force installations that rely on contracts to meet their food service 
needs to achieve similar financial benefits. Prior to the 
implementation of the Food Transformation Initiative, the Air Force 
did not closely monitor the number of labor hours required to provide 
food services. Air Force officials told GAO that they did not realize 
how poorly their food service contracts were structured, in that these 
contracts might not be matched to the labor needs of the installation. 

Actions Needed and Potential Financial or Other Benefits: 

The Air Force has opportunities to significantly reduce its food 
service costs at Air Force installations that are not part of the Food 
Transformation Initiative pilot.[Footnote 184] During GAO's review of 
the Air Force's Food Transformation Initiative, GAO discussed this 
potential opportunity for savings with Air Force officials. As a 
result, the Air Force issued a memorandum to the Major Commands 
directing a review of existing food service contracts to determine if 
the contracts meet current mission needs. For example, the memorandum 
indicates that special attention must be given to whether the food 
service contract workload estimates were properly aligned with the 
actual number of meals served. GAO believes that this is a good first 
step toward addressing this issue. GAO recommended in July 2011 that 
the Secretary of the Air Force should: 

* monitor the actions taken by the Air Force Major Commands in 
response to the direction to review food service contracts, and take 
actions, as appropriate, to ensure that cost-savings measures are 
implemented. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its July 2011 report to the Department of 
Defense for review and comment. The Department of Defense agreed with 
this recommendation and stated that the Commander of the Air Force 
Services Agency requested that each Air Force Major Command task its 
bases to conduct a 100 percent review of existing food service to 
determine if their current contract workload estimates meet current 
mission needs or if the contracts require modifications. 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. Further, Air Force officials told GAO that the 
Air Force continues to review contracts for additional savings 
opportunities. The Department of Defense further noted that it intends 
to share the results of the Air Force's review of its food service 
labor costs to achieve cost savings with the other services, where 
similar reviews could result in substantial financial benefits. GAO 
agrees that the other services should similarly consider reviewing 
their food service contracts for potential cost savings where 
appropriate. As part of its routine audit work, GAO will track the 
extent to which progress has been made to address the identified 
action and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the product listed in the related GAO products section as well as 
additional work GAO conducted. GAO obtained documentation from the 
pilot installations regarding labor hours under the previous 
contracts, including memoranda showing how the contract prices were 
negotiated and contractor price proposals that estimated the number of 
labor hours for these contracts. Although these documents do not 
contain the precise number of labor hours for the main dining 
facilities, they provided the best estimates of labor costs available. 
GAO reviewed this information from the Air Force about the amount of 
labor included in previous food service contracts at the six pilot 
locations and compared this to information from the Air Force and 
Aramark presented in projected work schedules for the Food 
Transformation Initiative contract. Further, GAO talked with Air Force 
officials about opportunities for reducing food service costs outside 
of the Food Transformation Initiative. Finally, GAO spoke with Air 
Force officials about cost savings achieved from reviewing food 
service contracts. 

Related GAO Product: 

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. 

Contact Information: 

For additional information about this area, contact Brian Lepore at 
(202) 512-4523 or leporeb@gao.gov. 

[End of section] 

34. Defense Headquarters: 

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

Why This Area Is Important: 

In 2010, the Secretary of Defense expressed concerns about the 
dramatic growth in Department of Defense's (DOD) headquarters and 
support organizations that had occurred since 2001, including 
increases in spending, staff, numbers of senior executives, and 
proliferation of management layers. DOD has multiple layers of 
headquarters management with complex, overlapping relationships. Such 
layers include, but are not limited to, the Office of the Secretary of 
Defense, the Joint Staff, and portions of the military departments, 
defense agencies, and DOD field activities. In DOD Instruction 
5100.73, DOD defines those headquarters whose primary mission is to 
manage or command the programs and operations of DOD and its 
components, and their major military units, organizations, or agencies 
as major DOD headquarters activities.[Footnote 185] Since the mid-
1980s, Congress has enacted statutory limits on the number of major 
DOD headquarters activity personnel, to include the Office of the 
Secretary of Defense; the headquarters of the combatant commands; the 
Office of the Secretary of the Army and the Army Staff; the Office of 
the Secretary of the Air Force and the Air Staff; the Office of the 
Secretary of the Navy, the Office of the Chief of Naval Operations, 
and the Headquarters, Marine Corps; and the headquarters of the 
defense agencies and DOD field activities.[Footnote 186] In addition, 
Congress has enacted various reporting requirements related to major 
DOD headquarters activity personnel. 

In 2010, the Secretary of Defense directed DOD to undertake a 
departmentwide initiative to assess how the department is staffed, 
organized, and operated, with the goal of reducing excess overhead 
costs and reinvesting these savings toward sustainment of DOD's 
current force structure and modernizing its weapons portfolio. This 
effort identified efficiency initiatives totaling about $178 billion 
in projected savings across the military departments and other DOD 
components from fiscal year 2012 through fiscal year 2016, about $24.1 
billion of which is estimated to be achieved in fiscal year 2012. 
DOD's efficiency initiatives included a broad range of efforts, such 
as holding the civilian workforce at fiscal year 2010 levels; reducing 
the numbers of senior leaders, both officer and civilian; and reducing 
reliance on service support contractors. Some headquarters were 
planned to be closed and their missions and functions absorbed into 
other organizations, while others were reorganized. More recently, in 
January 2012, the administration released strategic guidance to guide 
defense priorities and spending over the coming decade. It lays out 
several principles to guide the development of DOD's force structure, 
such as reducing DOD's cost of doing business by finding further 
efficiencies in headquarters and other overhead. 

What GAO Found: 

Based on ongoing work for a report that GAO plans to issue in 2012, 
GAO found that DOD has taken some steps to examine its headquarters 
resources for efficiencies, but additional opportunities for cost 
savings may exist. For purposes of the Secretary of Defense's 
efficiency initiative, DOD components, including the military 
departments, were asked to focus, in particular, on headquarters and 
administrative functions, support activities, and other overhead in 
their portfolios. DOD's fiscal year 2012 budget request included 
several initiatives related to headquarters organizations or 
personnel. Two organizations, the Joint Forces Command and Business 
Transformation Agency, were disestablished and some of their functions 
were absorbed into other organizations. DOD estimated that closing 
these two organizations would save approximately $2.2 billion through 
fiscal year 2016. 

Other headquarters-related efficiency initiatives that GAO reviewed 
generally fell into two categories: (1) consolidating or eliminating 
organizations based on geographic proximity or span of control, and 
(2) centralizing overlapping functions and services.[Footnote 187] For 
example, the Navy merged the staff of the U.S. Fleet Forces Command 
and the U.S. 2nd Fleet. The missions of the two organizations were 
found to have converged over time, and the Navy decided that an 
integrated staff could better adapt to changing missions than two 
separate staffs and doing so would have the added benefit of 
eliminating redundant personnel. The result was the elimination of 344 
military personnel for an expected cumulative savings of $100.8 
million by fiscal year 2016. In another example, the Air Force is 
centralizing installation support functions, such as civil 
engineering, environmental quality and planning programs, real 
property programs, and family support services, among others, at field 
operating agencies or Air Force headquarters, eliminating 354 
positions for an expected cumulative savings of $148.1 million by 
fiscal year 2016. 

The DOD efficiencies that GAO reviewed to reduce headquarters 
resources are expected by DOD to save about $2.9 billion through 
fiscal year 2016, less than 2 percent of the $178 billion in savings 
DOD projected departmentwide. In January 2012, DOD announced it had 
found about $60 billion in additional efficiencies and overhead 
savings over fiscal years 2013 to 2017, but did not indicate what 
portion of these savings were specific to headquarters. GAO's work 
indicates that DOD may be able to find additional efficiencies by 
further examining opportunities to consolidate organizations or 
centralize functions at headquarters. DOD may not have identified all 
areas where reductions in headquarters personnel and operating costs 
could be achieved because, according to DOD officials, the department 
was working quickly to identify savings in the fiscal year 2012 
budget. To accomplish this quickly, DOD used a top-down approach that 
identified several targets of opportunity to reduce costs, to include 
headquarters organizations, but left limited time for a detailed data-
driven analysis. 

One key factor inhibiting DOD from conducting systematic analyses of 
headquarters is the lack of complete and reliable data about the 
resources being devoted to such headquarters. According to GAO 
internal control standards, an agency must have relevant, reliable, 
and timely information in order to run and control its operations. 
Moreover, accurate, timely, and useful financial information is 
essential for sound management analysis, decision making, and 
reporting within DOD. The department has had long-standing challenges 
in identifying and tracking personnel and other resources devoted to 
headquarters; in the late 1990s, GAO reported that the number of 
personnel and costs associated with major DOD headquarters activities 
were significantly higher than DOD reported to Congress due to 
inconsistencies in how DOD tracked headquarters data. 

GAO's ongoing work has found that these problems are unresolved and 
the data on major DOD headquarters activities are still incomplete and 
unreliable for decision making. As the department did not have 
reliable major DOD headquarters activity data, DOD gathered 
information from multiple sources to compile headquarters-related 
information for the Secretary of Defense's 2010 efficiency initiative. 
According to DOD officials, the ever-changing statutory reporting 
requirements have contributed to DOD's failure to report to Congress 
about the numbers of headquarters personnel. DOD is required to report 
major DOD headquarters activities annually in the Defense Manpower 
Requirements Report, which is to be submitted to Congress no later 
than 45 days after the President's budget.[Footnote 188] Specifically, 
DOD is to report the number of military and civilian personnel 
assigned to major DOD headquarters activities in the preceding fiscal 
year and estimates of such numbers for the current and subsequent 
fiscal year. It must also include a summary of the replacement of 
contract workyears providing support to major DOD headquarters 
activities with military or civilian personnel during the preceding 
fiscal year, including an estimate of the number of contract workyears 
associated with the replacement of contracts performing inherently 
governmental or exempt functions. DOD must also report on the plan for 
continued review of contract personnel supporting major DOD 
headquarters activities for possible conversion to military or 
civilian positions in accordance with other legal requirements. 
Additionally, DOD must report the amount of any adjustment in 
personnel limits made by the Secretary of Defense or the secretary of 
a military department, and for each adjustment made pursuant to 
section 1111(b)(2) of the fiscal year 2009 National Defense 
Authorization Act, the purpose of the adjustment.[Footnote 189] DOD 
officials are aware of the reporting requirements and expect to report 
some of the major DOD headquarters activity data to Congress in the 
fiscal year 2012 Defense Manpower Requirements Report; however, it is 
unclear what information will be included in the report. 

Furthermore, DOD Instruction 5100.73, which guides the compilation of 
data on major DOD headquarters activities, is outdated and does not 
identify all organizations that should be included, such as the 
component command headquarters of the Departments of Navy and Air 
Force at U.S. Africa Command and certain Marine Corps components; this 
potentially omits hundreds of personnel and associated operating costs 
from being counted as part of headquarters. Second, the Instruction 
does not explicitly address how and to what extent the thousands of 
contractors that work at headquarters around DOD should be included as 
part of its major headquarters activity data. DOD has increasingly 
relied on contractors to provide a range of services at headquarters, 
such as management and administrative support, information technology, 
and base operations support. Some of the services and functions 
performed by contractors could be considered as major DOD headquarters 
activities. 

GAO's work over the past decade on DOD's contracting activities has 
noted the need for DOD to obtain better data on its contracted 
services and personnel to enable it to make more informed management 
decisions, ensure departmentwide goals and objectives are achieved, 
and to have the resources to achieve desired outcomes, which could 
include reducing overhead. GAO reported in January 2011 that further 
action was needed by DOD to better implement its requirements for 
conducting an inventory of its service contractor activities and made 
two recommendations, to include that DOD develop a plan of action to 
collect manpower data from contractors. In response to GAO's report, 
DOD has outlined its approach for collecting these data, but does not 
anticipate complete reporting until 2016. 

In light of changes in DOD's strategic priorities, complete and 
reliable headquarters information will be even more important to 
support a systematic examination of DOD's future structure. Without 
such information, efforts to re-examine its headquarters resources on 
a more comprehensive basis to identify additional efficiencies will be 
hampered, and DOD may miss opportunities to further shift resources 
from overhead to forces. 

Actions Needed and Potential Financial or Other Benefits: 

In the report that GAO anticipates issuing in March 2012, GAO expects 
to recommend several actions to facilitate reliable reporting on 
headquarters staffing and improve information available for decision 
making. Specifically, DOD should: 

* revise its Instruction on tracking of headquarters resources to 
include all major DOD headquarters activity organizations; 

* specify how contractors performing headquarters functions will be 
identified and included in headquarters reporting; 

* clarify how components are to compile the major DOD headquarters 
activities information needed to respond to the reporting requirements 
in section 1109 of the fiscal year 2010 National Defense Authorization 
Act; and: 

* establish time frames for implementing the actions above to improve 
tracking and reporting headquarters resources. 

In addition, to further DOD's ability to find efficiencies in 
headquarters and other overhead, GAO expects to recommend in the March 
2012 report that DOD should: 

* continue to examine opportunities to consolidate or eliminate 
defense headquarters organizations that are geographically close or 
have similar missions, as well as seek further opportunities to 
centralize administrative and command support services, functions, or 
programs. 

GAO is unable to quantify the potential for further financial benefits 
because reliable headquarters data are unavailable. Although GAO 
cannot quantify the potential for additional financial benefits, 
further efforts by DOD to examine its headquarters resources and 
improve its headquarters data could present opportunities for 
additional cost savings. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to DOD for review and 
comment. DOD provided technical comments, which were incorporated as 
appropriate. DOD officials generally agreed with the actions needed 
identified by GAO. Specifically, DOD officials told GAO that the 
department focused on broader reductions for purposes of the Secretary 
of Defense's 2010 efficiency initiative, not merely those activities 
identified as major DOD headquarters activities. GAO recognizes that 
major DOD headquarters activities are a subset of what DOD considered 
for its efficiency initiatives. However, given the Secretary's focus 
on finding efficiencies in headquarters, both as part of his overall 
efficiency initiative, as well as DOD's recent 2012 strategic 
guidance, GAO believes complete and reliable headquarters-specific 
data is even more important in guiding an examination of DOD 
resources. Without this data on headquarters personnel and operating 
costs, DOD will not have the information it needs, which could impact 
its efforts to direct resources toward its main priorities. 

How GAO Conducted Its Work: 

The information in this draft is based on findings from the reports 
listed in the related GAO products section as well as additional work 
GAO conducted to be published as a separate product in 2012. GAO 
selected and assessed DOD efficiency initiatives related to 
headquarters based on GAO's analysis of information included in DOD's 
fiscal year 2012 budget request and the Secretary of Defense's Track 
Four Efficiency Initiatives Decisions memo. GAO then obtained and 
analyzed documentary and testimonial evidence on these selected 
headquarters-related efficiency initiatives, including the analysis 
conducted to identify headquarters-related resources and the approach 
taken to develop selected headquarters-related efficiency initiatives. 
GAO also obtained and analyzed documentary and testimonial evidence 
from DOD components detailing the policies and procedures, as well as 
roles and responsibilities, for tracking and reporting headquarters 
personnel and operating costs, such as DOD Instruction 5100.73 Major 
DOD Headquarters Activities.[Footnote 190] 

Related GAO Products: 

Defense Acquisitions: Further Action Needed to Better Implement 
Requirements for Conducting Inventory of Service Contract Activities. 
[Hyperlink, http://www.gao.gov/products/GAO-11-192] Washington, D.C.: 
January 14, 2011. 

Defense Headquarters: Status of Efforts to Reduce Headquarters 
Personnel. [Hyperlink, http://www.gao.gov/products/GAO/NSIAD-00-224] 
Washington, D.C.: September 6, 2000. 

Defense Headquarters: Status of Efforts to Reduce Headquarters 
Personnel. [Hyperlink, http://www.gao.gov/products/GAO/NSIAD-99-45] 
Washington, D.C.: February 17, 1999. 

Defense Headquarters: Total Personnel and Costs Are Significantly 
Higher Than Reported to Congress. [Hyperlink, 
http://www.gao.gov/products/GAO/NSIAD-98-25] Washington, D.C.: October 
30, 1997. 

Contact Information: 

For additional information about this area, contact John Pendleton at 
(404) 679-1816 or pendletonj@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

With a real estate portfolio of over 539,000 facilities and 28 million 
acres of land, the Department of Defense (DOD) has been challenged to 
effectively manage deteriorating facilities and underused and excess 
property. To address these challenges, DOD has pursued a multipart 
strategy involving the base realignment and closure process, housing 
privatization, and demolition of facilities that are no longer needed. 
In addition, DOD has pursued a strategy it calls enhanced use leasing, 
which involves leasing underused real property to gain additional 
resources for the maintenance and repair of existing facilities or the 
construction of new facilities.[Footnote 191] According to the 
military services, enhanced use leases (EUL) offer significant 
opportunities to reduce DOD's infrastructure costs and could provide 
hundreds of millions of dollars to improve installation facilities, 
rather than financing these improvements through annual appropriations. 

The secretaries of the military departments have authority[Footnote 
192] to lease nonexcess military real property under the control of 
the respective departments in exchange for cash or in-kind 
consideration that is not less than the fair market value[Footnote 
193] of the lease interest, subject to certain conditions. Some EULs 
involve complex agreements and long terms. For example, an EUL might 
provide for a 50-year lease of military land to a private developer 
that would be expected to construct office or other commercial 
buildings on the land and then rent the facilities to private sector 
tenants for profit. As consideration, the military might receive cash 
or in-kind services valued at an amount equal to a share of the net 
rental revenues from the developed property. As of the end of fiscal 
year 2010, the military services reported that 17 EULs were in place--
the Army reported 7, the Navy reported 5, and the Air Force reported 
5. The services also reported that 37 additional EULs were in various 
phases of review or negotiation for possible future implementation. 
However, as GAO previously reported in June 2011, the services did not 
always realize expected financial benefits from the EUL program. 

What GAO Found: 

GAO's detailed case studies of nine EULs found that the services' 
management of the EUL program contains internal control weaknesses 
related to policies and procedures and performance monitoring. 
Specifically, it is not clear how and to what extent the services have 
ensured the receipt of the fair market value of the lease interest, as 
required by the authorizing statute. In addition, GAO found that the 
services have not regularly monitored or performed periodic analyses 
of EUL program administration costs. Therefore, it is unclear whether 
such costs are in line with the potential program benefits. 

While the statute leaves the determination of fair market value to the 
discretion of the secretary of each military service, and thus a 
particular methodology for determining fair market value is not 
required, GAO found cases where receipt of fair market value was 
questionable, largely because service guidance for determining and 
ensuring the receipt of fair market value for proposed EULs was not 
clear. In implementing an internal controls framework, as outlined in 
GAO's Standards for Internal Control in the Federal Government, 
[Footnote 194] management is responsible for developing detailed 
policies, procedures, and practices to fit their agency's operations 
and to ensure that those controls are built into and are an integral 
part of operations. However, GAO found, in the absence of clear 
guidance, at least one instance where the Air Force agreed to an 
amount of lease consideration below one estimate of the value of the 
leased property. For example, in an Eglin Air Force Base EUL, referred 
to as the Okaloosa County Regional Airport Enhanced Use Lease, the Air 
Force hired a company to estimate the fair market value of the 
property. Although the company estimated a value of $1,274,000 
annually, after negotiations with the lessee, the Air Force agreed to 
accept $318,000 annually as consideration. Thus, the negotiated amount 
was $956,000, or 75 percent, less per year than the appraised value of 
the property. Because the services lack clear and consistent guidance 
on how the fair market value of lease interest should be determined 
and how the receipt of the fair market value can be best ensured, it 
is not clear how the officials involved in this and other cases 
determined whether the services received the fair market value of the 
leased property. 

In addition, GAO found that the services have not regularly monitored 
or performed periodic analyses of EUL program administration costs to 
help ensure that such costs are in line with program benefits. 
According to internal control standards, activities need to be 
established to monitor performance measures and indicators, such as 
analyses of data relationships, so that appropriate actions can be 
taken, if needed. Without regular monitoring and analysis, the 
services have less assurance that their EUL program administration 
costs are in line with program benefits. While the services have no 
criteria for how much they should be spending on EUL program 
administration costs relative to program benefits, GAO's analysis 
showed that EUL program administration costs ranged from 31 percent to 
135 percent of the total EUL consideration received during fiscal 
years 2006 through 2010. Specifically, GAO's analysis of information 
provided by the services concluded that EUL program administration 
costs, including personnel and consultant costs, equaled about 31 
percent of the total EUL consideration received by the Army and the 
Navy and about 135 percent of the total EUL consideration received by 
the Air Force. The Air Force spent about $10.4 million more to 
administer its EUL program than the amount of consideration received 
from its five EULs during fiscal years 2006 through 2010. 

Actions Needed and Potential Financial or Other Benefits: 

To help effectively implement the EUL program in order to maximize the 
potential economic benefits, GAO recommended in June 2011 that the 
departmental secretaries should: 

* review and clarify guidance describing how the fair market value of 
the lease interest should be determined and how the receipt of fair 
market value can be best ensured; and: 

* develop procedures to regularly monitor and analyze EUL program 
administration costs to help ensure that the costs are in line with 
program benefits. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its June 2011 report to DOD for review and 
comment. DOD agreed with GAO's previous recommendations and stated 
that the military services were taking appropriate measures to 
implement the recommendations. According to a DOD official, as of 
January 19, 2012, DOD did not have the formal status of actions taken 
to respond to the recommendations in GAO's report, but verified that 
they have begun the process of making those changes. As part of its 
routine audit work, GAO will track the extent to which progress has 
been made to address the identified actions and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the reports listed in the related products section. GAO reviewed 
statutory requirements; examined military service policies, 
instructions, and other guidance; and interviewed officials from the 
Office of the Secretary of Defense, the Army, the Navy, and the Air 
Force to discuss implementation of the EUL program. While GAO reviewed 
information on all 17 EULs in place at the end of fiscal year 2010, 
GAO selected 9 of the 17 EULs for detailed case study review. The EULs 
were selected non-randomly to include three from each service and a 
range of lease purposes, estimated financial benefits, and geographic 
locations. For the nine case studies, GAO reviewed how the services 
provided for the receipt of the fair market value of the leased 
property and how the services monitored program administration costs 
in relation to program benefits. 

Related GAO Products: 

Defense Infrastructure: The Enhanced Use Lease Program Requires 
Management Attention. [Hyperlink, 
http://www.gao.gov/products/GAO-11-574] Washington, D.C.: June 30, 
2011. 

Federal Real Property: Authorities and Actions Regarding Enhanced Use 
Leases and Sale of Unneeded Real Property. [Hyperlink, 
http://www.gao.gov/products/GAO-09-283R] Washington, D.C.: February 
17, 2009. 

Contact Information: 

For additional information about this area, contact Brian J. Lepore, 
at (202) 512-4523 or leporeb@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

As GAO reported in February 2005, the Department of Defense's (DOD) 
health care system is an example of a key challenge facing the U.S. 
government in the 21st century, as well as an area in which DOD could 
achieve economies of scale and improve delivery of services.[Footnote 
195] 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 
196] to provide health care to approximately 9.6 million active duty 
servicemembers, reservists, retirees, and their dependents. According 
to a 2011 Congressional Budget Office report, military health spending 
could reach $59 billion by 2016, and is projected to grow to $92 
billion by 2030.[Footnote 197] In 2009, the Defense Business Board, 
[Footnote 198] a group of private sector experts who advise DOD on its 
overall management and governance, expressed concern at the rise in 
military health care costs and noted such spending could eventually 
begin to divert funding away from other priorities such as critical 
national security initiatives, compensation and personnel costs, and 
the acquisition of equipment. 

Congressional leaders also share concerns over rising military health 
costs. For example, the House Committee on Armed Services' Print 
accompanying the Ike Skelton National Defense Authorization Act for 
Fiscal Year 2011[Footnote 199] noted that DOD had not yet developed a 
comprehensive plan to enhance quality, efficiencies, and savings in 
the Military Health System.[Footnote 200] Furthermore, DOD officials 
also agree that the rate at which health care costs are rising must be 
addressed, as noted in the 2010 Quadrennial Defense Review,[Footnote 
201] which stated that DOD intends to continue to develop health care 
initiatives that will improve the quality and standard of care, while 
reducing growth in overall costs. 

Under the current structure of DOD's Military Health System, the 
responsibilities and authorities for its management are distributed 
among several organizations--including the Assistant Secretary of 
Defense for Health Affairs and the military services. Health 
Affairs[Footnote 202] is responsible for creating and submitting a 
unified medical budget and allocating funds to the military services 
for their respective medical systems; however, Health Affairs lacks 
direct command and control of the services' military treatment 
facilities. Additionally, the three departments each have Surgeons 
General to oversee their deployable medical forces and operate their 
own health care systems, including training for medical personnel. In 
GAO's first report issued in response to its mandate to report on 
duplication, overlap, and fragmentation within the federal 
government,[Footnote 203] GAO stated that realigning DOD's military 
medical command structures and common functions could increase 
efficiency and result in projected savings ranging from $281 million 
to $460 million annually.[Footnote 204] GAO is currently conducting 
additional work to look beyond these potential governance 
transformation efforts and to examine other initiatives DOD is 
undertaking that could help contain its rising health care costs. 
These other initiatives--with the exception of one which is related to 
governance--are focused on reducing per capita costs,[Footnote 205] 
improving its servicemembers' medical readiness, and improving its 
beneficiaries' overall health and experience of care. 

What GAO Found: 

GAO's ongoing work has found that DOD has begun a number of health 
care initiatives intended to slow the rise in its health care costs, 
but it has not fully applied results-oriented management practices to 
its efforts, which limits its effectiveness in implementing these 
initiatives and achieving related cost savings and other performance 
goals. The Senior Military Medical Advisory Committee--a committee 
that functions as an executive-level discussion and advisory 
group,[Footnote 206] has approved 11 strategic initiatives that it 
believes will help reduce rising health care costs. DOD's strategic 
initiatives consist primarily of changes to clinical and business 
practices in areas ranging from primary care to psychological health 
to purchased care reimbursement practices. DOD was experiencing a 5.5 
percent annual increase in per capita costs for its enrolled 
population, according to data available as of December 2011, but DOD 
had set its target ceiling for per capita health care cost increases 
for fiscal year 2011 at a lower rate of 3.1 percent. According to DOD 
calculations using 2011 enrollee and cost data, if DOD had met its 
target ceiling of a 3.1 percent increase as opposed to a 5.5 percent 
increase, the 2.4 percent reduction would have resulted in 
approximately $300 million in savings. 

Partly in response to GAO's ongoing work assessing DOD's management of 
its initiatives, the department has taken some initial steps toward 
managing their implementation. GAO found that, in addition to 
developing a number of high-level, non-monetary metrics and 
corresponding goals for each strategic initiative, DOD has developed a 
dashboard management tool that will include elements such as an 
explanation of the initiative's purpose, measures, and funding 
requirements for implementation. In December 2011, the Senior Military 
Medical Advisory Committee approved 6 dashboards that were 
significantly, but not entirely completed. A Health Affairs official 
stated that only one initiative out of 11 currently has a cost savings 
estimate associated with it. Cost savings estimates are critical to 
successful management of the initiatives so that DOD can achieve its 
goal of reducing growth in medical costs as stated in the 2010 
Quadrennial Defense Review. In addition, DOD has developed a template, 
or a more detailed implementation plan, that is to be completed for 
each dashboard and is intended to include general timelines and 
milestones, key risks, and cost savings estimates. DOD currently has 
one completed implementation plan, which also contains the one 
available cost savings estimate among all the initiatives. See the 
table below for a list of the 11 initiatives and their current status 
as of January 13, 2012. 

Table: Progress made in Developing a Dashboard and Detailed 
Implementation Plans for Each of DOD's Strategic Initiatives as of 
January 13, 2012: 

Description of DOD's strategic initiatives: 

Implement the Patient Centered Medical Home model of care to increase 
satisfaction, improve care and reduce costs[B]; 
Dashboard approved? [Check]; 
Implementation plan approved? [Check]; 
Estimated net savings[A]: $39.3 million. 

Integrate psychological health programs to improve outcomes and 
enhance value; 
Dashboard approved? [Check]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Implement incentives to encourage adherence to medical standards based 
on evidence to increase patient satisfaction, improve care and reduce 
per capita health care costs; 
Dashboard approved? [Check]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Implement alternative payment mechanisms to reward value in health 
care services; 
Dashboard approved? [Check]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Revise DOD's future purchased care contracts to offer more and varied 
options for care delivery from private sector heath care providers; 
Dashboard approved? [Check]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Improve the measurement and management of DOD's population health by 
moving away from focusing on illness and disease to an emphasis on 
prevention, intervention, and wellness by health care providers; 
Dashboard approved? [Check]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Optimize pharmacy practices to improve quality and reduce cost; 
Dashboard approved? [Empty]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Implement policies, procedures, and partnerships to meet individual 
servicemembers' medical readiness goals; 
Dashboard approved? [Empty]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Implement DOD and Veterans Affairs joint strategic plan for mental 
health to improve coordination; 
Dashboard approved? [Empty]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Implement modernized electronic health record to improve outcomes and 
enhance interoperability; 
Dashboard approved? [Empty]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Improved governance to achieve better performance in multiservice 
medical markets; 
Dashboard approved? [Empty]; 
Implementation plan approved? [Empty]; 
Estimated net savings[A]: [Empty]. 

Source: GAO analysis of DOD information. 

[A] The net savings is DOD's estimate and it covers fiscal years 2012 
through 2016. GAO did not independently assess the reliability of this 
cost savings estimate. 

[B] DOD estimates that its investment in Patient Centered Medical Home 
will be $571.4 million in total from fiscal years 2010 through 2016. 

[End of table] 

As shown above, DOD has not fully completed the dashboards, 
implementation plans, and cost savings estimates for its 11 
initiatives as of January 13, 2012. GAO has found that comprehensive, 
results-oriented plans are key to effectively implementing agency 
strategies.[Footnote 207] As DOD completes its dashboards, 
implementation plans, and cost savings estimates, it could benefit 
from the application of a comprehensive, results-oriented management 
framework, including a robust description of the initiatives' mission 
statement; problem definition, scope, and methodology; goals, 
activities and performance measures; resources and investments; 
organizational roles, responsibilities, and coordination; and key 
external factors that could affect goals. Without completing its plans 
and incorporating these principles into them, DOD will be limited in 
its ability to implement these initiatives and achieve cost savings. 

In addition, DOD has not completed the implementation of an overall 
monitoring process across its portfolio of initiatives for overseeing 
the initiatives' progress and has not completed the process of 
identifying accountable officials and their roles and responsibilities 
for all of its initiatives. Further, GAO's work on results-oriented 
management practices has found that a process for monitoring progress 
and defining roles and responsibilities is key to successful 
implementation.[Footnote 208] As Military Health System leaders 
develop and implement their plans to control rising health care costs, 
they will also need to work across multiple authorities and areas of 
responsibility. As the 2007 Task Force on the Future of Military 
Health Care noted, the current Military Health System does not 
function as a fully integrated health care system.[Footnote 209] 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. 

As GAO reported in October 2005, agreement upon roles and 
responsibilities is a key step to successful collaboration when 
working across organizational boundaries, such as the military 
services.[Footnote 210] Committed leadership by those involved in the 
collaborative effort, from all levels of the organization, is also 
needed to overcome the many barriers to working across organizational 
boundaries. For example, Health Affairs manages the medical budget by 
allocating money to the services, but it lacks direct command and 
control of the military treatment facilities. DOD's one approved 
implementation plan provides further information on how DOD has 
applied a monitoring structure and has defined accountable officials 
and assigned roles and responsibilities in the case of this one 
initiative. However, DOD has not completed this process for the 
remainder of its initiatives. Without sustained top civilian and 
military leadership that is consistently involved throughout the 
implementation of its various initiatives and until DOD fully 
implements for all of its initiatives a mechanism to monitor progress 
and identify accountable officials including their roles and 
responsibilities, DOD may be hindered in its ability to achieve a more 
cost-efficient military health system and at the same time address its 
medical readiness goals, improve its overall population health, as 
well as increase its patients' experience of care. 

Actions Needed and Potential Financial or Other Benefits: 

Based on ongoing work, GAO expects to recommend that, 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, DOD should: 

* complete and fully implement the dashboards and 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. 

DOD may realize projected cost savings and other performance goals by 
taking the actions GAO describes 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. For example, according to a 
DOD calculation, if it had met its cost growth target for fiscal year 
2011, it could have saved approximately $300 million. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to DOD for review and 
comment. DOD provided technical comments, which were incorporated as 
appropriate. DOD agreed with GAO's finding on the need to complete, 
implement and monitor plans for each of its approved health care 
initiatives. Further, DOD officials agreed with GAO's expected 
recommendation to complete and fully implement, for each of their 
initiatives, detailed implementation plans in a manner consistent with 
results-oriented management practices, such as the inclusion of 
upfront investment costs and cost savings estimates. They stated that 
quantifying the financial benefits of programs that change the way 
care is delivered is an extremely complex task but that they are 
committed to trying to do so. Additionally, these officials agreed 
with GAO's second expected recommendation to complete and fully 
implement, for each of their initiatives, an overall monitoring 
process across DOD's portfolio of initiatives, and to identify 
accountable officials and their roles and responsibilities. As part of 
its routine audit work, GAO will track the extent to which progress 
has been made to address the identified actions and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted to be published as a separate product in 
2012. GAO interviewed DOD officials in the Health Budgets and 
Financial Policy Office and in the Office of Strategy Management, 
within the Office of the Assistant Secretary of Defense for Health 
Affairs, as well as officials in the TRICARE Management Activity 
concerning their 11 health care initiatives and obtained and reviewed 
documentation concerning their efforts. GAO compared DOD's efforts to 
its prior work on results-oriented key management practices. GAO 
obtained available documentation and interviewed DOD officials to 
determine DOD's approach for monitoring the initiatives' progress, 
identifying accountable officials, and defining their roles and 
responsibilities. GAO did not assess the reliability of any financial 
data since GAO was using the data for illustrative purposes to provide 
context on DOD's efforts and to make broad estimates about potential 
cost savings from these efforts, and GAO determined that this data did 
not materially affect the nature of its findings. 

Related GAO Products: 

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.: March 1, 
2011. 

Defense Health Care: DOD Needs to Address the Expected Benefits, 
Costs, and Risks for Its Newly Approved Medical Command Structure. 
[Hyperlink, http://www.gao.gov/products/GAO-08-122] Washington, D.C.: 
October 12, 2007. 

Contact Information: 

For additional information about this area, contact Brenda S. Farrell 
at 202-512-3604 or farrellb@gao.gov . 

[End of section] 

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. 

Why This Area Is Important: 

According to the 2010 Quadrennial Defense Review, approximately 
400,000 U.S. military personnel are forward-stationed or rotationally 
deployed, or postured, around the world on any given day--including 
those involved in operations in Afghanistan and Iraq. In addition to 
the costs of supporting ongoing combat operations, the Department of 
Defense (DOD) spends billions of dollars annually on its network of 
installations around the world that supports its overseas defense 
posture. In last year's report on opportunities to reduce potential 
duplication in government programs, GAO reported that DOD should 
assess the costs and benefits of its overseas installations before 
committing to costly realignments and construction plans. For this 
year's analysis, GAO is focusing on DOD's presence in the Pacific 
region. 

As GAO reported in May 2011, from 2006 through 2010, DOD obligated 
$24.6 billion to build, operate, and maintain installations in support 
of its defense posture in the Pacific. Additionally, the report stated 
that DOD is currently conducting the largest transformation of its 
defense posture in the Pacific since the end of World War II, 
including initiatives that will cost billions of dollars in resource 
investments and take many years--perhaps decades--to complete. 
Although DOD's new defense strategy identifies U.S. presence in the 
Pacific as important, questions have arisen about the magnitude and 
costs of overseas basing projects and whether DOD's planned 
investments support a coherent and affordable strategy. 

What GAO Found: 

Although DOD has taken steps to improve its planning for overseas 
defense posture, it has not fully identified costs or provided an 
analysis of alternatives for basing U.S. forces in the Pacific. Having 
U.S. troops permanently stationed overseas provides benefits--such as 
deterring aggression against U.S. allies--but it incurs significant 
costs. In previous GAO reports on overseas defense posture, GAO 
emphasized the need for DOD to assess the costs and benefits of 
options for the U.S. overseas military presence before committing to 
costly personnel realignments and construction plans. However, in the 
case of DOD's overseas presence in the Pacific, GAO found that 
comprehensive cost information is not systematically used to inform 
DOD's planning for its overseas defense posture. As a consequence, DOD 
and Congress lack reasonable assurance that overseas presence in the 
Pacific is being planned and implemented in a cost-effective and 
financially sustainable way. Reliable and complete cost estimates are 
critical to allow analyses of alternatives and oversight by decision 
makers. 

As GAO reported in May 2011, several evolving defense posture 
initiatives in the Pacific have the potential to cost the department 
billions of dollars. Through informed decision making based on 
comprehensive information and analysis of alternatives for some of its 
planned defense posture initiatives in that region, DOD may be able to 
reduce some of these costs. For example: 

* South Korea tour normalization initiative. DOD is transforming its 
defense posture in South Korea through a series of interrelated 
initiatives that DOD estimates will total $17.6 billion through fiscal 
year 2020. The largest of these initiatives, tour normalization, would 
increase the tour lengths of personnel stationed in South Korea and 
move thousands of military dependents to South Korea. According to DOD 
officials, the decision to move forward with tour normalization was 
made to achieve certain strategic objectives, such as providing 
military commanders greater flexibility in how U.S. military forces 
assigned to South Korea are used and to improve the quality of life 
for military service members and their families. This initiative alone 
could cost DOD $5 billion by fiscal year 2020 and $22 billion or more 
through 2050; however, prior to making the decision to move forward 
with the tour normalization initiative, DOD did not complete a 
business case analysis that would have considered alternative courses 
of action for achieving its strategic objectives, and the costs and 
benefits associated with any alternatives. Potential alternatives 
might be to maintain current primarily 1-year unaccompanied tour 
lengths, partially implement tour normalization at select locations, 
or other possibilities that would help achieve United States Forces 
Korea's strategic objectives. DOD is embarking on an initiative that 
involves moving thousands of U.S. civilians to locations in South 
Korea, mainly Camp Humphreys, and constructing schools, medical 
facilities, and other infrastructure to support them--without fully 
understanding the costs involved or considering potential alternatives 
that might more efficiently achieve U.S. strategic objectives. 

* Japan and Guam realignment initiatives. DOD has embarked on a major 
realignment of its defense posture in mainland Japan, Okinawa and Guam 
but has not developed comprehensive cost estimates for this work. 
Approximately $29.1 billion in costs--primarily in construction costs--
is anticipated to be shared by the United States and Japan to 
implement these realignment initiatives. DOD officials stated that 
total cost estimates for these initiatives--including operation and 
maintenance costs to DOD--were not available because of the 
significant uncertainty surrounding initiative-implementation 
schedules. In February 2012, the United States and Japan released a 
joint statement indicating that the two governments have started 
official discussions to revise current posture plans, specifically the 
plans to relocate the Marines to Guam. In July 2010, the Senate 
Appropriations Committee directed DOD to provide status updates on 
defense posture initiatives in Korea, Japan, Guam, and the Northern 
Mariana Islands, as an appendix to the annual DOD Global Posture 
Report, to address such items as schedule status, facilities 
requirements, and total costs--including operation and maintenance 
costs. These updates should be provided annually, beginning with the 
submission of the fiscal year 2012 budget request, until the 
restructuring initiatives are complete or funding requirements to 
support them are satisfied. The Committee renewed its direction in 
June 2011. If DOD is fully responsive to the Committee's reporting 
direction, these updates should provide needed visibility into the 
cost and funding of the initiatives. According to DOD officials, DOD 
will submit an appendix as part of its 2012 Global Posture Report that 
includes updates to posture initiatives in Korea, Japan, and Guam. 
They anticipate the report will be issued in the spring of 2012. 

* U.S. Pacific Command operation and maintenance costs. Service 
officials estimated that operation and maintenance costs for 
installations in the Pacific region would be about $2.9 billion per 
year through 2015.[Footnote 211] However, GAO found that, of the 
approximately $24.6 billion reported as obligated by the military 
services to build, operate, and maintain installations in the Pacific 
from 2006 through 2010, approximately $18.7 billion--or about $3.7 
billion per year--was for operation and maintenance costs, an increase 
of over 27 percent per year over the service officials' estimate 
through 2015.[Footnote 212] Further, the planned defense posture 
initiatives in South Korea, Japan, and Guam may significantly increase 
operation and maintenance costs over the long term, potentially 
through 2015 and beyond. For example, DOD has yet to estimate costs 
associated with furnishing and equipping approximately 321 new 
buildings and 578 housing units in Okinawa. In the United States 
Department of Defense Fiscal Year 2011 Budget Request Overview, 
prepared by the Office of the Under Secretary of Defense 
(Comptroller), DOD outlined the need to reform the way it buys its 
weapons and other important systems and investments, including 
strengthening front-end scrutiny of costs and not relying on overly 
optimistic or underestimated cost estimates. In June 2011, DOD revised 
posture-related guidance to require full project costs, including any 
operation and maintenance costs, for all ongoing, current, and 5-year 
planned posture initiatives to be submitted as part of a combatant 
commander's theater posture plan. In the October 2011, U.S. Pacific 
Command's Theater Posture Plan, neither operation and maintenance, nor 
total costs for posture initiatives had yet been included. GAO will 
continue to monitor future updates to the plan. 

Actions Needed and Potential Financial or Other Benefits: 

To provide DOD and Congress with the comprehensive defense posture 
cost information needed to fully evaluate investment decisions and the 
affordability of defense posture initiatives, GAO recommended in May 
2011 that the Secretary of Defense: 

* identify and direct appropriate organizations within DOD to complete 
a business case analysis, including an evaluation of alternative 
courses of action, for the strategic objectives that have to this 
point driven the decision to implement tour normalization in South 
Korea; 

* identify and limit investments and other financial risks associated 
with construction programs at Camp Humphreys, South Korea, that are 
affected by decisions related to tour normalization until a business 
case analysis is reviewed and the most cost-effective approach is 
approved by the Secretary of Defense; and: 

* direct the Secretaries of the military departments to develop annual 
cost estimates for defense posture in the Pacific that provide a 
comprehensive assessment of defense posture-related costs, including 
costs associated with operating and maintaining existing defense 
posture, as well as costs associated with defense posture initiatives, 
in accordance with guidance developed by the Under Secretary of 
Defense (Comptroller). 

Additionally, in light of the United States and Japan's joint 
statement announcing discussions to revise U.S. posture plans in the 
Pacific, it will be critical for DOD to develop comprehensive cost 
estimates--including estimates of operation and maintenance costs--as 
it evaluates cost effective alternatives for the future. To facilitate 
congressional oversight of plans to realign U.S. defense posture in 
the Pacific, and to provide reasonable assurance that DOD will take 
all appropriate measures to mitigate financial risks and better define 
future requirements, the Secretary of Defense should provide Congress: 

* specifics regarding corrective actions the department plans to take; 
and: 

* time frames for completion. 

By assessing alternatives, conducting comprehensive cost analyses, and 
providing comprehensive annual defense posture cost estimates, DOD 
will be in a better position to fully evaluate investment 
requirements, and make more informed decisions regarding the 
affordability of its overseas defense posture. Furthermore, 
congressional committees will have the appropriate financial context 
to determine funding needs for specific posture-related initiatives 
and construction programs. Cost savings or avoidance would depend on 
the nature of changes made to DOD's plans and how DOD implements its 
chosen options. 

Agency Comments and GAO's Evaluation: 

GAO provided its May 2011 report to DOD for review and comment. DOD 
agreed with GAO's recommendations and stated that it would work with 
its components to implement them. Insufficient time has passed since 
the issuance of the report for GAO to fully evaluate DOD's 
implementation. As part of its routine audit work, GAO will track the 
extent to which progress has been made to address the identified 
actions and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the reports listed in the related GAO products section. GAO assessed 
DOD policies and procedures, interviewed relevant DOD and State 
Department officials, and analyzed cost data from the military 
services. 

Related GAO Products: 

Defense Management: Comprehensive Cost Information and Analysis of 
Alternatives Needed to Assess Military Posture in Asia. [Hyperlink, 
http://www.gao.gov/products/GAO-11-316] Washington. D.C.: May 25, 2011. 

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.: March 1, 
2011. 

Defense Management: Additional Cost Information and Stakeholder Input 
Needed to Assess Military Posture in Europe. [Hyperlink, 
http://www.gao.gov/products/GAO-11-131] Washington D.C.: February 3, 
2011. 

Defense Planning: DOD Needs to Review the Costs and Benefits of Basing 
Alternatives for Army Forces in Europe. [Hyperlink, 
http://www.gao.gov/products/GAO-10-745R] Washington D.C.: September 
13, 2010. 

Force Structure: Actions Needed to Improve DOD's Ability to Manage, 
Assess, and Report on Global Defense Posture Initiatives. [Hyperlink, 
http://www.gao.gov/products/GAO-09-706R] Washington D.C.: July 2, 2009. 

Defense Management: Actions Needed to Address Stakeholder Concerns, 
Improve Interagency Collaboration, and Determine Full Costs Associated 
with the U.S. Africa Command. [Hyperlink, 
http://www.gao.gov/products/GAO-09-181] Washington D.C.: February 20, 
2009. 

Contact Information: 

For additional information about this area, contact Brian J. Lepore at 
(202) 512-4523 or leporeb@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

In 2007, the Department of the Navy (Navy) established the Next 
Generation Enterprise Network (NGEN) program to replace and improve 
the Navy Marine Corps Intranet, which provides about 382,000 
workstations to approximately 700,000 users across 2,500 Navy and 
Marine Corps locations around the world. NGEN is intended to provide 
secure data and information technology services, such as data storage, 
e-mail, and video-teleconferencing. It is also intended to provide the 
foundation for the Navy's future Naval Networking Environment--a set 
of integrated, phased programs that share a common enterprise 
architecture and standards. 

As envisioned, NGEN's capabilities are to be incrementally acquired 
through multiple providers (contractors). The first increment is to 
provide capabilities comparable to the Navy Marine Corps Intranet, as 
well as enhanced information assurance and increased government 
control over network operations. 

To date, according to the President's fiscal year 2012 budget, the 
NGEN program has spent about $434 million on work associated with the 
transition from the Navy Marine Corps Intranet. The first increment is 
to be fully operational in March 2014 and is to cost approximately $50 
billion to develop, operate, and maintain through fiscal year 2025. 

What GAO Found: 

As GAO reported in March 2011, the Navy did not have sufficient basis 
for knowing that it is pursuing the most cost-effective approach for 
acquiring NGEN capabilities. According to the Department of Defense 
guidance,[Footnote 213] an analysis of alternatives should examine 
viable solutions with the goal of identifying the most promising 
option, thereby informing acquisition decision making. While the Navy 
conducted an analysis of alternatives, it ultimately selected an 
approach that was not considered in this analysis and that the Navy 
estimated would cost at least $4.7 billion more than any of the four 
assessed alternatives. Further, the analysis of alternatives 
highlighted the potential for greater schedule and performance risks 
as the number of contractual relationships in the approach increases. 
Given that the selected approach includes a larger number of such 
relationships than the assessed alternatives, the relative schedule 
and performance risks for this approach are likely greater, and 
therefore are likely to result in greater costs. (See the table below 
for the contractual relationships and Navy's estimated costs of the 
assessed alternatives and the selected approach.) 

Table: NGEN Alternative and Selected Approaches: 

Contractual relationships; 
Status quo: 3; 
Alt. 2: 3; 
Alt. 3 variant: 10; 
Alt. 3: 15; 
Selected approach: 21. 

Estimated cost[A]; 
Status quo: $10.3 billion; 
Alt. 2: $10.8 billion; 
Alt. 3 variant: $10.8 billion; 
Alt. 3: $10.7 billion; 
Selected approach: $15.6 billion. 

Sources: Navy data (status quo and alternatives 2, 3 variant, and 3); 
GAO analysis of Navy data (selected approach). 

[A] Fiscal years 2011-2015 in billions (adjusted for inflation). 

[End of table] 

Navy officials did not view the differences in contractual 
relationships and schedule and performance risks between the approach 
selected and the assessed alternatives as significant, despite the 
difference in cost. Nevertheless, by using this acquisition approach, 
Navy decision makers lack assurance that their selected approach is 
the most promising and cost-effective course of action. 

GAO also determined that the Navy's schedule for NGEN did not 
adequately satisfy key schedule estimating best practices, which GAO 
has previously identified, 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. Because it did not satisfy these practices, the schedule 
does not provide a reliable basis for program execution. According to 
program officials, schedule estimating was constrained by staffing 
limitations. However, these weaknesses have contributed to delays in 
key NGEN events and milestones, including the completion of multiple 
major acquisition reviews and program plans. 

Additionally, successful execution of system acquisition programs 
depends in part on effective executive-level governance, to include 
having organizational executives review these programs at key 
milestones in their life cycles and make informed performance-and risk-
based decisions as to how they should proceed.[Footnote 214] NGEN 
acquisition decisions were not always performance-and risk-based. In 
particular, senior executives approved the program's continuing 
progress in the face of known performance shortfalls and risks. For 
example, in November 2009, the program was approved at a key 
acquisition review despite the lack of defined requirements, which 
officials recognized as a risk that would impact the completion of 
other key documents, such as the test plan. According to Navy 
officials, the decisions to proceed were based on their view that they 
had sufficiently mitigated known risks and issues. However, Navy 
officials later realized the risk from a lack of defined requirements 
was a critical issue. 

By selecting an approach that carries greater relative schedule and 
performance risks than other alternatives and that is being executed 
against an unreliable program schedule, the department increases the 
risk that its approach will lead to future cost overruns. Furthermore, 
if the department proceeds along its current course, the issues GAO 
has identified with the program's schedule, along with the delays 
already experienced, raise concerns that it will be unable to complete 
the transition as planned. 

Actions Needed and Potential Financial or Other Benefits: 

To ensure that NGEN capabilities are acquired in the most cost-
effective manner, GAO recommended in March 2011 that Secretary of 
Defense should: 

* limit further investment in NGEN until the Navy conducts an 
immediate interim review to reconsider the selected acquisition 
approach. At a minimum, this review should ensure that the Navy 
pursues the most advantageous acquisition approach, as evidenced by a 
meaningful analysis of all viable alternative acquisition approaches; 
it also should consider existing performance shortfalls and known 
risks. 

Furthermore, to facilitate implementation of the acquisition approach 
resulting from this review, the Secretary of the Navy should: 

* ensure that the NGEN schedule substantially reflects the key 
schedule estimating practices, and that future NGEN acquisition 
reviews and decisions fully reflect the state of the program's 
performance and its exposure to risks. 

The Navy has subsequently indicated that changes to the acquisition 
strategy are under way. GAO is 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, 
including the basis for determining that this approach is the most 
cost-effective. GAO will also determine the extent to which Navy has 
implemented key schedule estimating practices and has made performance-
and risk-based decisions. If fully implemented, GAO's key recommended 
actions should help the Navy ensure that the most cost-effective 
approach is pursued. 

Agency Comments and GAO's Evaluation: 

GAO provided a copy of its March 2011 report to the Department of 
Defense for review and comment. The department agreed with the 
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 concur with the 
recommendation to reconsider its acquisition approach. However, as 
noted earlier, the Navy is currently in the process of reviewing and 
making changes to its acquisition strategy. Further, the department 
partially concurred with the recommendation to ensure that the NGEN 
schedule substantially reflects the key schedule estimating practices, 
stating that it would consider incorporating practices found to be 
beneficial. GAO believes that incorporating all of the best practices 
for schedule estimating in the NGEN master schedule would help the 
department manage and measure its progress in executing the work 
needed to transition from the Navy Marine Corps Intranet to NGEN. As 
part of its routine audit work, GAO will track agency actions to 
address these recommendations and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based primarily on 
findings from the products listed in the related GAO products section. 
GAO analyzed the NGEN alternatives analysis report and underlying 
support, the program's master schedule, program performance 
assessments and risk reports, and executive acquisition decision 
briefings and meeting minutes, among other things. GAO also 
interviewed cognizant agency and program officials regarding the 
analysis of alternatives' development and results, development and 
management of the program schedule, and NGEN performance and program 
risks. 

Related GAO Products: 

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.: March 11, 
2011. 

Information Technology: DOD Needs to Ensure That Navy Marine Corps 
Intranet Program Is Meeting Goals and Satisfying Customers. 
[Hyperlink, http://www.gao.gov/products/GAO-07-51] Washington, D.C.: 
Dec. 8, 2006. 

Contact Information: 

For additional information about this area, contact Valerie C. Melvin 
at (202) 512-6304 or melvinv@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

In 2008 and 2009, the Department of the Treasury (Treasury) committed 
$62 billion in Troubled Asset Relief Program funding to General Motors 
(GM) and Chrysler to help the companies restructure. Anticipating the 
possible effects of the companies' restructuring on communities that 
relied heavily on these companies and their suppliers for employment 
and economic investment, in June 2009 the President issued Executive 
Order 13509 establishing the White House Council on Automotive 
Communities and Workers (the Council)--composed of over 20 members, 
including the heads of all domestic cabinet agencies and key White 
House offices--to coordinate a federal response to issues affecting 
these communities and others that rely on GM, Chrysler, or other auto 
companies and suppliers.[Footnote 215] The staff and the funding for 
the Council were housed within the Department of Labor's Office of 
Recovery for Auto Communities and Workers (Auto Recovery Office). 

As GAO reported in May 2011, GM and Chrysler restructured their 
operations from 2008 through 2010 in part by closing or halting 
production at 22 plants[Footnote 216] (16 GM and 6 Chrysler), and 
communities in which these plants were located experienced economic 
challenges in addition to those they already faced. GAO visited six of 
these communities and found that unemployment in all of them increased 
after the plants closed. Staff of the Auto Recovery Office have tried 
to help communities address these challenges by serving as a listening 
post and federal liaison to agencies and programs that might assist 
them, but it is not clear whether the office provided communities with 
assistance that they otherwise would not have received. Nevertheless, 
the Department of Labor received funding for its management expenses, 
which it allocated to the office in fiscal years 2011 and 2012. The 
office spent approximately $1.2 million in fiscal year 2011. The Auto 
Recovery Office does not receive a direct line item appropriation, but 
rather negotiates an annual spending plan with the Secretary of Labor 
based on projected needs and historical data, and officials told GAO 
that they expect the same will occur for the fiscal year 2013 budget. 

What GAO Found: 

Since the Auto Recovery Office was established, it has not 
accomplished half of the responsibilities set forth in executive 
orders, and has not been able to demonstrate the results of its 
efforts to assist auto communities. In July 2011, the President issued 
Executive Order 13578 to continue assisting auto communities and 
workers.[Footnote 217] While this executive order revoked the previous 
one establishing the Council, it contains essentially the same 
responsibilities, but with the Secretary of Labor performing them 
instead of the Council. These responsibilities include (1) working 
among executive departments and agencies to coordinate a federal 
response to issues that impact auto communities and workers; (2) 
conducting outreach to nonprofits, businesses, local governments, and 
others that could assist in bringing to the President's attention 
concerns, ideas, and policy options for enhancing efforts to 
revitalize auto communities; (3) advising the President on the 
potential effects of pending legislation; and (4) providing 
recommendations to the President on changes to federal policies and 
programs to address issues of special importance to automotive 
communities and workers. 

As GAO reported in May 2011, the Auto Recovery Office's efforts were 
focused primarily on the first two of these functions--coordinating 
the efforts and support of federal agencies to ensure a coordinated 
federal response to issues that affect auto communities and workers, 
and conducting outreach--and this continues to be the case. As part of 
their coordination efforts, the Council members and Auto Recovery 
Office staff visited auto communities around the country, met with 
local officials to understand the key challenges facing each 
community, and connected them to the appropriate federal agencies and 
resources. A specific Auto Recovery Office staff member was assigned 
to each auto community and state to serve as a point person for each 
auto community. These staff members responded to their assigned 
communities' needs, such as by providing technical assistance or 
identifying contacts, and continued to connect the communities to 
resources and individuals as appropriate. 

Although officials in communities GAO visited in 2010 and 2011 
acknowledged the efforts of Council members and Auto Recovery Office 
staff, they also reported securing much of the assistance they 
received following plant closures without those efforts. For instance, 
officials told GAO that much of the federal assistance they received 
was targeted to individuals recently laid off from auto plants and 
delivered through Department of Labor resources outside the Council 
and Auto Recovery Office, such as the Workforce Investment Act 
Dislocated Workers Program and Trade Adjustment Assistance. 

In August 2011 a new executive director joined the Auto Recovery 
Office, filling a position that had been vacant for almost a year. The 
new director and staff have visited eight communities, including 
communities and officials identified by the office in the past as well 
as new individuals. They are also planning to visit additional 
communities where office staff noted that automotive plant closures 
have been announced, such as Shreveport, Louisiana and St. Paul, 
Minnesota. The office staff stated that they continue to provide 
technical assistance to auto communities and have also participated in 
webinars and other events related to auto community interests, such as 
events hosted by the Mayors Automotive Coalition, and RACER--the 
environmental trust established to remediate old GM plants. However, 
while the Auto Recovery Office has continued its efforts, it still has 
not fulfilled its other two responsibilities--advising the President 
on pending legislation and making recommendations to the President on 
changes to federal policies and programs--for which it was 
established. Auto Recovery Office officials told GAO that they plan to 
make policy recommendations to the White House in fiscal year 2012. 

Further, as GAO also reported in May 2011, neither the Council nor the 
Auto Recovery Office systematically tracked, measured, or assessed 
their assistance to auto communities and GAO recommended that they do 
so. GAO has reported in the past that federal agencies engaged in 
collaborative efforts need to create the means to monitor and evaluate 
their efforts so that they can identify areas for 
improvement.[Footnote 218] However, since the Council and Auto 
Recovery Office did not keep an inventory of assistance that they had 
provided or funding they had helped communities secure, analyze the 
inventory for trends, or publish the results of their analysis, it was 
difficult to identify that assistance. In their response to GAO's May 
2011 report, the Department of Labor noted the challenges in 
developing a set of metrics that measures activities such as 
facilitation and process and that the more traditional measures of 
performance-based results are being tracked by the agencies that are 
responsible for administering the actual delivery of services. 

Since then, the office has provided some additional examples of 
assistance provided to specific communities, for example noting that 
its staff helped Kokomo, Indiana, secure Economic Development 
Administration funding to hire a "recovery coordinator" to support a 
regional economic development strategic plan, and helped Kokomo 
negotiate with Chrysler to receive over $25 million in personal 
property taxes the company owed the county. The office plans to 
publish some of these examples on its website. In addition, the office 
reported that it is in the process of developing measures to assess 
its work, including "assessments of needs of affected communities" and 
"strategic collaboration/recovery plans tailored to affected 
communities." However, the Auto Recovery Office still does not have a 
process to systematically inventory and analyze all assistance 
provided to auto communities, without which it cannot ensure that it 
has identified all relevant areas for improvement or made the 
appropriate recommendations, including to the President, as it was 
tasked to do. 

Finally, Auto Recovery Office officials told GAO the office's unique 
role is to serve as an ombudsman between auto communities undergoing 
economic and social distress and federal initiatives that could be of 
value to those communities, and that they see a need for this role 
continuing as long as auto factories are marked for closure. However, 
there are other efforts within the executive branch to assist 
economically distressed communities. For example, the White House's 
Office of Domestic Policy is overseeing the Strong Cities, Strong 
Communities program, which also involves multiple agencies 
collaborating to assist communities facing economic challenges. This 
program has selected six communities to receive technical assistance, 
and at least one--Detroit--is an auto community that the Auto Recovery 
Office has also assisted. 

Actions Needed and Potential Financial or Other Benefits: 

Though the Auto Recovery Office has made progress toward tracking its 
assistance to auto communities, it still has not implemented three of 
GAO's prior recommendations, making it difficult to identify the 
office's assistance or benefit to auto communities. GAO recommended in 
May 2011 that the Secretary of Labor: 

* direct the Auto Recovery Office to (1) document the office's 
achievements to date, including its assistance to various auto 
communities; (2) establish a process for measuring the office's 
results; and (3) determine when and how the specialized assistance 
provided by the office can be transitioned to existing federal 
programs. 

In addition, in the absence of documented results, 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. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to the Department of Labor 
for review and comment. The department provided written comments and 
agreed with GAO's recommendations. In its comments, the department 
reiterated that the Auto Recovery Office is the only executive office 
that deals specifically with the needs of auto communities, and thus 
it is more effective than other federal programs at helping 
communities address the complex effects of automotive industry 
restructuring. The department notes that Strong Cities, Strong 
Communities, the initiative GAO cites as an example of other 
interagency efforts to assist economically distressed communities, was 
not designed to deal with issues unique to automotive communities, and 
therefore GAO should not suggest that it replace the Auto Recovery 
Office. In the report, GAO does not suggest that this initiative 
replace the Auto Recovery Office, but rather highlights that other 
executive efforts exist to help communities facing economic 
challenges, regardless of the cause of these challenges. The 
department also provided additional examples of auto communities the 
office is assisting, which GAO incorporated as appropriate. Finally, 
the department writes that the Auto Recovery Office has fulfilled its 
responsibilities to advise the President on pending legislation, in 
part by participating in administrative review of pending legislation, 
preparing portions of the President's budget, and engaging with the 
National Economic Council's Office of Manufacturing Policy to inform 
policy decisions affecting proposed manufacturing legislation. While 
GAO recognizes that the Auto Recovery Office is involved in executive 
branch discussions regarding policies that could affect auto 
communities, the tasks the department cites, such as preparing the 
President's budget, are tasks in which all executive agencies engage. 
Outside of these typical agency tasks, the department did not identify 
instances in which the Auto Recovery Office formally advised the 
President. More importantly, the Auto Recovery Office has not 
fulfilled GAO's recommendations to track and measure its assistance, 
without which neither GAO nor Congress can identify what the office 
has done or accomplished with the funding provided to date. Given the 
challenges auto communities face, it is important to maximize federal 
assistance to these communities. As such, GAO suggested the 
department, if unable to demonstrate the results of the Auto Recovery 
Office's efforts, redirect funds from the office to other departmental 
programs. As part of GAO's routine audit work, GAO will track agency 
actions to address these recommendations and report to Congress. All 
written comments are reprinted in appendix IV. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted. GAO interviewed the Auto Recovery 
Office to obtain updated information on its activities and 
accomplishments. GAO also reviewed existing documentation related to 
the data and interviewed Auto Recovery Office staff. GAO determined 
that the data were sufficiently reliable to describe the Auto Recovery 
Office's spending. 

Related GAO Products: 

Troubled Asset Relief Program: Treasury's Exit from GM and Chrysler 
Highlights Competing Goals, and Results of Support to Auto Communities 
Are Unclear. [Hyperlink, http://www.gao.gov/products/GAO-11-471] 
Washington, D.C.: May 10, 2011. 

Troubled Asset Relief Program: Continued Stewardship Needed as 
Treasury Develops Strategies for Monitoring and Divesting Financial 
Interests in Chrysler and GM. [Hyperlink, 
http://www.gao.gov/products/GAO-10-151] Washington, D.C.: November 2, 
2009. 

Contact Information: 

For additional information about this area, contact A. Nicole Clowers 
at (202) 512-8678 or clowersa@gao.gov. 

[End of section] 

40. Excess Uranium Inventories: 

Marketing the Department of Energy's excess uranium could provide 
billions in revenue for the government. 

Why This Area Is Important: 

Uranium--a naturally occurring radioactive element--is used in nuclear 
weapons, as well as in fuel for nuclear power plants. In the United 
States, 20 percent of the nation's electricity comes from nuclear 
power, and growing anxiety over climate change generated by ever-
growing demand for fossil fuels has sparked interest in increasing the 
use of nuclear power, despite ongoing concerns about safety in light 
of the March 2011 nuclear accident in Japan. A healthy domestic 
uranium industry is considered essential to ensuring that commercial 
nuclear power remains a reliable option for supporting the nation's 
energy needs. 

The Department of Energy (Energy) maintains large inventories of 
uranium that it no longer requires for nuclear weapons or fuel for 
naval nuclear propulsion reactors. A large portion of Energy's 
inventories consists of depleted uranium hexafluoride, otherwise known 
as "tails"--a byproduct of the uranium enrichment process. Although 
once considered an environmental liability, recent increases in 
uranium prices could transform these tails into a lucrative source of 
revenue for the government. Hundreds of thousands of metric tons of 
tails are stored at Energy's uranium enrichment plants in Portsmouth, 
Ohio, and Paducah, Kentucky. 

In addition to tails, Energy maintains thousands of tons of natural 
uranium, which likewise could be sold to utilities or others for 
additional revenue. For example, since December 2009, Energy has used 
some of this uranium to pay for environmental cleanup work at its 
Portsmouth uranium enrichment plant. 

What GAO Found: 

The Energy uranium inventories are worth potentially billions of 
dollars to commercial nuclear power plants that can use the material 
as fuel in their reactors. 

With regard to the Energy depleted uranium tails, as GAO reported in 
March and April 2008 and again in June 2011, under certain conditions, 
pursuing the following options could generate significant revenue: 

* Energy could contract to re-enrich the tails. Uranium tails lack 
sufficient quantities of the fissile uranium-235 isotope necessary for 
nuclear fuel. Considerable enrichment is required to further increase 
the concentration of uranium-235. In the past, low uranium prices 
meant that the cost of enrichment would have been greater than the 
proceeds the government would receive for the relatively small amount 
of uranium-235 extracted. But increases in uranium prices--from a 
nominal price of approximately $21 per kilogram of uranium in the form 
of uranium hexafluoride in November 2000 to about $160 per kilogram in 
May 2011--could make tails re-enrichment profitable. Although Energy 
would have to pay for processing, the resulting re-enriched uranium 
could be profitably sold if the sales price of the uranium exceeded 
processing costs. 

* Provided appropriate statutory authority, Energy could sell the 
tails "as is." Although GAO found that Energy generally has the legal 
authority to process the tails and sell the resulting re-enriched 
uranium, GAO found that the department lacks authority to sell 
depleted uranium tails in their current form. While Energy disagrees 
and believes it currently has the necessary legal authority, it is 
nonetheless planning no sale of depleted uranium tails in the near 
term. Instead, Energy is committed to converting the tails to a more 
stable chemical form for safe long-term storage, which involves 
additional processing and stockpiling thousands of protective 
cylinders to contain the material indefinitely. If Congress were to 
provide the department with the needed legal authority to sell the 
tails, however, firms such as nuclear power utilities and enrichment 
companies might find it cost-effective to purchase these tails and re-
enrich them as a source of nuclear fuel. 

With regard to Energy's inventories of natural uranium, as GAO 
reported in March and April 2008 and again in June 2011, the 
department has the general legal authority to sell this material; and 
in September 2011, GAO reported that in seven transactions executed 
since 2009, Energy has, in effect, "sold" nearly 1,900 metric tons of 
natural uranium into the market, using its contractor as a sales 
agent, receiving from $109 to $183 per kilogram. The total proceeds 
from these transactions funded over $250 million in environmental 
cleanup services by that contractor at the Portsmouth uranium 
enrichment plant. Although Energy characterized these sales as barter 
transactions--exchanges of services (environmental cleanup work) for 
materials (uranium)--GAO's review showed that they were sales of 
natural uranium through a sales agent. While Energy received no cash 
from the transactions, it allowed USEC, Inc. to keep cash from the 
sales. Energy thus violated the miscellaneous receipts statute, which 
requires an official or agent of the government receiving money for 
the government from any source to deposit the money in the U.S. 
Treasury. Executed in accordance with federal law, however, future 
sales of natural uranium by Energy could generate additional revenue 
for the government. 

Ultimately, the extent to which sales of Energy's uranium inventories 
would generate financial benefits for the government depends on 
several factors: 

* The market price of uranium. The price for uranium is historically 
volatile, affected greatly by speculation regarding supply and demand, 
the price of competing energy resources, and domestic and 
international political and economic events or natural disasters, such 
as the March 2011 nuclear accident in Japan. 

* The price and availability of re-enrichment services. Only two 
companies currently provide enrichment services domestically. Energy 
would have to find a company with excess enrichment capacity beyond 
its current commitments, which may be difficult if large amounts of 
enrichment processing were required. 

* An existing commitment to domestic uranium producers to limit Energy 
inventory sold. Under its December 2008 Excess Uranium Inventory 
Management Plan, Energy committed to limit the amount of uranium sold 
in a given year to no more than 10 percent of the domestic 
requirements for nuclear fuel. The sudden introduction of hundreds of 
tons of uranium into the market could topple prices and not only 
reduce the government's revenue from such sales, but could also 
undermine profitability of the domestic uranium industry. 

As GAO reported in June 2011, the potential value of Energy's tails is 
currently substantial, but changing market conditions could greatly 
affect the tails' value over time. GAO estimated the value of the 
tails at $4.2 billion based on May 2011 uranium prices and enrichment 
costs and assuming sufficient re-enrichment capacity was available. 

Actions Needed and Potential Financial or Other Benefits: 

In Energy's 2008 uranium management plan, the department summarized 
its intent to sell or transfer uranium to the commercial market 
through 2017, including plans to re-enrich and sell depleted uranium 
tails. But because DOE has decided to use uranium to fund 
environmental cleanup at the Portsmouth site, more uranium has been 
released into the market than articulated in the 2008 plan. As a 
result, Energy tabled plans to also sell uranium tails, because doing 
so would violate the commitment the department made to domestic 
uranium producers to limit the amount of uranium Energy sells in a 
given year. 

Even in the absence of such a commitment, however, legal obstacles to 
the pursuit of certain options for its uranium tails and natural 
uranium exist. GAO previously found that Energy lacked the necessary 
legal authority to pursue potential options for its tails and natural 
uranium and that the following congressional action may be needed. 
Specifically: 

GAO recommended in March 2008 that Congress may wish to: 

* clarify Energy's statutory authority regarding depleted uranium, 
explicitly providing direction about whether and how Energy may sell 
or transfer the tails in their current form. Depending on the terms of 
the legislation, and given the significant amount of tails in 
inventory, the government could garner substantial revenue as a result. 

GAO recommended in September 2011 that if Congress sees merit in using 
the proceeds from the barter, transfer, or sale of federal uranium 
assets to pay for environmental cleanup of uranium enrichment plants, 
it could consider: 

* providing Energy with explicit authority to barter excess uranium 
and to retain the proceeds from all three types of uranium 
transactions (barter, transfer, and sale). Likewise, Congress could 
direct Energy to sell uranium for cash and make those proceeds 
available by appropriation for decontamination and decommissioning 
expenses at Energy's uranium enrichment plants. 

Congress has taken some actions in response to GAO's work. For 
example, the Consolidated Appropriations Act, 2012, among other 
things, requires the Secretary of Energy to report to the House and 
Senate Appropriations Committees not less than 30 days prior to the 
transfer, sale, barter, distribution, or other provision of uranium in 
any form specific details on the transactions, including the amounts 
of uranium to be provided and an estimate of the uranium value along 
with the expected recipient of the material. The act also requires the 
Secretary to submit a report evaluating the economic feasibility of re-
enriching depleted uranium. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its September 2011 report to Energy. Energy 
provided written comments that stated that because it did not receive 
money for the uranium it used to pay for environmental cleanup work, 
it did not violate the miscellaneous receipts statute. However, GAO 
and the courts have found in a number of instances that an entity does 
not have to receive actual cash to trigger a responsibility to deposit 
money into the U.S. Treasury. Energy also disagreed with GAO's 
estimate of the value of Energy's depleted uranium tails, stating that 
it did not include additional costs that may be incurred processing 
tails including, among other things, the costs of re-enriching the 
tails and packaging and transporting the material. The estimate does 
include the costs of re-enriching the tails, but it does not include 
some other costs, including packaging and transportation, because 
those costs are unknown. Furthermore, as GAO's March and April 2008, 
June 2011, and September 2011 reports noted, GAO's estimate is very 
sensitive to changing uranium prices, as well as to the availability 
of sufficient enrichment capacity. Uranium prices are volatile, and a 
sharp rise or fall can greatly affect the value of the tails. Any 
estimates of the value of the Energy tails are therefore subject to 
great uncertainty. As part of its routine audit work, GAO will track 
agency actions to address its recommendations and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed the related GAO products section. These reports 
reviewed Energy's management of its uranium inventories and the 
department's transactions using its uranium to pay for environmental 
cleanup and other services. GAO reviewed Energy documents detailing 
the transactions the department has engaged in involving its uranium, 
assessments of the value of uranium in each transaction, and analyses 
of the impact of DOE's activities on the uranium market. 

Related GAO Products: 

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.: September 
26, 2011. 

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. 

Department of Energy: December 2004 Agreement with the United States 
Enrichment Corporation. B-307137. Washington, D.C.: July 12, 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.: April 3, 
2008. 

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.: 
March 31, 2008. 

Contact Information: 

For additional information about this area, contact Gene Aloise at 
(202) 512-3841 or aloisee@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

In recent years, federal agencies spent nearly $40 billion each fiscal 
year procuring goods and services through the General Services 
Administration's (GSA) Multiple Award Schedules (MAS) contracts. MAS 
contracts are operated to help leverage the buying power of the 
federal government by providing cost savings at prices associated with 
volume buying on millions of commercial goods and services. GSA awards 
and administers over 19,000 contracts with vendors under the MAS 
program. 

As permitted by statute, GSA charges customer agencies a fee when they 
place orders under MAS contracts. The MAS program's fee rate, which is 
expressed as a percentage of the dollar value of the order, has 
remained stable for the last 5 fiscal years at 0.75 percent. In fiscal 
year 2010, GSA collected approximately $282 million in fee revenue 
from agencies that use the MAS contracts. GSA retains this revenue to 
support the MAS program. 

What GAO Found: 

As GAO reported in September 2011, the revolving fund statute under 
which GSA operates its MAS program requires that GSA set its 
interagency contract fee rate to recover the costs of the program's 
operations.[Footnote 219] It also provides that GSA may establish 
reserves for operating needs. The program is not required to break 
even on an annual basis. As such, the program is permitted to have 
excess revenue in a given year or annual costs that exceed revenue. 
The figure below shows the fee revenue GSA collected and GSA's costs 
to operate the MAS program during fiscal years 2007 through 2010, and 
illustrates the difference between those amounts, which GAO refers to 
as excess revenue. The figure also illustrates that although the 
annual excess revenue generated by GSA's MAS program has declined over 
those years, GSA's MAS program averaged an excess of $62.2 million in 
revenue over program costs, before contributions to reserves, each 
fiscal year. 

Figure: Fee Revenue versus Costs for the GSA MAS Program--Fiscal Years 
2007 through 2010: 

[Refer to PDF for image: 6 multiple line graphs] 

GSA MAS: 

Fiscal year: 2007; 
Cost: $190.25 million; 
Revenue: $250.33 million; 
Total excess revenue: $60.88 million. 

Fiscal year: 2008; 
Cost: $184.54 million; 
Revenue: $268.79 million; 
Total excess revenue: $84.25 million. 

Fiscal year: 2009; 
Cost: $211.47 million; 
Revenue: $279.2 million; 
Total excess revenue: $67.73 million. 

Fiscal year: 2010; 
Cost: $245.32 million; 
Revenue: $281.86 million; 
Total excess revenue: $36.54 million. 

Average excess revenue: $62.2 million. 

Source: GAO analysis of GSA financial data. 

Note: All data and calculations are in nominal dollars. 

[End of figure] 

GSA maintains three reserves for all the programs operated through the 
revolving fund that includes the MAS program: 

* the Working Capital Reserve, an operating reserve, 

* the Business Reserve, which is to be used for planned improvement 
projects, and: 

* the Investment Reserve, which is to be used for improvements that 
were not planned when the revenue was placed in the reserve. 

Excess revenue accumulates in the reserves until it is used for 
operations or improvement projects. 

From fiscal years 2007 to 2010 GSA's reserve balances grew 
significantly, largely due to this excess revenue generated annually 
by the MAS program. At the end of fiscal year 2010, the combined 
balance of GSA's three reserves was over $800 million--about $350 
million of which resided in the Working Capital Reserve to cover 
shortfalls in operating funds. Although GSA reviews its program fee 
rate annually as part of its budget process, there is nothing in GSA's 
internal guidance that would trigger an evaluation of the fee rate of 
an individual program, such as the MAS program, that consistently 
generates excess revenue resulting in the continuous growth of the 
reserve balances. 

A reduction in the fee rate for the MAS program could generate 
significant cost savings for every agency of the federal government 
that uses the MAS program. For example, a reduction of 0.10 percentage 
points--from the current rate of 0.75 percent to 0.65 percent--would 
generate a savings of almost $40 million per year. 

Actions Needed and Potential Financial or Other Benefits: 

To improve the management of the MAS program, GAO recommended in 
September 2011 that the Administrator of General Services direct the 
Federal Acquisition Service Commissioner to: 

* develop and implement guidance for evaluation of current fee rates 
when an individual program consistently transfers excess revenue to 
the reserve funds. 

Such an evaluation would allow GSA to determine whether a reduction in 
the fee rate of any of its programs might be warranted. A reduction of 
the fee rate for the MAS program alone would provide federal agencies 
potentially significant cost savings. 

Agency Comments and GAO's Evaluation: 

GAO provided GSA with a copy of its September 2011 report for review 
and comment. GSA agreed with GAO's recommendation to develop and 
implement guidance. GSA is planning to issue a new policy in February 
2012 that establishes an annual process to determine the need to 
conduct fee rate reviews for programs that produce an excess (or 
shortfall) of over $5 million in revenue on average over any 3-year 
period. The draft policy also requires an automatic review of the fee 
rate of the MAS program each year. GSA plans to perform these 
assessments annually beginning in March 2012. GSA expressed concern 
about reducing the current fee rate in light of recent reductions in 
excess revenue. In this regard, GSA pointed out that it needs to 
ensure sufficient levels of reserves to fund needed improvements in 
the information technology systems that support its programs. GAO 
believes the annual process will provide for a more rigorous 
monitoring of the fee rates charged by GSA and provide a trigger for 
fee rate reviews when appropriate. The annual process could also give 
GSA further insight into the level of reserve funds that will be 
available for its information technology improvement projects. 

As part of its routine audit work, GAO will track agency action to 
address the recommendation and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on the findings in 
the report listed in the related GAO product section as well as 
additional work GAO conducted. GAO analyzed cost and revenue data on 
the program for fiscal years 2007 through 2010. GAO also interviewed 
officials from GSA's MAS program, policy, and financial offices. 

Related GAO Product: 

Interagency Contracting: Improvements Needed in Setting Fee Rates for 
Selected Programs. [Hyperlink, http://www.gao.gov/products/GAO-11-784] 
Washington, D.C.: September 9, 2011. 

Contact Information: 

For additional information about this area, contact William T. Woods 
at (202) 512-4841 or woodsw@gao.gov. 

[End of section] 

42. U.S. Currency: 

Legislation replacing the $1 note with a $1 coin would provide a 
significant financial benefit to the government over time. 

Why This Area Is Important: 

Over the past 40 years, many nations have replaced lower-denomination 
notes with coins as a means of providing a financial benefit to their 
governments. GAO has reported five times over the past 22 years that 
replacing the $1 note with a $1 coin would provide a net benefit to 
the government of hundreds of millions of dollars annually.[Footnote 
220] 

What GAO Found: 

The federal government realizes a financial gain when it issues notes 
or coins because both forms of currency usually cost less to produce 
than their face value. This gain, which is known as "seigniorage," 
equals the difference between the face value of currency and its costs 
of production.[Footnote 221] Seigniorage reduces the government's need 
to raise revenues through borrowing, and with less borrowing, the 
government pays less interest over time, resulting in a financial 
benefit. 

GAO updated its most recent March 2011 estimate[Footnote 222] due to 
changes by the Federal Reserve and Department of the Treasury 
(Treasury) in note processing and $1 coin production[Footnote 223] and 
found that replacing the $1 note with a $1 coin would provide a net 
benefit to the government of approximately $4.4 billion over 30 years, 
amounting to an average yearly discounted net benefit[Footnote 224] of 
about $146 million. This benefit occurs because, based on differences 
in how notes and coins are used in the economy, more coins than notes 
will have to be circulated to meet demand, and therefore more 
seignorage will be created. This estimate differs from what GAO 
reported in March 2011 because it takes into account the Treasury's 
decision in December 2011 to stop producing $1 coins for circulation 
immediately. To meet public demand for the coins, the Treasury intends 
to rely on the approximately 1.4 billion $1 coins currently stored 
with the Federal Reserve as of September 30, 2011. The current 
estimate also differs from the 2011 estimate because it uses a revised 
forecast that anticipates a lower government borrowing rate over the 
next 30 years and a longer life expectancy for the $1 note that 
results from efficiencies in the way the Federal Reserve processes 
notes, which began in April 2011. 

GAO's current estimate assumes a 4-year transition period beginning in 
2012 during which the production of $1 notes stops immediately and $1 
coins are quickly produced to meet demand for this currency 
denomination. This replacement scenario is compared to a status quo 
scenario under which $1 notes remain the primary single dollar 
currency. The status quo scenario also incorporates the Treasury's 
December 2011 decision to rely on $1 coins in storage to meet public 
demand for $1 coins until that stock is nearly depleted, at which time 
production of $1 coins would resume. According to the Treasury, the 
coins in storage could meet current levels of circulating demand for 
more than a decade. As shown in the figure below, the annual net 
benefit from replacing the $1 note with a $1 coin would vary over the 
30 years--the government would incur a net loss in 6 of the first 7 
years and then realize a net benefit in the remaining years. The early 
net loss from replacing the $1 note is due in part to the up-front 
costs to the United States Mint of increasing its coin production 
during the transition, together with the limited interest expense the 
government would avoid in the first few years after replacement began. 
GAO's net benefit estimate is due solely to seigniorage and not to 
reduced production costs. In fact, the production costs of 
transitioning to a $1 coin are never recovered during the 30-year 
period. And like all estimates, it is uncertain, particularly in the 
later years, and thus the benefit could be greater or smaller than 
estimated. 

Figure: Discounted Net Benefit to the Government of Replacing $1 Notes 
with $1 Coins over 30 Years, by Year: 

[Refer to PDF for image: vertical bar graph] 

Year: 2012; 
Discounted Net Benefit to the Government: -$177 million. 

Year: 2013; 
Discounted Net Benefit to the Government: -$383 million. 

Year: 2014; 
Discounted Net Benefit to the Government: -$337 million. 

Year: 2015; 
Discounted Net Benefit to the Government: -$29 million. 

Year: 2016; 
Discounted Net Benefit to the Government: $231 million. 

Year: 2017; 
Discounted Net Benefit to the Government: -$45 million. 

Year: 2018; 
Discounted Net Benefit to the Government: -$1 million. 

Year: 2019; 
Discounted Net Benefit to the Government: $40 million. 

Year: 2020; 
Discounted Net Benefit to the Government: $70 million. 

Year: 2021; 
Discounted Net Benefit to the Government: $100 million. 

Year: 2022; 
Discounted Net Benefit to the Government: $123 million. 

Year: 2023; 
Discounted Net Benefit to the Government: $143 million. 

Year: 2024; 
Discounted Net Benefit to the Government: $161 million. 

Year: 2025; 
Discounted Net Benefit to the Government: $177 million. 

Year: 2026; 
Discounted Net Benefit to the Government: $191 million. 

Year: 2027; 
Discounted Net Benefit to the Government: $204 million. 

Year: 2028; 
Discounted Net Benefit to the Government: $222 million. 

Year: 2029; 
Discounted Net Benefit to the Government: $234 million. 

Year: 2030; 
Discounted Net Benefit to the Government: $244 million. 

Year: 2031; 
Discounted Net Benefit to the Government: $254 million. 

Year: 2032; 
Discounted Net Benefit to the Government: $262 million. 

Year: 2033; 
Discounted Net Benefit to the Government: $271 million. 

Year: 2034; 
Discounted Net Benefit to the Government: $279 million. 

Year: 2035; 
Discounted Net Benefit to the Government: $286 million. 

Year: 2036; 
Discounted Net Benefit to the Government: $294 million. 

Year: 2037; 
Discounted Net Benefit to the Government: $301 million. 

Year: 2038; 
Discounted Net Benefit to the Government: $308 million. 

Year: 2039; 
Discounted Net Benefit to the Government: $314 million. 

Year: 2040; 
Discounted Net Benefit to the Government: $321 million. 

Year: 2041; 
Discounted Net Benefit to the Government: $331 million. 

Source: GAO analysis. 

[End of figure] 

The December 2011 action by the Treasury to stop producing $1 coins 
for circulation and to meet public demand for the coin by using the $1 
coins currently being stored will reduce government costs by 
preventing the overproduction of $1 coins. The overproduction results 
from the presidential $1 coin program, which requires four new 
presidential $1 coin designs, featuring images of past presidents in 
the order they served, to be issued each year.[Footnote 225] According 
to Federal Reserve officials, because the United States Mint delivers 
each new presidential coin design to banks in large quantities, banks 
have no choice but to order more coins than they ultimately need to 
fulfill the demand for new coins.[Footnote 226] As a result, unneeded 
coins are returned to the Federal Reserve, which held over 1.4 billion 
$1 coins in storage as of September 30, 2011. The Treasury estimates 
that stopping production of $1 coins for circulation while it draws 
down the coins in storage will save about $50 million per year over 
the next several years in coin production costs. However, GAO 
estimates that eliminating $1 notes and replacing them with a $1 coin 
will have larger net benefit over time. 

Actions Needed and Potential Financial or Other Benefits: 

To reduce the costs associated with the $1 note and $1 coins in the 
long term, Congress may wish to consider: 

* replacing the $1 note with a $1 coin to achieve an estimated 
financial benefit of $4.4 billion over 30 years. Legislation has been 
proposed that would make this replacement.[Footnote 227] 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to the Federal Reserve and 
Treasury for review and comment. The Federal Reserve provided written 
comments that noted it believes GAO's estimate overstates the net 
financial benefit to the government because it does not (1) adequately 
address the costs to the Federal Reserve to reinforce the floors of 
its bank vaults to accommodate the heavier weight of coins or (2) 
consider potential increases in raw material costs for coins or 
possible future changes in discount rates. GAO included all costs to 
the Federal Reserve that the agency provided data on. The Federal 
Reserve provided no estimate of the additional cost to accommodate 
heavier coins. GAO used the best data available on coin production 
costs, which accounts for the cost of raw materials, and discount 
rate. The Federal Reserve also noted an increased risk of 
counterfeiting $1 coins and the lack of a GAO sensitivity analysis 
that reflected further increases in electronic payments by the public. 
GAO reported in 2011 that counterfeiting of U.S. coins is currently 
minimal, according to the U.S. Secret Service. Furthermore, in 2011, 
GAO reported the results of a sensitivity analysis in which the 
replacement leads to a decrease in the demand for currency as people 
switch to electronic means of payment. GAO recognizes that changing 
conditions, such as how people use cash and the cost of materials in 
the future, may alter the total cost savings associated with the $1 
coin. The Treasury provided e-mailed comments that pointed out that 
GAO's analysis does not account for the impact on or costs to the 
private sector; both Treasury and the Federal Reserve noted that the 
analysis should not include seigniorage. As GAO reported in 2011, it 
found no quantitative estimates of the cost of replacement to the 
private sector that could be evaluated or modeled. GAO believes that 
seigniorage cannot be set aside since it is a result of issuing 
currency. The Treasury also provided technical comments, which were 
incorporated as appropriate. All written comments are reprinted in 
appendix IV. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the product listed in the related GAO products section as well as 
additional work GAO conducted. GAO reviewed the Federal Reserve's June 
2011 report on the $1 coin[Footnote 228] and recent proposed 
legislation; and conducted interviews with senior officials from the 
Federal Reserve, the United States Mint, the Bureau of Engraving and 
Printing, and the Department of the Treasury. To estimate the net 
benefit to the government of replacing the $1 note with a $1 coin, GAO 
constructed an economic model with data from the Federal Reserve, the 
Bureau of Engraving and Printing, and the United States Mint. GAO's 
model assumptions covered a range of factors including the replacement 
ratio of coins to notes, the expected rate of growth in the demand for 
currency over 30 years, the costs of producing and processing both 
coins and notes, and the differential life spans of coins and notes. 
GAO arrived at its estimate of net benefit to the government by 
subtracting the benefit from a status quo scenario from the benefit of 
a replacement scenario. In the status quo scenario, notes remain the 
dominant form of currency at the $1 denomination, the United States 
Mint ceases production of $1 coins until the current stored coins are 
all released into circulation to meet public demand, and production of 
$1 coins resumes after the stored coins are depleted. In the 
replacement scenario, GAO assumed, among other things, that the 
production of $1 notes would stop immediately; no notes would be 
withdrawn from circulation, but because of their shorter life span, 
they would naturally fall out of circulation within a few years; and 
the United States Mint would expand its production of $1 coins during 
the first 4 years. In estimating the net benefit to the government of 
replacing the $1 note with a $1 coin, GAO considered only the 
financial effect of this change on the government and did not consider 
other factors, such as the relative environmental and societal costs 
and benefits due to data limitations. GAO conducted sensitivity 
analyses that decreased the demand for currency as people switch to 
electronic payments and changed the number of coins needed to replace 
each note. 

Related GAO Product: 

U.S. Coins: Replacing the $1 Note with a $1 Coin Would Provide a 
Financial Benefit to the Government. [Hyperlink, 
http://www.gao.gov/products/GAO-11-281] Washington, D.C.: March 4, 
2011. 

Contact Information: 

For additional information about this area, contact Lorelei St. James 
at (202) 512-2834 or stjamesl@gao.gov. 

[End of section] 

43. Federal User Fees: 

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

Why This Area Is Important: 

Federal user fees and charges are generally related to some voluntary 
transaction or request for government goods or services beyond what is 
normally available to the public, such as fees for national park 
entrance, patent applications, and customs inspections. Twenty-three 
federal agencies reported collecting nearly $64 billion in fees or 
charges in fiscal year 2010. As GAO reported in May 2008, well-
designed user fees can reduce the burden on taxpayers to finance those 
portions of activities that provide benefits to identifiable users. 
Regular, comprehensive fee reviews can help identify duplicative fee-
funded activities, prevent misalignment between fees and the 
activities they cover, and maximize opportunities for user financing. 

What GAO Found: 

In many instances, Congress has provided specific authority to federal 
agencies to assess user fees in agency authorization or appropriations 
legislation. Agencies that lack specific statutory authority to charge 
fees can rely on the Independent Offices Appropriation Act of 1952 
[Footnote 229] which provides broad authority to assess user fees or 
charges on identifiable beneficiaries by administrative 
regulation.[Footnote 230] When a fee's authorizing statute does not 
specify review and reporting requirements, and for fees that derive 
their statutory authority from the Independent Offices Appropriation 
Act, the CFO Act of 1990[Footnote 231] (CFO Act) and OMB Circular No. 
A-25 directs agencies to biennially review their fees and to recommend 
fee adjustments as appropriate. In addition, OMB Circular No. A-25 
directs agencies to include non-fee-funded programs in these reviews 
to determine whether fees should be initiated for government services 
or goods for which fees are not currently charged. Further, if 
imposing such fees is prohibited or restricted by law, agencies are to 
recommend legislative changes as appropriate. Moreover, agencies are 
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. This discussion may be included in agency performance and 
accountability reports. Lastly, budget formulation guidance to 
agencies in OMB Circular No. A-11 directs agencies to follow fee 
review guidance in OMB Circular No. A-25 and to report on the results 
of fee reviews in CFO Act reports. 

GAO previously reported that not reviewing fees regularly can result 
in large fee increases and create costly challenges. For example, 
prior to its 2007 fee review, U.S. Citizenship and Immigration 
Services had not conducted a comprehensive review of its immigration 
and naturalization fees in 9 years and, as a result, had to increase 
fees by an average of 86 percent to cover its costs. Further, during 
the month before the fee increase took effect, applications increased 
an unprecedented 100 percent over the prior month, far outpacing the 
agency's processing capacity. As a result, 1.47 million applications 
were delayed and the agency incurred unplanned costs to secure 
additional facilities to store these applications. 

In May 2008, GAO issued its User Fee Design Guide, which examined how 
the four key design and implementation characteristics--how fees are 
set, collected, used, and reviewed--may affect the economic 
efficiency, equity, revenue adequacy, and administrative burden of the 
fees. The Design Guide also stated that the tools for congressional 
and stakeholder oversight could be enhanced by agencies reporting the 
methods for setting fees, including an accounting of program costs and 
assumptions it uses to project future program costs and fee 
collections. 

In GAO's 2011 survey of the 24 agencies covered by the CFO Act and OMB 
Circular No. A-25, 21 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 of the CFO 
Act and OMB Circular No. A-25.[Footnote 232] 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. Specifically, agencies reported that only 29 percent of 
the fees (1,064 fees), representing only 37 percent ($23.6 billion) of 
total fee collections in fiscal year 2010 were discussed in their CFO 
annual report as directed by OMB Circular No. A-25. However, agencies 
reported reviewing 1,687 fees, which make up about 46 percent of the 
total 3,666 fees charged.[Footnote 233] This suggests that agencies 
are reviewing more fees than are being discussed in their annual 
reports. For agency responses, please see the table below. While these 
reviews may provide information for agency management and decision 
making, the extent to which this information is being shared with 
congressional decision makers or other stakeholders appears far more 
limited. When asked why they did not review individual reported fees, 
agencies most commonly chose "other" amongst the survey responses 
provided. When selecting "other," agency-provided responses included 
that fees were based upon market prices, that the fee was set or 
administrated by another agency, or that they did not review some fees 
because the fee was set in legislation, and therefore they may not 
have the authority to revise the fee. Agencies also commonly selected 
responses that GAO provided, including minimal total fee collections 
or that fee requirements were not clear. GAO has previously reported 
that to ensure decision makers have complete information about program 
costs and activities, agencies must substantively review and report on 
all cost-based fees regularly, regardless of whether agencies have 
sole discretion for revising fee rates. 

Table: Agencies Reported Fiscal Year 2010 Total Fee Collections and 
Adherence to the CFO Act and OMB Circular No. A-25 Guidance on 
Reviewing and Discussing Results of Biennial Fee Reviews: 

Agency: Department of Health and Human Services; 
Reported FY 2010 total fee collections: $31.545 billion; 
Reported percentage of fees and charges reviewed[A]: 84%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 30%. 

Agency: Department of the Treasury; 
Reported FY 2010 total fee collections: $9.789 billion; 
Reported percentage of fees and charges reviewed[A]: 97%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 67%. 

Agency: Department of Homeland Security; 
Reported FY 2010 total fee collections: $8.784 billion; 
Reported percentage of fees and charges reviewed[A]: 87%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 96%. 

Agency: Department of Agriculture; 
Reported FY 2010 total fee collections: $3.991 billion; 
Reported percentage of fees and charges reviewed[A]: 100%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 100. 

Agency: Department of Energy; 
Reported FY 2010 total fee collections: $2.498 billion; 
Reported percentage of fees and charges reviewed[A]: 86; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 0. 

Agency: Department of Commerce; 
Reported FY 2010 total fee collections: $2.136 billion; 
Reported percentage of fees and charges reviewed[A]: 83%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 65%. 

Agency: Department of State; 
Reported FY 2010 total fee collections: $1.896 billion; 
Reported percentage of fees and charges reviewed[A]: 100%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 73%. 

Agency: Department of Interior; 
Reported FY 2010 total fee collections: $1.320 billion; 
Reported percentage of fees and charges reviewed[A]: 6%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 5%. 

Agency: Department of Justice; 
Reported FY 2010 total fee collections: $777 million; 
Reported percentage of fees and charges reviewed[A]: 71%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 65%. 

Agency: Social Security Administration; 
Reported FY 2010 total fee collections: $370 million; 
Reported percentage of fees and charges reviewed[A]: 100%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 100%. 

Agency: Department of Transportation; 
Reported FY 2010 total fee collections: $214 million; 
Reported percentage of fees and charges reviewed[A]: 89%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 0. 

Agency: Department of Labor; 
Reported FY 2010 total fee collections: $164 million; 
Reported percentage of fees and charges reviewed[A]: 90%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 0. 

Agency: Environmental Protection Agency; 
Reported FY 2010 total fee collections: $84 million; 
Reported percentage of fees and charges reviewed[A]: 100%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 29%. 

Agency: National Aeronautics and Space Administration; 
Reported FY 2010 total fee collections: $61 million; 
Reported percentage of fees and charges reviewed[A]: 83%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 0. 

Agency: Department of Veterans Affairs; 
Reported FY 2010 total fee collections: $51 million; 
Reported percentage of fees and charges reviewed[A]: 80%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 47%. 

Agency: Small Business Administration; 
Reported FY 2010 total fee collections: $16 million; 
Reported percentage of fees and charges reviewed[A]: 100%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 100%. 

Agency: Office of Personnel Management; 
Reported FY 2010 total fee collections: $8 million; 
Reported percentage of fees and charges reviewed[A]: 0; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 0. 

Agency: General Services Administration; 
Reported FY 2010 total fee collections: $6 million; 
Reported percentage of fees and charges reviewed[A]: 50%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 0. 

Agency: United States Agency for International Development; 
Reported FY 2010 total fee collections: $5 million; 
Reported percentage of fees and charges reviewed[A]: 0; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 0. 

Agency: Nuclear Regulatory Commission; 
Reported FY 2010 total fee collections: $2 million; 
Reported percentage of fees and charges reviewed[A]: 100%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 50%. 

Agency: Department of Housing and Urban Development; 
Reported FY 2010 total fee collections: $0.043 million; 
Reported percentage of fees and charges reviewed[A]: 100%; 
Reported percentage of fees and charges reviewed biennially and 
discussed in CFO annual documents: 0. 

Source: GAO summary of agency-reported data. 

[A] The third column, "reported percentage of fees and charges 
reviewed" is generally inclusive of fees and charges reported in the 
fourth column as reviewed biennially and discussed in CFO annual 
documents. 

[End of table] 

Agencies were inconsistent in their ability to provide documentation 
for their fee reviews. For example, the Department of Agriculture 
provided documentation of reviews for all of its fees, while a few 
agencies did not provide any documentation. Even for agencies that 
provided documentation however, GAO found the reviews contained 
varying levels of detail and analysis, potentially limiting their 
value to decision makers. For one agency, it was not clear when the 
reviews had been conducted. GAO has previously reported that decision 
makers must understand the decisions and tradeoffs made when designing 
fees to achieve specific policy goals and the costs of these decisions 
in determining if the policy goals were being met. Finally, most of 
the reporting agencies (16 out of 23) reported reviewing at least some 
of their non-fee-funded programs for opportunities to initiate new 
fees for government services or goods. 

Without regular comprehensive reviews, agencies and Congress may miss 
opportunities to make improvements to a fee's design which, if left 
unaddressed, could contribute to inefficient use of government 
resources. For example, fee reviews could help ensure that fees are 
properly set to cover the total costs of those activities which are 
intended to be fully fee-funded, thus eliminating the need for direct 
appropriations for those activities. Fee reviews may also: 

* allow agencies and Congress to identify where similar activities are 
funded differently; for example, one by fees and one by 
appropriations. One such example is the export control system, in 
which the State Department charges fees for the export of items on the 
U.S. Munitions List, while the Commerce Department does not charge 
fees for those items exported under its jurisdiction. Fee reviews may 
thereby assist in eliminating or managing inconsistent or overlapping 
funding sources for similar activities; and: 

* be a useful step toward examining whether the activities themselves 
are duplicative or overlapping. 

As GAO reported in September 2007, fragmentation exists in the 
Department of Homeland Security's One Face at the Border program, 
which integrated the customs, agriculture, and immigration air 
passenger inspection programs and is funded by three separate fees and 
general fund appropriations, creating administrative, operational, and 
oversight challenges. GAO also reported in February 2008 that 
fragmentation in Harbor Maintenance Fee administration between the 
Army Corps of Engineers and Department of Homeland Security's U.S. 
Customs and Border Protection inhibits oversight. Further, regular 
reviews increase congressional and agency awareness of federal program 
costs, and therefore may increase incentives to reduce costs where 
possible. 

Actions Needed and Potential Financial or Other Benefits: 

Federal agencies reported collecting nearly $64 billion in federal 
user fees and charges in fiscal year 2010. Regular fee reviews can 
help the Congress and federal agencies identify opportunities to 
revise fees in ways that enhance user funding of goods or services 
above and beyond what is normally available to the public, and can be 
a useful step towards examining whether the activities themselves are 
duplicative or overlapping. GAO has ongoing work evaluating federal 
user fee reviews and opportunities to initiate new fees for government 
services or goods. The Director of the Office of Management and Budget 
(OMB) should use its budget reviews to ensure that agencies: 

* review their fee-funded programs biennially, as required by the CFO 
Act and consistent with GAO's User Fee Design Guide, to help identify 
opportunities to improve the (1) efficiency, equity, revenue adequacy, 
and administrative burden of the fee design and (2) alignment of fee 
collections with program costs over time; and: 

* review their non-fee-funded programs on a regular basis, in 
accordance with OMB Circular No. A-25 guidance, and discuss the 
results in their CFO annual report. Regular reviews of non fee-funded 
programs can help agencies and Congress determine whether programs 
funded with general fund revenues could be fully or partially funded 
with user fees. 

Further, the Director of OMB could direct agencies to: 

* use a framework such as GAO's User Fee Design Guide when designing 
or redesigning user fees. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to OMB as well as the 
Departments of State, Commerce, and Homeland Security. OMB as well as 
the Departments of State and Commerce provided technical comments, 
which were incorporated as appropriate. The Department of Homeland 
Security responded that it generally agreed. 

OMB said that two of our three recommended actions--that is, that OMB 
use its budget reviews to (1) ensure that agencies review their fee-
funded programs biennially and (2) review their non fee-funded 
programs--seem unnecessary. OMB Circular No. A-11 guidance directs 
agencies to comply with the user fee review requirements in OMB 
Circular No. A-25 and the CFO Act. OMB did not comment on our third 
recommended action. 

As we note above, agencies review less than half of the fees that they 
charge, and report the reviews of less than one-third of the fees 
charged. In addition, as noted above, 16 out of the 23 agencies told 
us that they review at least some of their non fee-funded programs to 
determine whether fees should be assessed. 

GAO continues to believe that the recommended actions have merit. 
Especially in light of the significant impact user fees can have on 
the federal treasury given the current budgetary outlook, we believe 
that OMB should do more to ensure that agencies comply with OMB's own 
guidance. We have added clarifying language regarding OMB's direction 
to agencies. As part of its routine audit work, GAO will track the 
extent to which progress has been made to address the identified 
actions and report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section, as well as 
work GAO conducted between May 2011 and February 2012. GAO surveyed 24 
agencies covered by the CFO Act to obtain (1) the number of fees the 
department or agency administered, (2) the basis for setting the fee 
amounts, (3) the aggregate amount of fees collected for fiscal year 
2010, (4) the most recent CFO Act/OMB Circular No. A-25 review date, 
(5) documentation of fee reviews, and (6) in cases where reviews were 
not conducted, the reasons why. Because this was not a sample survey, 
there are no sampling errors. However, the practical difficulties of 
conducting any survey may introduce nonsampling errors, such as 
variation in how respondents interpret questions and their willingness 
or ability to offer accurate responses. GAO took steps to minimize 
nonsampling errors. For example, prior to surveying agencies, GAO 
pretested the survey with three agencies with differing numbers of 
fees, as well as varying values of total collections, to ensure that 
GAO's questions were clear and that the definitions used in the survey 
were correct and understandable to the respondents. GAO revised the 
final survey instrument based on the pretest results. Since this was a 
self-administered survey using a spreadsheet completed by the 
respondents, there was no need to have data entered by another party, 
thus eliminating another source of error. Finally, all calculations 
used in the analysis of the data were reviewed by another GAO analyst. 
GAO did not independently verify survey responses provided by the 23 
agencies. GAO did not verify that the results of these fee reviews and 
any resulting proposals were discussed in the CFO annual report, per 
OMB Circular No. A-25. Some fees have more specific, statutorily-set 
review and reporting requirements, and are therefore not subject to 
the CFO Act's or OMB Circular No. A-25's biennial review. As a result, 
GAO did not independently verify whether agencies reported all of the 
applicable user fees. 

Related GAO Products: 

Budget Issues: Better Fee Design Would Improve Federal Protective 
Service's and Federal Agencies' Planning and Budgeting for Security. 
[Hyperlink, http://www.gao.gov/products/GAO-11-492] Washington, D.C.: 
May 20, 2011. 

Budget Issues: Electronic Processing of Non-IRS Collections Has 
Increased but Better Understanding of Cost Structure Is Needed. 
[Hyperlink, http://www.gao.gov/products/GAO-10-11] Washington, D.C.: 
November 20, 2009. 

Federal User Fees: Additional Analyses and Timely Reviews Could 
Improve Immigration and Naturalization User Fee Design and USCIS 
Operations. [Hyperlink, http://www.gao.gov/products/GAO-09-180] 
Washington, D.C.: January 23, 2009. 

Federal User Fees: A Design Guide. [Hyperlink, 
http://www.gao.gov/products/GAO-08-386SP] Washington, D.C.: May 29, 
2008. 

Federal User Fees: Substantive Reviews Needed to Align Port-Related 
Fees with the Programs They Support. [Hyperlink, 
http://www.gao.gov/products/GAO-08-321] Washington, D.C.: February 22, 
2008. 

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.: September 24, 2007. 

Contact Information: 

For additional information about this area, contact Susan J. Irving at 
(202) 512-6806 or irvings@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The financing of the federal government depends largely on the 
Internal Revenue Service's (IRS) 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 with no 
direct enforcement and little interaction with IRS. 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. IRS's enforcement of tax laws remains 
on GAO's high-risk list. 

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--one that covers both IRS's enforcement and taxpayer 
service programs and also leverages external resources such as tax 
whistleblowers--could increase legally owed revenue collection by 
billions of dollars and result in cost savings for IRS. Without 
continued attention to IRS's enforcement and taxpayer service efforts, 
taxpayers could feel that the tax system is not administered fairly 
and not everyone is paying their fair share, which could undermine 
voluntary compliance. 

What GAO Found: 

GAO identified a range of areas where IRS can improve its programs 
which can help it collect billions in tax revenue, facilitate 
voluntary compliance, or reduce IRS's costs. These include pursuing 
stronger enforcement through increasing third-party information 
reporting and identifying and pursuing abusive tax avoidance 
transactions;[Footnote 234] making more use of external resources such 
as tax whistleblowers to prevent and detect compliance problems; and 
improving telephone and online services provided to taxpayers. 

* Expanding third-party information reporting 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. 

As GAO reported in August 2008, one area where information reporting 
could be expanded is payments made to contractors (payees) by owners 
of rental real estate (third-party payers). Like other businesses 
entities, under current law, taxpayers who rent out real estate are 
required to report to IRS expense payments for certain services, such 
as payments for property repairs, as long as their rental activity is 
considered a trade or business (which includes activities engaged in 
for profit as well as activities by certain nonprofits). However, the 
law does not clearly spell out how to determine when rental real 
estate activity is considered a trade or business. Consequently, 
determining whether an information return should be filed requires a 
case-by-case analysis of when rental real estate is, or is not, a 
trade or business depending on the facts and circumstances for each 
taxpayer. As GAO reported in August 2008, without clear statutory 
language, it may be difficult for payers with rental real estate 
activity to determine if they are required to report certain expense 
payments to IRS, and as a result, it is possible that some third-party 
payers who should report do not. Expanding information reporting to 
cover payment for services by all owners of rental real estate would 
provide clarity on reporting requirements and improve payee compliance. 

In another case, as GAO reported in November 2010, under existing law, 
businesses (payers) must report to IRS payments for services they made 
to unincorporated persons or businesses, but payments to corporations 
generally do not have to be reported. Extending reporting to cover 
payments to corporations for services would increase payee compliance. 
Congress enacted a more expansive regime in March 2010, covering goods 
as well as services, and repealed it in 2011. GAO believes the more 
narrow extension to include services, but not goods, provided by 
corporations--which would match the provision for unincorporated 
persons or businesses--remains an important option for improving 
compliance.[Footnote 235] 

In 2010, the Joint Committee on Taxation estimated revenue increases 
for a 10-year period from third-party reporting of (1) rental real 
estate service payments to be $2.5 billion and (2) service payments to 
corporations to be $3.4 billion. 

* Pursuing abusive tax avoidance transactions has been a long-standing 
tax evasion problem that results in potentially billions of dollars in 
tax losses. As GAO reported in May 2011, IRS had incomplete data on 
the results of abusive tax avoidance transaction (ATAT) related 
enforcement efforts, so it is unable to assess the effectiveness of 
these efforts. More could also be done to ensure compliance with ATAT 
disclosure requirements. For example, while investigations of those 
who promoted ATATs were often closed without penalties or injunctions 
to stop promoters, IRS had incomplete data on why these investigations 
were closed. During fiscal year 2011, IRS started tracking the amount 
of additional taxes collected as a result of taxpayer audits, where 
ATATs were at least one of the audited issues, but the amounts 
collected from ATAT issues alone could not be isolated. 

Pursuant to the American Jobs Creation Act of 2004, IRS expanded 
requirements for both promoters and taxpayers to disclose their use of 
certain transactions and enhanced penalties for improper disclosure--
failure to disclose, delinquent disclosure, and incomplete disclosure. 
However, as GAO reported in May 2011, IRS did not know whether it 
received all the disclosures it should have from taxpayers and did not 
verify the completeness of those disclosures it received. IRS also did 
not track how quickly all those who promoted ATATs provided lists of 
their investors when either required or requested. Without complete 
data on enforcement outcomes or full disclosure from promoters and 
taxpayers, IRS is less able to assess the effectiveness of ATAT 
enforcement efforts, make informed resource allocation decisions, or 
identify transactions that merit auditing or penalties. 

* Leveraging external resources such as tax whistleblowers can 
contribute to taxpayer compliance. GAO reported in August 2011, IRS 
did not collect or report complete data on, nor have a systematic 
process to manage the timeliness of, processing claims from 
whistleblowers, in part, because of how it set up its claims tracking 
system. As a result, claims alleging millions or potentially billions 
of dollars in tax noncompliance may not receive the attention or 
resources they need. Moreover, without complete and accurate data or 
processes to follow up on claims that exceed established review time 
targets, IRS may not be able to identify aspects of the program that 
could be improved to more effectively address noncompliance. 
Collecting and reporting such data could also improve the transparency 
of the program, which may result in additional whistleblowers coming 
forward. 

* Improving taxpayer services can benefit voluntary compliance by 
making it easier for taxpayers to pay what they owe. As GAO reported 
in December 2011, determining the costs and benefits of enhancing 
certain services for taxpayers, such as providing more automated 
telephone applications, could lead to faster service for taxpayers and 
lower IRS costs. Similarly, GAO also reported that completing a 
comprehensive online services plan might include an assessment of and 
justification for giving taxpayers the ability to access and update 
account information online, which may simultaneously improve taxpayer 
services and lower IRS's costs. In addition to reducing costs, 
providing more automated taxpayer services could increase revenue 
collection by supporting greater voluntary compliance and allow 
resources to be shifted to other priorities. 

Actions Needed and Potential Financial or Other Benefits: 

GAO continues to suggest Congress consider expanding third-party 
information reporting, which improves taxpayer compliance, by amending 
the Internal Revenue Code. GAO recommended that Congress may wish to: 

* make owners of rental real estate subject to the same payment 
reporting requirements regardless of whether they engaged in a trade 
or business under current law [Hyperlink, 
http://www.gao.gov/products/GAO-08-956] and: 

* require payers to report service payments to corporations, thereby 
reducing payers' burden to determine which payments require reporting 
[Hyperlink, http://www.gao.gov/products/GAO-11-218T] [Hyperlink, 
http://www.gao.gov/products/GAO-09-238]. 

IRS has agreed with and taken action on some GAO recommendations--for 
example, by providing taxpayers with rental real estate activity 
additional guidance on their reporting obligations. However, other 
recommendations remain to be addressed. Specifically, to increase 
revenue, reduce costs, and promote voluntary compliance, GAO 
recommended that IRS: 

* track the examination results for ATAT versus non-ATAT issues 
separately and check whether taxpayers filed all required ATAT-related 
disclosure forms [Hyperlink, http://www.gao.gov/products/GAO-11-493]; 

* collect and report more information on the whistleblower program and 
establish a process to follow up on claims that exceed review time 
targets [Hyperlink, http://www.gao.gov/products/GAO-11-683]; 

* determine the costs and benefits of creating automated telephone 
applications and automate those where benefits exceed the costs 
[Hyperlink, http://www.gao.gov/products/GAO-12-176]; and: 

* finalize a more comprehensive plan for online services, including an 
assessment of granting taxpayers the ability to update their account 
information online [Hyperlink, http://www.gao.gov/products/GAO-12-176]. 

These actions can lead to increased revenue collections and cost 
savings totaling billions of dollars, which would help reduce the $385 
billion tax gap. Although precise estimates of total cost savings are 
not available, for just the two congressional actions cited above, the 
Joint Committee on Taxation estimated revenue increases of $5.9 
billion over 10 years. As part of its routine audit work, GAO will 
continue to track the extent to which progress has been made to 
address the identified actions and report to Congress. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its previously issued reports to IRS for 
review and comment. IRS generally agreed with GAO's recommendations on 
checking taxpayer ATAT filing obligations, return preparer oversight, 
and whistleblower information and processing but has not yet completed 
the recommended actions. IRS said it will consider reporting summary 
whistleblower statistics and improving online taxpayer services. 
Finally, IRS agreed that the recommendations regarding tracking ATAT 
issues and determining the costs and benefits of automating selected 
telephone applications had merit, but that resources for tracking or 
telephone automation were not available. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. 

Related GAO Products: 

2011 Filing Season: Processing Gains, but Assistance Could Be Enhanced 
by More Self-Service Tools. [Hyperlink, 
http://www.gao.gov/products/GAO-12-176] Washington, D.C.: December 15, 
2011. 

Tax Whistleblowers: Incomplete Data Hinders IRS's Ability to Manage 
Claim Processing Time and Enhance External Communication. [Hyperlink, 
http://www.gao.gov/products/GAO-11-683] Washington, D.C.: August 10, 
2011. 

Abusive Tax Avoidance Transactions: IRS Needs Better Data to Inform 
Decisions about Transactions. [Hyperlink, 
http://www.gao.gov/products/GAO-11-493] Washington, D.C.: May 12, 2011. 

High Risk Series: An Update. [Hyperlink, 
http://www.gao.gov/products/GAO-11-278] Washington, D.C.: February 
2011. 

Small Businesses: Tax Compliance Benefits and Opportunities to 
Mitigate Costs on Third Parties of Miscellaneous Income Reporting 
Requirements. [Hyperlink, http://www.gao.gov/products/GAO-11-218T] 
Washington, D.C.: November 18, 2010. 

Tax Gap: IRS Could Do More to Promote Compliance by Third Parties with 
Miscellaneous Income Reporting Requirements. [Hyperlink, 
http://www.gao.gov/products/GAO-09-238] Washington, D.C.: January 28, 
2009. 

Tax Gap: Actions That Could Improve Rental Real Estate Reporting 
Compliance. [Hyperlink, http://www.gao.gov/products/GAO-08-956] 
Washington, D.C.: August 28, 2008. 

Contact Information: 

For additional information about this area, contact Michael Brostek or 
James R. White at brostekm@gao.gov or whitej@gao.gov or (202) 512-9110. 

[End of section] 

45. Medicare Advantage Payment: 

The Centers for Medicare & 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. 

Why This Area Is Important: 

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. Medicare Advantage plans are paid a fixed monthly 
amount to provide beneficiaries with the same services as traditional 
Medicare. Most of these plans receive larger payments than would be 
required to provide traditional Medicare services. This allows them to 
provide additional services not covered by traditional Medicare. 

The Centers for Medicare & Medicaid Services (CMS), the agency that 
administers Medicare, adjusts payments to Medicare Advantage plans 
based on the health status of each plan's enrollees. This adjustment 
is intended to provide higher payments for sicker patients and lower 
payments for those who are less sick. CMS calculates a risk score--
which is a relative measure of health status--for every beneficiary. 
The risk score 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, and CMS has taken steps to reduce Medicare Advantage 
payments, saving $2.7 billion in 2010. 

What GAO Found: 

Risk scores for beneficiaries with the same demographic 
characteristics and health conditions should be identical, regardless 
of whether the beneficiaries are in a Medicare Advantage plan or 
traditional Medicare. This will be true if Medicare Advantage and 
traditional providers code medical diagnoses with the same level of 
reliability and completeness. However, Medicare Advantage plans and 
providers in traditional Medicare may code diagnoses differently. 
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. If Medicare Advantage 
risk scores are higher than traditional Medicare scores for 
beneficiaries with the same demographic characteristics and medical 
conditions simply because Medicare Advantage diagnostic coding is more 
comprehensive, then CMS's payment adjustment will not be accurate and 
Medicare Advantage payments will be too high. 

Policymakers have expressed concern that risk scores for Medicare 
Advantage beneficiaries have grown at a faster rate than those for 
traditional Medicare beneficiaries, and some believe that systematic 
differences in coding diagnoses have contributed to this growth. The 
Deficit Reduction Act of 2005 directed CMS to conduct an analysis and 
adjust risk scores for differences in coding practices, to the extent 
that such differences could be identified in 2008, 2009, and 2010. The 
Health Care and Education Reconciliation Act of 2010 directed CMS to 
continue adjusting risk scores until the agency implements risk 
adjustment using Medicare Advantage data. In 2010, CMS estimated that 
3.41 percent of Medicare Advantage risk scores were due to differences 
in diagnostic coding practices, and it reduced the scores by 3.41 
percent, thereby saving $2.7 billion. 

As GAO reported in January 2012, three major shortcomings exist in 
CMS's method for adjusting Medicare Advantage payments to reflect 
differences in diagnostic coding practices between Medicare Advantage 
and traditional Medicare. 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--a total savings of between $3.9 
billion and $5.8 billion. GAO expects savings in 2011 and future years 
will be greater. However, CMS has continued to use, or plans to use, 
its 2010 adjustment of 3.41 percent in 2011 and 2012. 

First, CMS did not use the most recent data for its estimates. For 
2010, the agency did not incorporate in its estimates 2008 data, the 
most recent data available. Similarly, the agency did not incorporate 
2009 and 2010 data as it became available to update its estimates for 
2011 and 2012. The most recent risk score data used by CMS in any of 
these estimates was 2007. 

Second, CMS assumed that the annual impact of coding differences 
remained constant relative to coding differences from 2004 to 2007, 
despite evidence that the impact was increasing over time. Although 
CMS's 2010 estimate accounted for the cumulative impact of coding 
differences over the 3 prior years, CMS did not account for any 
additional years of accumulated impact in its 2011 or 2012 estimates. 

Third, CMS only accounted for differences in age and mortality between 
the Medicare Advantage and traditional Medicare populations. GAO 
accounted for additional beneficiary characteristics, such as sex, 
diagnoses as a proxy for health status, Medicaid enrollment status, 
beneficiary residential location, and whether the original reason for 
Medicare entitlement was disability, thereby improving the accuracy of 
the estimate. 

Actions Needed and Potential Financial or Other Benefits: 

CMS could enhance its efforts to estimate effects of coding 
differences between Medicare Advantage and traditional Medicare and 
realize even greater cost savings than the $2.7 billion that it has 
identified. GAO demonstrated a methodology which incorporated 
additional data and identified additional savings--$1.2 billion to as 
much as $3.1 billion in payment reductions to Medicare Advantage 
plans. In January, 2012, GAO made the following recommendations: 

To help ensure appropriate payments to Medicare Advantage plans and 
improve the accuracy of the adjustment made for differences in coding 
practices over time, the Secretary of Health and Human Services should 
direct the Administrator of CMS: 

* incorporate the most recent data available in its estimates and 
identify and account for all years of diagnostic coding differences 
that could affect the payment year for which any adjustment is made; 

* take into account the upward trend of annual impact of coding 
differences in its estimates; and: 

* account, insofar as possible, for all relevant differences in 
beneficiary characteristics between the Medicare Advantage and 
traditional Medicare populations. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its January 2012 report to the Department of 
Health and Human Services. The Department of Health and Human Services 
did not comment on GAO's recommendations but provided general and 
technical comments, which were incorporated as appropriate. The 
Department of Health and Human Services characterized GAO's results as 
"similar" to those obtained by CMS, and found GAO's methodological 
approach and findings informative. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the report listed in the related GAO product section. GAO estimated 
the impact of coding differences between Medicare Advantage and 
traditional Medicare on Medicare Advantage risk scores and payment to 
plans. GAO compared risk score growth for Medicare Advantage 
beneficiaries with an estimate of what risk score growth would have 
been if they had been in traditional Medicare. 

Related GAO Product: 

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.: January 12, 
2012. 

Contact Information: 

For additional information about this area, contact James C. Cosgrove 
at (202) 512-7114 or cosgrovej@gao.gov. 

[End of section] 

46. Medicare and Medicaid Fraud Detection Systems: 

The Centers for Medicare & 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. 

Why This Area Is Important: 

GAO has 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.[Footnote 236] As the 
administrator of these programs, the Centers for Medicare & Medicaid 
Services (CMS) is responsible for safeguarding them from loss and for 
performing functions intended to help ensure the integrity of the 
programs, such as reviewing paid claims to identify patterns that may 
indicate cases of fraud, waste, and abuse, or other payment errors. 
These and other program integrity functions are conducted by CMS staff 
and several types of contractors. 

To integrate data about all types of Medicare and Medicaid claims and 
improve its ability to detect fraud, waste, and abuse in these 
programs, CMS initiated two information technology programs: the 
Integrated Data Repository (IDR) and One Program Integrity (One PI). 
IDR is intended to provide a centralized repository of claims data for 
all Medicare and Medicaid programs, and One PI is a set of tools that 
enables CMS's program integrity contractors and staff to access and 
analyze data retrieved from IDR. The intent of these programs is to 
provide enhanced capabilities and support to help CMS achieve goals 
for improving outcomes of its program integrity initiatives. Among 
other things, these enhancements are intended to improve CMS's ability 
to detect and recover funds lost to improper payments, and according 
to CMS officials, are expected to provide financial benefits of more 
than $21 billion by the end of fiscal year 2015. 

What GAO Found: 

As GAO reported in June 2011, CMS had developed and begun using both 
IDR and One PI, but was not yet positioned to identify, measure, or 
track benefits realized from these programs. Although IDR had been 
implemented and in use since 2006, it did not include all the data 
that were planned to be incorporated by fiscal year 2010. 
Specifically, while IDR included most types of Medicare claims data, 
it did not include the Medicaid data needed to help analysts detect 
improper payments of Medicaid claims. IDR also did not include data 
from other CMS systems that store and process data related to the 
entry, correction, and adjustment of claims prior to payment. These 
data are needed to help the agency's program integrity analysts 
prevent improper payments. According to program officials, the data 
were not incorporated because of obstacles introduced by delays in 
funding and technical issues. Specifically, funding to support 
activities to incorporate data from the other CMS systems was not 
approved until summer 2010. In November 2011, program officials stated 
that they had begun incorporating these data in September 2011 and 
planned to make them available to program integrity analysts in spring 
2012. 

Regarding the Medicaid data, IDR officials stated that they did not 
account for difficulties and resulting delays associated with 
integrating into IDR the various types and formats of data stored in 
disparate state systems. Further, the agency did not finalize plans 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 IDR. Until it does so, CMS may face additional delays 
in making available all the data that are needed to support enhanced 
program integrity efforts. 

Additionally, CMS developed and deployed to users its One PI system--a 
web-based portal that is to provide CMS program integrity analysts a 
single point of access to data contained in IDR, along with tools for 
analyzing those data. Nonetheless, few program integrity analysts were 
using the system. Specifically, One PI program officials planned for 
639 analysts to be using One PI by the end of fiscal year 2010; 
however, only 41--less than 7 percent--were actively using the portal 
and tools as of October 2010. 

According to program officials, the agency had not trained its broad 
community of analysts to use the system because of delays introduced 
when they took time to redesign initial training plans, which were 
found to be insufficient. Specifically, the initial plan provided 
training for the use of the One PI system and IDR data in a 3-and-a-
half-day course, whereas the redesigned plan includes courses on each 
of the components and allows trainees time to use them to reinforce 
learning before taking additional courses. 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, CMS officials reported that a total of 215 program 
integrity analysts had been trained and were using One PI.[Footnote 
237] However, until program officials finalize plans and schedules for 
training all intended users and expanding the use of One PI, the 
agency may continue to experience delays in reaching widespread use of 
the system and realizing expected financial benefits. 

Further, while CMS made some progress toward its goals to provide a 
single repository of data and enhanced analytical capabilities for 
program integrity efforts, the agency was not positioned to identify, 
measure, or track financial benefits or progress toward meeting 
program goals as a result of its efforts. Specifically, although IDR 
program officials stated that they avoided technology costs as a 
result of implementing IDR, they did not identify financial benefits 
of using IDR based on the recovery of improper payments. 

According to agency officials, CMS expected to realize more than $21 
billion in benefits as a result of using One PI from 2006 through 
2015. These benefits were expected to accrue as CMS's broad community 
of program integrity analysts used the systems to identify increasing 
numbers of improper payments. However, these officials further stated 
that because the agency did not meet its goal for widespread use of 
One PI, there were not enough data available to quantify benefits 
attributable to the use of the system. In this regard, we found that 
CMS did not produce outcomes that positioned the agency to identify or 
measure financial benefits, or to gauge its progress toward achieving 
the $21 billion in benefits that it expected. 

CMS officials also did not develop quantifiable measures that could be 
used to determine whether the agency was making progress toward 
meeting program goals through the use of One PI. For example, 
performance measures for one PI included increases in the detection of 
improper payments for Medicare Parts A and B claims. However, program 
integrity officials stated that measures were not quantified because 
they had not identified ways to determine the extent to which 
increases in the detection of errors could be attributed to the use of 
One PI. Additionally, the limited use of the system did not generate 
enough data to quantify the amount of funds recovered from improper 
payments. 

Actions Needed and Potential Financial or Other Benefits: 

To better position the agency to measure, gauge, and take actions to 
help ensure the program's success toward achieving the $21 billion in 
financial benefits that program integrity officials projected, GAO 
recommended in June 2011 that the Administrator of CMS: 

* finalize plans and schedules for incorporating additional data into 
IDR that consider risks and obstacles to the program; 

* implement and manage plans for incorporating data into IDR to meet 
schedule milestones; 

* establish plans and schedules for training all program integrity 
analysts who are intended to use One PI; 

* establish and communicate deadlines for program integrity 
contractors to complete training and use One PI in their work; 

* conduct training in accordance with plans and deadlines; 

* define any measurable financial benefits expected from the 
implementation of IDR and One PI; and: 

* establish measures for IDR and One PI that gauge progress toward 
meeting program goals. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its June 2011 report to CMS for review and 
comment. CMS agreed with all of GAO's recommendations and identified 
steps agency officials were taking to implement them. GAO expects to 
conduct additional work to determine whether CMS has addressed its 
recommendations and identified financial benefits and progress toward 
meeting agency goals resulting from the implementation of IDR and One 
PI for program integrity purposes. As part of its routine audit work, 
GAO will track agency actions to address these recommendations and 
report to Congress. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. GAO reviewed 
IDR and One PI system and program management plans and other documents 
and compared them to key practices. GAO also interviewed program 
officials, analyzed system data, and reviewed reported costs and 
benefits. 

Related GAO Products: 

Fraud Detection Systems: Centers for Medicare and Medicaid Services 
Needs to Expand Efforts to Support Program Integrity Initiatives. 
[Hyperlink, http://www.gao.gov/products/GAO-12-292T] Washington, D.C.: 
December 7, 2011. 

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. 

Contact Information: 

For additional information about this area, contact Valerie C. Melvin 
at (202) 512-6304 or melvinv@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Securing the Arizona portion of the approximately 2,000-mile southwest 
border that the United States shares with Mexico--while keeping 
illegal flows of people and drugs elsewhere under control--is a top 
priority for the Department of Homeland Security's (DHS) U.S. Customs 
and Border Protection (CBP). 

Following the 2011 cancellation of CBP's costly Secure Border 
Initiative Network (SBInet), CBP has taken steps to develop and 
implement a new Arizona Border Surveillance Technology Plan (the Plan) 
for the remainder of the Arizona border. This Plan is the first step 
in a multiyear, multibillion-dollar effort to secure the southwest 
border. The Plan is intended to guide the identification, acquisition, 
and deployment of additional surveillance technology, as well as any 
modifications needed to adjust them to varying terrain along the 
Arizona border to enhance situational awareness of illegal intrusions. 
CBP requested $242 million to fund the new Plan for fiscal year 2012 
and estimates that the total costs of acquiring and maintaining all of 
the proposed new systems for the Arizona border over their expected 10-
year life cycle will be about $1.5 billion. 

CBP began development of SBInet in 2005 as a combination of 
surveillance technologies that relied primarily on radar and camera 
towers to create a "virtual fence" along the southwest border in order 
to enhance CBP's capability to detect, identify, classify, track, and 
respond to illegal breaches at and between land ports of entry. After 
5 years and a cost of nearly $1 billion, SBInet systems are now 
deployed along the 53 miles of Arizona's 378-mile border with Mexico 
that represent the highest-risk area for illegal entry attempts. 

Since its inception, SBInet experienced continued and repeated 
technical problems, cost overruns, and schedule delays, which raised 
serious questions about the program's ability to meet CBP's needs for 
surveillance technology along the border. GAO issued 26 reports and 
testimonies identifying operational and program management weaknesses 
that contributed to SBInet's performance shortfalls, including cost 
overruns and schedule slippages. For example, as GAO reported in 
November 2008 and June 2010, deficiencies existed in CBP's timely 
preparation and completion of key acquisition documents essential to 
setting operational requirements, identifying and mitigating risks, 
and establishing the cost, schedule, and performance requirements of 
the project and the technology to be delivered.[Footnote 238] In May 
2010, GAO concluded that it was unclear whether the department's 
pursuit of SBInet was a cost-effective course of action, and whether 
it would produce expected results on time and within budget. In part 
based on these concerns, the Secretary of Homeland Security announced 
the cancellation of further procurements of SBInet systems in January 
2011. 

Given the previously reported challenges and eventual cancellation of 
SBInet, and the fact that similar challenges could affect CBP's 
current plan to acquire and deploy surveillance technology, GAO 
analyzed CBP's business case for its new initiative. This business 
case is important in light of DHS's overall management of 
acquisitions. GAO has reported that DHS faces significant challenges 
in managing its acquisitions, including programs not meeting their 
cost, schedule, and performance expectations. Further, strengthening 
its acquisition management process would help DHS to deliver critical 
mission capabilities that meet identified needs on time and within 
budget, including helping to reduce the cost overruns and schedule 
delays that DHS continues to experience in many of the major 
acquisition programs GAO has reviewed.[Footnote 239] 

What GAO Found: 

CBP's proposed approach is at an increased risk of not cost-
effectively accomplishing its goal in support of Arizona border 
security because CBP has not provided support for its business case 
for investing in the Plan. As GAO reported in November 2011, CBP has 
taken some steps to develop a business case for the Plan, but the 
agency has not (1) documented the analysis justifying the specific 
types, quantities, and deployment locations of border surveillance 
technologies proposed in the Plan in accordance with Standards for 
Internal Control in the Federal Government; (2) defined the mission 
benefits or developed performance metrics to assess its implementation 
of the Plan; or (3) developed a robust life-cycle cost estimate that 
can be relied on for the purposes of budget requests for fiscal year 
2012 and beyond. 

CBP program officials developed and proposed the Plan without 
documenting the analysis justifying the specific types, quantities, 
and deployment locations of border surveillance technologies proposed 
in the Plan. These technologies include a mix of currently employed 
technologies, such as unattended ground sensors, as well as new 
alternatives, such as Integrated Fixed Tower systems (that include 
fixed towers, cameras and radar, a data communications network, 
facilities upgrades, information displays, and an information 
management system). According to the Plan, CBP will begin acquiring 
and deploying three Integrated Fixed Tower systems in Arizona in 2012, 
with two others to be deployed by 2015, depending on funding 
availability. Standards for Internal Control in the Federal Government 
call for agencies to promptly record and clearly document transactions 
and significant events to maintain their relevance and value to 
management in controlling operations and making decisions and to 
ensure that agency objectives are met. The senior CBP official 
responsible for the program's acquisitions told GAO that he believed 
the process used to develop and support the plan justified acquisition 
decisions called for in the Plan. However, documenting the analysis 
justifying the specific types, quantities, and deployment locations of 
border surveillance technologies proposed in the Plan would allow an 
independent party to confirm the process followed, and to assess the 
validity of the decisions made. 

The Secretary of Homeland Security reported to Congress in January 
2011 that the Plan is expected to provide situational awareness for 
the entire Arizona border by 2014. However, CBP officials have not yet 
defined the expected benefits or developed measurable and quantifiable 
performance metrics which could show progress toward achieving that 
goal.[Footnote 240] In September 2011, CBP officials reported that 
they are developing new measures to determine whether and how 
investments impact border security. They acknowledged that since large 
investments have been made in border security, it is critical to 
assess the impacts these investments have had on improving border 
security, as well as projecting the additional impact future 
investments will have on their ability to manage the borders. However, 
CBP officials had not yet determined the key attributes of these new 
measures. The Clinger-Cohen Act of 1996 and Office of Management and 
Budget (OMB) guidance emphasize the need to ensure that information 
technology investments produce tangible, observable improvements in 
mission performance.[Footnote 241] Additionally, the GPRA 
Modernization Act of 2010 (GPRAMA) established a new, cross-cutting, 
and integrated framework for achieving results and improving 
government performance.[Footnote 242] Without defining the expected 
benefit or establishing metrics, CBP's ability to assess the 
effectiveness of the Plan as it is implemented may be limited. 

Finally, while CBP officials have taken steps to develop a cost 
estimate for the Plan, because they did not determine a level of 
confidence around the estimate, it may not be realistic or sufficient 
for the purposes of budget requests for fiscal year 2012 or beyond. 
GAO reported that CBP's cost estimate did not fully comply with 
related best practices. GAO's Cost Estimating and Assessment Guide and 
OMB guidance emphasize that reliable cost estimates are important for 
program approval and continued receipt of annual funding. High-quality 
cost estimates should be well documented, comprehensive, accurate, and 
credible.[Footnote 243] Specifically, GAO reported that CBP officials 
took steps to develop a comprehensive and accurate cost estimate. 
However, the actual data used to determine the estimate were not 
always shown. As a result of insufficient documentation, the validity 
and reliability of the estimate cannot be verified. In addition, 
because CBP officials did not follow other best practices for cost 
estimation, the estimate for the plan is likely to be unrealistic. 
Until CBP determines a robust life-cycle cost estimate for the Plan in 
accordance with best practices, it will be difficult for CBP to 
provide reasonable assurance regarding the reliability of CBP's 
expected future cost estimates for border surveillance technology. 

Actions Needed and Potential Financial or Other Benefits: 

To increase the likelihood of successful implementation of the Arizona 
Border Surveillance Technology Plan, minimize performance risks 
associated with the new approach, help justify program funding, and 
increase the reliability of CBP's cost estimate, GAO recommended in 
November 2011 that the Commissioner of CBP: 

* determine the mission benefits to be derived from implementation of 
the plan, 

* develop and apply key attributes for metrics to assess program 
implementation; and: 

* update its cost estimate for the Plan using best practices. 

In addition, Congress may wish to consider: 

* limiting future program funding until CBP has more fully defined the 
benefits and costs of its new Plan for Arizona. As part of our routine 
audit work, we will track agency actions to address these 
recommendations and report the results to Congress. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its November 2011 report as well as this 
report section for review and comment. DHS agreed with GAO 
recommendations and identified steps officials planned to take to 
implement them, along with estimated dates for their completion. 
Regarding the recommendations that CBP determine the mission benefits 
to be derived from implementation of the Plan and develop and apply 
key attributes for metrics to assess the program's implementation, DHS 
concurred and stated that CBP plans to develop a set of measures by 
April 30, 2012, that will assess the effectiveness and mission 
benefits of future technology investments. Such action should address 
the intent of the recommendations. Regarding the recommendation 
related to updating CBP's life-cycle cost estimate using best 
practices, DHS concurred and stated that CBP was preparing individual 
project cost estimates for the two largest elements of the Plan and 
will complete these actions by April 30, 2012. While these actions are 
positive steps, they do not fully address the recommendation that DHS 
implement best practices for cost estimates for the entire Plan, which 
is still needed to fully understand the impacts of integrating these 
separate projects. 

How GAO Conducted Its Work: 

This information contained in this analysis is based on findings from 
the products listed in the related GAO products section. GAO reviewed 
key program planning documents CBP relied on to support its new 
approach to identifying, acquiring, and deploying surveillance 
technology and compared them with requirements in DHS acquisition 
regulations. GAO also interviewed CBP officials responsible for 
assessing the need for and documenting the cost, operational 
effectiveness and suitability of proposed systems to support its 
Arizona Border Surveillance Technology Plan, and for identifying 
appropriate metrics to assess progress in border security. GAO 
reviewed cost and budget documents CBP relied on to support cost 
estimates for technology alternatives and interviewed program 
officials and contractors responsible for estimating the cost of 
future investments in surveillance technology, specifically the life-
cycle approach, requirements development and management, test 
management, and risk management. GAO also compared this information to 
relevant federal guidance and leading industry practices. 

Related GAO Products: 

Arizona Border Surveillance Technology: More Information on Plans and 
Costs Is Needed Before Proceeding. [Hyperlink, 
http://www.gao.gov/products/GAO-12-22] Washington, D.C.: November 4, 
2011. 

Border Security: Preliminary Observations on the Status of Key 
Southwest Border Technology Programs. [Hyperlink, 
http://www.gao.gov/products/GAO-11-448T] Washington D.C.: March 15, 
2011. 

Secure Border Initiative: DHS Needs to Strengthen Management and 
Oversight of Its Prime Contractor. [Hyperlink, 
http://www.gao.gov/products/GAO-11-6] Washington, D.C.: October 18, 
2010. 

Secure Border Initiative: DHS Needs to Reconsider Its Proposed 
Investment in Key Technology Program. [Hyperlink, 
http://www.gao.gov/products/GAO-10-340] Washington, D.C.: May 5, 2010. 

Secure Border Initiative: DHS Needs to Address Testing and Performance 
Limitations That Place Key Technology Program at Risk. [Hyperlink, 
http://www.gao.gov/products/GAO-10-158] Washington, D.C.: January 29, 
2010. 

Secure Border Initiative: Technology Deployment Delays Persist and the 
Impact of Border Fencing Has Not Been Assessed. [Hyperlink, 
http://www.gao.gov/products/GAO-09-1013T] Washington, D.C.: September 
17, 2009. 

Secure Border Initiative: DHS Needs to Address Significant Risks in 
Delivering Key Technology Investment. [Hyperlink, 
http://www.gao.gov/products/GAO-08-1148T] Washington, D.C.: September 
10, 2008. 

Secure Border Initiative: Observations on the Importance of Applying 
Lessons Learned to Future Projects. [Hyperlink, 
http://www.gao.gov/products/GAO-08-508T] Washington, D.C.: February 
27, 2008. 

Secure Border Initiative: SBInet Planning and Management Improvements 
Needed to Control Risk. [Hyperlink, 
http://www.gao.gov/products/GAO-07-504T] Washington, D.C.: February 
27, 2007. 

Contact Information: 

For additional information about this area, contact Rebecca Gambler at 
(202) 512-6912 or gamblerr@gao.gov. 

[End of section] 

48. Passenger Aviation Security Fees: 

Options for adjusting the passenger aviation security fee could 
further offset billions of dollars in civil aviation security costs. 

Why This Area Is Important: 

According to the President's 2011 National Counterterrorism Strategy, 
aviation security and screening is an essential tool in the country's 
ability to detect, disrupt, and defeat plots to attack the 
homeland.[Footnote 244] Civil aviation security includes, among other 
things, screening passengers and their carry-on and checked baggage 
for explosives, weapons, and other prohibited items. To help offset 
the costs associated with providing this security, the Aviation and 
Transportation Security Act authorized the Transportation Security 
Administration (TSA) to impose two security-related fees: a passenger 
security fee and an air carrier security fee (Aviation Security 
Infrastructure Fee).[Footnote 245] 

TSA imposed the passenger security fee--a uniform fee on passengers of 
U.S. and foreign air carriers originating at airports in the United 
States--in February 2002 at $2.50 per enplanement, capped at $5.00 per 
one-way trip, which are the maximum amounts allowed under the Aviation 
and Transportation Security Act. In addition, in February 2002, TSA 
imposed the air carrier security fee--a fee imposed on air carriers to 
further offset the costs of civil aviation security and capped at the 
amount paid by air carriers for screening passengers and property in 
calendar year 2000.[Footnote 246] 

The fees collected offset amounts appropriated to TSA for aviation 
security. In his fiscal year 2012 budget request, the President 
requested that Congress increase the passenger security fee but did 
not request an increase in the air carrier fee. In light of the 
administration's focus on the passenger security fee and the 
possibility that the basis for calculating the cost to air carriers 
for screening passengers and property in 2000 could remain in dispute, 
for the purposes of this summary, GAO will focus on options for 
offsetting aviation security costs related to the passenger fee. 
[Footnote 247] 

In the 10 years since TSA imposed the passenger security fee, TSA has 
developed additional measures to help mitigate potential risks to the 
nation's civil aviation security system, such as enhanced passenger 
screening technologies, among other programs, which have contributed 
to increases in the costs of aviation security to the federal 
government. 

What GAO Found: 

Several options exist for revising passenger security fees to help 
further offset civil aviation security costs. From fiscal years 2002 
through 2011, TSA collected about $18 billion in passenger and air 
carrier security fees, compared to the approximately $63 billion 
appropriated for aviation security activities over the same time 
frame; thus, security fees offset about 29 percent of amounts 
appropriated for aviation security-related activities during this time 
frame. The figure below shows the difference between the funds 
appropriated for aviation security and the aviation security fees 
collected since fiscal year 2002. 

Figure: Difference between TSA's Annual Appropriations and Aviation 
Security Fees Collected, from Fiscal Years 2002 through 2011: 

[Refer to PDF for image: vertical bar graph and associated table] 

Funding sources for TSA aviation security programs: Amounts 
Appropriated to TSA for Aviation Security: 
Fiscal year 2002: $4,340; (74%); 
Fiscal year 2003: $7,662; (81%); 
Fiscal year 2004: $4,775; (61%); 
Fiscal year 2005: $5,516; (65%); 
Fiscal year 2006: $5,876; (66%); 
Fiscal year 2007: $6,403; (64%); 
Fiscal year 2008: $6,180; (70%); 
Fiscal year 2009: $7,630; (75%); 
Fiscal year 2010: $7,231; (75%); 
Fiscal year 2011: $7,231; (72%); 
Total: $62,844                     
                     
Funding sources for TSA aviation security programs: Passenger Security 
Fees Collected: 
Fiscal year 2002: $995; (3%); 
Fiscal year 2003: $1,200; (3%); 
Fiscal year 2004: $1,600; (6%); 
Fiscal year 2005: $1,616; (6%); 
Fiscal year 2006: $1,660; (6%); 
Fiscal year 2007: $1,710; (9%); 
Fiscal year 2008: $1,420; (7%); 
Fiscal year 2009: $1,506; (5%); 
Fiscal year 2010: $1,558; (4%); 
Fiscal year 2011: $1,598; (6%); 
Total: $14,863                     

Funding sources for TSA aviation security programs: Air Carrier Fees 
Collected: 
Fiscal year 2002: $133; (23%); 
Fiscal year 2003: $253; (16%); 
Fiscal year 2004: $283; (34%); 
Fiscal year 2005: $307; (29%); 
Fiscal year 2006: $350; (28%); 
Fiscal year 2007: $573; (27%); 
Fiscal year 2008: $412; (23%); 
Fiscal year 2009: $407; (20%); 
Fiscal year 2010: $282; (22%); 
Fiscal year 2011: $400; (22%); 
Total: $3,400                      

Source: GAO analysis of TSA data.  

Notes: For the purposes of GAO's analysis, TSA identified the total 
amounts appropriated to TSA for aviation security-related programs and 
activities, including Federal Air Marshals, threat assessments, and 
some support costs. Due to statutory and other limitations, TSA did 
not collect a full year's worth of fees in fiscal years 2002 through 
2004. In addition, beginning in fiscal year 2005, and each fiscal year 
thereafter, the first $250 million in passenger security fees 
collected have been designated to the Aviation Security Capital Fund, 
except for fiscal year 2008, when an additional $250 million in fee 
collections were designated to the Checkpoint Screening Security Fund. 
See 49 U.S.C. §§ 44923(h), 44940(i). The figure above excludes amounts 
designated for the Aviation Security Capital Fund or the Checkpoint 
Screening Security Fund from "passenger security fees collected" and 
does not include these amounts in "amounts appropriated to TSA." 
Percentages may not add to 100 due to rounding. 

[End of figure] 

The importance of closely aligning fees to the cost of the service 
provided has been widely documented. As GAO previously reported in May 
2008 about user fee design, agencies should review their fees on a 
regular basis to ensure that they, Congress, and stakeholders have 
complete information on the costs of federal programs, and that fees 
are appropriately aligned to program costs and activities, among other 
things.[Footnote 248] Further, GAO's report stated that user fees can 
be designed to reduce the burden on taxpayers to finance the portions 
of activities that provide benefits to identifiable users above and 
beyond what is normally provided to the public. The International 
Civil Aviation Organization also issued guidance regarding cost 
recovery for airport charges.[Footnote 249] This guidance provides 
information to consider when setting fees, including fees related to 
aviation security, and determining the extent to which fees should 
offset security costs. According to International Civil Aviation 
Organization officials, costs should be a key consideration in setting 
fees and governments or airports, with input from relevant 
stakeholders, may consider increasing security fees when costs 
increase. For example, following the September 11, 2001, terrorist 
attacks, the government of Canada imposed an Air Travelers Security 
Charge of $12.00 per one-way trip to cover the costs of aviation 
security services.[Footnote 250] This fee was reviewed and reduced 
each year from 2003 through 2006 to reflect increases in passenger 
enplanements, revenue, and tax reductions, while it was increased in 
2010 to $7.48 to reflect increased expenditures for deploying upgraded 
checked baggage screening systems, among other things.[Footnote 251] 

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. The table below 
provides a description of the proposed options presented from various 
sources for increasing the passenger security fee. 

Table: Options to Increase the Passenger Aviation Security Fee: 

Source: President's Deficit Reduction Plan (September 2011); 
Description of option: The administration proposed increasing the 
passenger fee to $7.50 per one-way trip by 2017 through incremental 
$0.50 increases; 
Potential for addressing the difference between amounts appropriated 
and fees collected: The plan estimates that this option would collect 
an additional $8.8 billion over 5 years and $24.9 billion over 10 
years. According to the plan, over 10 years, $15 billion of these 
collections would be directed for debt reduction and the remaining 
collections would be used to offset TSA appropriations. 

Source: Congressional Budget Office (CBO) (March 2011), President's 
Debt Commission (November 2010), and House Budget Committee (April 
2011); 
Description of option: In late 2010 and 2011, CBO and the President's 
Debt Commission advanced similar options in which the passenger fee 
would be increased to a flat rate of $5.00 per one-way trip. The House 
Budget Committee also included this option in its concurrent 
resolution on the budget for fiscal year 2012; 
Potential for addressing the difference between amounts appropriated 
and fees collected: CBO estimates that this option would increase 
annual fee collections by about $2 billion, on average, or about $10 
billion over 5 years. TSA officials stated that TSA is supportive of 
the CBO and President's Debt Commission option because it would enable 
them to more closely meet their goal of offsetting 80 percent of the 
federal government's aviation security costs through fee collections. 

Source: TSA Fiscal Year 2012 Budget Request (February 2011); 
Description of option: In its fiscal year 2012 budget request, TSA 
proposed incrementally increasing the passenger security fee to $5.50 
per enplanement by 2014, with an $11 per one-way trip maximum; 
Potential for addressing the difference between amounts appropriated 
and fees collected: The fiscal year 2012 budget request for TSA 
includes an option to increase the current $2.50 fee by $1.50, 
offsetting appropriations by $590 million in 2012. In addition, the 
option assumes $0.50 and $1.00 increases in 2013 and 2014, 
respectively. When fully implemented in 2014, TSA anticipates that 
this option will increase annual passenger fee collections by $2.3 
billion. 

Source: TSA's goal for security fee collections (February 2009); 
Description of option: TSA officials stated that their goal is 
ultimately to offset 80 percent of amounts appropriated to TSA for 
aviation security-related programs and activities through fee 
collections. To achieve this goal, TSA would need to increase the 
passenger security fee to about $7.00 per enplanement, capped at $14 
per one-way trip, according to GAO's analysis; 
Potential for addressing the difference between amounts appropriated 
and fees collected: Increasing the fee to offset 80 percent of the 
amounts appropriated to TSA for aviation security-related programs and 
activities would represent an average annual increase of about $4 
billion in passenger fee collections, depending on appropriations. 

Source: GAO analysis of TSA, CBO, OMB, and President's Debt Commission 
data. 

Note: Estimates for future years are based on available enplanement 
data and are subject to change. 

[End of table] 

In addition to the options noted above, the passenger security fee 
could also be adjusted for inflation. OMB Circular A-25 provides that 
biennial reviews assure that existing charges are adjusted to reflect 
unanticipated changes in costs or market values. GAO also reported on 
issues to consider when setting user fees such as whether fee 
collections are projected to change with inflation. According to GAO's 
analysis, an inflation adjustment to the existing passenger security 
fee would result in an increase of approximately $0.50,[Footnote 252] 
increasing the fee from $2.50 to about $3.00 per enplanement, capped 
at $6 per one-way trip. Adjusting the fee for inflation would 
represent an average annual increase of about $410 million in 
passenger fee collections. 

Industry association officials representing key aviation stakeholders--
including airport executives, airlines, and passengers--from four of 
the five associations GAO interviewed have expressed general 
opposition to a passenger security fee increase for various reasons, 
such as the argument that aviation security is a federal 
responsibility and therefore associated costs should be borne by the 
government. One association noted that the burden of subsidizing these 
costs should not fall solely on passengers. Officials with three of 
the five aviation industry associations GAO interviewed also stated 
that the demand for air travel could be impacted if aviation security 
fees were increased. However, TSA officials stated that TSA does not 
expect its fiscal year 2012 proposal to increase the passenger 
security fee to $5.50 per enplanement (capped at $11.00 per one-way 
trip) to have a significant impact on travelers' demand to fly since 
the proposal suggests modest, incremental increases to the fee. 

In addition, GAO's review of the economic literature and related 
analysis suggests that the demand for air travel is somewhat elastic 
to price changes,[Footnote 253] though TSA's proposed fee increase to 
$5.50 per enplanement by 2014 constitutes a small proportion of the 
average price of a one-way trip,[Footnote 254] which is about $210 as 
of calendar year 2010, according to the U.S. Department of 
Transportation.[Footnote 255] Moreover, the responsiveness of 
travelers to changes in air travel prices depends on several factors 
such as distance traveled, nature of the trip (nonbusiness versus 
business), and the availability of alternative travel modes (for 
example, rail, road, etc.). GAO's analysis of TSA's fiscal year 2012 
budget proposal to incrementally increase the passenger security fee 
to $5.50 per enplanement by 2014 shows that when demand effects are 
taken into account, total enplanements from fiscal years 2012 through 
2014 could be reduced by 1 percent or about 26 million passengers over 
this 3-year period.[Footnote 256] This would reduce expected fee 
collections by about $120 million, or 3 percent of the $4.4 billion in 
additional fees collected over this period.[Footnote 257] 

Actions Needed and Potential Financial or Other Benefits: 

Increasing the passenger security fee could help further offset 
billions of dollars in the federal budget for aviation security 
programs and activities in outlying fiscal years. Therefore, Congress, 
working with the Administrator of TSA, may wish to consider: 

* increasing the passenger security fee according to one of the 
options identified in this summary. Options to increase the fee 
include the President's Deficit Reduction Plan option ($7.50 per one-
way trip by 2017); the CBO, President's Debt Commission, and House 
Budget Committee option ($5.00 per one-way trip); TSA's Fiscal Year 
2012 Budget Request option ($5.50 per enplanement by 2014); TSA's goal 
to ultimately offset 80 percent of federal aviation security costs 
through fee collections (according to GAO analysis, this option would 
increase the fee to about $7.00 per enplanement); as well as adjusting 
the fee for inflation (according to GAO analysis, this option would 
increase the fee to about $3.00 per enplanement). These options could 
increase fee collections from about $2 billion to $10 billion over 5 
years. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to DHS for review and 
comment. DHS provided technical comments, which were incorporated as 
appropriate. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
products listed in the related GAO products section and additional 
work GAO conducted. To address the issues discussed here, GAO analyzed 
(1) available documentation and guidance on TSA's aviation security 
fees and programs, (2) TSA's historical revenue data for aviation 
security fees from fiscal years 2002 through 2011, and (3) TSA 
estimates of applicable enplanement data for fiscal years 2012 through 
2014. GAO compared this data with other supporting documents, when 
available, to determine data consistency and reasonableness. On the 
basis of these efforts, GAO concluded that the data are sufficiently 
reliable for the purposes of this summary. GAO also analyzed various 
options to raise the passenger security fee, including the Obama 
administration's February 2009 budget request for fiscal year 2010, 
CBO's August 2009 option, and the President's Debt Commission report. 

To develop the option to adjust the fee for inflation, GAO analyzed 
OMB Circular A-25 and GAO's May 2008 report, which includes issues to 
consider when setting user fees such as whether fee collections are 
projected to change with inflation. GAO also reviewed OMB Circular A-
25 and relevant provisions of the Chief Financial Officers Act related 
to the setting and periodic review of user fees. GAO further 
interviewed officials with the International Civil Aviation 
Organization and analyzed policy guidance regarding international 
policies and best practices for the development and periodic review of 
aviation-related fees. To provide information on comparable fee 
structures and approaches in which fees are periodically adjusted, GAO 
analyzed documentation and analysis regarding Canada's Air Travelers 
Security Charge, including documentation of fee adjustments and 
associated demand elasticity analysis. GAO also discussed the current 
aviation security fee structure and options for modifying these fees 
with TSA officials; officials from five industry associations 
representing passengers, airports, and international groups; and 
officials from three organizations with subject matter expertise in 
aviation issues. GAO selected these associations because they 
represent key stakeholders--passengers, airports, and airlines--that 
could be affected by a fee increase. 

Related GAO Products: 

Federal User Fees: A Design Guide. [Hyperlink, 
http://www.gao.gov/products/GAO-08-386SP] Washington, D.C.: May 29, 
2008. 

Aviation Fees: Review of Air Carriers' Year 2000 Passenger and 
Property Screening Costs. [Hyperlink, 
http://www.gao.gov/products/GAO-05-558] Washington, D.C.: April 18, 
2005. 

Contact Information: 

For additional information about this area, contact Steve Lord at 
(202) 512-4379 or lords@gao.gov. 

[End of section] 

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 the Department of 
Homeland Security's U.S. Immigration and Customs Enforcement and U.S. 
Customs and Border Protection rather than using general fund 
appropriations. 

Why This Area Is Important: 

International air passengers arriving in the United States are subject 
to an immigration inspection to ensure that they have legal entry and 
immigration documents. Immigration inspection activities are conducted 
by U.S. Immigration and Customs Enforcement (ICE) and U.S. Customs and 
Border Protection (CBP). The immigration fee is set in statute at $7 
per passenger. The collections are available to pay for all expenses 
incurred in providing inspection and pre-inspection services.[Footnote 
258] The statute also directed the agency to report to the Congress 
every 2 years on the status of the Immigration User Fee Account, 
including balances, and recommend fee adjustments that may be required 
to ensure that the collections equal, as closely as possible, the cost 
of providing these services. However, ICE has not yet analyzed air 
passenger immigration inspection fee data to identify what fee 
adjustments, if any, are necessary. 

Passengers pay the immigration inspection fee when they purchase their 
airline tickets. Fee collections--which GAO estimates were about $600 
million[Footnote 259] in fiscal year 2010--are available to ICE and 
CBP to pay for costs incurred in providing inspection and pre-
inspection services, and are intended to be divided between ICE and 
CBP according to the costs of the immigration inspection activities 
for which each agency is responsible. Air passenger immigration 
inspection fee collections do not recover the total costs of these 
inspections. However, because immigration inspection costs and 
collections have not recently been comprehensively reviewed, it is 
unknown (1) whether collections are appropriately distributed between 
ICE and CBP and (2) the extent to which fee collections fail to cover 
air passenger immigration inspection costs, especially for ICE's 
inspection activities. 

What GAO Found: 

Air passenger immigration fee collections did not fully cover CBP's 
costs in fiscal years 2009 and 2010. According to ICE officials, 
although ICE does not track air passenger costs separately from sea 
passenger costs, ICE's portion of total air and sea passenger 
collections did not cover ICE's total air and sea passenger costs in 
fiscal years 2007 through 2009.[Footnote 260] As a result, in recent 
years, CBP and ICE have relied on general fund appropriations (in 
fiscal year 2010 alone, this amounted to over $120 million for CBP and 
an unknown amount for ICE) to help fund activities for which these 
agencies have statutory authority to fund with user fees. 

Table: Air Passenger Immigration Inspection Fee Costs and Collections: 

Air passenger immigration inspection collections; 
Fiscal year 2008: ICE: $115,522,669 (GAO estimate)[A]; 
Fiscal year 2008: CBP: $549,547,391; 
Fiscal year 2009: ICE: $98,917,337 (GAO estimate)[A]; 
Fiscal year 2009: CBP: $470,554,955; 
Fiscal year 2010: ICE: $103,865,917 (GAO estimate)[A]; 
Fiscal year 2010: CBP: $494,095,613. 

Air passenger immigration inspection costs; 
Fiscal year 2008: ICE: Unknown[B]; 
Fiscal year 2008: CBP: $524,016,131; 
Fiscal year 2009: ICE: Unknown[B]; 
Fiscal year 2009: CBP: $523,576,731; 
Fiscal year 2010: ICE: Unknown[B]; 
Fiscal year 2010: CBP: $620,348,927. 

Difference; 
Fiscal year 2008: ICE: Unknown; 
Fiscal year 2008: CBP: $25,531,260; 
Fiscal year 2009: ICE: Unknown; 
Fiscal year 2009: CBP: -$53,021,776; 
Fiscal year 2010: ICE: Unknown; 
Fiscal year 2010: CBP: -$126,253,314. 

Source: GAO analysis of ICE and CBP data. 

[A] Because ICE does not separately analyze air passenger collections 
data, GAO estimated ICE's collections using CBP's data and the user 
fee allocation rate between ICE and CBP. This estimate does not 
replace the actual data which would be found in a fee review. 

[B] ICE provided immigration inspection cost data for both air and sea 
passengers, but not specific data for air passengers. 

[End of table] 

The air passenger immigration inspection fee has not been recently 
comprehensively reviewed, and the rate, which is set in statute, has 
not been adjusted since fiscal year 2002. As GAO reported in May 2008, 
regular, comprehensive fee reviews could prevent misalignment between 
fees and the activities they support. Comparing ICE and CBP cost and 
collection information could help determine the extent to which 
collections cover costs and the appropriate share of collections for 
each agency. Further, GAO reported in its May 2008 User Fee Design 
Guide that regular reviews also help to increase awareness about 
program costs--and therefore increase incentives to reduce costs where 
possible. 

As GAO reported in September 2007, while CBP reviewed its share of air 
passenger inspection costs, ICE had not reviewed its share of these 
costs, and ICE and CBP do not have a process to determine how the 
immigration user fee would be split between them. In that report, GAO 
recommended that the Secretary of Homeland Security report on ICE's 
activity costs to ensure the immigration fee is divided between ICE 
and CBP 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. The Department of Homeland 
Security agreed with GAO's recommendations. 

Since 2006, GAO has requested that ICE and CBP provide a comprehensive 
review showing the extent to which fee collections cover their air 
passenger immigration inspection costs. CBP provided GAO with this 
analysis for its share of the immigration inspection activities. ICE 
only provided aggregate costs for air and sea ports of entry. Agency 
officials said that ICE cannot provide this information because it 
does not separately analyze air passenger amounts. Absent such 
information, the extent to which total air passenger fee collections 
cover total air passenger costs, and whether these collections are 
appropriately distributed between ICE and CBP, is unknown. 

Actions Needed and Potential Financial or Other Benefits: 

To determine the extent to which air passenger immigration inspection 
fees are aligned with the costs of inspection activities, which could 
enable fee adjustments to reduce reliance on general fund 
appropriations, Congress may wish to require the Secretary of the 
Department of Homeland Security to fully implement the recommendations 
from GAO's September 2007 report, including to: 

* require ICE and CBP to regularly report on the total cost of air 
passenger immigration inspections and the amount of associated fee 
collections; 

* adjust the fee as needed so that collections are aligned with total 
inspection costs, if it is determined that total immigration fee 
collections do not cover total immigration inspection costs;[Footnote 
261] 

* direct ICE to amend its cost study methodology to determine the 
extent to which air passenger fee collections cover reimbursable 
activities;[Footnote 262] and: 

* direct ICE and CBP to establish a regular schedule to review and 
coordinate on the costs of their respective air passenger immigration 
inspection activities, and revise the proportion of the fee received 
by each agency accordingly. 

Taking these four actions would allow ICE and CBP 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. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section for to the Department of 
Homeland Security for review and comment. The department agreed with 
the material facts as presented. ICE supplied GAO with its Immigration 
User Fee Account cost studies for fiscal years 2007, 2008, and 2009, 
which showed its combined immigration inspection fee costs for air and 
sea inspections. ICE said that it will update its methodology for 
determining Immigration User Fee Account air and sea costs and will 
conduct additional analysis to separate the air and sea immigration 
fee collections and costs. ICE estimates that the revised analysis for 
fiscal year 2010 will be completed by March 31, 2012. Further, ICE 
said that it will continue to work with GAO and CBP to close the 
remaining recommendations outlined in GAO reports concerning the 
Immigration User Fee Account. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section as well as 
additional work GAO conducted. GAO reviewed documents from ICE and 
CBP. In addition, GAO requested fiscal year 2010 cost and collections 
data from ICE and CBP and used data from CBP. 

Related GAO Products: 

Federal User Fees: A Design Guide. [Hyperlink, 
http://www.gao.gov/products/GAO-08-386SP] Washington, D.C.: May 29, 
2008. 

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.: September 24, 2007. 

Contact Information: 

For additional information about this area, contact Susan J. Irving at 
(202) 512-6806 or irvings@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

Since 2003, the United States has reported obligating about $708 
billion for U.S. military operations in Iraq and has provided about 
$25.5 billion for training, equipment, supplies, facility 
construction, and other services for Iraqi security forces.[Footnote 
263] In its fiscal year 2012 budget request, the administration 
requested more than $2.4 billion in U.S. funding to support the 
training and equipping of forces under Iraq's security ministries. The 
fiscal year 2009 National Defense Authorization Act instructed the 
U.S. government to take actions to ensure that Iraqi funds are used to 
pay the costs of training, equipping, and sustaining Iraqi security 
forces.[Footnote 264] In December 2011, the United States withdrew all 
U.S. forces from Iraq. However, the U.S.-Iraq Strategic Framework 
Agreement affirms the desires of the two countries to establish a long-
term relationship of cooperation in the economic, diplomatic, 
cultural, and security fields, among others.[Footnote 265] Iraq's 
large oil reserves offer the Iraqi government the potential to 
contribute to the country's current and future security and 
stabilization requirements. Oil revenues account for over 50 percent 
of the country's gross domestic product and about 90 percent of the 
government's revenues. As GAO previously reported, Iraq reported 
substantial budget surpluses. 

What GAO Found: 

GAO analysis of Iraqi revenue and expenditure data through the end of 
2009 showed that Iraq generated an estimated cumulative budget surplus 
of $52.1 billion. This estimate is consistent with the method that 
Iraq uses to calculate its fiscal position. Adjusting for $40.3 
billion in estimated outstanding advances reduces the amount of 
available surplus funds to $11.8 billion. For 2010, Iraqi Ministry of 
Finance and Central Bank of Iraq data show that the Iraqi government 
generated a $600 million cash deficit (rather than the $19. 6 billion 
deficit budgeted) due to higher-than-predicted revenue and less-than-
planned expenditures. In addition, during the first 6 months of 2011, 
the government of Iraq collected $7.9 billion more in oil revenue than 
it originally budgeted. GAO does not have more recent data on 
outstanding advances that would allow for an update to the amount of 
available surplus. The International Monetary Fund, however, has 
determined that the Ministry of Finance should review the outstanding 
advances as a benchmark the government of Iraq needs to achieve under 
its current stand-by arrangement. 

Iraqi government data indicate that security spending under the 
Ministries of Defense and Interior increased from $2.0 billion in 2005 
to an estimated $8.6 billion in 2009. In addition, these ministries 
set aside about $5.5 billion over this period for the purchase of 
equipment, training, and services under the U.S. Foreign Military 
Sales (FMS) program. In certain instances, the United States has 
provided an incentive for these ministries to increase their security 
spending by leveraging U.S. funds to supplement Iraq's FMS purchases. 
The Iraqi government also funded the Iraq-Commander's Emergency 
Response Program and assumed responsibility for the salaries of almost 
90,000 Sons of Iraq--nongovernmental security contractors hired by 
U.S. and Coalition forces to help maintain security in their local 
communities. While security spending has increased, GAO's analysis of 
data for the Iraqi government, the Department of Defense (DOD), and 
the Trade Bank of Iraq showed that the ministries did not spend or set 
aside between $2.5 billion and $5.2 billion of their 2005 through 2009 
budgeted funds--funds that could have been used to address security 
needs.[Footnote 266] Department of State (State) and DOD officials 
cited overly centralized decision making and weak procurement capacity 
as reasons for the ministries' inability to spend these funds. In 
April 2010, Ministry of Defense officials received Ministry of Finance 
approval to use $143 million of their unspent 2009 funds for FMS 
purchases. Ministry of Interior officials planned to use more than 
$300 million of their unspent 2009 funds for similar purposes. 

In its fiscal year 2012 budget request, the administration requested 
more than $2.4 billion in U.S. funding to support the training and 
equipping of forces under Iraq's security ministries. Specifically, 

* State requested $1 billion for Foreign Military Financing to 
purchase training and equipment for Iraqi security forces. According 
to State, this request for Iraq is a replacement for DOD's Iraq 
Security Forces Funding and is in addition to the $25.5 billion that 
has already been provided since 2003. In the 2012 Consolidated 
Appropriations Act, Congress appropriated $1.102 billion for Foreign 
Military Financing for Overseas Contingency Operations/Global War on 
Terrorism.[Footnote 267] The Conference Agreement accompanying the act 
explains that the amount is for the extraordinary costs of contingency 
operations, including in Iraq, Pakistan, the Philippines, and Yemen. 

* State also requested $886 million to fund its new Police Development 
Program in Iraq, of which 15.5 percent ($137 million) will be used to 
deploy approximately 190 police advisors and 82 percent ($723 million) 
will be used for security and support costs. These funds are in 
addition to the $757 million that was available in fiscal years 2010 
and 2011, for the Police Development Program's start-up and initial 
operating costs. Congress appropriated $983,605,000 for International 
Narcotics Control and Law Enforcement for Overseas Contingency 
Operations/Global War on Terrorism. The conference Agreement 
accompanying the act explained that the amount is for the 
extraordinary costs of contingency operations, including in Iraq, 
Pakistan, Afghanistan, Yemen, Somalia, and for African 
counterterrorism partnerships. 

* DOD requested $524 million to establish its Office of Security 
Cooperation-Iraq, which will be responsible for administering Iraq's 
FMS and Foreign Military Financing program, among other 
responsibilities. Congress authorized that from the funds made 
available to DOD for Operation and Maintenance, Air Force, up to $524 
million could be used to fund the operations and activities of the 
Office of Security Cooperation-Iraq and security assistance teams, 
including life support, transportation and personal security, and 
facilities renovation and construction. 

Actions Needed and Potential Financial or Other Benefits: 

Iraq generated an estimated cumulative budget surplus of $52.1 billion 
through December 2009. Adjusting for outstanding advances, at least 
$11.8 billion of this surplus was available for future spending. In 
light of these resources, Iraq has the potential to further contribute 
toward its security needs, even as it addresses other competing 
priorities. GAO recommended in September 2010 that Congress should: 

* consider Iraq's available financial resources when it reviews future 
budget requests for additional funds to train and equip Iraqi security 
forces. 

Additional clarity is needed on Iraq's outstanding advances to 
determine the financial resources Iraq has available for future 
spending. To this end, GAO recommended in September 2010 that the 
Secretaries of State and the Treasury should: 

* work with the Iraqi government to identify these resources by 
assisting Iraq in completing International Monetary Fund-required 
review of outstanding advances. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of its September 2010 report to State, Treasury, 
DOD and the International Monetary Fund for review and comment. State, 
Treasury, DOD, and the International Monetary Fund provided technical 
comments, which were incorporated as appropriate. State and Treasury 
agreed with GAO's recommendation and agreed to work with their Iraqi 
counterparts to identify available financial resources. Treasury also 
agreed in principle that, while Iraq's fiscal accounts are not well 
ordered, Iraq potentially will have financial resources to engage in 
greater cost-sharing. State, Treasury, and DOD stated that the Iraqi 
government's available funds are closer to the low end of GAO's range, 
and that Iraq needs to maintain a fiscal reserve. GAO believes that it 
is premature to determine that Iraq's available resources fall at the 
low end of the range until Iraq has completed International Monetary 
Fund-required review of outstanding advances, particularly in light of 
the substantial shortcomings associated with Iraq's accounting for 
advances. This review will clarify the total resources available for 
government spending. GAO agrees that it may be prudent for Iraq to 
maintain a fiscal reserve. 

DOD also commented that it believes the overall message of the draft 
report--that the Iraqi government had significant cash reserves that 
would have allowed it to pay more of its security costs--is 
inaccurate. GAO disagreed. In its report, GAO noted that Iraq ended 
2009 with at least $15.3 billion in financial deposits. Moreover, when 
completed, International Monetary Fund-required review of Iraq's 
outstanding advances will clarify the total funds that are available 
to the government for spending. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
the products listed in the related GAO products section. GAO analyzed 
relevant data, reviewed documents, and interviewed Iraqi officials in 
Baghdad, Iraq, including the Ministers of Finance, Defense, and 
Interior; the Governor of the Central Bank of Iraq; the President of 
the Trade Bank of Iraq; and the Deputies General of Accounting at the 
Rafidain and Rasheed banks, which are Iraq's two largest state-owned 
commercial banks. GAO analyzed data on Iraq's reported revenues and 
expenditures from the Minister of Finance for 2005 through 2010 and 
from Iraq's financial statements prepared by Iraq's Board of Supreme 
Audit for 2005 through 2007. GAO also analyzed similar data on Iraq's 
advances through September 2009. GAO also interviewed U.S. and other 
officials in Washington, D.C., and Baghdad, Iraq, including officials 
from DOD, State, and the Department of the Treasury; the World Bank; 
the International Monetary Fund; and the Federal Reserve Bank of New 
York. GAO conducted a site visit in Baghdad, Iraq, in April 2010, to 
interview Iraqi officials and to obtain additional information on 
Iraq's fiscal position. To report on the President's fiscal year 2012 
budget request, GAO reviewed the President's fiscal year budget 
request for international affairs, and past and current transition and 
interagency planning documents for the transition to a civilian-led 
U.S. presence in Iraq. GAO also interviewed officials from the 
Departments of State and Defense in Washington, D.C., and the U.S. 
Embassy Baghdad. 

Related GAO Products: 

Iraqi-U.S. Cost-Sharing: Iraq Has a Cumulative Budget Surplus, 
Offering the Potential for Further Cost-Sharing. [Hyperlink, 
http://www.gao.gov/products/GAO-10-304] Washington, D.C.: September 
13, 2010. 

Iraq: Key Issues for Congressional Oversight. [Hyperlink, 
http://www.gao.gov/products/GAO-09-294SP] Washington, D.C.: March 24, 
2009. 

Stabilizing and Rebuilding Iraq: Iraq Revenues, Expenditures, and 
Surplus. [Hyperlink, http://www.gao.gov/products/GAO-08-1031] 
Washington, D.C.: August 5, 2008. 

Contact Information: 

For additional information about this area, contact Charles Michael 
Johnson, Jr. at (202) 512-7331 or johnsoncm@gao.gov. 

[End of section] 

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. 

Why This Area Is Important: 

The growing number of major disaster declarations has contributed to 
an increase in federal expenditures for disaster assistance. From 
fiscal years 2002 to 2011, Presidents have declared 35 percent more 
disasters than during the preceding 10-year period. Major disaster 
declarations can trigger a variety of federal response and recovery 
assistance for government and nongovernmental entities, households, 
and individuals. Officials from the Federal Emergency Management 
Agency (FEMA), within the Department of Homeland Security (DHS), have 
cited various possible reasons for increases in the number of 
declarations, including more active weather patterns, increased costs 
to repair damaged infrastructure, and population increases. 

When a state is hit by a disaster, the governor may request a major 
disaster declaration from the President.[Footnote 268] FEMA makes an 
assessment of damage and other factors and makes a recommendation to 
the President, who has discretion to accept or reject FEMA's 
recommendation. FEMA uses a statewide per capita damage indicator to 
help determine whether sufficient damage has occurred to warrant a 
declaration and to determine whether a state should receive Public 
Assistance. Public Assistance is the federal disaster assistance 
program used by FEMA to reimburse states for certain response and 
recovery activities.[Footnote 269] Public Assistance funding 
represents the largest proportion of funds obligated from FEMA's 
Disaster Relief Fund, which is the major source of federal disaster 
recovery assistance for state and local governments when a disaster is 
declared. 

Much of the growth in major disaster declarations has occurred at the 
same time (that is, since 9/11) that the federal government has 
provided more than $34 billion to state and local governments to 
enhance their preparedness to protect against, respond to, and recover 
from disasters of all types. From fiscal years 2004 through 2011, the 
President approved 539 major disaster declarations. As of September 
30, 2011, $78.7 billion was paid for by the Disaster Relief Fund for 
these disasters.[Footnote 270] For 13 of these declared disasters, 
FEMA has obligated over $1 billion each.[Footnote 271] 

In August 2011, the Disaster Relief Fund diminished to a level that 
caused FEMA to temporarily halt funding on long-term recovery projects 
and focus on immediate needs. According to the FEMA Administrator, due 
to the shortage of available balances in the Disaster Relief Fund, 
FEMA accelerated its efforts to recover previously obligated funds 
from states for completed projects that had unexpended 
balances.[Footnote 272] Further, throughout fiscal year 2011, FEMA 
recovered over $3.5 billion in unexpended funds from states and other 
federal agencies.[Footnote 273] GAO has identified determining the 
costs to be borne by the federal, state, and local governments or the 
private sector in preparing for, responding to, and recovering from 
disasters of all types as a 21st Century challenge.[Footnote 274] GAO 
is currently conducting a review of the disaster declaration process 
and plans to report the results in summer 2012. 

What GAO Found: 

FEMA could reduce federal expenditures by updating its eligibility 
indicator and more accurately determining a state's capacity to 
respond to a disaster. According to FEMA and state emergency 
management officials, FEMA has primarily relied on a single indicator, 
the statewide per capita damage indicator, to determine whether to 
recommend that a state receive Public Assistance funding. For example, 
in fiscal year 2012, the per capita indicator is $1.35; thus, for a 
state with 10 million people, estimated damages from a disaster would 
generally have to be $13.5 million or more for FEMA to recommend 
Public Assistance, although other factors could also influence the 
recommendation. 

FEMA's method for determining a state's capacity to respond without 
federal assistance relies on a governor's certification and damage 
indicators. The Stafford Act requires that a governor's request for a 
major disaster declaration be based on a finding that the disaster is 
of such severity and magnitude that an effective response is beyond 
the capabilities of the state and that federal assistance is 
necessary.[Footnote 275] FEMA officials stated that governors must 
certify in their letter to the President requesting a major disaster 
declaration that the disaster is beyond the capabilities of the state. 
FEMA regulations list quantitative and qualitative factors, such as 
whether a state is responding to multiple disasters within a short 
time period, that the agency considers when determining whether a 
disaster declaration is warranted.[Footnote 276] However, in 
describing the declarations process, FEMA and state officials stated 
that FEMA uses the statewide per capita indicator as the primary 
determining factor for Public Assistance funding. This damage 
indicator, which FEMA has used since 1986, is essentially a proxy 
fiscal measure of a state's capacity to respond to and recover from a 
disaster. 

The Post-Katrina Emergency Management Reform Act of 2006, enacted in 
response to Hurricane Katrina, required FEMA to develop a set of 
preparedness metrics that could be used to assess operational 
preparedness capacity.[Footnote 277] Presidential Policy Directive-8, 
issued in March 2011, also includes such a requirement. However, FEMA 
has not yet developed such metrics, which limits its ability to 
comprehensively assess a state's disaster preparedness and 
capabilities. Moreover, at this time, FEMA does not have any plans or 
policies in place to use state preparedness data to inform decisions 
regarding Presidential disaster declarations. Without an established 
means of assessing state response and recovery capacity, FEMA has 
continued to rely primarily on the per capita damage indicator when 
determining whether a major disaster declaration is warranted. Metrics 
to assess a state's disaster preparedness and capabilities would 
augment the Public Assistance per capita indicator to provide a more 
comprehensive understanding of a state's capacity to respond to and 
recover from a disaster without federal assistance.[Footnote 278] 

Further, FEMA has not adjusted the per capita indicator for Public 
Assistance to keep pace with changes in per capita personal income. 
According to federal internal control standards, activities should be 
established to monitor performance indicators and controls should be 
aimed at validating the propriety and integrity of such 
indicators.[Footnote 279] In 1986, FEMA proposed a $1.00 per capita 
indicator for Public Assistance as a means of gauging state fiscal 
capacity.[Footnote 280] The indicator was based on the 1983 per capita 
personal income nationwide, then estimated at $11,667. FEMA thought it 
reasonable "that a state would be capable of providing $1.00 for each 
resident of that state to cover the cost of state efforts to alleviate 
the damage which results from a disaster situation" given that 
national per capita personal income was $11,667.[Footnote 281] While 
the proposed rule was not codified in 1986, FEMA began to use the 
$1.00 per capita indicator informally as part of its preliminary 
damage assessment efforts and did not adjust the indicator annually 
for either inflation or increases in national per capita income. In 
1998, FEMA had suggested that the Public Assistance indicator be 
adjusted to $1.51 to account for inflation since 1986, but due to 
input from state emergency management officials, FEMA decided not to 
do so. In 1999, FEMA issued a rule codifying the per capita indicator 
at $1.00, which was stipulated to include an annual adjustment for 
inflation, but the rule was silent on whether the indicator would 
continue to be based on nationwide per capita personal 
income.[Footnote 282] As a result, the indicator has risen 35 percent 
from $1.00 to $1.35 in the 12 years since FEMA began its annual 
inflationary adjustments. In proposing and finalizing the rule, FEMA 
stated that it recognized that a straight per capita figure may not be 
the best measurement of a state's capability, but that it provided a 
simple, clear, consistent and long-standing means of measuring the 
severity, magnitude, and impact of a disaster, while at the same time 
ensuring that the President can respond quickly and effectively to a 
governor's request for assistance.[Footnote 283] 

Had the indicator been adjusted for inflation beginning when FEMA 
started using it in 1986, it would have risen more than 100 percent to 
$2.07 by 2012. Furthermore, had the indicator been adjusted for 
increases in per capita personal income, the indicator would have 
risen to $3.42 in 2010, based on 2010 national per capita personal 
income of $39,945. While these alternate adjustment methods would have 
increased the per capita indicator, they are not necessarily 
indicative of a state's ability to pay for the damage because they do 
not consider the substantial differences in states' financial 
capacities to respond when disasters occur. For example, per capita 
personal income is a relatively poor indicator of a state's fiscal 
capacity because it does not comprehensively measure income 
potentially subject to state taxation.[Footnote 284] In addition, 
reliance on a single damage estimate as the primary indicator to 
determine whether a major disaster declaration is warranted does not 
provide a comprehensive assessment of a state's capacity to respond to 
a disaster without federal assistance. 

As GAO reported in August 2001, issues exist regarding the criteria 
that FEMA used to recommend to the President that a state disaster 
declaration request be approved or denied. Specifically, GAO reported 
that the per capita indicator was not necessarily indicative of state 
or local capability to respond effectively without federal assistance, 
and recommended that FEMA should consider alternative criteria. FEMA's 
response noted that GAO provided valuable input for the FEMA team that 
was reviewing the disaster declaration process and the criteria used 
to assess state damages. According to FEMA, in 2001 the President's 
budget for fiscal year 2002 included a provision for the development 
of improved guidelines for disaster assistance that provided states 
with meaningful criteria that must be met to become eligible for 
federal disaster assistance. FEMA undertook a review of disaster 
declaration guidelines; however, no changes to the established 
declaration guidelines were adopted and, ultimately, FEMA did not 
change its reliance on the per capita indicator. In January 2012, FEMA 
officials stated that it is a balancing act to agree on a good, 
reasonable measure of a state's capacity to respond to and recover 
from a disaster. 

At the time of GAO's recommendation, there was no requirement, as 
there is now, that FEMA develop metrics to assess state capabilities. 
The growing number of major disaster declarations highlights the need 
to re-examine the criteria used to assess state damages and also 
augment the damage indicator with a means of assessing state 
capabilities.[Footnote 285] The figure below shows the actual 
increases in the per capita indicator for Public Assistance from 1986 
to 2010 compared to the increases that would have occurred if FEMA had 
adjusted the indicator for inflation or the increase in per capita 
personal income during this period. 

Figure: FEMA Per Capita Indicator for Public Assistance and Alternate 
Measures: 

[Refer to PDF for image: multiple line graph] 

Per capita indicators: 

Year: 1986; 
Personal income: $1; 
Inflation adjustment: $1; 
Actual indicator: $1. 

Year: 1990; 
Personal income: $1.66; 
Inflation adjustment: $1.14; 
Actual indicator: $1. 

Year: 1995; 
Personal income: $1.99; 
Inflation adjustment: $1.36; 
Actual indicator: $1. 

Year: 2000; 
Personal income: $2.6; 
Inflation adjustment: $1.52; 
Actual indicator: $1. 

Year: 2005; 
Personal income: $3.04; 
Inflation adjustment: $1.73; 
Actual indicator: $1.14. 

Year: 2010; 
Personal income: $3.42; 
Inflation adjustment: $1.97; 
Actual indicator: $1.29. 

Source: GAO analysis of Department of Homeland Security, Department of 
Commerce, and Bureau of Labor Statistics data. 

[End of figure] 

Because FEMA's current per capita indicator does not reflect the rise 
in either (1) per capita personal income since it was created in 1986 
or (2) inflation from 1986 to 1999, the indicator could be 
artificially low. Further, FEMA officials stated that the rise in 
construction and other costs to respond to and recover from disasters 
have outpaced the rise in the per capita indicator. As a result, 
states can receive disaster funding for relatively small damage 
estimates. FEMA officials stated that in states with smaller 
populations, damage to a single building or facility, such as a water 
treatment facility, could result in a damage estimate sufficient to 
meet the state per capita damage threshold and warrant a disaster 
declaration. Given the recent increase in disaster declarations, re-
examining the basis for the per capita indicator would better position 
FEMA to assess a state's capacity to respond to and recover from a 
disaster. 

Actions Needed and Potential Financial or Other Benefits: 

Based on GAO's ongoing work, and given the experiences over the past 
decade and the inclusion of FEMA in DHS in 2003, GAO expects to 
reiterate its August 2001 recommendations and further recommend that 
the Secretary of Homeland Security direct the FEMA Administrator to 
implement them. GAO recommended that the FEMA Administrator: 

* re-examine the basis for the Public Assistance per capita indicator 
and determine whether it accurately reflects a state's capacity to 
respond to and recover from a disaster without federal assistance. 

* re-examine the method used to update the per capita indicator to 
ensure that the indicator accurately reflects annual changes in a 
state's capacity to respond to and recover from a disaster. 

We also expect to recommend that once FEMA has established the metrics 
required by both statute and Presidential Policy Directive to assess a 
state's disaster preparedness and capabilities, FEMA should: 

* examine their usefulness in supplementing or replacing the per 
capita damage indicator on which FEMA now principally relies. 

The data FEMA provided to GAO cannot be used to calculate the 
financial savings that may have been realized for prior disaster 
declarations had FEMA and the President used alternate indicators. For 
example, according to FEMA officials, they frequently stopped 
estimating damages for Public Assistance once the estimate equaled or 
exceeded the per capita indicator. Consequently, GAO cannot determine 
whether the estimated damages would have met or exceeded a higher, 
alternative per capita indicator. However, updating the current 
indicator to more accurately reflect the basis of and changes in a 
state's capacity has the potential to reduce costs to the federal 
government in the future. 

Agency Comments and GAO's Evaluation: 

GAO provided a draft of this report section to DHS for review and 
comment. DHS generally agreed with the content as presented. DHS also 
provided technical comments, which were incorporated as appropriate. 

How GAO Conducted Its Work: 

The information contained in this analysis is based on findings from 
products listed in the related GAO products section and additional 
work GAO conducted to be published as a separate product in 2012. GAO 
analyzed Disaster Relief Fund obligations and the criteria that FEMA 
uses to recommend to the President whether requests for disaster 
declarations should be approved. GAO also reviewed FEMA documents, 
policies, and briefings, as well as GAO's prior findings and 
recommendations associated with this effort. Further, GAO collected 
and analyzed financial and nonfinancial data for disaster declarations 
requested and approved from fiscal years 2004 through 2011 to identify 
trends and opportunities for cost savings. GAO focused on Public 
Assistance funding because it represents the largest proportion of 
funds obligated from the Disaster Relief Fund for fiscal years 2004 
through 2011. 

Related GAO Products: 

Disaster Recovery: FEMA's Public Assistance Grant Program Experienced 
Challenges with Gulf Coast Rebuilding. [Hyperlink, 
http://www.gao.gov/products/GAO-09-129] Washington, D.C.: December 18, 
2008. 

Disaster Cost Estimates: FEMA Can Improve Its Learning from Past 
Experience and Management of Disaster-Related Resources. [Hyperlink, 
http://www.gao.gov/products/GAO-08-301] Washington, D.C.: February 22, 
2008. 

Disaster Assistance: Improvement Needed in Disaster Declaration 
Criteria and Eligibility Assurance Procedures. [Hyperlink, 
http://www.gao.gov/products/GAO-01-837] Washington, D.C.: August 31, 
2001. 

Contact Information: 

For additional information about this area, contact William O. Jenkins 
Jr. at (202) 512-8757 or jenkinswo@gao.gov. 

[End of section] 

Appendix I: List of Congressional Addressees: 

The Honorable Daniel K. Inouye:
Chairman:
The Honorable Thad Cochran:
Vice Chairman:
Committee on Appropriations:
United States Senate: 

The Honorable Kent Conrad:
Chairman:
The Honorable Jeff Sessions:
Ranking Member:
Committee on the Budget:
United States Senate: 

The Honorable Joseph I. Lieberman:
Chairman:
The Honorable Susan M. Collins:
Ranking Member:
Committee on Homeland Security and Governmental Affairs:
United States Senate: 

The Honorable Harold Rogers:
Chairman:
The Honorable Norman D. Dicks:
Ranking Member:
Committee on Appropriations:
House of Representatives: 

The Honorable Paul Ryan:
Chairman:
The Honorable Chris Van Hollen:
Ranking Member:
Committee on the Budget:
House of Representatives: 

The Honorable Darrell Issa:
Chairman:
The Honorable Elijah E. Cummings:
Ranking Member:
Committee on Oversight and Government Reform:
House of Representatives: 

The Honorable Scott Brown:
United States Senate: 

The Honorable Tom Coburn:
United States Senate: 

The Honorable Claire McCaskill:
United States Senate: 

The Honorable Mark R. Warner:
United States Senate: 

[End of section] 

Appendix II: Objectives, Scope, and Methodology: 

Section 21 of Public Law 111-139, enacted in February 2010, requires 
GAO to conduct routine investigations to identify federal programs, 
agencies, offices, and initiatives with duplicative goals and 
activities within departments and governmentwide. This provision also 
requires GAO to report annually to Congress on its findings, including 
the cost of such duplication, and recommendations for consolidation 
and elimination to reduce duplication and specific rescissions 
(legislation canceling previously enacted budget authority) that 
Congress may wish to consider.[Footnote 286] As agreed with the key 
congressional committees, our objectives in this report are to (1) 
identify what potentially significant areas of duplication, overlap, 
and fragmentation as well as opportunities for cost savings and 
enhanced revenues exist across the federal government; and (2) 
identify what options, if any, exist to minimize duplication, overlap, 
and fragmentation in these areas and take advantage of opportunities 
for cost savings and enhanced revenues. 

For the purposes of our analysis, we considered "duplication" to occur 
when two or more agencies or programs are engaged in the same 
activities or provide the same services to the same beneficiaries. We 
used the term "overlap" when multiple agencies or programs have 
similar goals, engage in similar activities or strategies to achieve 
them, or target similar beneficiaries. We used the term 
"fragmentation" to refer to those circumstances in which more than one 
federal agency (or more than one organization within an agency) is 
involved in the same broad area of national need and there may be 
opportunities to improve how the government delivers these services. 
[Footnote 287] This report presents 32 areas of duplication, overlap, 
or fragmentation where greater efficiencies or effectiveness in 
providing government services may be achievable. In light of the long-
term fiscal imbalances that the federal government faces, and 
consistent with our approach for the first annual report, we also 
highlighted other opportunities for potential cost saving or revenue 
enhancements. 

GAO's Approach: 

To identify potentially significant areas of duplication, overlap, and 
fragmentation as well as opportunities for cost savings and enhanced 
revenues, for this and future reports we used a multiphased approach. 

* Examination of budget functions and subfunctions of the federal 
government: We examined the OMB's MAX Information System[Footnote 288] 
fiscal year 2010 data to identify and analyze which federal agencies 
obligated funds for budget functions and subfunctions. Budget 
functions provide a system of classifying budget resources so that 
budget authority, outlays, receipts, and tax expenditures can be 
related to the national needs being addressed. Each budget account is 
generally placed in the single budget function (for example, national 
defense or health) that best reflects its major purpose, an important 
national need. A budget function may be divided into two or more 
subfunctions, depending on the complexity of the national need 
addressed. Because federal budget functions classify budget resources 
by important national need, identifying instances when multiple 
federal agencies obligate funds within a budget function or 
subfunction may indicate potential duplication or cost savings 
opportunities. 

* Examination of key agency documents: When multiple federal agencies 
have similar missions, goals or programs, the potential for 
unnecessary duplication, overlap or fragmentation exists. As a result, 
we examined key agency documents such as strategic plans, performance 
and accountability reports, and budget justifications to determine and 
analyze their missions, goals, or programs. 

* Review of key external published sources: We reviewed key external 
published sources of information. For example, we reviewed reports 
published by the Congressional Budget Office, Inspectors General, the 
Congressional Research Service, as well as the President's Budget to 
identify potential overlap and duplication among agency missions, 
goals, and programs. 

Because it is impractical to examine all instances of potential 
duplication or opportunities for cost savings across the federal 
government, we considered a variety of factors to determine whether 
such potential instances or opportunities were significant enough to 
require additional examination. Such factors included, but were not 
limited to, the extent of potential cost savings, opportunities for 
enhanced program efficiency or effectiveness, the degree to which 
multiple programs may be duplicative, overlapping or fragmented, 
whether issues had been identified by GAO or external sources, and the 
level of coordination among agency programs. On the basis of this 
multiphased approach we identified areas of potential duplication, 
overlap and fragmentation and opportunities for costs savings or 
revenue enhancement. GAO programmed work to examine these areas for 
reporting in this or future annual reports. 

Each issue area contained in Sections I and II of this report lists 
any respective GAO reports and publications upon which it is based. 
Those prior reports contain more detailed information on our 
supporting work and methodologies. For issues based on GAO work that 
has not yet been published or those that update prior GAO work, we 
provide additional information on the methodologies used in that 
ongoing work or update in the section entitled "How GAO Conducted Its 
Work" of each issue area. 

Identifying Options: 

To identify what options, if any, exist to minimize duplication, 
overlap, and fragmentation and take advantage of opportunities for 
cost savings and enhanced revenues, we reviewed and updated prior GAO 
work and recommendations to identify what additional actions agencies 
may need to take and Congress may wish to consider. For example, we 
used a variety of previously issued work identifying leading practices 
that could help agencies address challenges associated with 
interagency coordination,[Footnote 289] achieving efficiencies, 
[Footnote 290] and managing user fees.[Footnote 291] 

To identify the potential financial and other benefits that might 
result from actions addressing duplication, overlap, or fragmentation, 
we collected and analyzed data on costs and potential savings to the 
extent it was available. Estimating the benefits that could result 
from eliminating unnecessary duplication, overlap, or fragmentation 
was not possible in some cases because information about the extent of 
unnecessary duplication among certain programs was not available. 
Further, the financial benefits that can be achieved from eliminating 
duplication, overlap, or fragmentation were not always quantifiable in 
advance of congressional and executive branch decision making, and 
needed information was not readily available on, among other things, 
program performance, the level of funding devoted to overlapping 
programs, or the implementation costs and time frames that might be 
associated with program consolidations or terminations. 

We also included tables in appendix III that provide a detailed 
listing of federally-funded program names and associated budgetary 
information. While there is no standard definition for what 
constitutes a program, they may include grants, tax expenditures, 
centers, loans, funds, and other types of assistance. A wide variety 
of budgetary information may be used to convey the federal commitment 
to these programs. When available, we collected obligations 
information for fiscal year 2010 for consistent reporting across issue 
areas. In some instances, obligations data were not available, but we 
were able to report other budgetary information, such as 
appropriations. In other issue areas, we did not report any budgetary 
information, because such information was either not available or 
sufficiently reliable. For example, some agencies could not isolate 
budgetary information for some programs, because the data were 
aggregated at higher levels. 

We assessed the reliability of any computer-processed data that 
materially affected our findings, including cost savings and revenue 
enhancement estimates. The steps that GAO takes to assess the 
reliability of data vary but are chosen to accomplish the auditing 
requirement that the data be sufficiently reliable given the purposes 
it is used for in our products. GAO analysts review published 
documentation about the data system and Inspector General or other 
reviews of the data. GAO may interview agency or outside officials to 
better understand system controls and to assure ourselves that we 
understand how the data are produced and any limitations associated 
with the data. GAO may also electronically test the data to see if 
values in the data conform to agency testimony and documentation 
regarding valid values, or compare data to source documents. In 
addition to these steps, GAO often compares data with other sources as 
a way to corroborate our findings. Per GAO policy, when data do not 
materially affect findings and are presented for background purposes 
only, we may not have assessed the reliability depending upon the 
context in which the data are presented. 

This report is based substantially on previously issued GAO products 
and ongoing audits, which were conducted in accordance with generally 
accepted government auditing standards, or with our Quality Assurance 
Framework, as appropriate. Those standards require that we plan and 
perform the audit to obtain sufficient, appropriate evidence to 
provide a reasonable basis for our findings and conclusions based on 
our audit objectives. We believe that the evidence obtained provides a 
reasonable basis for our findings and conclusions based on our audit 
objectives. For issues where information is being reported on for the 
first time in this report, GAO sought comments from the agencies 
involved and incorporated their comments, as appropriate. 

[End of section] 

Appendix III: Lists of Programs Identified: 

This appendix includes lists of federal programs or other activities 
related to issue areas in this report, and their fiscal year 2010 
obligations data, where such information was available. In some cases, 
we did not report budgetary information because it was either not 
available or sufficiently reliable. For some issue areas, agencies 
were not able to readily provide programmatic information needed to 
determine whether and to what extent programs are actually 
duplicative. Additionally, 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. 

Table1: Electronic Warfare: List of Programs and Related Budgetary 
Information: 

Agency: Department of Defense: Airborne Electronic Attack Systems for 
Irregular Warfare. 

Air Force; 
Program: MQ-9 Reaper Electronic Attack Pod; 
FY 2010 obligations: $0. 

Army; 
Program: Communications Electronic Attack with Surveillance and 
Reconnaissance; 
FY 2010 obligations: $13,752,000. 

Marine Corps; 
Program: Collaborative Online Reconnaissance Provider Operationally 
Responsive Attack Link; 
FY 2010 obligations: $8,359,000. 

Marine Corps; 
Program: Intrepid Tiger II; 
FY 2010 obligations: $4,457,000. 

Total: 
FY 2010 obligations: $26,568,000. 

Agency: Department of Defense: Airborne Electronic Attack Systems for 
Near-Peer Conflicts. 

Air Force; 
Program: Miniature Air Launched Decoy - Jammer Increment II; 
FY 2010 obligations: $8,423,044. 

Navy; 
Program: Airborne Electronic Attack Expendable; 
FY 2010 obligations: $3,941,000. 

Total: 
FY 2010 obligations: $12,264,044. 

Source: GAO analysis of Department of Defense data. 

[End of table] 

Table 2: Unmanned Aircraft Systems: List of DOD Systems and Subsystems 
and Related Budgetary Information: 

Unmanned Aircraft Systems: 

Aircraft[D]: 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MA-9A Reaper; 
FY 2010 obligations[C]: $1,928,888. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: RQ-4A/B Global 
Hawk; 
FY 2010 obligations[C]: $1,543,111. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MQ-4C 
BAMS/BAMS-D (Broad Area Maritime Surveillance); 
FY 2010 obligations[C]: $438,199. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: A160 
Hummingbird; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MQ-1C Gray 
Eagle/Warrior A; 
FY 2010 obligations[C]: $951,531. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MQ-5B Hunter; 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MQ-1A/B 
Predator; 
FY 2010 obligations[C]: $696,704. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MQ-8B Fire 
Scout Vertical Take-off and Landing Tactical Unmanned Air Vehicle 
(VTUAV); 
FY 2010 obligations[C]: $242,912. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MQ-X; 
FY 2010 obligations[C]: [E]. 

Agency: USMC; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Cargo Unmanned 
Aircraft System (UAS); 
FY 2010 obligations[C]: $53,000. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Vertical Take-
off and Landing Unmanned Aircraft System (VTOL UAS); 
FY 2010 obligations[C]: $0. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Medium Range 
Maritime Unmanned Aircraft System (MRMUAS); 
FY 2010 obligations[C]: $0. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Unmanned 
Carrier Launched Airborne Surveillance and Strike (UCLASS); 
FY 2010 obligations[C]: $0. 

Payloads - Signals Intelligence: 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Enhanced 
Integrated Sensor Suite, Advanced Signals Intelligence Program 
(EISS/ASIP) (Blk 30M); 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Advanced 
Signals Intelligence Program (ASIP) 2-C; 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Blue Moon; 
FY 2010 obligations[C]: [E]. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MCS-21; 
FY 2010 obligations[C]: [E]. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: LR-100; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: ARGUS; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: TSP; 
FY 2010 obligations[C]: $19,393. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: ACES HY; 
FY 2010 obligations[C]: [E]. 

Payloads - EO/IR: 

Agency: Air Force/Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Integrated 
Sensor Suite (ISS) (Blk 10); 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Integrated 
Sensor Suite (ISS) (Blk 20); 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Enhanced 
Integrated Sensor Suite (EISS) (Blk 30); 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Enhanced 
Integrated Sensor Suite, Advanced Signals Intelligence Program 
(EISS/ASIP) (Blk 30M); 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Gorgon Stare; 
FY 2010 obligations[C]: $45,984. 

Agency: Navy/Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MTS-B (AN/DAS-
1); 
FY 2010 obligations[C]: [E]. 

Agency: Army/Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MTS-B (AN/DAS-
2); 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: ARGUS; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MX-15HDi; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: CSP Upgrade; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MOSP 3000; 
FY 2010 obligations[C]: [E]. 

Agency: Army/Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: CSP (AN/AAS-
53); 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MTS-A; 
FY 2010 obligations[C]: [E]. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Bright Star II; 
FY 2010 obligations[C]: [E]. 

Payloads - Radar: 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Multi-Platform 
Radar Technology Insertion Program (MP-RTIP); 
FY 2010 obligations[C]: $71,901. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: DDR; 
FY 2010 obligations[C]: [E]. 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Enhanced 
Integrated Sensor Suite, Advanced Signals Intelligence Program 
(EISS/ASIP) (Blk 30M); 
FY 2010 obligations[C]: [E]. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MFAS; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: STARLite ER; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: LYNX I; 
FY 2010 obligations[C]: [E]. 

Agency: Army/Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: LYNX II; 
FY 2010 obligations[C]: [E]. 

Ground Control Stations: 

Agency: Air Force; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MD-1A/B/C/D; 
FY 2010 obligations[C]: [E]. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: MQ-4C Broad 
Area Maritime Surveillance (BAMS) FOB/MOB; 
FY 2010 obligations[C]: [E]. 

Agency: Air Force/Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: RD-2A/B; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: 
Hummingbird/Argus GCS; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Legacy GCS; 
FY 2010 obligations[C]: [E]. 

Agency: Army; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: UGCS; 
FY 2010 obligations[C]: [E]. 

Agency: Navy; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Fire Scout GCS; 
FY 2010 obligations[C]: [E]. 

Agency: Army/USMC; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Shadow GCS; 
FY 2010 obligations[C]: [E]. 

Agency: Navy/USMC; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: Small Tactical 
Unmanned Aircraft Systems (STUAS GCS); 
FY 2010 obligations[C]: [E]. 

Agency: Army/USMC; 
Systems and Subsystems[A,B]: Unmanned Aircraft Systems: OSGCS BLK 
I/II/III; 
FY 2010 obligations[C]: [E]. 

Source: GAO analysis of Department of Defense data. 

[A] List includes Quick Reaction Capability programs used to satisfy 
near-term urgent warfighting needs. 

[B] EISS/ASIP (BLK 30M) and ARGUS payloads perform more than one 
function. 

[C] Dollars are then year in thousands. 

[D] Aircraft listed include five future programs. 

[E] The Department of Defense Programs Funding documentation did not 
include a budget line for this program. 

[End of table] 

Table 3: Support for Entrepreneurs: List of Programs and Related 
Budgetary Information: 

Support for Entrepreneurs: 

Agency: Department of Commerce: Economic Development Administration; 

Program: Grants for Public Works and Economic Development Facilities; 
FY 2010 obligations: $158,930,000. 

Program: Economic Development/Support for Planning Organizations; 
FY 2010 obligations: : 31,391,000. 

Program: Economic Development/Technical Assistance; 
FY 2010 obligations: : 9,800,000. 

Program: Economic Adjustment Assistance; 
FY 2010 obligations: : 45,270,000. 

Program: Trade Adjustment Assistance; 
FY 2010 obligations: : 18,987,000. 

Program: Global Climate Change Mitigation Incentive Fund; 
FY 2010 obligations: : 25,000,000. 

Agency: Department of Commerce: Minority Business Development Agency; 

Program: Minority Business Centers (merged the former Minority 
Business Enterprise Centers and Minority Business Opportunity Center 
programs); 
FY 2010 obligations: $10,113,693. 

Program: Native American Business Enterprise Centers; 
FY 2010 obligations: $1,351,500. 

Agency: U.S. Department of Agriculture: 

Program: Empowerment Zones; 
FY 2010 obligations: $500,000. 

Program: Woody Biomass Utilization Grant Program; 
FY 2010 obligations: $5,000,000. 

Program: 1890 Land Grant Institutions Rural Entrepreneurial Outreach 
Program/Rural Business Entrepreneur Development Initiative/Business 
Information System Network; 
FY 2010 obligations: $0. 

Program: Small Business Innovation Research; 
FY 2010 obligations: $22,000,000. 

Program: Biomass Research and Development Initiative Competitive 
Grants Program; 
FY 2010 obligations: $0. 

Program: Value Added Producer Grants; 
FY 2010 obligations: $19,400,000. 

Program: Agriculture Innovation Center; 
FY 2010 obligations: $0. 

Program: Small Socially-Disadvantaged Producer Grants; 
FY 2010 obligations: $3,500,000. 

Program: Intermediary Re-lending; 
FY 2010 obligations: $8,500,000. 

Program: Business and Industry Loans; 
FY 2010 obligations: $52,900,000. 

Program: Rural Business Enterprise Grants; 
FY 2010 obligations: $38,700,000. 

Program: Rural Cooperative Development Grants; 
FY 2010 obligations: $8,300,000. 

Program: Rural Business Opportunity Grants; 
FY 2010 obligations: $2,500,000. 

Program: Rural Microentrepreneur Assistance Program; 
FY 2010 obligations: $9,000,000. 

Agency: Department of Housing and Urban Development: 

Program: Community Development Block Grant/Entitlement Grants; 
FY 2010 obligations: $2,760,223,970. 

Program: Community Development Block Grant/Special Purpose/Insular 
Areas; 
FY 2010 obligations: $6,930,000. 

Program: Community Development Block Grant/States; 
FY 2010 obligations: $1,176,594,747. 

Program: Community Development Block Grant/Non-entitlement Community 
Development Block Grant Grants in Hawaii; 
FY 2010 obligations: $5,791,797. 

Program: Community Development Block Grant/Brownfields Economic 
Development Initiative; 
FY 2010 obligations: $17,500,000. 

Program: Community Development Block Grant/Section 108 Loan Guarantees; 
FY 2010 obligations: $6,000,000. 

Program: Section 4 Capacity Building for Affordable Housing and 
Community Development; 
FY 2010 obligations: $50,000,000. 

Program: Rural Innovation Fund; 
FY 2010 obligations: $25,000,000. 

Program: Community Development Block Grant Disaster Recovery Grants; 
FY 2010 obligations: $100,000,000. 

Program: Indian Community Development Block Grant; 
FY 2010 obligations: $65,000,000. 

Program: Hispanic Serving Institutions Assisting Communities; 
FY 2010 obligations: $6,250,000. 

Program: Alaska Native/Native Hawaiian Institutions Assisting 
Communities; 
FY 2010 obligations: $3,265,000. 

Agency: Small Business Administration: 

Program: 8(a) Business Development Program; 
FY 2010 obligations: $56,817,000. 

Program: 7(j) Technical Assistance; 
FY 2010 obligations: $3,275,000. 

Program: Procurement Assistance to Small Businesses; 
FY 2010 obligations: $3,164,000. 

Program: Small Business Investment Companies; 
FY 2010 obligations: $24,262,000. 

Program: 7(a) Loan Program; 
FY 2010 obligations: $518,869,000. 

Program: Surety Bond Guarantee Program; 
FY 2010 obligations: $0. 

Program: Service Corps of Retired Executives; 
FY 2010 obligations: $7,000,000. 

Program: Small Business Development Centers; 
FY 2010 obligations: $112,624,000. 

Program: 504 Loan Program; 
FY 2010 obligations: $70,645,000. 

Program: Women's Business Centers; 
FY 2010 obligations: $13,997,000. 

Program: Veterans' Business Outreach Centers; 
FY 2010 obligations: $2,500,000. 

Program: Microloan Program; 
FY 2010 obligations: $42,901,000. 

Program: Program for Investment in Micro-Entrepreneurs; 
FY 2010 obligations: $8,000,000. 

Program: New Markets Venture Capital Program; 
FY 2010 obligations: $0. 

Program: 7(a) Export Loan Guarantees; 
FY 2010 obligations: $0. 

Program: Historically Underutilized Business Zones; 
FY 2010 obligations: $2,189,000. 

Program: Small Business Technology Transfer Program; 
FY 2010 obligations: $0. 

Program: Small Business Innovation Research Program; 
FY 2010 obligations: $0. 

Program: Federal and State Technology Partnership Program; 
FY 2010 obligations: $2,000,000. 

Total: 
FY 2010 obligations: $5,561,941,707. 

Source: GAO analysis of Department of Commerce, U.S. Department of 
Agriculture, Department of Housing and Urban Development, and Small 
Business Administration data. 

[End of table] 

Table 4: Surface Freight Transportation: List of Programs: 

Surface Freight Transportation: 

Agency: Department of Transportation; 
Programs: 
National Highway System;
Interstate Maintenance;
Surface Transportation Program;
Highway Bridge Program;
Congestion Mitigation & Air Quality;
Appalachian Development Highway System;
Metropolitan Planning;
Highway Safety Improvement Program;
Railway-Highway Crossings;
Coordinated Border Infrastructure Program;
Equity Bonus;
Denali Access System Program;
Freight Intermodal Distribution Pilot Grant Program;
Great Lakes Intelligent Transportation System Implementation;
Multimodal Facility Improvements;
National Work Zone Clearinghouse;
Operation Lifesaver;
Pavement Marking Systems;
Road Safety (Data and Public Awareness);
Road User Fee Study;
Set-aside for Minneapolis/St; Paul-Chicago segment (from Crossing 
Hazard Elimination);
Set-aside for Alaska, New Jersey, and Washington for projects on the 
NHS (from Ferry Boats);
Interstate Maintenance Discretionary Program;
Territorial Highway Program;
Alaska Highway;
Indian Reservation Roads;
Public Lands Highways;
Park Roads and Parkways;
Lake Tahoe;
Bureau of Transportation Statistics;
Highway Use Tax Evasion Program;
Rail Highway Crossing Hazard Elimination in High Speed Rail Corridors 
(after set-aside);
Construction of Ferry Boat and Ferry Terminal Facilities (after set-
asides);
Puerto Rico Highway Program;
Indian Reservation Road Bridges;
Transportation Infrastructure Finance and Innovation Act;
Value Pricing Pilot Program;
Highways for Life;
Truck Parking Facilities;
Delta Region Transportation Development Program;
Work Zone Safety Grants;
Undesignated High Priority Projects;
Surface Transportation Research, Development, and Deployment Program;
Future Strategic Highway Research Program;
Training and Education;
University Transportation Research;
Intelligent Transportation System Research;
Emergency Relief Program. 

Agency: Department of Transportation; Federal Motor Carrier Safety 
Administration; 
Programs: 
Border Enforcement Grant.
Commercial Vehicle Information Systems and Networks Deployment Grant. 

Agency: Department of Transportation; Federal Railroad Administration; 
Programs: 
Railroad Rehabilitation & Improvement Financing.
Rail Line Relocation and Improvement Program. 

Agency: Department of Transportation; Maritime Administration; 
Programs: 
Federal Ship Financing Program.
Small Shipyard Grants. 

Agency: Department of Transportation; Office of the Secretary; 
Program: 
Transportation Investment Generating Economic Recovery (TIGER) Program. 

Source: GAO analysis of Department of Transportation data. 

Note: This table includes grant programs and other forms of financial 
assistance for freight transportation infrastructure. Budgetary data 
are not included with these programs because the majority of these 
programs benefit both freight and passenger transportation. According 
to Department of Transportation officials, it is not possible to 
isolate program costs associated with just freight transportation. 

[End of table] 

Table 5: Department of Justice Grants: List of Agencies and Related 
Budgetary Information: 

Agency: Office of Justice Programs[A]; 
FY 2010 obligations for grants: $2,608,000,000. 

Agency: Community Oriented Policing Services Office; 
FY 2010 obligations for grants: $547,000,000. 

Agency: Office on Violence Against Women; 
FY 2010 obligations for grants: $844,000,000. 

Source: GAO analysis of Department of Justice data. 

[A] Office of Justice Programs is comprised of a number of smaller 
bureaus and offices, including the Bureau of Justice Assistance, the 
Bureau of Justice Statistics, the Community Capacity Development 
Office, the National Institute of Justice, the Office of Juvenile 
Justice and Delinquency Prevention, the Office of Victims of Crime, 
and the Sex Offender Sentencing, Monitoring, Apprehending, 
Registering, and Tracking Office. 

[End of table] 

Table 6: Homeland Security Grants: List of Major Programs and Related 
Budgetary Information: 

Department of Homeland Security: 

Agency: Federal Emergency Management Agency; 

Program: State Homeland Security Program; 
FY 2010 obligations: $852,000,000. 

Program: Urban Areas Security Initiative; 
FY 2010 obligations: $851,520,000. 

Program: Port Security Grant Program; 
FY 2010 obligations: $288,000,000. 

Program: Transit Security Grant Program[A]; 
FY 2010 obligations: $268,000,000. 

Total; 
FY 2010 obligations: $2,259,520,000. 

Source: GAO analysis of Department of Homeland Security data. 

[A] These obligations include grants to transit systems, Amtrak, and 
freight rail. 

[End of table] 

Table 7: Information Technology Investment Management: List of 
Investments and Related Budgetary Information: 

Information Technology Investment Management: 

Agency: Department of Defense: 

Investment: Executive Performance and Appraisal Tool; 
Similar purpose: Civilian Personnel Management; 
Total IT spending for fiscal years 2007-2012: $591,000. 

Investment: Defense Civilian Personnel Data System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $503,280,000. 

Air Force: 

Investment: Contract Writing System; 
Similar purpose: Contract Management; 
Total IT spending for fiscal years 2007-2012: $4,663,000. 

Investment: Automated Contract Preparation System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $22,604,000. 

Investment: Contracting Information Database System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $9,952,000. 

Investment: Acquisition and Due In System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $2,290,000. 

Investment: Contract Profit Reporting Systems; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $1,183,000. 

Army: 

Investment: Enlisted Distribution and Assignment System; 
Similar purpose: Personnel Assignment Management; 
Total IT spending for fiscal years 2007-2012: $11,545,000. 

Investment: Assignment Satisfaction Key; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $6,000. 

Navy: 

Investment: Naval Sea Systems Command Acquisition Capabilities; 
Similar purpose: Acquisition Management; 
Total IT spending for fiscal years 2007-2012: $3,347,000. 

Investment: Space and Naval Warfare Systems Command Acquisition 
Capabilities; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $129,149,000. 

Investment: Naval Sea Systems Command Systems Acquisition Management 
Capabilities; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $3,486,000. 

Investment: Space and Naval Warfare Systems Command Systems 
Acquisition Management Capabilities; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $271,084,000. 

Navy: 

Investment: Decision Knowledge Programming for Logistics Analysis and 
Technical Evaluation; 
Similar purpose: Aviation Maintenance and Logistics; 
Total IT spending for fiscal years 2007-2012: $50,195,000. 

Investment: Airborne Weapons Info System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $34,308,000. 

Navy: 

Investment: Integrated Technical Item Management Program; 
Similar purpose: Contract Management; 
Total IT spending for fiscal years 2007-2012: $10,267,000. 

Investment: Space and Naval Warfare Systems Command Contract 
Information Management System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $858,000. 

Investment: Space and Naval Warfare Systems Command Systems Center 
Atlantic Contract Information Management System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $22,000. 

Investment: Contract Data Requirements List; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $539,000. 

Investment: Acquisition Management Automation System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $4,889,000. 

Navy: 

Investment: APPLY/SLATER; 
Similar purpose: Housing Management; 
Total IT spending for fiscal years 2007-2012: $671,000. 

Investment: Commander, Navy Installations Command Manpower/Billets; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $4,154,000. 

Navy: 

Investment: Career Management System Interactive Detailing; 
Similar purpose: Personnel Assignment Management; 
Total IT spending for fiscal years 2007-2012: $14,180,000. 

Investment: Officer Assignment Information System II; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $1,014,000. 

Investment: Enlisted Assignment information System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $1,408,000. 

Investment: Reserve Order Writing System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $11,527,000. 

Navy: 

Investment: Fleet Rating Identification System; 
Similar purpose: Promotion Rating; 
Total IT spending for fiscal years 2007-2012: $2,749,000. 

Investment: Departmental Systems; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $610,000. 

Navy: 

Investment: Total Force Administration System; 
Similar purpose: Workforce Management; 
Total IT spending for fiscal years 2007-2012: $89,601,000. 

Investment: Manpower Models; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $13,819,000. 

Investment: Total Workforce Management System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $5,704,000. 

Agency: Department of Energy: 

Energy Programs: 

Investment: Office of Science Headquarters Back-end Infrastructure; 
Similar purpose: Back-end Infrastructure; 
Total IT spending for fiscal years 2007-2012: $250,000. 

Investment: Office of Science Oak Ridge Back-end Infrastructure; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $648,000. 

Investment: Office of Science Chicago Back-end Infrastructure; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $93,000. 

Environmental and Other Defense Activities: 

Investment: Environmental Management Carlsbad Field Office Electronic 
Records and Document Mgmt System; 
Similar purpose: Electronic Records and Document Management; 
Total IT spending for fiscal years 2007-2012: $4,337,000. 

Investment: Health and Safety Electronic Document Review System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $1,418,000. 

Investment: Office of Legacy Management Record Management System; 
Similar purpose: [Empty]; 
Total IT spending for fiscal years 2007-2012: $1,003,000. 

Total: $1,217,444,000[A]. 

Source: GAO analysis of Department of Defense and Department of Energy 
data. 

[A] The $2 million difference between the $1.219 billion total 
presented in the report, and the $1.217 billion total presented in 
this appendix table, is due to rounding. 

[End of table] 

Table 8: Diesel Emissions: List of Programs and Related Budgetary 
Information: 

Agency: Department of Energy; 

Program: Clean Cities Program[A]; 
FY 2010 obligations: $301,635,084. 

Program: Energy Efficiency and Conservation Block Grant Program[A]; 
FY 2010 obligations: $121,030,300. 

Program: State Energy Program; 
FY 2010 obligations: $0. 

Agency: Department of Transportation: 

Federal Aviation Administration: 

Program: Voluntary Airport Low Emissions Program; 
FY 2010 obligations: $5,971,868. 

Federal Highway Administration: 

Program: Congestion Mitigation and Air Quality Improvement Program; 
FY 2010 obligations: $22,046,617. 

Program: Ferry Boat Discretionary Program[A]; 
FY 2010 obligations: $4,285,422. 

Program: State Infrastructure Banks Program; 
FY 2010 obligations: $0. 

Federal Transit Administration; 
Program: Bus and Bus Facilities Program; 
FY 2010 obligations: [B]. 

Program: Clean Fuels Grants Program; 
FY 2010 obligations: $2,732,667. 

Program: National Fuel Cell Bus Technology Development Program; 
FY 2010 obligations: $45,000. 

Program: Transit in Parks Program; 
FY 2010 obligations: $0. 

Program: Transit Investments for Greenhouse Gas and Energy Reduction 
Program[A]; 
FY 2010 obligations: $40,010,000. 

Program: Urbanized Area Formula Grant Program[A]; 
FY 2010 obligations: [B]. 

Environmental Protection Agency: 

Program: Diesel Emissions Reduction Act Program[A]; 
FY 2010 obligations: $238,511,081. 

Total: $736,268,039. 

Source: GAO analysis of Department of Energy, Department of 
Transportation, and Environmental Protection Agency documents. 

Notes: Three tax expenditures--biodiesel producer tax credits, a 
diesel fuel emulsion excise tax credit, and an excise tax exemption 
for idling reduction devices--also provide incentives for owners and 
operators of diesel engines and vehicles to reduce emissions. 

GAO identified these 14 programs as providing funding for activities 
that reduce mobile source diesel emissions. While one program--the 
Environmental Protection Agency's Diesel Emissions Reduction Act 
Program--has a specific purpose of reducing mobile source diesel 
emissions, the remaining 13 programs focus on other goals or purposes, 
and may not fund mobile source diesel emissions reduction activities 
in a particular year. 

[A] The American Recovery and Reinvestment Act of 2009 provided a 
portion of these funds. 

[B] The Department of Transportation was unable to determine the 
amount of funding this program awarded for projects that reduced 
mobile source diesel emissions. 

[End of table] 

Table 9: Green Building: List of Initiatives: 

Green Building: 

Agency: U.S. Department of Agriculture.
Initiatives: 
High Energy Cost Grant Program;
Rural Energy for America;
Rural Housing Service Section 502 Direct and Guaranteed Loan 
Assistance and Section 504 Loan and Grant Assistance for the Rural 
Economic Development Energy Efficiency initiative;
Rural Housing Service Section 502 Direct and Guaranteed Loan 
Assistance for the Rural Energy Plus Program;
Rural Housing Service Section 514 and Section 516 Assistance for Farm 
Labor Housing;
Rural Housing Service Section 515 Assistance for Low-income, Elderly, 
and Handicapped Housing;
Rural Utilities Service Electric Loan Programs;
Section 538 Guaranteed Rural Rental Housing Program. 

Agency: Department of Defense.
Initiatives: 
Environmental Security Technology Certification Program. 

Agency: Department of Education.
Initiatives: 
Impact Aid Construction Program;
State Fiscal Stabilization Fund. 

Agency: Department of Energy.
Initiatives: 
Building Technologies Program/Commercial Building 
Integration/Commercial Building Initiative;
Building Technologies Program/Emerging Technologies;
Building Technologies Program/Home Energy Score Pilot Program;
Building Technologies Program/Residential Buildings Integration;
Building Technologies Program/Residential Buildings Integration/Solar 
Decathlon;
Building Technologies Program/Technology Validation and Market 
Introduction/Building Energy Codes;
Energy Efficient Building Systems Regional Innovation Cluster 
Initiative;
Energy Transformation Acceleration Fund/Advanced Research Projects 
Agency/Building Energy Efficiency Through Innovative Thermodevices;
Small Business Innovation Research and Small Business Technology 
Transfer programs;
State Energy Efficient Appliance Rebate Program;
Superior Energy Performance Program;
Title 17 Loan Guarantee Program;
Weatherization and Intergovernmental Activities/Energy Efficiency and 
Conservation Block Grant;
Weatherization and Intergovernmental Activities/State Energy Program;
Weatherization and Intergovernmental Activities/Tribal Energy Program;
Weatherization and Intergovernmental Activities/Weatherization 
Assistance Program;
Weatherization Innovation Pilot Program. 

Agency: Department of Health and Human Services.
Initiatives: 
Low Income Home Energy Assistance Program. 

Agency: Department of Housing and Urban Development.
Initiatives: 
Capital Fund Recovery Act Competitive Grant Program;
Choice Neighborhoods;
Green Retrofit Program for Multifamily Housing;
Healthy Homes Program;
HOME Investment Partnerships Program;
Hope VI Revitalization Grant Program;
Indian Community Development Block Grant Program;
Indian Housing Block Grant Program;
Mark to Market Green Initiative;
Moving to Work Demonstration Program;
Multifamily Energy Innovation Fund;
PowerSaver Pilot Program;
Public Housing Environmental and Conservation Clearinghouse;
Public Housing Operating Fund, Energy Performance Contract Incentives;
Public Housing Operating Fund, Streamlining Energy Performance 
Contracting;
Section 203(b) Mortgage Insurance, Energy Efficient Mortgage;
Section 203(b) Mortgage Insurance, Weatherization;
Section 203(k) Mortgage Insurance, Section 203(k) Streamlined Mortgage 
Insurance;
Supportive Housing for Persons with Disabilities (Section 811);
Supportive Housing for the Elderly (Section 202);
Sustainable Communities Initiative, Capacity-building Program and 
Tools Clearinghouse;
Sustainable Communities Initiative, Housing-Transportation Integration 
Research;
Sustainable Communities Initiative, Sustainable Communities Regional 
Planning Grants;
Sustainable Communities Initiative, Sustainable Community Challenge 
Grants;
Title I Property Improvement Loan Insurance Program (Title I Program);
Transformation Initiative, Energy Efficiency and Green Building Across 
Affordable Housing Program;
Transformation Initiative, Green and Healthy Homes;
Transformation Initiative, Sustainable Building Practice;
Transformation Initiative, Sustainable Communities Grant Program. 

Agency: Department of Transportation.
Initiatives: 
Federal Transit Administration Bus and Bus Facilities Program;
Federal Transit Administration Environmental Management Systems 
Training and Technical Assistance;
Federal Transit Administration Transit Investments for Greenhouse Gas 
and Energy Reduction;
Federal Transit Administration Urbanized Area Formula Program;
Formula Grants for Other than Urbanized Areas; 

Agency: Department of the Treasury.
Initiatives: 
Accelerated Depreciation Deduction for Specified Energy Property;
Energy Efficient Commercial Buildings Deduction;
Energy Investment Tax Credit;
New Energy Efficient Home Credit;
Nonbusiness Energy Property Tax Credit;
Payments for Specified Energy Property in Lieu of Tax Credits;
Residential Energy Conservation Subsidy Exclusion;
Residential Energy Efficient Property Credit. 

Agency: Environmental Protection Agency.
Initiatives: 
Brownfields Program;
Design for the Environment Program;
Energy Star Program;
Environmentally Preferable Purchasing Program;
Environmentally Responsible Redevelopment and Reuse;
Green Communities Program;
Green Infrastructure Program;
Green Power Partnership;
Healthy Communities--Clean, Green, and Healthy Schools;
Heat Island Reduction Program;
Indoor Environments Program;
Industrial Materials Recycling Program;
Pesticide Environmental Stewardship Program;
Small Business Innovation Research Program;
Smart Growth Program;
Tribal Green Building Initiative;
WasteWise;
WaterSense. 

Agency: National Institute of Standards and Technology.
Initiatives: 
Advanced Building Energy Technologies Program;
Embedded Intelligence in Buildings Program;
Improved Building Energy Performance Program. 

Agency: Small Business Administration.
Initiatives: 
Certified Development Company 504 Loan Program;
Small Business Energy Audit and Energy Efficiency Program. 

Source: GAO analysis of agency information and questionnaire responses. 

Note: GAO requested funding information for all initiatives, but the 
information agencies provided was incomplete and unreliable for the 
purposes of describing the size of green building initiatives. Agency 
officials stated that many of the initiatives are part of broader 
programs and, as such, the agencies do not track green building funds 
separately from other program activities. 

[End of table] 

Table 21: Housing Assistance: List of Programs, Activities, and Tax 
Expenditures and Related Budgetary Information: 

Housing Assistance: 

Purpose: Assistance for buying, selling, or financing a home: 

Agency/entity: Department of Housing and Urban Development; 
Activity/program: Self-Help Homeownership Opportunity Program; 
Related budgetary information/FY 2010 obligations: $26,500,000; 
Explanatory notes: [Empty]. 

Activity/program: One-to Four-Family Home Mortgage Insurance (Section 
203(b)); 
Related budgetary information/FY 2010 obligations: -$2,546,000,000; 
Explanatory notes: For loan programs these obligations represent the 
expected credit subsidy costs for loan commitments made in fiscal year 
2010. These estimates are revised in subsequent years and the ultimate 
cost will not be known until the loans have matured, which in some 
cases may be 30 years. The obligations reported are for guarantees of 
single family loans insured under the Mutual Mortgage Insurance Fund. 
The loan program called One-to Four-Family Home Mortgage Insurance 
(Section 203(b)) is the single largest loan program in this Fund. 

Activity/program: Mortgage Insurance for Disaster Victims (Section 
203(h)); 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Rehabilitation Loan Insurance (Section 203(k)); 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Single Family Property Disposition Program (Section 
204(g)); 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: Costs/savings associated with property disposition 
are among the items factored into subsidy rates. See note for One-to 
Four-Family Home Mortgage Insurance (Section 203(b)). 

Activity/program: Self-Help Housing Property Disposition; 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: Costs/savings associated with property disposition 
are among the items factored into subsidy rates. See note for One-to 
Four-Family Home Mortgage Insurance (Section 203(b)). 

Activity/program: Loss Mitigation; 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Graduated Payment Mortgage (Section 245(a)); 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Adjustable Rate Mortgages (Section 251); 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Home Equity Conversion Mortgage Program (Section 
255); 
Related budgetary information/FY 2010 obligations: -$106,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010. These estimates 
are revised in subsequent years and the ultimate cost will not be 
known until the loans have matured. The Home Equity Conversion 
Mortgage Program is part of the Mutual Mortgage Insurance Fund but has 
separate subsidy costs which are reported here. 

Activity/program: Manufactured Homes Loan Insurance (Title I); 
Related budgetary information/FY 2010 obligations: -$1,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments under this program made in fiscal year 
2010. These estimates are revised in subsequent years and the ultimate 
cost will not be known until the loans have matured, which in some 
cases may be 30 years. This loan program is part of the General 
Insurance and Special Risk Insurance Fund, which houses a wide range 
of mortgage insurance products, including insurance for loans to 
develop, rehabilitate, and refinance multifamily rental housing, 
nursing home facilities, and hospitals. The General Insurance and 
Special Risk Insurance Fund programs also include loan guarantees for 
Title I Property Improvement loans. 

Activity/program: Property Improvement Loan Insurance (Title I); 
Related budgetary information/FY 2010 obligations: see note; 
Explanatory notes: Expected credit subsidy costs are less than 
$500,000. See note for Manufactured Homes Loan Insurance. 

Activity/program: Good Neighbor Next Door; 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: Costs/savings associated with property disposition 
are among the items factored into subsidy rates. See note for One-to 
Four-Family Home Mortgage Insurance (Section 203(b)). 

Activity/program: Energy Efficient Mortgage Insurance; 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Energy Efficient Mortgage Innovation Pilot; 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: Program created in fiscal year 2010; however no 
funds were obligated in that year. In fiscal year 2011 $13 million was 
obligated to the Energy Efficient Mortgage Innovation Pilot. 

Activity/program: Insured Mortgages on Hawaiian Home Lands (Section 
247); 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Insured Mortgages on Indian Land (Section 248); 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Mortgage Insurance for Condominium Units (Section 
234(c)); 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: Program is not active. Condominiums are now insured 
under Section 203(b) program. 

Activity/program: Mortgage Insurance for Older, Declining Areas 
(Section 223(e)); 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: No loans made in fiscal year 2010. 

Activity/program: Growing Equity Mortgage Insurance (Section 245(a)); 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: No loans made in fiscal year 2010. 

Activity/program: Mortgage Insurance for Cooperative Housing (Section 
213); 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to-Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Single Family Cooperative Housing Mortgage Insurance; 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: See note for One-to Four-Family Home Mortgage 
Insurance (Section 203(b)). 

Activity/program: Homeownership Voucher Assistance; 
Related budgetary information/FY 2010 obligations: Included in 
obligations for Housing Choice Voucher Program; 
Explanatory notes: [Empty]. 

Activity/program: Public Housing Homeownership (Section 32); 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: Program is no longer active. 

Activity/program: Loan Guarantees for Indian Housing (Section 184); 
Related budgetary information/FY 2010 obligations: $4,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010. These estimates 
are revised in subsequent years and the ultimate cost will not be 
known until the loans have matured. 

Activity/program: Loan Guarantees for Native Hawaiian Housing (Section 
184A); 
Related budgetary information/FY 2010 obligations: $1,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010. These estimates 
are revised in subsequent years and the ultimate cost will not be 
known until the loans have matured. 

Agency/entity: Department of Agriculture; 

Activity/program: Section 523 Self-Help Housing; 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: No loans were made in fiscal year 2010. 

Activity/program: Section 524 Site Development; 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: No loans were made in fiscal year 2010. 

Activity/program: Section 523 Mutual and Self-Help Housing Technical 
Assistance Grants; 
Related budgetary information/FY 2010 obligations: $43,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Section 502 Rural Housing Single Family Loans-Direct; 
Related budgetary information/FY 2010 obligations: $78,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010, including loans 
authorized under the American Recovery and Reinvestment Act of 2009. 
These estimates are revised in subsequent years and the ultimate cost 
will not be known until the loans have matured. 

Activity/program: Section 502 Rural Housing Single Family Loans-
Guaranteed; 
Related budgetary information/FY 2010 obligations: $204,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010, including loans 
authorized under the American Recovery and Reinvestment Act of 2009. 
These estimates are revised in subsequent years and the ultimate cost 
will not be known until the loans have matured. 

Activity/program: Section 509(f) Housing Application Packaging Grants; 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: No grants were made in fiscal year 2010. 

Activity/program: Section 502 Mutual Self-Help Housing Loan; 
Related budgetary information/FY 2010 obligations: Included in 
obligations for Section 502 Direct loan; 
Explanatory notes: [Empty]. 

Agency/entity: Department of Veterans Affairs; 

Activity/program: Veterans Administration Home Loan Guaranty; 
Related budgetary information/FY 2010 obligations: -$107,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010. These estimates 
are revised in subsequent years and the ultimate cost will not be 
known until the loans have matured. 

Activity/program: Veterans Housing Manufactured Home Loans; 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: No loans were made in fiscal year 2010. 

Activity/program: Native American Veterans Direct Loan Program; 
Related budgetary information/FY 2010 obligations: -$5,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010. These estimates 
are revised in subsequent years and the ultimate cost will not be 
known until the loans have matured. 

Agency/entity: Internal Revenue Service; 

Activity/program: Capital gains exclusion on home sales; 
FY 2010 estimated revenue losses[A]: $22,160,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Deduction for mortgage insurance premiums; 
FY 2010 estimated revenue losses[A]: $300,000,000; 
Explanatory notes: Revenue losses for fiscal year 2010 were estimated 
by the Joint Committee on Taxation in Estimates of Federal Tax 
Expenditures for Fiscal Years 2010-2014, JCS-3-10. This provision 
expired on December 31, 2011. 

Activity/program: District of Columbia first-time homebuyer tax credit; 
FY 2010 estimated revenue losses[A]: see note; 
Explanatory notes: Revenue losses for fiscal year 2010 were not 
estimated by the Department of the Treasury in Analytical 
Perspectives, Budget of the U.S. Government, Fiscal Year 2012, nor by 
the Joint Committee on Taxation in Estimates of Federal Tax 
Expenditures for Fiscal Years 2010-2014, JCS-3-10. This provision 
expired on December 31, 2011. 

Purpose: Supports housing and other activities: 

Agency/entity: Federal Home Loan Banks; 

Activity/program: Community Investment Program; 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: The Community Investment Program is not included in 
the federal budget. 

Agency/entity: Department of Housing and Urban Development; 

Activity/program: Community Development Block Grants (CDBG) 
Entitlement; 
Related budgetary information/FY 2010 obligations: $1,025,687,000; 
Explanatory notes: Obligations represent an estimate of the total used 
for activities related to housing. 

Activity/program: CDBG States and Small Cities; 
Related budgetary information/FY 2010 obligations: Included in 
obligations under CDBG Entitlement; 
Explanatory notes: [Empty]. 

Activity/program: CDBG Section 108 Loan Guarantee; 
Related budgetary information/FY 2010 obligations: see note; 
Explanatory notes: Obligations for CDBG Section 108 Loan Guarantee in 
fiscal year 2010 were $4 million; some amount of the obligations may 
be attributable to activities related to housing. Obligations 
represent the expected credit subsidy costs for loan commitments made 
in fiscal year 2010. These estimates are revised in subsequent years 
and the ultimate cost will not be known until the loans have matured. 

Activity/program: CDBG Disaster Recovery Assistance; 
Related budgetary information/FY 2010 obligations: see note; 
Explanatory notes: Obligations for CDBG Disaster Recovery Assistance 
in fiscal year 2010 were $4.304 billion; some amount of obligations 
may be attributable to activities related to housing. 

Activity/program: CDBG Section 107; 
Related budgetary information/FY 2010 obligations: see note; 
Explanatory notes: Obligations for CDBG Section 107 in fiscal year 
2010 were $2.1 million; some amount of obligations may be attributable 
to activities related to housing. 

Activity/program: CDBG Insular Areas; 
Related budgetary information/FY 2010 obligations: Included in 
obligations under CDBG Entitlement; 
Explanatory notes: [Empty]. 

Activity/program: HOME Investment Partnerships; 
Related budgetary information/FY 2010 obligations: $1,857,423,000; 
Explanatory notes: [Empty]. 

Activity/program: Housing Trust Fund; 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: Program authorized in 2008, however no funding has 
been appropriated. 

Activity/program: Capacity Building for Community Development and 
Affordable Housing; 
Related budgetary information/FY 2010 obligations: $34,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Housing Opportunities for Persons With AIDS; 
Related budgetary information/FY 2010 obligations: $314,220,000; 
Explanatory notes: [Empty]. 

Activity/program: Counseling for Homebuyers, Homeowners, and Tenants 
(Section 106); 
Related budgetary information/FY 2010 obligations: $65,168,000; 
Explanatory notes: [Empty]. 

Activity/program: Manufactured Home Construction and Safety Standards; 
Related budgetary information/FY 2010 obligations: $8,731,000; 
Explanatory notes: [Empty]. 

Activity/program: Dollar Home Sales; 
Related budgetary information/FY 2010 obligations: Included in 
obligations under Mutual Mortgage Insurance Fund; 
Explanatory notes: Costs/savings associated with property disposition 
are among the items factored into subsidy rates. See note for One-to 
Four-Family Home Mortgage Insurance (Section 203(b)). 

Activity/program: Choice Neighborhoods; 
Related budgetary information/FY 2010 obligations: Included in 
obligations for HOPE VI; 
Explanatory notes: [Empty]. 

Activity/program: Indian Community Development Block Grant; 
Related budgetary information/FY 2010 obligations: see note; 
Explanatory notes: Obligations for the Indian Community Development 
Block Grant in fiscal year 2010 were $65.332 million; some amount of 
obligations may be attributable to activities related to housing. 

Activity/program: Native American Housing Block Grants; 
Related budgetary information/FY 2010 obligations: $761,650,000; 
Explanatory notes: [Empty]. 

Activity/program: Federal Guarantees for Financing for Tribal Housing 
Activities (Title VI); 
Related budgetary information/FY 2010 obligations: see note; 
Explanatory notes: Expected credit subsidy costs are less than 
$500,000 for loan commitments made in fiscal year 2010. These 
estimates are revised in subsequent years and the ultimate cost will 
not be known until the loans have matured. 

Activity/program: Native Hawaiian Housing Block Grant Program; 
Related budgetary information/FY 2010 obligations: $13,333,000; 
Explanatory notes: [Empty]. 

Activity/program: Healthy Homes Initiative; 
Related budgetary information/FY 2010 obligations: $19,765,000; 
Explanatory notes: [Empty]. 

Activity/program: Sustainable Communities Initiative; 
Related budgetary information/FY 2010 obligations: $66,000; 
Explanatory notes: [Empty]. 

Activity/program: Lead Hazard Control Grants; 
Related budgetary information/FY 2010 obligations: $66,600,000; 
Explanatory notes: [Empty]. 

Activity/program: Lead Hazard Demonstration Project; 
Related budgetary information/FY 2010 obligations: $48,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Lead Hazard Reduction Technical Studies and Support; 
Related budgetary information/FY 2010 obligations: $4,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Housing Assistance Council; 
Related budgetary information/FY 2010 obligations: $5,000,000; 
Explanatory notes: [Empty]. 

Agency/entity: Neighborhood Reinvestment Corporation; 

Activity/program: Neighborhood Reinvestment Corporation, also known as 
"NeighborWorks America"; 
Related budgetary information/FY 2010 obligations: $233,000,000; 
Explanatory notes: Federal obligations provided $168 million in base 
funding and an additional $65 million for activities related to 
foreclosure counseling mitigation and prevention. The Neighborhood 
Reinvestment Corporation receives both federal and non-federal funding 
to finance its program activities. 

Department of the Treasury; 
Activity/program: Community Development Financial Institutions Fund; 
Related budgetary information/FY 2010 obligations: see note; 
Explanatory notes: The Community Development Financial Institutions 
Fund provides funding for multiple initiatives that may support 
housing. In fiscal year 2010 $108 million was obligated to providing 
awards to Community Development Financial Institutions for financial 
and technical assistance to further affordable housing, among other 
goals. Additionally, in fiscal year 2010 $80 million was obligated for 
the Capital Magnet Fund to increase capital investment for affordable 
housing. 

Department of Agriculture; 

Activity/program: Section 525 Technical and Supervisory Assistance 
Grants; 
Related budgetary information/FY 2010 obligations: None; 
Explanatory notes: No grants were made in fiscal year 2010. 

Activity/program: Rural Community Development Initiative Grants; 
Related budgetary information/FY 2010 obligations: $6,512,000; 
Explanatory notes: [Empty]. 

Internal Revenue Service; 

Activity/program: Historic preservation tax credit (20 percent); 
Related budgetary information/FY 2010 obligations: see note; 
Explanatory notes: Historic preservation tax credit is administered by 
both the National Park Service and the IRS. The Department of the 
Treasury estimated revenue losses of $390 million for fiscal year 2010 
in Analytical Perspectives, Budget of the U.S. Government, Fiscal Year 
2012 which includes both residential and non-residential historic 
structures. 

Purpose: Assistance for financing rental housing. 

Agency/entity: Federal Home Loan Banks; 

Activity/program: Affordable Housing Program; 
FY 2010 obligations: $216,000,000; 
Explanatory notes: Created by the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989. The act requires each of the 
twelve Federal Home Loan Banks to contribute 10 percent of its 
previous year's net earnings to an Affordable Housing Program to be 
used to subsidize the cost of affordable homeownership and rental 
housing. 

Agency/entity: Department of Housing and Urban Development; 

Activity/program: Supportive Housing for the Elderly (Section 202); 
FY 2010 obligations: $580,250,000; 
Explanatory notes: [Empty]. 

Activity/program: Assisted-Living Conversion Program; 
FY 2010 obligations: Included in obligations under Supportive Housing 
for the Elderly (Section 202); 
Explanatory notes: [Empty]. 

Activity/program: Mortgage Insurance for Manufactured Home Parks 
(Section 207); 
FY 2010 obligations: None; 
Explanatory notes: No loans made in fiscal year 2010. 

Activity/program: Existing Multifamily Rental Housing (Section 207/ 
223(f)); 
FY 2010 obligations: -$261,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments under this program made in fiscal year 
2010. These estimates are revised in subsequent years and the ultimate 
cost will not be known until the loans have matured, which in some 
cases may be 30 years. This loan program is part of the General 
Insurance and Special Risk Insurance Fund, which houses a wide range 
of mortgage insurance products, including insurance for loans to 
develop, rehabilitate, and refinance multifamily rental housing, 
nursing home facilities, and hospitals. General Insurance and Special 
Risk Insurance Fund programs also include loan guarantees for Title I 
manufactured housing and for property improvement loans; This estimate 
also includes expected credit subsidy costs for refinances of current 
FHA loans under Section 223(a)(7) made in fiscal year 2010. 

Activity/program: Mortgage and Major Home Improvement Loan Insurance 
for Urban Renewal Areas (Section 220); 
FY 2010 obligations: -$18,000,000; 
Explanatory notes: Also includes loans under Section 231, and some 
made under Section 207. Also see note for Existing Multifamily Rental 
Housing (Section 207/223(f)). 

Activity/program: Multifamily Cooperatives (Section 221(d)(3)); 
FY 2010 obligations: $9,000,000; 
Explanatory notes: See note for Existing Multifamily Rental Housing 
(Section 207/223(f)). 

Activity/program: Multifamily Rental Housing (Section 221(d)(4)); 
FY 2010 obligations: -$45,000,000; 
Explanatory notes: See note for Existing Multifamily Rental Housing 
(Section 207/223(f)). 

Activity/program: Mortgage Insurance for Housing for the Elderly 
(Section 231); 
FY 2010 obligations: Included in obligations for Mortgage and Major 
Home Improvement Loan Insurance for Urban Renewal Areas (Section 220); 
Explanatory notes: 

Activity/program: Mortgage Insurance for Single Room Occupancy 
Projects (Section 221(d)) pursuant to Section 223(g); 
FY 2010 obligations: None; 
Explanatory notes: No loans made in fiscal year 2010. 

Activity/program: Supplemental Loans for Multifamily Projects (Section 
241); 
FY 2010 obligations: see note; 
Explanatory notes: Expected credit subsidy costs are less than 
$500,000. Also see note for Existing Multifamily Rental Housing 
(Section 207/223(f)). 

Activity/program: Supportive Housing for Persons with Disabilities 
(Section 811); 
FY 2010 obligations: $130,359,000; 
Explanatory notes: [Empty]. 

Activity/program: Housing Finance Authority Risk Sharing (Section 
542(c)); 
FY 2010 obligations: -$2,000,000; 
Explanatory notes: See note for Existing Multifamily Rental Housing 
(Section 207/223(f)). 

Activity/program: Government Sponsored Enterprise Risk Sharing 
(Section 542(b)); 
FY 2010 obligations: see note; 
Explanatory notes: Expected credit subsidy costs are less than 
$500,000. See note for Existing Multifamily Rental Housing (Section 
207/223(f)). 

Activity/program: Mark-to-Market Program; 
FY 2010 obligations: Included in obligations under the General 
Insurance and Special Risk Insurance Fund; 
Explanatory notes: Costs/savings associated with this are among the 
items factored into subsidy rates. See note for Existing Multifamily 
Rental Housing (Section 207/223(f)). 

Activity/program: Interest Reduction Payments for Rental and 
Cooperative Housing for Lower Income Families; 
FY 2010 obligations: None; 
Explanatory notes: Payments are made from obligations recorded in 
prior years. No new commitments since 1973. 

Activity/program: Multifamily Operating Loss Loans (Section 223(d)); 
FY 2010 obligations: see note; 
Explanatory notes: Expected credit subsidy costs are less than 
$500,000. Also see note for Existing Multifamily Rental Housing 
(Section 207/223(f)). 

Activity/program: Multifamily Property Disposition; 
FY 2010 obligations: Included in obligations under the General 
Insurance and Special Risk Insurance Fund; 
Explanatory notes: Costs/savings associated with property disposition 
are among the items factored into subsidy rates. See note for Existing 
Multifamily Rental Housing (Section 207/223(f)). 

Activity/program: Revitalization of Severely Distressed Public Housing 
(HOPE VI); 
FY 2010 obligations: $120,456,000; 
Explanatory notes: [Empty]. 

Department of Agriculture; 

Activity/program: Section 515 Multifamily Direct Rural Rental Housing 
Loans; 
Related budgetary information/FY 2010 obligations: $39,000,000; 
Explanatory notes: Explanatory notes: Obligations represent the 
expected credit subsidy costs for loan commitments made in fiscal year 
2010. These estimates are revised in subsequent years and the ultimate 
cost will not be known until the loans have matured. 

Activity/program: Section 538 Rural Rental Housing Guaranteed Loans; 
Related budgetary information/FY 2010 obligations: $1,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010. These estimates 
are revised in subsequent years and the ultimate cost will not be 
known until the loans have matured. 

Activity/program: Section 514 and 516 Farm Labor Housing Loan and 
Grant Program; 
Related budgetary information/FY 2010 obligations: $16,000,000; 
Explanatory notes: Grants under this program obligated $10 million and 
the expected credit subsidy costs for loans originated in fiscal year 
2010 was $6 million. These estimates of credit subsidy costs are 
revised in subsequent years and the ultimate cost will not be known 
until the loans have matured. 

Activity/program: Multifamily Rental Housing Preservation and 
Revitalization; 
Related budgetary information/FY 2010 obligations: $1,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010. These estimates 
of credit subsidy costs are revised in subsequent years and the 
ultimate cost will not be known until the loans have matured. 

Agency/entity: Internal Revenue Service; 

Activity/program: Low-income housing tax credit; 
FY 2010 estimated revenue losses[A]: $5,650,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Rental housing bonds interest exclusion; 
FY 2010 estimated revenue losses[A]: $1,050,000,000; 
Explanatory notes: [Empty]. 

Purpose: Emergency assistance to housing market or current homeowner: 

Agency/entity: Department of Housing and Urban Development; 

Activity/program: Tax Credit Assistance Program; 
FY 2010 obligations: None; 
Explanatory notes: During fiscal year 2009, the American Recovery and 
Reinvestment Act of 2009, provided $2.25 billion to the HOME program 
to make available to state housing credit agencies for low-income 
housing tax credit projects via a formula-based allocation. All of the 
appropriated funds were obligated in fiscal year 2009. 

Activity/program: HOPE for Homeowners; 
FY 2010 obligations: $3,000,000; 
Explanatory notes: Obligations represent the expected credit subsidy 
costs for loan commitments made in fiscal year 2010. These estimates 
are revised in subsequent years and the ultimate cost will not be 
known until the loans have matured. 

Activity/program: Neighborhood Stabilization Program; 
FY 2010 obligations: $1,980,000,000; 
Explanatory notes: The Neighborhood Stabilization Program was 
established by the Housing and Economic Recovery Act of 2008 and 
funded by that legislation at a level of $3.92 billion, obligated 
during fiscal year 2009. The American Recovery and Reinvestment Act of 
2009 provided $1.98 billion in additional funding, obligated in 2010. 
The Dodd-Frank Wall Street Reform and Consumer Protection Act provided 
another $1 billion available in fiscal year 2011. 

Agency/entity: Department of the Treasury; 

Activity/program: New Issue Bond Program: Purchase securities of 
Fannie Mae and Freddie Mac backed by new housing bonds issued by the 
Housing Finance Agencies (HFA Initiative); 
FY 2010 obligations: -$79,000,000; 
Explanatory notes: Represents the expected credit subsidy costs for 
securities purchased in fiscal year 2010, worth $15.3 billion. 
Ultimate cost will not be known until the securities mature or are 
sold. The Department of the Treasury's authority to purchase 
securities under the program expired on December 31, 2009. 

Activity/program: Temporary Credit and Liquidity Program: Purchased 
participation interests in government-sponsored enterprises liquidity 
facilities available for outstanding housing bonds issued by state and 
local HFAs (HFA Initiative); 
FY 2010 obligations: -$552,000,000; 
Explanatory notes: Represents the expected credit subsidy costs for 
purchases in fiscal year 2010, worth $8.2 billion. Ultimate cost will 
not be known until the Department of the Treasury's interests are 
dissolved. The Department of the Treasury's authority to enter 
additional obligations under the program expired on December 31, 2009. 

Activity/program: Housing Finance Authority (HFA) Hardest Hit Fund; 
FY 2010 obligations: $7,600,000,000; 
Explanatory notes: In fiscal year 2010, the Department of the Treasury 
obligated $7.6 billion for the HFA Hardest Hit Fund to be available 
until December 31, 2017. Actual payments made in fiscal year 2010 to 
the 19 HFAs participating in the program was $56 million. 

Activity/program: Grants to States for Low-Income Housing Projects in 
Lieu of Low-Income Housing Credits Program (Section 1602 Program); 
FY 2010 obligations: $3,083,000,000; 
Explanatory notes: Designed to be used in lieu of tax credits, the 
Section 1602 Program allowed state HFAs to exchange a portion of their 
2009 credit ceiling (up to 100 percent of 2008 unused LIHTC and credit 
returned during 2009 and 40 percent of their 2009 allocation) for 
grant funds from Treasury at the rate of 85 cents for every tax credit 
dollar, and then award proceeds to finance the construction or 
acquisition and rehabilitation of qualified low-income buildings. 

Activity/program: Making Home Affordable (MHA); 
FY 2010 obligations: see note; 
Explanatory notes: In February 2009, the Department of the Treasury 
announced a program to assist homeowners in danger of foreclosure--the 
centerpiece of which was the Home Affordable Modification Program 
(HAMP)--that would use up to $50 billion in funds from the Troubled 
Asset Relief Program (TARP). The Department of the Treasury 
subsequently reduced its total obligations of its TARP-funded housing 
programs to $45.6 billion, of which $29.9 billion has been allocated 
to the Making Home Affordable program which includes HAMP. Treasury 
officials estimated that the last MHA incentive payment would likely 
occur sometime in mid-2018. Actual payments made in fiscal year 2010 
for all programs under the MHA program were $484 million. 

Activity/program: Preferred Stock Purchase Agreements with Fannie Mae 
and Freddie Mac; 
FY 2010 obligations: see note; 
Explanatory notes: Purchase of government-sponsored enterprises' stock 
in fiscal year 2010 was worth $52.6 billion. Ultimate value the 
Department of the Treasury will receive for preferred stock is to be 
determined. 

Activity/program: Purchase of mortgage-backed securities issued by 
Fannie Mae and Freddie Mac; 
FY 2010 obligations: -$1,114,000,000; 
Explanatory notes: Represents the expected credit subsidy costs for 
purchases in fiscal year 2010, worth $29.9 billion. Ultimate cost will 
not be known until the securities mature or are sold. The Department 
of the Treasury's authority to enter additional obligations under the 
program expired on December 31, 2009. 

Agency/entity: Department of the Treasury and Department of Housing 
and Urban Development; 

Activity/program: Federal Housing Administration Short Refinance 
program; 
FY 2010 obligations: $8,120,000,000; 
Explanatory notes: The Department of the Treasury entered into a 
letter of credit facility to fund up to $8 billion of losses, if any, 
associated with providing Federal Housing Administration Short 
Refinance loans originated on or before December 31, 2012. Actual 
payments made in fiscal year 2010 were $3 million. No loans had been 
refinanced under this program in fiscal year 2010; 
payments were used to maintain the letter of credit. 

Agency/entity: Federal Reserve System; 

Activity/program: Purchase of mortgage-backed securities issued by 
Fannie Mae, Freddie Mac and Ginnie Mae; 
FY 2010 obligations: see note; 
Explanatory notes: Purchases of mortgage-backed securities issued by 
Fannie Mae, Freddie Mac and Ginnie Mae in fiscal year 2010 were valued 
at $346.1 billion. Ultimate cost will not be known until the 
securities mature or are sold. 

Activity/program: Purchase of Fannie Mae, Freddie Mac and Federal Home 
Loan Bank debt; 
FY 2010 obligations: see note; 
Explanatory notes: Purchases of Fannie Mae, Freddie Mac and Federal 
Home Loan Bank debt in fiscal year 2010 were valued at $40.8 billion. 
Ultimate cost is not yet known. 

Agency/entity: Internal Revenue Service; 
Activity/program: Exclusion of forgiven mortgage debts; 
FY 2010 estimated revenue losses[A]: $1,480,000,000; 
Explanatory notes: [Empty]. 

Activity/program: First-Time Homebuyer Tax Credit; 
FY 2010 estimated revenue losses[A]: $13,680,000,000; 
Explanatory notes: Revenue losses were estimated by the Department of 
the Treasury for fiscal year 2010. This provision expired April 30, 
2010. 

Activity/program: Increased standard deduction for property taxes; 
FY 2010 estimated revenue losses[A]: $500,000,000; 
Explanatory notes: Revenue losses for fiscal year 2010 were estimated 
by the Joint Committee on Taxation in Estimates of Federal Tax 
Expenditures for Fiscal Years 2010-2014, JCS-3-10. This provision 
expired on December 31, 2009. 

Purpose: Regulatory requirements: 

Agency/entity: Consumer Financial Protection Bureau and Federal 
Financial Regulators; (Federal Reserve Board, Federal Deposit 
Insurance Corporation, National Credit Union Administration, and 
Office of the Comptroller of the Currency) and the Federal Financial 
Institutions Examination Council; 

Activity/program: Real Estate Settlement Procedures Act of 1974 
(RESPA); 
Related budgetary information: see note; 
Explanatory notes: Responsibility for Rulemaking under RESPA moved to 
the Consumer Financial Protection Bureau on July 21, 2011; 
The Consumer Financial Protection Bureau and the federal financial 
regulators are responsible for examination and enforcement of RESPA at 
certain institutions; The Federal Financial Institutions Examination 
Council promotes uniformity in the supervision of financial 
institutions; Costs for RESPA are not quantified or tracked separately. 

Activity/program: Secure and Fair Enforcement for Mortgage Licensing 
Act of 2008 (SAFE Act); 
Related budgetary information: see note; 
Explanatory notes: Responsibility for Rulemaking under the SAFE Act 
moved to the Consumer Financial Protection Bureau on July 21, 2011; 
The Consumer Financial Protection Bureau and the federal financial 
regulators are responsible for examination and enforcement of the SAFE 
Act at certain institutions; The Federal Financial Institutions 
Examination Council promotes uniformity in the supervision of 
financial institutions; Costs for the SAFE Act are not quantified or 
tracked separately. 

Activity/program: Home Mortgage Disclosure Act of 1975 (HMDA); 
Related budgetary information: see note; 
Explanatory notes: Responsibility for Rulemaking under HMDA moved to 
the Consumer Financial Protection Bureau on July 21, 2011; 
The Consumer Financial Protection Bureau and the federal financial 
regulators are responsible for examination and enforcement of HMDA at 
certain institutions; The Federal Financial Institutions Examination 
Council promotes uniformity in the supervision of financial 
institutions and facilitates public access and aggregation of data 
that depository institutions must disclose under HMDA. Obligations in 
calendar year 2010 were $13 million; of this amount, approximately $3 
million was related to costs associated with the processing, 
aggregation, and reporting of HMDA data. Source of funds for The 
Federal Financial Institutions Examination Council are collections 
from other federal sources. 

Activity/program: Truth in Lending Act; 
Related budgeoary information: see note; 
Explanatory notes: Responsibility for Rulemaking under the Truth in 
Lending Act moved to the Consumer Financial Protection Bureau on July 
21, 2011. However, rulemaking for certain aspects of the Truth in 
Lending Act remain with the federal financial regulators for real 
estate appraisals; The Consumer Financial Protection Bureau and the 
federal financial regulators are responsible for examination and 
enforcement of the Truth in Lending Act at certain institutions; 
The Federal Financial Institutions Examination Council promotes 
uniformity in the supervision of financial institutions; Costs for the 
housing related aspects of the Truth in Lending Act are not quantified 
or tracked separately. 

Activity/program: Equal Credit Opportunity Act; 
Related budgetary information: see note; 
Explanatory notes: Responsibility for Rulemaking under the Equal 
Credit Opportunity Act moved to the Consumer Financial Protection 
Bureau on July 21, 2011; The Consumer Financial Protection Bureau and 
the federal financial regulators are responsible for examination and 
enforcement of the Equal Credit Opportunity Act at certain 
institutions; The Federal Financial Institutions Examination Council 
promotes uniformity in the supervision of financial institutions; 
Costs for the housing related aspects of the Equal Credit Opportunity 
Act are not quantified or tracked separately. 

Federal Financial Regulators; (Federal Reserve Board, Federal Deposit 
Insurance Corporation, and Office of the Comptroller of the Currency); 
and the Federal Financial Institutions Examination Council; 
Activity/program: Community Reinvestment Act (CRA); 
Related budgetary information: see note; 
Explanatory notes: Federal financial regulators are responsible for 
Rulemaking and enforcement of CRA. However, they do not quantify or 
track costs separately for the housing related aspects of the CRA; 
The Federal Financial Institutions Examination Council promotes 
uniformity in the supervision of financial institutions. 

Federal Financial Institutions Examination Council; 
Activity/program: Appraisal Subcommittee; 
Related budgetary information: see note; 
Explanatory notes: The Appraisal Subcommittee ensures that real estate 
appraisals used in federally-related transactions are performed in 
accordance with uniform standards by appraisers certified and licensed 
by the States; Obligations for the Subcommittee in fiscal year 2010 
were $4 million; some amount of obligations may be attributable to 
activities related to housing; Source of funds for Subcommittee 
operations are fee income from State-licensed and certified real 
estate appraisers in the national registry. 

Department of Housing and Urban Development; 
Activity/program: Enforcement of the Fair Housing Act (Title VIII); 
Related budgetary information: Included in obligations for Fair 
Housing Assistance Program and Fair Housing Initiatives Program; 
Explanatory notes: [Empty]. 

Activity/program: Fair Housing Assistance Program; 
Related budgetary information: $25,000,000; 
Explanatory notes: See also Enforcement of the Fair Housing Act (Title 
VIII). 

Activity/program: Fair Housing Initiatives Program; 
Related budgetary information: $25,000,000; 
Explanatory notes: See also Enforcement of the Fair Housing Act (Title 
VIII). 

Purpose: Increase availability of mortgage loans: 

Agency/entity: Fannie Mae; 
Activity/program: Purchase mortgage loans and issue mortgage-backed 
securities; 
FY 2010 obligations: see note; 
Explanatory notes: Fannie Mae is not included in the federal budget; 
Also see activities listed under emergency assistance to housing 
market or current homeowner. 

Agency/entity: Freddie Mac; 
Activity/program: Purchase mortgage loans and issue mortgage-backed 
securities; 
FY 2010 obligations: see note; 
Explanatory notes: Freddie Mac is not included in the federal budget; 
Also see activities listed under emergency assistance to housing 
market or current homeowner. 

Agency/entity: Federal Home Loan Banks; 
Activity/program: Provide advances to member institutions; 
FY 2010 obligations: see note; 
Explanatory notes: The Federal Home Loan Banks are not included in the 
federal budget; Also see activities listed under emergency assistance 
to housing market or current homeowner. 

Agency/entity: Farm Credit System; 
Activity/program: Institutions of the Farm Credit System, which 
include the Agricultural Credit Bank and Farm Credit Banks, provide 
financed credit to agricultural and rural communities; 
FY 2010 obligations: None; 
Explanatory notes: Entities of the Farm Credit System are not included 
in the federal budget. 

Agency/entity: Farm Credit System Insurance Corporation; 
Activity/program: Ensure the timely payment of principal and interest 
on insured Farm Credit System debt obligations purchased by investors; 
FY 2010 obligations: see note; 
Explanatory notes: Obligations for the Farm Credit System Insurance 
Corporation in fiscal year 2010 were $209 million; some amount of 
obligations may be attributable to activities related to lending for 
rural housing; The Corporation derives its revenues from insurance 
premiums collected from insured Farm Credit System banks and from the 
investment income earned on its investment portfolio. 

Agency/entity: Federal Agricultural Mortgage Corporation (Farmer Mac); 
Activity/program: Purchases agricultural or rural housing mortgage 
loans and securitizes loans into guaranteed securities or agricultural 
mortgage-backed securities; 
FY 2010 obligations: None; 
Explanatory notes: Farmer Mac is not included in the federal budget. 

Agency/entity: Department of Housing and Urban Development; 
Activity/program: Government National Mortgage Association (Ginnie 
Mae): Guarantee the timely payment of principal and interest on 
securities issued by private lenders and backed by pools of federally 
insured or guaranteed mortgage loans; 
FY 2010 obligations: -$991,000,000; 
Explanatory notes: Represents expected credit subsidy costs for Ginnie 
Mae's guarantees of mortgage-backed securities in fiscal year 2010. 
These estimates are revised in subsequent years and the ultimate cost 
is not yet known. 

Agency/entity: Internal Revenue Service; 
Activity/program: Mortgage subsidy bonds interest exclusion; 
FY 2010 estimated revenue losses[A]: $1,230,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Veterans housing bonds interest exclusion; 
FY 2010 estimated revenue losses[A]: $20,000,000; 
Explanatory notes: [Empty]. 

Purpose: Assistance for homeowners: 

Agency/entity: Department of Agriculture; 

Activity/program: Section 504 Very Low-income Repair Loans and Grants; 
FY 2010 obligations: $35,000,000; 
Explanatory notes: Grants under this program obligated $32 million and 
the expected credit subsidy costs for loans originated in fiscal year 
2010 was $3 million. These estimates are revised in subsequent years 
and the ultimate cost will not be known until the loans have matured. 

Activity/program: Section 504 Direct Housing Loans and Grants for 
Natural Disasters; 
FY 2010 obligations: $3,000,000; 
Explanatory notes: This number represents only the grant portion of 
the program. The loan portion is included in the Section 504. 

Agency/entity: Department of Veterans Affairs; 

Activity/program: Specially Adapted Housing for Disabled Veterans; 
FY 2010 obligations: $68,000,000; 
Explanatory notes: Includes obligations for the Special Housing 
Adaptation for Disabled Veterans and Temporary Residence Adaptation 
programs. 

Activity/program: Direct Loans for Certain Disabled Veterans; 
FY 2010 obligations: None; 
Explanatory notes: No loans were made in fiscal year 2010. 

Activity/program: Special Housing Adaptation for Disabled Veterans; 
FY 2010 obligations: Included in obligations for Specially Adapted 
Housing for Disabled Veterans; 
Explanatory notes: [Empty]. 

Activity/program: Temporary Residence Adaptation; 
FY 2010 obligations: Included in obligations for Specially Adapted 
Housing for Disabled Veterans; 
Explanatory notes: [Empty]. 

Agency/entity: Department of the Interior; 
Activity/program: Housing Improvement Program; 
FY 2010 obligations: $15,943,367; 

Explanatory notes. 

Agency/entity: Internal Revenue Service; 

Activity/program: Mortgage interest deduction; 
FY 2010 estimated revenue losses[A]: $79,150,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Property tax deduction; 
FY 2010 estimated revenue losses[A]: $15,120,000,000; 
Explanatory notes: [Empty]. 

Purpose: Assistance for rental property owners: 

Agency/entity: Department of Housing and Urban Development; 

Activity/program: Project-Based Rental Assistance (Section 8 
Contracts); 
FY 2010 obligations: $8,764,224,000; 
Explanatory notes: [Empty]. 

Activity/program: Rental Housing Assistance Payments (Section 236); 
FY 2010 obligations: $10,232,000; 
Explanatory notes: Obligations are for amendments to existing 
contracts. No new commitments since 1973. 

Activity/program: Rent Supplement Program; 
FY 2010 obligations: $4,401,000; 
Explanatory notes: Obligations are for amendments to existing 
contracts. No new commitments since 1973. 

Activity/program: Project-Based Voucher Program; 
FY 2010 obligations: Included in obligations for Housing Choice 
Voucher Program; 
Explanatory notes: [Empty]. 

Activity/program: Section 8 Moderate Rehabilitation Program; 
FY 2010 obligations: Included in obligations for Project-Based Rental 
Assistance; 
Explanatory notes: [Empty]. 

Agency/entity: Department of Agriculture; 

Activity/program: Section 521 Rural Rental Assistance Payments; 
FY 2010 obligations: $979,000,000; 
Explanatory notes: [Empty]. 

Agency/entity: Internal Revenue Service; 

Activity/program: Passive rental losses; 
FY 2010 estimated revenue losses[A]: $8,790,000,000; 
Explanatory notes: [Empty]. 

Activity/program: Accelerated depreciation on rental housing; 
FY 2010 estimated revenue losses[A]: -$1,490,000,000; 
Explanatory notes: Tax expenditure revenue loss estimates are 
generally reported in the President's budget on a cash basis. When 
incoming tax receipts from past deferrals are greater than deferred 
receipts from new activity, the cash-basis tax expenditure estimate 
can be negative. For certain tax expenditures that take the form of 
deferrals of tax liability, the President's budget also presents 
estimates made on a present value basis. The President's budget for 
fiscal year 2012 reported that the estimated present value of revenue 
losses for activities undertaken in calendar year 2010 for this tax 
expenditure would be $6.570 billion. 

Purpose: Rental assistance for tenants: 

Agency/entity: Department of Housing and Urban Development; 

Activity/program: Housing Choice Voucher Program; 
FY 2010 obligations: $15,160,991,261; 
Explanatory notes: [Empty]. 

Activity/program: Mainstream Vouchers; 
FY 2010 obligations: $85,236,000; 
Explanatory notes: [Empty]. 

Activity/program: Family Unification Program; 
FY 2010 obligations: $15,877,000; 
Explanatory notes: [Empty]. 

Activity/program: Section 8 Moving to Work Demonstration; 
FY 2010 obligations: $2,823,379,109; 
Explanatory notes: [Empty]. 

Agency/entity: Department of Labor; 

Activity/program: National Farmworker Jobs Program - Housing 
Assistance; 
FY 2010 obligations: $5,700,000; 
Explanatory notes: Obligations represent allocations for housing 
activities in program year 2010. 

Agency/entity: Department of Agriculture; 

Activity/program: Section 542 Rural Housing Voucher Program; 
FY 2010 obligations: $8,000,000; 
Explanatory notes: [Empty]. 

Purpose: Operation/management of rental housing: 

Agency/entity: Department of Housing and Urban Development; 
Activity/program: Multifamily Energy Pilot; 
FY 2010 obligations: None; 
Explanatory notes: Program created in fiscal year 2010, however no 
funds were obligated in that year. 

Activity/program: Emergency Capital Repairs Program; 
FY 2010 obligations: Included in obligations under Supportive Housing 
for the Elderly (Section 202); 
Explanatory notes: [Empty]. 

Activity/program: Public Housing Operating Fund; 
FY 2010 obligations: $4,754,393,000; 
Explanatory notes: [Empty]. 

Activity/program: Public Housing Capital Fund; 
FY 2010 obligations: $2,485,538,000; 
Explanatory notes: [Empty]. 

Activity/program: Green Retrofit Program for Multifamily Housing; 
FY 2010 obligations: $235,000,000; 
Explanatory notes: Grants under this program obligated $167 million 
and the expected credit subsidy costs for loans originated in fiscal 
year 2010 were $68 million. These estimates are revised in subsequent 
years and the ultimate cost will not be known until the loans have 
matured. 

Agency/entity: Department of Agriculture; 

Activity/program: Section 533 Rural Housing Preservation Grants; 
FY 2010 obligations: $11,000,000; 
Explanatory notes: [Empty]. 

Purpose: Regulator of government-sponsored enterprises: 

Agency/entity: Federal Housing Finance Agency; 
Activity/program: Regulator and conservator of Fannie Mae and Freddie 
Mac and the regulator of the Federal Home Loan Banks (FHLBanks); 
FY 2010 obligations: $133,000,000; 
Explanatory notes: The Federal Housing Finance Agency receives direct 
funding for its activities from mandatory assessments on Fannie Mae, 
Freddie Mac, and the Federal Home Loan Banks. 

Agency/entity: Farm Credit Administration; 
Activity/program: Regulator and examiner of the banks, associations, 
and related entities of the Farm Credit System, including the Federal 
Agricultural Mortgage Corporation (Farmer Mac); 
FY 2010 obligations: see note; 
Explanatory notes: Fiscal year 2010 obligations were $50 million; 
some amount of obligations may be attributable to activities related 
to housing; Source of funds for Farm Credit Administration are 
assessments collected from institutions in the System, including 
Farmer Mac. 

Source: GAO. 

Note: Activities/programs may have multiple purposes. Listing does not 
include housing counseling programs nor energy efficiency tax 
expenditures that are covered in another section of this report and 
homeless housing programs that GAO discussed in its March 2011 
reports: 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) and List of Selected Federal Programs That Have Similar or 
Overlapping Objectives, Provide Similar Services, or Are Fragmented 
Across Government Missions, [Hyperlink, 
http://www.gao.gov/products/GAO-11-474R] (Washington, D.C.: Mar. 18, 
2011). Listing also does not include tax expenditures for employment-
related housing allowances or costs. 

[A] Revenue losses are estimated by the Department of the Treasury in 
Analytical Perspectives, Budget of the U.S. Government, Fiscal Year 
2012, unless otherwise specified. 

[End of table] 

Table 11: Early Learning and Child Care: List of Programs and Related 
Budgetary Information[A]: 

Early Learning and Child Care: 

Programs with an Explicit Early Learning or Child Care Purpose: 

Agency or subagency: Department of Education; 

Agency or subagency: Office of the Deputy Secretary; 
Program: Race to the Top - Early Learning Challenge; 
FY 2010 obligations[B]: [C]. 

Program: State Fiscal Stabilization Fund - Education State Grants, 
Recovery Act; 
FY 2010 obligations[B]: [D]. 

Agency or subagency: Office of Elementary and Secondary Education; 
Program: Indian Education - Grants to Local Educational Agencies; 
FY 2010 obligations[B]: $104,000,000. 

Program: Striving Readers Comprehensive Literacy[E]; 
FY 2010 obligations[B]: $35,000,000. 

Agency or subagency: Office of Postsecondary Education; 
Program: Child Care Access Means Parents in School; 
FY 2010 obligations[B]: $16,000,000. 

Agency or subagency: Office of Special Education and Rehabilitative 
Services; 
Program: Special Education - Grants for Infants and Families; 
FY 2010 obligations[B]: $439,000,000. 

Program: Special Education - Preschool Grants; 
FY 2010 obligations[B]: $374,000,000. 

Agency or subagency: Department of Health and Human Services; 

Agency or subagency: Administration for Children and Families; 
Program: Child Care and Development Block Grant; 
FY 2010 obligations[B]: $2,127,000,000. 

Program: Child Care Mandatory and Matching Funds of the Child Care and 
Development Fund; 
FY 2010 obligations[B]: $2,917,000,219. 

Program: Head Start; 
FY 2010 obligations[B]: $7,235,514,000. 

Agency or subagency: Department of the Interior; 

Agency or subagency: Bureau of Indian Education; 
Program: Indian Child and Family Education (FACE); 
FY 2010 obligations[B]: $15,370,870. 

Agency or subagency: General Services Administration; 

Agency or subagency: Public Buildings Service; 
Program: The General Services Administration's Child Care Program; 
FY 2010 obligations[B]: $3,144,000. 

Programs That Support Early Learning and Child Care or Allow Use of 
Funds for That Purpose[A]: 

Agency or subagency: Appalachian Regional Commission; 

Program: Appalachian Area Development; 
FY 2010 obligations[B]: $73,000,000. 

Agency or subagency: Department of Agriculture; 

Agency or subagency: Food and Nutrition Service; 
Program: Child and Adult Care Food Program; 
FY 2010 obligations[B]: $2,640,923,000. 

Program: National School Lunch Program; 
FY 2010 obligations[B]: $9,967,068,000. 

Program: School Breakfast Program; 
FY 2010 obligations[B]: $29,200,391,000. 

Program: Special Milk Program for Children; 
FY 2010 obligations[B]: $12,673,000. 

Agency or subagency: Department of Education; 

Agency or subagency: Office of Innovation and Improvement; 
Program: Full-Service Community Schools; 
FY 2010 obligations[B]: $1,166,000,000. 

Program: Promise Neighborhoods; 
FY 2010 obligations[B]: $10,000,000. 

Agency or subagency: Office of Elementary and Secondary Education; 
Program: Alaska Native Educational Programs; 
FY 2010 obligations[B]: $33,000,000. 

Program: Education for Homeless Children and Youth; 
FY 2010 obligations[B]: $65,000,000. 

Program: English Language Acquisition Grants; 
FY 2010 obligations[B]: $743,000,000. 

Program: Indian Education - Special Programs for Indian Children; 
FY 2010 obligations[B]: $19,060,000. 

Program: Migrant Education - State Grant Program; 
FY 2010 obligations[B]: $394,771,000. 

Program: Native Hawaiian Education; 
FY 2010 obligations[B]: $34,000,000. 

Program: Title I Grants to Local Educational Agencies; 
FY 2010 obligations[B]: [F]. 

Agency or subagency: Office of Special Education and Rehabilitative 
Services; 

Program: Special Education - State Personnel Development; 
FY 2010 obligations[B]: $48,000,000. 

Program: Special Education - Grants to States; 
FY 2010 obligations[B]: [G]. 

Program: Special Education - Technology and Media Services for 
Individuals with Disabilities; 
FY 2010 obligations[B]: $44,000,000. 

Agency or subagency: Department of Health and Human Services; 

Agency or subagency: Administration for Children and Families; 
Program: Community Services Block Grant; 
FY 2010 obligations[B]: $699,999,000. 

Program: Social Services Block Grant; 
FY 2010 obligations[B]: [H]. 

Program: Temporary Assistance for Needy Families; 
FY 2010 obligations[B]: [I]. 

Agency or subagency: Office of Community Planning and Development; 

Program: Community Development Block Grants/Entitlement Grants; 
FY 2010 obligations[B]: [J]. 

Program: Community Development Block Grants/Special Purpose 
Grants/Insular Areas; 
FY 2010 obligations[B]: [J]. 

Program: Community Development Block Grants/State's program and Non-
Entitlement Grants in Hawaii; 
FY 2010 obligations[B]: [J]. 

Agency or subagency: Department of Justice; 

Agency or subagency: Office of Juvenile Justice and Delinquency 
Prevention; 

Program: Reduction and Prevention of Children's Exposure to Violence 
(Safe Start); 
FY 2010 obligations[B]: $5,000,000. 

Agency or subagency: Violence Against Women Office; 

Program: Children and Youth Exposed to Violence; 
FY 2010 obligations[B]: $614,000. 

Program: Transitional Housing Assistance for Victims of Domestic 
Violence, Dating Violence, Stalking, or Sexual Assault; 
FY 2010 obligations[B]: $15,305,000. 

Agency or subagency: Department of Labor; 

Agency or subagency: Employment Training Administration; 

Program: National Farmworker Jobs Program; 
FY 2010 obligations[B]: $87,398,000. 

Program: Native American Employment and Training; 
FY 2010 obligations[B]: $53,000,000. 

Program: Workforce Investment Act Adult Program; 
FY 2010 obligations[B]: $861,540,000. 

Program: Workforce Investment Act Dislocated Worker Formula Grants; 
FY 2010 obligations[B]: $1,183,847,000. 

Agency or subagency: Department of the Interior; 

Agency or subagency: Bureau of Indian Affairs; 

Program: Indian Child Welfare Act-Title II Grants; 
FY 2010 obligations[B]: [K]. 

Program: Indian Education - Assistance to Schools; 
FY 2010 obligations[B]: $21,214,545. 

Agency or subagency: General Services Administration; 

Agency or subagency: Federal Acquisition Service; 

Program: Donation of Federal Surplus Personal Property; 
FY 2010 obligations[B]: $0. 

Source: GAO analysis of FY 2010 obligations based on agencies' federal 
budget justifications and other sources. 

[A] This table classifies fiscal year 2010 obligations for early 
learning and child care into two groups: (a) obligations for programs 
with an explicit early learning or child care purpose and (b) 
obligations for programs that support early learning and child care or 
allow use of funds for that purpose. However, obligations cited for 
the latter (programs that support or allow use of funds) do not 
represent funds specifically for early learning and child care 
services but rather for those programs overall. 

[B] In addition to FY 2010 obligations, some programs received 
Recovery Act funds in fiscal year 2010. These programs include, for 
example, Temporary Assistance for Needy Families, Child Care and 
Development Block Grant, Special Education - Grants for Infants and 
Families, and Special Education - Preschool Grants programs. 
Additionally, Head Start Recovery Act appropriations were made 
available in 2009 for two fiscal years. 

[C] Race to the Top - Early Learning Challenge was created as part of 
the American Recovery and Reinvestment Act of 2009 and may not 
continue to be funded after the Act's funds expire. It received a $500 
million appropriation in fiscal year 2011 and had no previous 
appropriation. It is jointly administered by the Departments of 
Education and Health and Human Services. 

[D] State Fiscal Stabilization Fund - Education State Grants, Recovery 
Act was created as part of the American Recovery and Reinvestment Act 
of 2009 and may not continue to be funded after the act's funds 
expire. It received an $18,170,000 obligation through Recovery Act 
funds in fiscal year 2010. 

[E] In its budget justification, the Department of Education stated 
that it was not requesting separate funding for the Striving Readers 
program for fiscal year 2012. In place of this and several other 
programs that seek to promote improvement of reading, writing, and 
language arts instruction, the department proposed creating a new 
program: Effective Teaching and Learning: Literacy. 

[F] Title I had fiscal year 2010 obligations of approximately $14.5 
billion. About 2 percent of total obligations were spent on early 
education programs in fiscal year 2009, the latest date for which 
expenditure data are available. 

[G] Although Special Education Grants to States had fiscal year 2010 
obligations of approximately $11.5 billion to provide children with 
free appropriate public education, not all of this funding served 
children under 5. 

[H] The Social Services Block Grant is a large, multipurpose block 
grant with fiscal year 2009 obligations of about $391 million spent on 
child care, or 14 percent of total funds. 

[I] Temporary Assistance for Needy Families is a large, multipurpose 
block grant with fiscal year 2010 obligations of approximately $17 
billion. It accounted for $3.5 billion in child care funding in fiscal 
year 2009. Funds that are eventually transferred to the Child Care and 
Development Fund at state option are included in Temporary Assistance 
for Needy Families totals. 

[J] Less than 1 percent of Community Development Block Grants funds 
were used for child care services or child care facilities. 

[K] Agency officials told us that, although child care is an allowable 
use, no funds were used for this purpose in fiscal year 2010. 

[End of table] 

Table 12: Early Learning and Child Care: List of Tax Expenditures and 
Estimated Revenue Loss: 

Tax expenditure: Exclusion of Benefits Provided Under Cafeteria Plans; 
26 U.S.C. § 125(a); 
Total estimated revenue loss FY 2010: [A]. 

Tax expenditure: Exclusion of Income Earned By Voluntary Employees' 
Beneficiary Associations; 
26 U.S.C. § 419; 
Total estimated revenue loss FY 2010: [B]. 

Tax expenditure: Credit For Child and Dependent Care Expenses; 
26 U.S.C. § 21; 
Total estimated revenue loss FY 2010: $3,100,000,000. 

Tax expenditure: Exclusion of Employer-Provided Child and Dependent 
Care; 26 U.S.C. § 129; 
Total estimated revenue loss FY 2010: $3,100,000,000. 

Tax expenditure: Credit For Employer-Provided Child Care; 26 U.S.C. § 
45F; 
Total estimated revenue loss FY 2010: Less than 50,000,000. 

Source: Congressional Research Service, Tax Expenditures: Compendium 
of Background Material on Individual Provisions (Washington, D.C.: 
December 2010). 

[A] The total estimated revenue loss for "cafeteria plans" was $26.4 
billion in fiscal year 2010.This figure does not exclusively represent 
revenue lost for child care but also includes accident and health 
insurance, and other benefits. 

[B] The total estimated revenue loss for the Exclusion of Income 
Earned By Voluntary Employees' Beneficiary Associations tax 
expenditure was $3.2 billion in fiscal year 2010. This figure does not 
exclusively represent child care expenditures but also includes a 
range of benefits including life insurance, disability, and health 
insurance. 

[End of table] 

Table 13: Employment for People with Disabilities: List of Programs 
and Related Budgetary Information: 

Employment for People with Disabilities: 

Agency: U.S. AbilityOne Commission; 
Program: AbilityOne Program; 
FY 2010 obligations: $5,380,775; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Agency: Department of Agriculture; 

Program: Assistive Technology Program for Farmers with Disabilities: 
AgrAbility Project; 
FY 2010 obligations: $4,667,107; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $4,667,107. 

Agency: Department of Defense; 

Program: Air Force Warrior and Survivor Care; 
FY 2010 obligations: Program could not provide[B]; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: 0. 

Program: Army Warrior Care and Transition Program[C]; 
FY 2010 obligations: $1,353,680,000[D]; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: Computer/Electronic Accommodations Program; 
FY 2010 obligations: $8,847,404; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $8,847,404. 

Program: Marine Corps Wounded Warrior Program; 
FY 2010 obligations: $0; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: National Resource Directory[C] (joint with Department of 
Veterans Affairs); 
FY 2010 obligations: No response; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: No response[E]. 

Program: Navy Safe Harbor Program; 
FY 2010 obligations: $2,400,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $24,000. 

Program: National Organization on Disability Wounded Warrior Careers 
Demonstration Program[F]; 
FY 2010 obligations: Program could not provide; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: Recovery Care Coordinator Program; 
FY 2010 obligations: $3,825,960; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: Recovery Coordination Program - Operation Warfighter; 
FY 2010 obligations: $966,502; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $966,502. 

Program: U.S. Special Operations Command Care Coalition; 
FY 2010 obligations: $3,592,700; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Agency: Department of Education; 

Program: American Indian Vocational Rehabilitation Services; 
FY 2010 obligations: $42,822,202; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $42,822,202. 

Program: Helen Keller National Center for Youths and Adults Who Are 
Deaf-Blind; 
FY 2010 obligations: $9,181,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $9,181,000. 

Program: Migrant and Seasonal Farmworkers[G]; 
FY 2010 obligations: $2,197,283; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $2,197,283. 

Program: Model Comprehensive Transition and Postsecondary Programs for 
Students with Intellectual Disabilities[G]; 
FY 2010 obligations: $11,000,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $11,000,000. 

Program: Projects with Industry[H]; 
FY 2010 obligations: $17,842,595; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $17,842,595. 

Program: Randolph-Sheppard Vending Facilities Program; 
FY 2010 obligations: $0; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: Rehabilitation Services Demonstration and Training Programs; 
FY 2010 obligations: $11,601,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $5,800,000. 

Program: State Grant for Assistive Technology Program; 
FY 2010 obligations: $25,660,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: Supported Employment Services for Individuals with the Most 
Significant Disabilities[G,I]; 
FY 2010 obligations: $28,889,190; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $28,889,190. 

Program: Vocational Rehabilitation Services Program[I]; 
FY 2010 obligations: $2,437,797,600; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $2,437,797,600. 

Agency: Department of Health and Human Services; 

Program: 1915(c) Home and Community Based Services Waiver; 
FY 2010 obligations: No response; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: 1915(i) State Plan Home and Community-Based Services; 
FY 2010 obligations: Program could not provide; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: Medicaid Infrastructure Grant Program[H]; 
FY 2010 obligations: $74,606,990; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: No response. 

Program: Medicaid State Plan Services; 
FY 2010 obligations: No response; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: No response. 

Program: Money Follows the Person Rebalancing Demonstration; 
FY 2010 obligations: $105,596,872; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Agency: Department of Labor; 

Program: America's Heroes at Work; 
FY 2010 obligations: $300,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $300,000. 

Program: Work Incentive Grants/Disability Program Navigator 
Initiative[J]; 
FY 2010 obligations: $0; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: Disabled Veterans' Outreach Program; 
FY 2010 obligations: $81,251,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: Employer Assistance and Resource Network; 
FY 2010 obligations: $1,600,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $1,600,000. 

Program: Job Accommodation Network; 
FY 2010 obligations: $2,366,318; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $2,366,318. 

Program: Job Corps[K]; 
FY 2010 obligations: $1,712,000,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: Local Veterans' Employment Representatives Program; 
FY 2010 obligations: $76,481,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: REALifelines Program; 
FY 2010 obligations: Program could not provide; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: Registered Apprenticeship for Youth and Young Adults with 
Disabilities Initiative; 
FY 2010 obligations: $0; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: Community Service Employment for Older Americans; 
FY 2010 obligations: $825,400,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: Veterans' Workforce Investment Program; 
FY 2010 obligations: $9,493,707; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: Work Opportunity Tax Credit (joint with the Internal Revenue 
Service); 
FY 2010 obligations: $18,520,000[L]; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $0. 

Program: Workforce Investment Act Youth Activities; 
FY 2010 obligations: $910,207,965; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: Workforce Recruitment Program (joint with the Department of 
Defense); 
FY 2010 obligations: $211,377; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $211,377. 

Program: YouthBuild[I]; 
FY 2010 obligations: $69,020,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Agency: Department of Veterans Affairs; 

Program: Compensated Work Therapy Program; 
FY 2010 obligations: 0; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: 0. 

Program: Disabled Transition Assistance Program; 
FY 2010 obligations: Program could not provide; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Program: Vocational Rehabilitation and Employment; 
FY 2010 obligations: $768,000,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $768,000,000. 

Program: Vocational Training and Rehabilitation for Vietnam Veterans' 
Children with Spina Bifida or Other Covered Birth Defects; 
FY 2010 obligations: Program could not provide; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: Program could not provide. 

Agency: Social Security Administration; 

Program: Benefit Offset National Demonstration; 
FY 2010 obligations: 13,510,873; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: 13,510,873. 

Program: Mental Health Treatment Study[H]; 
FY 2010 obligations: $971,274; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $699,317. 

Program: Work Incentives Planning and Assistance Program[H]; 
FY 2010 obligations: $27,328,266; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $27,328,266. 

Program: State Vocational Rehabilitation Cost Reimbursement Program; 
FY 2010 obligations: $106,000,000; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $106,000,000. 

Program: Ticket to Work Program; 
FY 2010 obligations: $22,100,000[M]; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $22,100,000. 

Program: Youth Transition Demonstration Project[H]; 
FY 2010 obligations: $4,860,286; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $768,628. 

Program: Total: 
FY 2010 obligations: $8,800,177,246; 
Portion of FY 2010 obligations for employment-related services and 
support for people with disabilities[A]: $3,512,919,662. 

Source: GAO survey of programs that support employment for people with 
disabilities. 

[A] Some programs were not able to identify obligations related to 
providing employment supports to people with disabilities. 

[B] "Program could not provide" indicates that the program reported in 
GAO's survey that they were not able to provide obligations data. 

[C] In commenting on a draft of this report, the Department of Defense 
indicated that this program should be added to the scope. GAO will 
pursue additional information on this program for a final report. 

[D] A significant portion of these obligations ($578,500,000) was for 
constructing healing campuses for wounded, ill, and injured soldiers. 

[E] "No response" indicates that the program did not respond to this 
survey question or otherwise provide this information. 

[F] This program is a collaboration between the Army and the National 
Organization on Disability. The memorandum of understanding between 
the Army and the National Organization on Disability was terminated in 
July 2010. 

[G] This program was proposed to be consolidated or eliminated in the 
Department of Education's fiscal year 2012 budget request, but the 
department reported that funds were appropriated in fiscal year 2012. 

[H] Indicates programs that have been eliminated or are planned to end 
by fiscal year 2012. Two of these are research studies that have 
concluded. For example, the Social Security Administration's Mental 
Health Treatment Study has concluded and the results are available at 
[Hyperlink, 
http://socialsecurity.gov/disabilityresearch/mentalhealth.htm]. 

[I] Program reported appropriated funds instead of obligations. 

[J] The Work Incentives Grants/Disability Program Navigator was funded 
for 7 years as a pilot program and is being expanded and replicated as 
a new program, the Disability Employment Initiative. 

[K] Total program obligations for Job Corps includes $102 million in 
American Recovery and Reinvestment Act obligations. 

[L] Reported obligations for the Work Opportunity Tax Credit are for 
the Department of Labor's administration of the program, according to 
agency officials. According to the Internal Revenue Service, in tax 
year 2009--the most recent data available--there were more than $600 
million in Work Opportunity Tax Credits that were eligible to be 
claimed by individuals. In addition, for tax year 2009, there were 
more than $1 billion in Work Opportunity Tax Credits that were 
eligible to be claimed by corporations (including S corporations). 

[M] Obligations reported for the Ticket to Work program in fiscal year 
2010 represent the cost of funding the Employment Networks and not the 
total cost of the program. Data on total obligations for fiscal year 
2010 will be available later in fiscal year 2012. 

[End of table] 

Table 14: List of Programs and Related Budgetary Information: 

Science, Technology, Engineering, and Mathematics (STEM) Education. 

Agency and subagency: National Aeronautics and Space Administration; 

Program: Aeronautics Research Directorate - STEM Education activities; 
FY 2010 obligations[A]: $4,153,000. 

Program: Exploration Systems Directorate - STEM Education activities; 
FY 2010 obligations[A]: $6,400,000. 

Program: Higher Education; 
FY 2010 obligations[A]: $18,346,329. 

Program: K-12 STEM Program; 
FY 2010 obligations[A]: $36,291,069. 

Program: Minority University Research and Education Program; 
FY 2010 obligations[A]: $28,862,619. 

Program: National Aeronautics and Space Administration Informal 
Education Opportunities; 
FY 2010 obligations[A]: $14,295,934. 

Program: National Aeronautics and Space Administration Science Mission 
Directorate Education and Public Outreach; 
FY 2010 obligations[A]: $30,057,100. 

Program: Space Grant/EPSCoR Program; 
FY 2010 obligations[A]: $68,910,696. 

Program: Space Operations Directorate - STEM Education activities; 
FY 2010 obligations[A]: $2,293,000. 

Agency and subagency: National Science Foundation; 

Program: Advanced Technological Education; 
FY 2010 obligations[A]: $64,510,000. 

Program: Alliances for Graduate Education and the Professoriate; 
FY 2010 obligations[A]: $16,730,000. 

Program: Broadening Participation in Computing; 
FY 2010 obligations[A]: $14,000,000. 

Program: Centers for Ocean Science Education Excellence; 
FY 2010 obligations[A]: $$5,700,000. 

Program: Computer Information Science & Engineering Directorate 
Pathways to Revitalized Undergraduate Computing Education; 
FY 2010 obligations[A]: $4,370,000. 

Program: Cyberinfrastructure Training, Education, Advancement, and 
Mentoring for Our 21st Century Workforce; 
FY 2010 obligations[A]: $4,850,000. 

Program: Discovery Research K-12; 
FY 2010 obligations[A]: $118,380,000. 

Program: East Asia & Pacific Summer Institutes for U.S. Graduate 
Students; 
FY 2010 obligations[A]: $1,740,000. 

Program: Engineering Education; 
FY 2010 obligations[A]: $13,740,000. 

Program: Enhancing the Mathematical Sciences Workforce in the 21st 
Century; 
FY 2010 obligations[A]: $15,070,000. 

Program: Ethics Education in Science & Engineering; 
FY 2010 obligations[A]: $2,650,000. 

Program: Federal Cyber Service: Scholarship for Service; 
FY 2010 obligations[A]: $14,870,000. 

Program: Geoscience Education; 
FY 2010 obligations[A]: $2,020,000. 

Program: Geoscience Teacher Training; 
FY 2010 obligations[A]: $2,980,000. 

Program: Global Learning and Observations to Benefit the Environment; 
FY 2010 obligations[A]: $1,100,000. 

Program: Graduate Research Fellowship Program; 
FY 2010 obligations[A]: $136,130,000. 

Program: Graduate STEM Fellows in K-12 Education Program; 
FY 2010 obligations[A]: $55,970,000. 

Program: Historically Black Colleges and Universities Undergraduate 
Program; 
FY 2010 obligations[A]: $32,060,000. 

Program: Informal Science Education; 
FY 2010 obligations[A]: $65,850,000. 

Program: Integrative Graduate Education and Research Traineeship 
Program; 
FY 2010 obligations[A]: $69,700,000. 

Program: Interdisciplinary Training for Undergraduates in Biological 
and Mathematical Sciences; 
FY 2010 obligations[A]: $2,700,000. 

Program: International Research Experiences for Students; 
FY 2010 obligations[A]: $3,430,000. 

Program: Louis Stokes Alliances for Minority Participation; 
FY 2010 obligations[A]: $44,550,000. 

Program: Math and Science Partnership; 
FY 2010 obligations[A]: $57,930,000. 

Program: Nanotechnology Undergraduate Education in Engineering; 
FY 2010 obligations[A]: $1,830,000. 

Program: Opportunities for Enhancing Diversity in the Geosciences; 
FY 2010 obligations[A]: $4,180,000. 

Program: Polar Education Program; 
FY 2010 obligations[A]: $1,500,000. 

Program: Research and Evaluation on Education in Science and 
Engineering; 
FY 2010 obligations[A]: $45,670,000. 

Program: Research Experiences for Teachers in Engineering and Computer 
Science; 
FY 2010 obligations[A]: $5,410,000. 

Program: Research Experiences for Undergraduates; 
FY 2010 obligations[A]: $80,990,000. 

Program: Research in Disabilities Education; 
FY 2010 obligations[A]: $6,920,000. 

Program: Research on Gender in Science and Engineering; 
FY 2010 obligations[A]: $11,570,000. 

Program: Robert Noyce Teacher Scholarship Program; 
FY 2010 obligations[A]: $54,930,000. 

Program: Science, Technology, Engineering, and Mathematics Talent 
Expansion Program; 
FY 2010 obligations[A]: $31,640,000. 

Program: Transforming Undergrad Education in STEM; 
FY 2010 obligations[A]: $41,600,000. 

Program: Tribal Colleges and Universities Program; 
FY 2010 obligations[A]: $13,350,000. 

Program: Undergraduate Research and Mentoring in the Biological 
Sciences; 
FY 2010 obligations[A]: $9,000,000. 

Agency and subagency: Nuclear Regulatory Commission; 

Program: Integrated University Program; 
FY 2010 obligations[A]: $15,000,000. 

Program: Minority Serving Institutions Program; 
FY 2010 obligations[A]: $2,838,500. 

Program: Nuclear Education Curriculum Development Grants; 
FY 2010 obligations[A]: $4,700,997. 

Agency and subagency: U.S. Department of Agriculture; 

Agency and subagency: Animal and Plant Health Inspection Service; 

Program: AgDiscovery Program; 
FY 2010 obligations[A]: $15,000. 

Agency and subagency: National Institute of Food and Agriculture; 

Program: 1890 Institution Teaching, Research and Extension Capacity 
Building Grants Program; 
FY 2010 obligations[A]: $17,167,994. 

Program: Agriculture in the Classroom; 
FY 2010 obligations[A]: $314,912. 

Program: Food and Agricultural Sciences National Needs Graduate and 
Postdoctoral Fellowships Grants Program; 
FY 2010 obligations[A]: $3,664,127. 

Program: Higher Education Challenge Grants Program; 
FY 2010 obligations[A]: $5,654,000. 

Program: Higher Education Multicultural Scholars Program; 
FY 2010 obligations[A]: $1,126,000. 

Program: Hispanic Education Partnership Grants; 
FY 2010 obligations[A]: $8,809,568. 

Program: New Era Rural Technology Competitive Grants Program; 
FY 2010 obligations[A]: $875,000. 

Program: Resident Instruction Grants for Institutions of Higher 
Education in Insular Areas; 
FY 2010 obligations[A]: $859,547. 

Program: Secondary Education, Two-Year Postsecondary Education and 
Agriculture in the K-12 Classroom Grants; 
FY 2010 obligations[A]: $983,000. 

Agency and subagency: Office of the Assistant Secretary for 
Departmental Management; 

Program: U.S. Department of Agriculture/1890 National Scholars Program; 
FY 2010 obligations[A]: $2,398,947. 

Agency and subagency: U.S. Department of Commerce; 

Agency and subagency: National Institute of Standards and Technology; 

Program: National Institute of Standards and Technology Summer 
Institute for Middle School Science Teachers; 
FY 2010 obligations[A]: $300,000. 

Program: Recovery Act Measurement Science and Engineering Fellowship 
Program; 
FY 2010 obligations[A]: $20,000,000. 

Program: Summer Undergraduate Research Fellowship Program; 
FY 2010 obligations[A]: $595,641. 

Agency and subagency: National Oceanic and Atmospheric Administration; 

Program: Bay Watershed Education and Training Program; 
FY 2010 obligations[A]: $9,700,000. 

Program: Climate Communications and Education Program; 
FY 2010 obligations[A]: $536,000. 

Program: Coral Reef Conservation Program; 
FY 2010 obligations[A]: $838,000. 

Program: Dr. Nancy Foster Scholarship Program; 
FY 2010 obligations[A]: $603,125. 

Program: Educational Partnership Program with Minority Serving 
Institutions; 
FY 2010 obligations[A]: $14,309,000. 

Program: Environmental Literacy Grants; 
FY 2010 obligations[A]: $10,388,185. 

Program: Ernest F. Hollings Undergraduate Scholarship Program; 
FY 2010 obligations[A]: $6,450,638. 

Program: Global Learning and Observations to Benefit the Environment; 
FY 2010 obligations[A]: $3,000,000. 

Program: National Environmental Satellite, Data, and Information 
Service Education; 
FY 2010 obligations[A]: $2,700,000. 

Program: National Estuarine Research Reserve System Education Program; 
FY 2010 obligations[A]: $1,020,000. 

Program: National Marine Fisheries Service Education; 
FY 2010 obligations[A]: $3,084,750. 

Program: National Marine Sanctuaries Education Program; 
FY 2010 obligations[A]: $908,150. 

Program: National Ocean Service Education; 
FY 2010 obligations[A]: $426,000. 

Program: National Sea Grant College Program - Education Component; 
FY 2010 obligations[A]: $9,378,529. 

Program: National Weather Service Outreach Program; 
FY 2010 obligations[A]: $3,070,000. 

Program: Teacher at Sea Program; 
FY 2010 obligations[A]: $600,000. 

Agency and subagency: U.S. Department of Defense; 

Agency and subagency: Air Force; 

Program: Awards to Stimulate and Support Undergraduate Research 
Experience; 
FY 2010 obligations[A]: $4,500,000. 

Program: National Defense Science and Engineering Graduate Fellowship; 
FY 2010 obligations[A]: $38,695,132. 

Program: University NanoSatellite Program; 
FY 2010 obligations[A]: $660,000. 

Agency and subagency: Army; 

Program: Army Educational Outreach Program; 
FY 2010 obligations[A]: $7,885,000. 

Program: Consortium Research Fellows Program; 
FY 2010 obligations[A]: $1,634,050. 

Program: National Science Center; 
FY 2010 obligations[A]: $1,982,000. 

Agency and subagency: Office of the Secretary of Defense; 

Program: Autonomous Robotic Manipulation; 
FY 2010 obligations[A]: $8,180,000. 

Program: Computer Science in Science, Technology, Engineering, and 
Mathematics Education; 
FY 2010 obligations[A]: $2,661,000. 

Program: Department of Defense STARBASE Program; 
FY 2010 obligations[A]: $20,000,000. 

Program: ENGAGE; 
FY 2010 obligations[A]: $2,100,000. 

Program: National Defense Education Program K-12; 
FY 2010 obligations[A]: $13,595,000. 

Program: National Defense Education Program Science, Mathematics And 
Research for Transformation; 
FY 2010 obligations[A]: $47,400,000. 

Agency and subagency: Military Health System; 

Program: Uniformed Services University of the Health Sciences; 
FY 2010 obligations[A]: $447,000. 

Agency and subagency: Navy; 

Program: Historically Black College and Universities/Minority 
Institutions Research Education Partnership; 
FY 2010 obligations[A]: $700,000. 

Program: Iridescent Learning; 
FY 2010 obligations[A]: $810,000. 

Program: Science and Engineering Apprentice Program; 
FY 2010 obligations[A]: $755,000. 

Program: SeaPerch; 
FY 2010 obligations[A]: $700,000. 

Program: The Naval Research Enterprise Intern Program; 
FY 2010 obligations[A]: $1,960,000. 

Program: University/Laboratory Initiative; 
FY 2010 obligations[A]: $2,350,000. 

Agency and subagency: Department of Education; 

Program: Developing Hispanic-Serving Institutions: STEM and 
Articulation Programs (mandatory); 
FY 2010 obligations[A]: $0[B]. 

Program: Graduate Assistance in Areas of National Need; 
FY 2010 obligations[A]: $31,005,248. 

Program: Mathematics and Science Partnerships; 
FY 2010 obligations[A]: $180,478,000. 

Program: Minority Science and Engineering Improvement Program; 
FY 2010 obligations[A]: $9,503,000. 

Program: National Science and Mathematics Access to Retain Talent 
Program; 
FY 2010 obligations[A]: $379,775,972. 

Program: Predominantly Black Institutions Competitive Grant Program; 
FY 2010 obligations[A]: $0[B]. 

Program: Research in Special Education; 
FY 2010 obligations[A]: $11,000,000. 

Program: Research, Development, and Dissemination; 
FY 2010 obligations[A]: $39,986,940. 

Program: Teachers for a Competitive Tomorrow: Baccalaureate Degrees in 
STEM and Critical Foreign Languages; 
FY 2010 obligations[A]: $1,092,000. 

Program: Teachers for a Competitive Tomorrow: Master's Degrees in STEM 
and Critical Foreign Languages; 
FY 2010 obligations[A]: $1,092,000. 

Program: Upward Bound Math-Science; 
FY 2010 obligations[A]: $34,873,057. 

Program: Women's Educational Equity; 
FY 2010 obligations[A]: $2,423,000. 

Agency and subagency: U.S. Department of Energy; 

Program: Academies Creating Teacher Scientists; 
FY 2010 obligations[A]: $3,721,600. 

Program: Advanced Vehicle Competitions; 
FY 2010 obligations[A]: $2,000,000. 

Program: American Chemical Society Summer School in Nuclear and 
Radiochemistry; 
FY 2010 obligations[A]: $546,813. 

Program: Advanced Scientific Computing Research - Oak Ridge National 
Laboratory Research Alliance in Math and Science; 
FY 2010 obligations[A]: $250,000. 

Program: Community College Institute of Science and Technology; 
FY 2010 obligations[A]: $685,000. 

Program: Computational Science Graduate Fellowship; 
FY 2010 obligations[A]: $7,800,000. 

Program: Faculty and Student Teams; 
Program: 1,019,000. 

Program: Fusion Energy Sciences Graduate Fellowship Program; 
FY 2010 obligations[A]: $800,000. 

Program: Graduate Automotive Technology Education; 
FY 2010 obligations[A]: $1,000,000. 

Program: Hampton University Graduate Studies; 
FY 2010 obligations[A]: $48,000. 

Program: Historically Black Colleges and Universities Mathematics, 
Science & Technology, Engineering and Research Workforce Development 
Program; 
FY 2010 obligations[A]: $8,967,507. 

Program: Industrial Assessment Centers; 
FY 2010 obligations[A]: $6,086,000. 

Program: Integrated University Program; 
FY 2010 obligations[A]: $5,000,000. 

Program: Laboratory Equipment Donation Program; 
FY 2010 obligations[A]: $150,000. 

Program: Mickey Leland Energy Fellowship; 
FY 2010 obligations[A]: $700,000. 

Program: Minority Serving Institutions Program; 
FY 2010 obligations[A]: $840,000. 

Program: Minority University Research Associates Program; 
FY 2010 obligations[A]: $591,880. 

Program: National Science Bowl; 
FY 2010 obligations[A]: $2,449,900. 

Program: National Undergraduate Fellowship Program in Plasma Physics 
and Fusion Energy Sciences; 
FY 2010 obligations[A]: $370,000. 

Program: Office of Science Graduate Fellowship program; 
FY 2010 obligations[A]: $17,500,000. 

Program: Pan American Advanced Studies Institute; 
FY 2010 obligations[A]: $200,000. 

Program: Plasma/Fusion Science Educator Programs; 
FY 2010 obligations[A]: $779,000. 

Program: Pre-Service Teacher Program; 
FY 2010 obligations[A]: $429,000. 

Program: QuarkNet; 
FY 2010 obligations[A]: $750,000. 

Program: Science Undergraduate Laboratory Internships; 
FY 2010 obligations[A]: $3,802,500. 

Program: Solar Decathlon; 
FY 2010 obligations[A]: $5,000,000. 

Program: Summer Applied Geophysical Experience; 
FY 2010 obligations[A]: $100,000. 

Program: Technical Career Intern Program; 
FY 2010 obligations[A]: $0[C]. 

Program: Wind for Schools; 
FY 2010 obligations[A]: $630,000. 

Agency and subagency: U.S. Department of Health and Human Services; 

Agency and subagency: Health Resources and Services Administration; 

Program: Health Careers Opportunity Program; 
FY 2010 obligations[A]: $22,086,000. 

Program: Public Health Traineeship Program; 
FY 2010 obligations[A]: $1,510,000. 

Agency and subagency: National Institutes of Health; 

Program: Bridges to the Baccalaureate Program; 
FY 2010 obligations[A]: $6,460,988. 

Program: Bridges to the Doctorate; 
FY 2010 obligations[A]: $2,977,075. 

Program: Cancer Education Grants Program; 
FY 2010 obligations[A]: $6,756,869. 

Program: Cancer Research Interns; 
FY 2010 obligations[A]: $191,608. 

Program: Center for Cancer Research/Johns Hopkins University Master of 
Science in Biotechnology Concentration in Molecular Targets and Drug 
Discovery Technologies; 
FY 2010 obligations[A]: $445,000. 

Program: Clinical Research Training Program; 
FY 2010 obligations[A]: $1,100,000. 

Program: Community College Summer Enrichment Program; 
FY 2010 obligations[A]: $105,000. 

Program: Curriculum Supplement Series; 
FY 2010 obligations[A]: $341,849. 

Program: Education Programs for Population Research (R25); 
FY 2010 obligations[A]: $750,154. 

Program: Graduate Program Partnerships; 
FY 2010 obligations[A]: $16,720,000. 

Program: Initiative for Maximizing Student Development; 
FY 2010 obligations[A]: $21,412,146. 

Program: Intramural National Institute of Allergy and Infectious 
Diseases Research Opportunities; 
FY 2010 obligations[A]: $129,111. 

Program: Minority Access to Research Careers Undergraduate Student 
Training in Academic Research National Research Service Award Program; 
FY 2010 obligations[A]: $20,386,651. 

Program: Material Development for Environmental Health Curriculum; 
FY 2010 obligations[A]: $1,544,868. 

Program: National Cancer Institute Cancer Education and Career 
Development Program; 
FY 2010 obligations[A]: $20,442,233. 

Program: National Center for Research Resources Science Education 
Partnership Award; 
FY 2010 obligations[A]: $16,653,015. 

Program: National Heart, Lung, and Blood Institute Minority 
Undergraduate Biomedical Education Program; 
FY 2010 obligations[A]: $$475,970. 

Program: National Institute of Allergy and Infectious Diseases Science 
Education Awards; 
FY 2010 obligations[A]: $1,069,978. 

Program: National Institute of Diabetes and Digestive and Kidney 
Diseases Education Program Grants; 
FY 2010 obligations[A]: $432,000. 

Program: National Institutes of Health Academy; 
FY 2010 obligations[A]: $249,866. 

Program: National Institutes of Health Summer Research Experience 
Programs; 
FY 2010 obligations[A]: $1,679,422. 

Program: National Institute of Neurological Disorders and Stroke 
Diversity Research Education Grants in Neuroscience; 
FY 2010 obligations[A]: $821,800. 

Program: National Library of Medicine Institutional Grants for 
Research Training in Biomedical Informatics; 
FY 2010 obligations[A]: $10,143,676. 

Program: Office of Science Education K-12 Program; 
FY 2010 obligations[A]: $2,270,151. 

Program: Post-baccalaureate Intramural Research Training Award Program; 
FY 2010 obligations[A]: $24,810,000. 

Program: Postbaccalaureate Research Education Program; 
FY 2010 obligations[A]: $5,780,503. 

Program: Recovery Act Limited Competition: National Institutes of 
Health Challenge Grants in Health and Science Research; 
FY 2010 obligations[A]: $4,953,293. 

Program: Research Scientist Award for Minority Institutions; 
FY 2010 obligations[A]: $82,146. 

Program: Research Supplements to Promote Diversity in Health-Related 
Research; 
FY 2010 obligations[A]: $68,981,252. 

Program: Research Initiative for Scientific Enhancement; 
FY 2010 obligations[A]: $24,441,722. 

Program: Ruth L. Kirschstein National Research Service Award 
Institutional Research Training Grants**(T32, T35); 
FY 2010 obligations[A]: $230,840,328. 

Program: Ruth L. Kirschstein NRSA for Individual Predoctoral Fellows, 
including Underrepresented Racial/Ethnic Groups, Students from 
Disadvantaged Backgrounds; 
FY 2010 obligations[A]: $56,882,642. 

Program: Science Education Drug Abuse Partnership Award; 
FY 2010 obligations[A]: $2,294,996. 

Program: Short Courses in Integrative and Organ Systems Pharmacology; 
FY 2010 obligations[A]: $665,937. 

Program: Short Courses on Mathematical, Statistical, and Computational 
Tools for Studying Biological Systems; 
FY 2010 obligations[A]: $695,460. 

Program: Short Term Educational Experiences for Research in the 
Environmental health Sciences for Undergraduates and High School 
Students; 
FY 2010 obligations[A]: $568,298. 

Program: Short-Term Research Education Program to Increase Diversity 
in Health-Related Research; 
FY 2010 obligations[A]: $4,188,763. 

Program: Student Intramural Research Training Award Program; 
FY 2010 obligations[A]: $5,868,500. 

Program: Summer Genetics Institute; 
FY 2010 obligations[A]: $53,935. 

Program: Summer Institute for Training in Biostatistics; 
FY 2010 obligations[A]: $1,449,092. 

Program: Technical Intramural Research Training Award; 
FY 2010 obligations[A]: $2,240,000. 

Program: Training in Computational Neuroscience: From Biology to Model 
and Back Again; 
FY 2010 obligations[A]: $1,443,450. 

Program: Training in Neuroimaging: Integrating First Principles and 
Applications; 
FY 2010 obligations[A]: $1,356,252. 

Program: Undergraduate Scholarship Program for Individuals from 
Disadvantaged Backgrounds; 
FY 2010 obligations[A]: $2,426,137. 

Agency and subagency: U.S. Department of Homeland Security; 

Agency and subagency: Science and Technology Directorate; 

Program: Homeland Security-related STEM Career Development Grants 
Program; 
FY 2010 obligations[A]: $2,300,000. 

Program: Homeland Security-related STEM Scholars Program; 
FY 2010 obligations[A]: $1,920,000. 

Program: Homeland Security-related STEM Summer Internship Program; 
FY 2010 obligations[A]: $363,000. 

Program: Minority Serving Institutions - Scientific Leadership Awards; 
FY 2010 obligations[A]: $2,400,000. 

Program: Minority Serving Institutions - Summer Research Team; 
FY 2010 obligations[A]: $116,000. 

Agency and subagency: U.S. Department of the Interior; 

Agency and subagency: U.S. Geological Survey; 

Program: EDMAP Component of the National Cooperative Geologic Mapping 
Program; 
FY 2010 obligations[A]: $566,161. 

Program: National Association of Geoscience Teachers - U.S. Geological 
Survey Cooperative Summer Field Training Program; 
FY 2010 obligations[A]: $200,000. 

Program: Student Intern in Support of Native American Relations; 
FY 2010 obligations[A]: $204,013. 

Agency and subagency: U.S. Department of Transportation; 

Agency and subagency: Federal Aviation Administration; 

Program: Joint University Program; 
FY 2010 obligations[A]: $300,000. 

Program: National Center of Excellence for Aviation Operations 
Research; 
FY 2010 obligations[A]: $5,393,000. 

Agency and subagency: Federal Highway Administration; 

Program: Garrett A. Morgan Technology and Transportation Education 
Program; 
FY 2010 obligations[A]: $1,250,000. 

Program: National Summer Transportation Institute Program; 
FY 2010 obligations[A]: $2,602,999. 

Program: Summer Transportation Internship Program for Diverse Groups; 
FY 2010 obligations[A]: $1,425,000. 

Agency and subagency: Research and Innovative Technology 
Administration; 

Program: University Transportation Centers Program; 
FY 2010 obligations[A]: $83,370,600. 

Agency and subagency: U.S. Environmental Protection Agency: 

Program: Cooperative Training in Environmental Sciences Research; 
FY 2010 obligations[A]: $1,593,184. 

Program: Environmental Education Grants; 
FY 2010 obligations[A]: $3,450,882. 

Program: Environmental Protection Agency Greater Research 
Opportunities Fellowships for Undergraduate Environmental Study; 
FY 2010 obligations[A]: $1,532,099. 

Program: Environmental Protection Agency Marshall Scholars Program; 
FY 2010 obligations[A]: $205,888. 

Program: National Environmental Education and Training Partnership; 
FY 2010 obligations[A]: $2,259,500. 

Program: National Network for Environmental Management Studies 
Fellowship Program; 
FY 2010 obligations[A]: $469,403. 

Program: P3 Award: National Student Design Competition for 
Sustainability; 
FY 2010 obligations[A]: $2,000,000. 

Program: President’s Environmental Youth Awards; 
FY 2010 obligations[A]: $50,000. 

Program: Science to Achieve Results Graduate Fellowship Program; 
FY 2010 obligations[A]: $6,387,830. 

Program: University of Cincinnati/Environmental Protection Agency 
Research Training Grant; 
FY 2010 obligations[A]: $333,153. 

Source: GAO analysis of survey data, 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). 

[A] This number equals the total program obligations for fiscal year 
2010, unless the survey respondent provided obligations for the STEM 
only activities within the program. 

[B] Program funding was authorized in 2010, but was not obligated 
until 2011. 

[C] Fiscal year 2010 obligations for the Technical Career Intern 
Program are reflected in the Mickey Leland Program. 

[End of table] 

Table 15: Financial Literacy: List of Programs and Activities and 
Related Budgetary Information: 

Financial literacy: 

Agency: Board of Governors of the Federal Reserve System; 
Program or activity: Division of Consumer and Community Affairs; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $1,029,885; 
Notes: Estimate of calendar year 2010 costs provided by agency staff. 

Agency: Consumer Financial Protection Bureau; 
Program or activity: Office of Financial Education and other offices; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: Not applicable; 
Notes: Agency had not yet been created at the beginning of FY 2010. 

Agency: Department of Agriculture; 
Program or activity: Family and Consumer Economics programs; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $8,433,500; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Department of Defense; 
Program or activity: Family Support Centers (including Financial 
Readiness Campaign); 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: Estimate pending[B]; 
Notes: [Empty]. 

Agency: Department of Education; 
Program or activity: Excellence in Economic Education Program; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $1,447,000[C]; 
Notes: FY 2010 obligations. 

Agency: Department of Education; 
Program or activity: Financial Education for College Access and 
Success Program; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $1,700,000[C]; 
Notes: FY 2010 obligations. 

Agency: Department of Health and Human Services; 
Program or activity: National Education and Resource Center on Women 
and Retirement Planning; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $245,763; 
Notes: FY 2010 obligations. 

Agency: Department of Labor; 
Program or activity: Retirement Savings Education Campaign; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $365,387; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Department of Labor; 
Program or activity: Wi$eUp; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $170,000; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Department of the Treasury; 
Program or activity: Office of Financial Education and Financial 
Access (including staff support for the Financial Literacy and 
Education Commission, and other initiatives); 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $2,100,000; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Federal Deposit Insurance Corporation; 
Program or activity: Money Smart Financial Education Program; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $2,749,594; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Federal Trade Commission; 
Program or activity: Division of Consumer and Business Education; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $784,904; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Office of the Comptroller of the Currency; 
Program or activity: Consumer education activities; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $450,000[D]; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Securities and Exchange Commission; 
Program or activity: Office of Investor Education and Advocacy; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $2,000,000; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Social Security Administration; 
Program or activity: Financial Literacy Research Consortium; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $9,221,000[E]; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Total (Financial literacy activities); 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $30,697,033. 

Housing Counseling and Foreclosure Mitigation[F]: 

Agency: Department of Housing and Urban Development; 
Program or activity: Housing Counseling Assistance Program; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $65,420,000[G]; 
Notes: FY 2010 obligations. 

Agency: Department of the Treasury; 
Program or activity: Financial Education and Counseling Pilot Program; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $4,150,000[H]; 
Notes: FY 2010 appropriation. 

Agency: NeighborWorks America[I]; 
Program or activity: National Foreclosure Mitigation Counseling 
Program; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $65,000,000; 
Notes: FY 2010 obligations. 

Agency: NeighborWorks America[I]; 
Program or activity: Other housing counseling activities; 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $2,000,000; 
Notes: Estimate of FY 2010 costs provided by agency staff. 

Agency: Total (Housing counseling and foreclosure mitigation 
activities); 
FY 2010 estimate for portion of program costs attributed to financial 
literacy activities[A]: $136,570,000. 

Source: GAO analysis of federal financial literacy programs and 
activities. 

[A] Cost estimates represent the portion of the program or activity 
related specifically to financial literacy and education, which in 
most cases included the estimated cost of staff time. However, because 
agencies may have used slightly different methods in estimating costs, 
dollar figures across agencies may not be fully comparable. 

[B] As of February 1, 2012, we were still developing a cost estimate 
related to these activities and we expect to provide this estimate in 
a future report. 

[C] The Excellence in Economic Education Program and the Financial 
Education for College Access and Success Program did not receive 
funding in fiscal year 2012. 

[D] Represents midpoint of the staff estimate of costs as ranging from 
$400,000-$500,000. 

[E] The Financial Literacy Research Consortium did not receive new 
funding after fiscal year 2010, according to agency staff. 

[F] In addition to the agencies listed below, some programs of the 
Department of Defense and the Department of Veterans Affairs include 
some element of housing counseling. 

[G] Program received no appropriation in fiscal year 2011. Fiscal year 
2010 amount includes HUD grants to NeighborWorks America of $1,250,501 
for comprehensive counseling and $500,000 for counseling under the 
Home Equity Conversion Mortgage program. These grants were separate 
from the congresssional appropriations to Neighborworks cited below. 

[H] The Financial Education and Counseling Pilot Program was not 
appropriated funds in fiscal years 2011 and 2012. 

[I] NeighborWorks America is a federally chartered nonprofit 
corporation that receives an annual appropriation from Congress. 

[End of table] 

[End of section] 

Appendix IV: Agency Comments: 

For issues where information is being reported on for the first time 
in this report, we sought comments from the agencies involved, and 
incorporated those comments as appropriate. This appendix includes 
only those letters that agencies provided on official letterhead. 

Note: This letter includes comments on Area 7: Support for 
Entrepreneurs. 

United States Department of Commerce: 
Economic Development Administration: 
1401 Constitution Avenue, NW, Room 7009: 
Washington, D.C. 20230: 

February 14, 2012: 

William B. Shear: 
441 G Street, NW: 
Washington, DC 20548: 

Dear Mr. Shear, 

Subject: Gao Report on Economic Development Programs (250610): 

Effectively evaluating the Federal programs that support economic 
development requires a thorough understanding of not only the types of 
investments that are made, but how, why and to whom the investments 
are made. GAO has periodically issued several reports that analyzed 
potential overlap of federal economic development activities; however, 
these reports have all focused exclusively on the types of investments 
made without considering the goals of each of the programs. Without 
viewing Federal investments in economic development through this in-
depth perspective, GAO may be incorrectly identifying duplication 
where none exists. 

As the country prepares to address the mounting deficit and reevaluate 
its investments, GAO's new report could offer important information to 
inform future budget discussions; however, this interim report 
presents premature "Actions Needed" rather than conclusions informed 
by a robust analysis. For example, on page 4 of the interim report, 
GAO indicates that it "plans to determine what, if any, unique value 
some of these overlapping programs provide." However, later on in the 
report (within the "Actions Needed" section on page 6 and GAO's future 
plans outlined at the bottom of page 7), it does not appear that this 
critical component will be part of the scope of the current study, 
regardless of the fact that findings from such an analysis on the 
unique values of each program could impact the current study's 
conclusions. Additionally, on page 5 of the report, GAO notes the lack 
of consistent performance evaluations of agencies who provide 
"entrepreneurial" services, but does not note the significant advances 
EDA has taken with the development of its Performance Management 
Improvement logic model and implementation strategy, along with a 
third-party Research Design Study to support EDA's performance 
measurement improvement activities. GAO's report also misses the 
important work DOC has undertaken to create a Departmental Performance 
Working Group to facilitate best practices in performance evaluation 
across all DOC Bureaus. 

EDA encourages GAO to reevaluate its approach with this interim 
report, and instead consider providing a status update which outlines 
the research question being examined, the methodology being conducted, 
and the project status. Further, EDA strongly encourages GAO to 
refrain from offering conclusions at this interim period until the 
research and analysis has been completed — including, as GAO cites on 
page 4, an analysis of the unique value of each program — and 
conclusions are substantiated by more robust data. We look forward to 
the final results of your study and further engaging with you on this 
important subject. 

If you have any questions, please do not hesitate to contact Deborah 
Neff on 202-482-1252. 

[End of letter] 

U.S. Department Of Housing And Urban Development: 
Office of Community Planning and Development: 
Washington, DC 20410-7000: 

January 23, 2012: 

Mr. William B. Shear: 
Director, Financial Markets and Community Investments: 
US Government Accountability Office: 
441 G Street, NW: 
Washington, DC 20548:  

Dear Mr. Shear:  

Thank you for the opportunity to provide comments on Draft 2012 
Economic Development  Duplication Report Template.  

1. Overall Comments: 

HUD recommends that GAO reduce its count of economic development 
programs administered by HUD. Eight programs are listed under the 
heading of "CDBG" when, in feet, there arc only three distinctive 
programs. A singular listing for CDBG should encompass the following 
"programs" listed individually by GAO:  

* Entitlement Grants; 
* Insular Areas; 
* States; 
* Nonentitlement Communities In Hawaii; 
* Disaster Recovery Grants.  

HUD's reasoning is that the CDBG program is authorized by Title I of 
the Housing and Community Development Act of 1974 (42 USC 5301 et. 
seq.) and section 106 of Title 1 (42 USC 5306) splits amounts 
appropriated for MBE; purposes into formula grants to different types 
of governmental units. All annual CDBG formula funding is appropriated 
by Congress under the singular heading of the "Community Development 
Fund" (CDF), including, supplemental appropriations provided for 
disaster recovery purposes, and are for activities authorized under 
Title I.  

Regulations for each these "programs" are found in 24 CFR Part 570 
and, in fact, multiple subparts of Part 570 are applicable to 
eachprogram," Thus, economic development activities carried out by 
CDBG grantee, under these "programs"' are all subject to the same 
basic set of statutory and regulatory requirements with funding from a 
single source within HUD's annual appropriation. HUD also uses a 
singluar funding agreement (HUD Form 7082) to contractually make 
grants for each of these "programs." 

While the CDBG "programs" may have separate Catalog of Federal 
Domestic Assistance (CFDA) numbers, they are effectively delivering 
funding from a single source for the same purposes under the same 
requirements but to different types of government units. These 
"programs" cannot overlap as a governmental unit receiving a CDBG 
formula allocation tinder one CDBG funding stream cannot obtain 
additional assistance under a different CDBG formula funding stream 
(excepting supplemental disaster recovery funds). For the above stated 
reasons, HUD recommends that GAO treat these "programs" a single 
entity under the CDBG label. 

The second distinctive program is the Section 108 loan guarantee 
program. While it can be argued that Section 108 comes under the CDBG 
umbrella (authorized by Title I, regulations at Subpart M of 24 CFR 
Part 570, loan commitments made via HUD Fonts 7082) the form of 
assistance differs front the "programs" that HUD recommends placing 
under the CDBG umbrella (loan guarantee vs. grant finding). Section 
108 also operates on a non-competitive application basis and thus does 
not have a formula allocation aspect as do the CDBG "programs." 
Further, credit subsidy appropriations and maximum commitment levels 
for Section 108 are provided under a heading outside the CDF. Given 
these facts, HUD believes it is correctly listed separate from the
CDBG "programs." 

The third distinctive program is the Indian CDBG program. While 
authorized by Title I and funded through the CDF, the program is 
administered by HUD's Office of Public and Indian Housing. Since the 
Indian CDBG program is administered by a different organization within 
HUD under a different set of regulations, it is correctly listed apart 
from the basic CDBG program administered by the Office of Community 
Planning and Development. 

HUD also recommends that GAO eliminate the Brownfields Economic: 
Development Initiative (BEDI) from the list of HUD's active economic 
development programs. HUD did not request funding nor did Congress 
appropriate BEDI funding in FYs 2011 and 2012. While HUD will continue 
to administer the existing BEDI grants, it is highly unlikely that any 
additional funding will be requested in FY 2013 or made available in 
the future. Further, BEDI activities can be funded with CDBG or 
Section 108 funding. As such, HUD views BEDI as having been
"consolidated or eliminated" consistent with GAO's "Action 3" in 
Report GAO-11-318SP. 

Adoption of HUD's analysis of the CDBG "programs" would require 
revisions throughout the GAO draft wherever there is a citation to the 
number of programs administered by HUD. 

II. Specific Comments: 

While the draft does not mention any specific -IUD program other than 
in the at act-anent enumerating various programs, HUD offers the 
following comments: 

Page 2 - What GAO Found - The discussion should highlight the fact 
drat CDBG is different from virtually every other program included in 
the review. The block 12rallt nature of CDBG permits grantees to 
design programs based on local needs and priorities to address a wide 
range of community development needs, including infrastructure, 
housing, public services as well as economic development. There is no 
requirement that funds be used for economic development purposes or to 
support entreprenural efforts unless local officials opt to use CDBG 
funds in this manner. This fact places CDBG in a significantly 
different context than the solely business-oriented programs that 
predominate the list of programs GAO is reviewing as part of this 
effort. 

Page 5/paragraph 2 -- HUD notes its Office of Policy Development and 
Research contracted for an extensive study of the Section 108 loan 
guarantee program and that the final report will be issued in the 
spring of 2012. 

Page 6/paragraph 1 — While there have been a limited number of broad 
analytical evaluations of the CDBG program, HUD routinely evaluates 
CDBG grantee performance and compliance through monitoring. Further, 
HUD is undertaking a series of improvements to the Integrated 
Disbursement and Information System (IDIS) which will significantly 
upgrade HUD's ability to track grantee progress in implementing 
activities and to gather improved data with regard to performance. HUD 
expects to have these improvements in place in late 2012. Further, it 
should be noted that GAO is mandated by HUD's FY 2012 appropriation 
act to undertake a review of best practices within the CDBG program at 
to report back to Congress by late May 2012. HUD suggests that GAO 
focus a portion of this review upon best practices using CDBG funds 
for economic development purposes. 

Page 6/Actions Needed/First bullet — Again, CDBG is different from 
virtually every other program included in the review in that local 
officials have extensive discretion in the use of CDBG funds and only 
a small proportion of grantees opt to use CDBG funds for economic 
development and entrepreneurial efforts. Tying future CDBG funding 
levels to outcomes on the economic development entrepreneurial 
activities misses the fact that use of CDBG funds for this purpose is 
determined by the grantees. 

Page 6/Actions Needed/Second bullet - HUD is working to improve its 
performance metrics by evaluating the data currently collected and 
anticipates adjusting these data points to reduce grantee reporting 
burden while simultaneously improving the quality and value of the 
data. 

Page 6/Actions Needed/Third bullet — While HUD agrees with GAO's 
observation that there should be better coordination of these programs 
across agencies, we must again point out that CDBG is different from 
other programs included in this review given the block grant nature of 
the funding stream. [ IUD makes no decisions with regard to the types 
of businesses targeted by grantees in the use of these funds and is 
not desirous of placing such restrictions on local decisions on uses of
CDBG funding. 

Again, thank you for the opportunity to provide these comments. If you 
have any questions regarding this letter, please contact me at (202) 
708-2111. 

Sincerely, 

Signed by: 

Yolanda Chavez: 
Deputy Assistant Secretary for Grant Programs: 

[End of letter] 

Note: This letter includes comments on Area 14: Health Research 
Funding. 
 
Office Of The Assistant Secretary Of Defense: 
Health Affairs: 
Washington, DC 20301-1200: 

Ms. Linda Kohn: 
Director, Health Care
U.S. Government Accountability Office
441 G Street, N.W.
Washington DC 20333 

January 6, 2012: 

Dear Ms. Kohn: 

This is the Department of Defense (DoD) response to the GAO Draft 
Report, "Health Research Funding: NIH, DoD and VA Can Improve Sharing 
of Information to Help  Avoid Duplication," dated December 16, 2011 
(GAO #290961). 

The Department appreciates the opportunity to comment on this draft 
report and concurs with its findings. GAO's thoughtful discussion on 
this topic and the identification of possible ways to eliminate 
duplication of research efforts will add to discussion on this matter. 

My point of contact on this subject is Dr. Terry Rauch, who can be 
reached at  (703) 578-8503 or via e-mail at Terry.Rauch@ha.osd.mil. 

Signed by: 

George Peach Taylor, Jr., M.D.
Deputy Assistant Secretary of Defense: 
Force Health Protection and Readiness: 

[End of letter] 

Note: This letter includes comments on Area 14: Health Research 
Funding. 

Department of Health & Human Services: 
Office of The Secretary: 
Assistant Secretary for Legislation: 
Washington, DC 20201: 

January 9, 2012: 

Linda Kohn: 
Director, Health Care: 
U.S. Government Accountability Office: 
441 G Street NW: 
Washington, DC 20548: 

Dear Ms. Kohn: 

Attached are comments on the U.S. Government Accountability Office's 
(GAO) draft section on health research funding for your Fiscal Year 
2012 Duplication Mandate report (GAO 12-342SP). 

The Department appreciates the opportunity to review this draft 
section of the report prior to publication. 

Sincerely, 

Signed by: 

Jim R. Esquea: 
Assistant Secretary for Legislation: 

Attachment: 

General Comments Of The Department Of Health And Human Services (HHS) 
On The Government Accountability Office's (GAO) Draft Section On 
Health Research Funding Of The GAO Fiscal Year 2012 Duplication 
Mandate Report (GAO-12-342SP): 

The Department appreciates the opportunity to review and comments on 
this draft section of the FY12 Duplication Mandate report. 

GAO Summary of Actions Needed: 

While NIH, DOD, and VA take steps to check for duplication in the 
health research they find, the agencies have opportunities to improve 
sharing of information needed to evaluate research for potential 
duplication when making decisions. In order to do so, NIH, DOD and VA 
should determine ways to improve the comprehensiveness of information 
on funded health research shared among agency officials and improve 
the ability of agency officials to identify possible duplication. For 
example: 

* NIH, DOD and VA could collaborate to allow for more efficient, 
comprehensive searches to identify duplication, by, for example, 
increasing commonalities among their respective databases, such as 
more details on the aims and methodology of applications that may be 
useful to program managers evaluating applications for duplication; 
and ensuring contact information for agency officials associated with 
specific applications is made available in their respective databases, 
if possible. 

* NIH, DOD and VA could provide program managers with information to 
help them identify when they receive similar applications and to 
monitor the funding status of these applications, such as which 
applications receive funding, and which are modified during the 
funding process. 

National Institutes of Health (NIH) Response: 

GAO suggested that NIH, DOD, and VA provide program managers with 
information to help them identify when they receive similar 
applications and to monitor the funding status of these applications, 
such as which applications receive funding and which are modified 
during the funding process. NIH has extensive policies in place 
concerning monitoring and managing potential overlap in funding. 
Management of potential overlap is a critical responsibility of NIH 
staff, including grants management, program, and staff in the Center 
for Scientific Review. Further, NIH's comprehensive internal database 
Information for Management, Planning, Analysis, and Coordination 
(IMPAC)—provides information systems to support the full life cycle of 
grants administration and is the source of comprehensive information 
related to NIH grants management and administration, including 
detailed funding data. NIH's comprehensive database, together with 
strong policy guidance, provides an infrastructure to support 
successful identification of potential duplication of funding. 

NIH Policy and Guidance: 

NTH addresses any type of overlap—whether it is scientific, budgetary, 
or commitment of effort—prior to the issuance of a Notice of Grant 
Award. It is the responsibility of program and grants management staff 
routinely to review Other Support documentation (which includes all 
financial resources whether Federal, non-Federal, commercial, or 
organizational, available in direct support of an individual's 
research endeavors, including but not limited to research grants, 
cooperative agreements, contracts, or organizational awards, but not 
training awards, prizes, or gifts) to determine if there is budgetary, 
scientific, or commitment overlap. The Other Support information helps 
meet the goal of identifying and eliminating overlap to ensure there 
is no duplication of funding for scientific aims. NIH has long-
standing policies and procedures in place on the topic of Other 
Support and overlap for extramural staff as well as for grantees. 

Pre-Award Review: 

NTH policy requires that if the research plan in the pending 
application is identical to either other pending applications or an 
active award, the Principal Investigator/Program Director (PI/PD) must 
negotiate with NIH staff concerning which grant will be funded. If 
there is partial duplication, the pending application, other 
applications, or the active award will be modified prior to NIH's 
funding the pending application. Depending upon the amount of 
scientific overlap, NH may choose not to fund the pending application. 

When resolving any question of overlap, program and grants management 
staffs coordinate their efforts to collect pertinent information and 
make determinations. Based on additional information received from the 
PI/PD, program and grants management staff will determine the 
appropriate action and decide whether budgetary adjustments are 
needed. In order to make these determinations, staff must consult, as 
necessary, with other funding components within N1H, other Government 
agencies, or private organizations to resolve questions of overlap. 

In addition to the submission of Other Support, the application 
instructions require the applicant to indicate whether his/her 
application has been sent to other agencies, outside of the Public 
Health Service (PHS), and include on the cover of the application to 
which agencies the application has been submitted. This information is 
part of every electronic application. It is also important to note 
that the NIH Grants Policy Statement (10/2011), which is a term and 
condition of all NIH grant awards, and the application instructions 
contain NIH's policy on similar, essentially identical, or identical 
applications. 

Submissions of identical applications to one or more components of the 
PHS are not allowed, and the NIH will not accept similar grant 
applications with essentially the same research focus from the same 
applicant organization. This includes derivative or multiple 
applications that propose to develop a single product, process, or 
service that, with non-substantive modifications, can be applied to a 
variety of purposes. Likewise, identical or essentially identical 
grant applications submitted by different applicant organizations will 
not be accepted. Applicant organizations should ascertain and assure 
that the materials they are submitting on behalf of the principal 
investigator are the original work of the principal investigator and 
have not been used elsewhere in the preparation and submission of a 
similar grant application. Applications to the NIH are grouped by 
scientific discipline for review by individual Scientific Review 
Groups and not by disease or disease state. The reviewers can thus 
easily identify multiple grant applications for essentially the same 
project. In these cases, application processing may be delayed or the 
application(s) may not be reviewed. 

Essentially identical applications will not be reviewed except for 
those of: I) individuals submitting an application for an Independent 
Scientist Award (K02) proposing essentially identical research in an 
application for an individual research project; and 2) individuals 
submitting an individual research project identical to a subproject 
that is part of a program project or center grant application. 

Post-Award Monitoring: 

To assist with monitoring awards in the post-award stage, the PIJPD is 
required to report any substantial changes in Other Support or other 
overlap issues in the noncompeting application. Any overlap issues are 
required to be addressed by NIH Grants and Program Staff prior to the 
issuance of the next funding increment. 

Database Information Available: 

The NIH and the VA staff currently have a number of resources 
available to examine details of existing funding when evaluating 
overlap. Program staff from other agencies can obtain and share 
information through discussion by telephone and email. In an 
electronic setting, the NIH and the VA staff have access to an eRA 
module called QVR (for Query/View/Report). This system provides 
extensive data about funded grants and unfunded grant applications and 
is a module within the IMPAC comprehensive internal database. IMPAC is 
the database used extensively by NIH grants and program staff to 
obtain and manage detailed information used for funding decisions, 
among other things. The information available far exceeds the data 
that is available through the public Web sites such as RePORTER. By 
contrast, the RePORTER tool was developed to provide the public with 
information on NIH-supported research projects and was not designed to 
be a sole source of information on which to base funding decisions. 
Not only are PIs/PDs easily identified using QVR, but also their 
complete grant application/award history and data about their 
individual grants (including aims and methodologies) are immediately 
available. Additionally, the Federal grant-processing staff can 
identify grants that deal with similar areas of science. This 
capability is built upon the Research, Condition, and Disease 
Categorization[Footnote 1] (RCDC) data that provides scientific 
"fingerprints" of grants and is much more effective at identifying 
similar projects than a simple keyword search. The QVR system clearly 
provides the tools and information needed to detect potentially 
duplicative grants. 

NIH makes the QVR facility available to other Federal agencies, 
contingent upon acceptance of the formal data access agreement. In 
fact, the VA currently uses NIH eRA systems for some of their 
applications and grants. The DOD staff may request access to QVR and 
may also obtain training in the use of QVR by contacting the eRA 
Program Manager. 

Since NIH is an acceptable grant processing site under the Grants 
Management Line of Business (GMLoB) initiative, other agencies may 
wish to discuss using the NIH system (and database) for processing 
their research grants. If other agencies, like the VA, used the NTH 
system, identifying potential grant overlap would be a straightforward 
process. 

Footnote: 

[1] Further information on the Research. Condition, and Disease 
Categorization process is available at: [hyperlink, 
http://report.nih.gov/rcdc/.] RCDC is a computerized process the NIH 
uses at the end of each fiscal year to sort and report the amount it 
funded in each of 229 historically reported categories of disease, 
condition, or research area. Since January 2009. RCDC reports have 
been available from the NIH's RePORT site. 

[End of letter] 

Note: This letter includes comments on Area 23: Space Launch Contract 
Costs. 

National Aeronautics and Space Administration: 
Headquarters: 
Washington, DC 20546-0001: 

February 1, 2012: 

Reply to Attn of: Human Exploration and Operations Mission Directorate: 

Ms. Cristina Chaplain: 
Director: 
Acquisition and Sourcing Management: 
United States Government Accountability Office: 
Washington, DC 20548: 

Dear Ms. Chaplain: 

The National Aeronautics and Space Administration (NASA) appreciates 
the opportunity to review and comment on the Government Accountability 
Office (GAO) draft report entitled, "Space Launch Services" (GAO Job 
Code 12105). 

We concur that the goal of improving efficiency and maximizing the 
government's buying power for Evolved Expendable Launch Vehicle (EELV) 
intermediate launch vehicles is worthy, and we believe that we are 
working with our Air Force and National Reconnaissance Office 
colleagues in such a way to achieve this goal, while still allowing 
each Agency to perform its assigned space-related responsibilities.
In the draft report, the GAO recommends that the Office of Management 
and Budget (OMB) pursue the following: 

* Assess the potential to consolidate the DOD and NASA acquisition 
processes for awarding contracts and providing mission assurance with 
an eye toward ensuring that launch prices are competitive for all U.S. 
Government customers and that the government is not paying twice for 
overhead costs under separate contracts. 

In our view, "consolidation" is not viable due to the assigned 
responsibilities of each Agency. NASA's unique responsibilities 
include the development and launch of payloads ranging from the small 
and simple to the large and very complex, with missions that support 
our planet, as well as those that travel to other planets in our solar 
system and beyond. Typically, the complexities for the NASA payloads 
that need to fly on an intermediate launch vehicle like the EELV Atlas 
V are immense requiring a large amount of involvement by a 
knowledgeable, experienced Agency mission team to work with the 
commercial launch service provider in order to maximize the 
probability for mission success. 

Instead of emphasizing "consolidation," we propose that the GAO revise 
its recommendation(s) to OMB as follows: 

* Assess the potential to ensure formal coordination of the DOD and 
NASA acquisition processes for awarding EELV launch service contracts 
with an eye toward ensuring that the launch service is acquired such 
that best value is provided to the U.S. Government. 

* Develop a way to ensure that the government is not paying twice for 
launch overhead costs through the separate acquisition processes. 

We believe that formalizing the need to coordinate our acquisition 
processes will not only provide the opportunity to improve efficiency 
and maximize the government's buying power for EELV intermediate 
launch vehicles, but it can also provide a means for increasing the 
opportunities for commercial launch service competition and improve 
its value to the nation. 

Again, thank you for the opportunity to comment on this draft report. 
If you have any questions please contact Jim Norman at (202) 358-0905. 

Sincerely,
Signed by: 

William H. Gerstenmaier: 
Associate Administrator For Human Exploration and Operations: 

[End of letter] 

Note: This letter includes comments on Area 29: Early Learning and 
Child Care. 

Department of Health & Human Services: 
Office of The Secretary: 
Assistant Secretary for Legislation: 
Washington, DC 20201: 

January 30, 2012: 

Kay Brown: 
Director, Education, Workforce, and Income Security Issues: 
U.S. Government Accountability Office: 
441 G Street NW: 
Washington, DC 20548: 

Dear Ms. Brown: 

Attached are comments on the U.S. Government Accountability Office's 
(GAO) draft section on early education and child care for your Fiscal 
Year 2012 Duplication Mandate report (GAO 12-342SP). 

The Department appreciates the opportunity to review this draft 
section of the report prior to publication. 

Sincerely, 

Signed by: 

Jim R. Esquea: 
Assistant Secretary for Legislation: 

Attachment: 

General Comments Of The Department Of Health And Human Services (HHS) 
On The Government Accountability Office's (GAO) Draft Section On Early 
Education And Child Care Of The GAO Fiscal Year 2012 Duplication 
Mandate Report (GAO-12-342SP): 

The Department appreciates the opportunity to review and comment on 
this draft section of the FY12 Duplication Mandate report. 

GAO Summary of Actions Needed: 

As the principal administrators of the federal government's early 
learning and child care programs, and consistent with Education's and 
HHS' identification of early learning access and quality as 
priorities, Education and HHS should deepen and extend their ongoing 
coordination efforts by establishing an inter-departmental workgroup 
that includes all the federal agencies that have early learning and 
child care programs. Using the GPRAIVIA framework, workgroup goals 
could include mitigating the effects of program fragmentation (for 
example, through simplifying children's access to these services), 
identifying and managing service gaps, meeting data requirements for 
the coordinated operation and evaluation of these programs, and 
identifying and minimizing any unwarranted overlap. These efforts 
could also provide a vehicle to conduct a coordinated analysis of 
child care tax expenditures and program spending. 

Administration for Children and Families (ACF) Response: 

ACF acknowledges GAO's recommendation and agrees with the importance 
of program coordination across Early Education and Child Care in order 
to meet the needs of children and families. 

Cross-program coordination to ensure that children have access to high 
quality Early Learning and Child Care (ELCC) programs has been a 
priority and key focus for the Administration. Over the last three 
years, ACF has developed and implemented an integrated early childhood 
unit under the leadership of the Office of the Deputy Assistant 
Secretary for Early Childhood Development, which has become the focal 
point within HHS for early childhood activities at the Federal level. 
Within this structure, the Administration has taken several steps to 
improve coordination between the Office of Child Care (OCC) and Office 
of Head Start (OHS), such as: 

* Establishing the National Center on Child Care Professional Systems 
and Workforce Initiatives, which is funded by both the OCC and the 
OHS; and; 

* Implementing the Early Head Start for Family Child Care 
Demonstration Project that was jointly coordinated by the OCC and the 
OHS to demonstrate and evaluate models of collaboration. 

While the GAO report recognizes that Head Start (HS) and the Child 
Care and Development Fund (CCDF) vary in structure, administration, 
and regulation, ACF believes the report fails to fully explore how 
these variations lead Head Start and CCDF to provide complementary 
services, not duplicative ones. For example, many HS programs only 
provide part-day services that may not cover the full time a parent is 
at work and in need of child care. Therefore, many families rely on 
child care for early childhood education and afterschool care. In 
addition, some low-income children benefit from a combination of both 
programs to create high quality full-day, full-year care. The OCC and 
the OHS have worked together to encourage collaboration at the grantee 
level in a variety of ways, including issuing guidance on aligning 
eligibility policies and providing technical assistance on aligning 
both programs at the State and community levels to help more low-
income children access high quality early learning. 

The GAO report expresses concern about the way many overlapping 
programs may impact service delivery for families trying to access 
early care and education services. ACF believes the report fails to 
take into account how States administer programs. Some of the largest 
Federal funding sources for Early Care and Education (ECC)-—including 
the CCDF, Temporary Assistance for Needy Families (TANF), and the 
Social Services Block Grant (SSBG)-—are block grants. Many States 
choose to jointly administer these flexible funding streams under one 
set of rules, often in coordination with other State and local 
funding. Therefore, in reality, from the perspective of service 
delivery for children and families, the block grant programs are not 
separate programs, but rather funding streams that are integrated 
together to provide services. The ACF supports this integration 
through technical assistance and program guidance. For example, the 
CCDF program allows States to submit required data reports on children 
that receive services funded by a pool of multiple funding streams, 
rather than requiring States to segregate funding or reporting. 

Additionally, some ELCC programs target very specific populations or 
child care facilities minimizing overlap of programs. For example, the 
General Services Administration's (GSA) Child Care Program helps 
federal workers gain access to work place child care facilities. Also, 
Education's Child Care Access Means Parents in School funds campus-
based child care programs primarily serving the needs of low-income 
students enrolled in institutions of higher education. 

ACF believes that the report does not adequately explain the 
distinction between federally funded ELCC programs and federally 
funded programs that permit the use of funds for the
provision of child care. Many programs included in the GAO report do 
not direct and implement policies related to ELCC. For example, the 
Workforce Investment Act Adult and Dislocated Workers Program 
administered by the Department of Labor is designed to provide 
employment and training services to eligible individuals in finding 
and qualifying for meaningful employment. The program does potentially 
fund child care, but child care is only one of many "supportive 
services" that are provided under certain circumstances to allow an 
individual to participate in the program. This is not an ELCC program; 
it is a job training program that may support participants by 
providing funding to cover child care expenses. 

ACF appreciates that the report references many of the 
Administration's interagency and interdepartmental efforts to 
coordinate federally funded ECC programs. However, we would like to 
provide a fuller account of some of the progress that has been made: 

* Race to the Top-Early Learning Challenge: The Race to the Top-Early 
Learning Challenge (RTT-ELC), jointly administered by Education and 
HHS provided approximately $500 million in FY 2011 to fund a major 
competition in support of bold and comprehensive State plans for 
reforming early learning and development programs to close the school 
readiness gap. 

The RTT-ELC will support the work of nine state grantees to develop 
new approaches to raising the bar across early learning centers and to 
close the school readiness gap. Awards will invest in grantees' work 
to build statewide systems of high-quality early learning and 
development programs. These investments will impact all early learning 
programs, including HS, public pre-K, child care, and private 
preschools. Key reforms will include: aligning and raising standards 
for existing early learning and development programs; improving 
training and support for the early learning workforce through evidence-
based practices; and building robust evaluation systems that promote 
effective practices and programs to help parents make informed 
decisions. 

* State Advisory Councils on Early Childhood Education and Care: The 
Improving Head Start for School Readiness Act of 2007 required that 
the Governor of each State designate or establish a council to serve 
as the State Advisory Council on Early Childhood Education and Care 
(ECEC) for children from birth to school entry. The State Advisory 
Councils will lead the development or enhancement of a high quality, 
comprehensive system of ECEC that ensures statewide coordination and 
collaboration among the wide range of early childhood programs and 
services in the State, including child care, Head Start, IDEA 
preschool and infants and families programs, and pre-kindergarten 
programs and services. The State Advisory Councils will play a key 
role in advancing the goal of integrated services to young children 
and families while promoting school preparedness of children from 
birth through school entry. The ACF awarded $100 million of the 
American Recovery Reinvestment Act funding earmarked for State 
Advisory Councils to 45 States, DC, PR, VI, Guam, and American Samoa. 

* ACF/Child and Adult Care Food Program (CACFP) Workgroup: Convened by 
the Office of Management and Budget (OMB), the ACF/CACFP Workgroup 
brings together staff from the Food and Nutrition Services (FNS), the 
OCC, and the OHS to discuss possible collaboration around the Child 
and Adult Care Food Program. The workgroup has identified the 
following areas of collaboration: sharing the National Disqualified 
List, joint information memorandums on collaboration at the State and 
local level, and improving Tribal participation in the CACFP. 

* Early Learning Interagency Policy Board: The Secretaries of 
Education and HHS established the Early Learning Interagency Policy 
Board to improve the quality of early learning programs and outcomes 
for young children; increase the coordination of research, technical 
assistance and data systems; and advance the effectiveness of the 
early learning workforce among the major federally funded early 
learning programs across Education and HHS. 

* Military Family Federal Interagency Collaboration: The OHS and the 
OCC are working with the Department of Defense as part of the Military 
Family Federal Interagency Collaboration. The collaborative effort is 
focused on increasing the availability and quality of child care in 13 
States for military families, especially those families not near 
military bases or not having easy access to other military child care 
supports. The Military Child Care subcommittee, as part of the overall 
collaboration, has identified the strategic goals of: 

(1) improving access to quality child care programs by increasing the 
level of quality; 

(2) improving the awareness of quality indicators and their importance 
for creating and maintaining safe and healthy environments for 
children; 

(3) improving the communication between various partners and agencies 
to ensure limited resources are used effectively. 

[End of letter] 

U.S. Department of Labor: 
Office of the Assistant: 
Secretary for Policy: 
Washington, DC 20210: 

January 20, 2012: 

Daniel Bertoni: 
Director Education, Workforce, and Income Security Issues: 
U.S. Government Accountability Office: 
441 G Street N.W. 
Washington, D.C. 20548: 

Dear Mr. Bertoni: 

On behalf of the U.S. Department of Labor (Department), I want to 
thank you for the opportunity to review and comment on the Government 
Accountability Office's (GAO) draft language that will be included in 
GAO's Fiscal Year 2012 Duplication Mandate. We are concerned about the 
GAO's general statement that finds duplication and fragmentation 
within the programs it examined without providing a more detailed 
explanation of that determination, We respectfully recommend that the 
GAO reconsider and refine its findings to better reflect the 
information in this letter and its enclosure. 

Ensuring programmatic and physical access for individuals with 
disabilities throughout the Department's programs is an ongoing 
priority. In the report, GAO notes that over the years many programs 
have been created to address issues related to the employment of 
people with disabilities. However, several of the Department's 
programs included in the study (e.g., the Workforce Investment Act of 
1998 (WIA) Youth Formula Program, Job Corps, YouthBuild, and the Local 
Veterans Employment Representative) were not created for this purpose. 
The majority of people served by these programs are not people with 
disabilities. We are proud that the Department has made great strides 
in accessibility and that employment and training programs 
administered by the Department serve people with disabilities along 
side their peers. Rather than being seen as duplicative or 
undesirable, we believe that such inclusion is an important 
operational achievement and that service integration is consistent 
with what Congress envisioned in enacting our nation's disability 
civil rights laws. 

GAO also appears to assume that those with disabilities are a 
homogeneous group and that one program could address their needs. The 
reality is that people with disabilities are a diverse population and 
as multidimensional as those without disabilities. GAO may not have 
given adequate consideration to the fact that while all of the 
programs in the study provide services related to employment of people 
with disabilities, the actual services provided, program design used, 
and the populations served, vary significantly, For example, while our 
youth programs (e.g., WIA Youth Formula Program, Job Corps, and 
YouthBuild) may provide some similar services, each program has 
distinct models and target populations and are more accurately 
described as complementary rather than overlapping. As a specific 
example, the Department's Workforce Recruitment Program helps place 
higher education graduates with disabilities in internships and 
employment, while the Department's Job Corps program provides low-
income youth with the academic, career technical, and social skills 
training needed to enter the workforce, join the military, or enroll 
in higher education. 

The Department is committed to bringing about better alignment of 
Federal investments in job training; improving models to deliver 
quality services across programs at lower costs; and providing 
relevant workforce and labor market information to jobseekers, 
employers, and others. The Department also is committed to working 
with its Federal agency partners on a variety of efforts in order to 
better respond to the current and future needs of our workforce and to 
leverage resources to help individuals, including those with 
disabilities, find and keep good jobs. Through participation in 
numerous federal workgroups, the Department has collaborated for many 
years with the U.S. Departments of Health and Human Services, 
Education, Transportation, the Social Security Administration and a 
number of other Federal agencies to streamline and strengthen the 
coordination of various programs and services. While we agree that it 
is important to minimize duplication and maximize efficiency, the 
Department wants to emphasize that some overlap between programs is 
necessary and appropriate to ensure that all participants receive 
comprehensive employment and training services. We believe that a 
coherent public workforce system does not necessarily mean a single 
program, supplier, or agency. Our goal is a rational system whose 
elements fit together logically, with minimal duplication, and provide 
ready and seamless access to services for jobseekers, including 
individuals with disabilities, looking for good jobs, and employers 
looking for job-ready skilled workers. 

We will also be sending you the Department's comments on the draft 
language that will be included in GAO's Fiscal Year 2012 Duplication 
Mandate. This will include information about some of the Department's 
programs. If you would like additional information, please do not 
hesitate to call me at 202-693-5959. The Department would also be 
available to meet with GAO to discuss this letter and enclosure.
The Department appreciates the work being done by GAO to improve 
efficiency in government. We also believe great progress has been made 
over the years within the Department. As our nation rises to meet the 
current fiscal challenges, please be assured that we will continue to 
work closely with GAO to maximize our nation's resources. 

Sincerely, 

Signed by: 

William E. Spriggs: 
Assistant Secretary for Policy: 

[End of letter] 

Note: This letter includes comments on Area 31: Science, Technology, 
Engineering, and Mathematics Education. 

Executive Office of The President: 
Office Of Science and Technology Policy: 
Washington, D.C. 20502: 

George A. Scott, Director: 
Education, Workforce, and Income Security Issues: 
Government Accountability Office: 
Washington, DC 20548: 

The Office of Science and Technology Policy (OSTP) appreciates the 
opportunity to comment on the STEM education section of the GAO's 2012 
Duplication Mandate report. We generally agree with the GAO's careful 
review of Federal STEM education programs. In December 2011, the 
National Science and Technology Council's (NSTC) Committee on STEM
Education (CoSTEM) also released an inventory of Federal spending on 
STEM education,[Footnote 1] which includes an analysis of overlap, 
redundancy, and fragmentation. The generally consistent findings in 
our respective inventories validate the quality of each effort and 
provide policy makers and STEM education stakeholders with an 
unprecedentedly clear picture of how the Federal government supports 
STEM education. 

The OSTP does, however, have some concerns about the GAO analysis of 
overlap and redundancy among Federal STEM education programs. The GAO 
and NSTC analyses of overlap both used the same definition of 
"overlap," and both found that more than 80 percent of programs 
overlapped with at least one other program. The results reported by 
the GAO,[Footnote 2] however, have been interpreted by some to 
indicate a "significant degree"[Footnote 3] of overlap, while we 
believe that-—given the technical definition of "overlap" used in 
these reports-—it would be more accurate to conclude, as the NSTC 
report did, that there is a relatively modest degree of overlap. 

Under the definition used, two programs were considered "overlapping" 
if they had the same primary objective and had in common at least one 
audience, STEM field, and product or activity. Under this definition, 
two programs that are quite different but share even one element in 
each of those categories are counted as overlapping. For example, a 
program that provides internships and curricular material about 
nuclear reactors for engineering students in their final year of 
college would be considered "overlapping" with a program that provides 
curricular material spanning the full range of STEM subjects for 
students in grades K-20 because they would share the same primary 
objective ("learning") and would share audience, activity, and field 
(since the college program represents a subset of the K-20 program in 
scope). But to call these two programs "overlapping" in the sense of 
being quite similar would be misleading. Indeed, in the NSTC analysis, 
every instance of overlap involved programs that had at least some-—
and in some cases many program characteristics that differed greatly. 
As an illustration of the problems that can arise in this situation, 
consider that the two programs above would still be considered 
"overlapping" even if one of them worked exclusively with students in 
inner-city New York and the other worked only with students in rural 
North Dakota, because geographic region is not one of the program 
characteristics included in the technical definition of "overlap." 

The NSTC report carried out an examination of the degree and nature of 
similarity between each pair of "overlapping" programs and concluded 
that there was a wide range in the degree of overlap. In addition, the 
NSTC report indicates that, "the implications of pairs of overlapping 
investments on policy decisions would be minimal, because each pair 
only represents two investments with similar characteristics." 
Further, a rigorous analysis by the NSTC revealed that there were no 
duplicative programs. By contrast, the GAO report—-which did not 
include an analysis of duplication—-states only that pairs of 
overlapping programs are not necessarily duplicative. OSTP recommends 
that the GAO, in its final report, cite the more detailed findings of 
the NSTC analysis to avoid misinterpretation of the GAO's findings. 

Four recommendations for OSTP are included in the GAO report. OSTP 
will address these recommendations in the NSTC 5-Year Federal STEM 
Education Strategic Plan. The Strategic Plan, to be released in spring 
2012, will provide evaluation guidance, describe how each agency's 
STEM education programs contribute to the Strategic Plan, and outline 
a process for tracking the implementation and impact of the Strategic 
Plan. The Strategic Plan will also provide guidance for ensuring 
efficient and effective use of Federal funds for STEM education 
programs. This will involve a review of program effectiveness, 
duplication, overlap, and fragmentation, as well as other relevant 
information. While the GAO recommends the NSTC consolidate or 
eliminate programs as the only two options for increasing efficiency 
and effectiveness of Federal STEM education spending, the NSTC intends 
to consider these two strategies along with a range of other 
strategies (e.g., strategic alignment of program goals, joint 
solicitations, improved program design and execution, and memoranda of 
understanding). 

Sincerely, 

Signed by: 

Carl Wieman: 
Associate Director for Science: 
Office of Science and Technology Policy: 

Footnotes: 

[1] [hyperlink, 
http://www.whitehouse.govisites/defaulUfiles/microsites/ostp/costem_fede
ral_stem_education_portfolio_report.pdf.] 

[2] [hyperlink, http://gao.gov/products/GA0-12-108]. 

[3] [hyperlink, 
http://edworkforce.house.gov/News/DoctunentSingle.aspx??DocumentID=27613
3.] 

[End of letter] 

Note: This letter includes comments on Area 32: Financial Literacy. 

Consumer Financial Protection Bureau: 
1801 L Street NW: 
Washington: DC 20036:  

Ms. Alicia Cackley: 
Director: 
Financial Markets and Community Investment: 
Government Accountability Office: 
441 G Street, NW: 
Washington, DC 20548:  

Dear Ms. Cackley:  

This letter responds to the request by the Government Accountability 
Office ("GAO") that the Consumer Financial Protection Bureau (the 
"Bureau" or the "CFPB") comment on the 2012 Annual Report: 
Opportunities to Reduce Duplication, Overlap, and Fragmentation, 
Achieve Savings, and Enhance Revenue, GAO-12-34SP. We appreciate the 
work done by the Comptroller General and the GAO to focus attention on 
this issue of critical importance to working families. 

We welcome the opportunity to provide comments pertaining to the 
activities of the CFPB's Offices of Financial Education, Servicemember 
Affairs, and Financial Protection for Older Americans. 
 
As you know, the CFPB is the only federal agency whose primary focus 
and mandate is the protection and education of the American financial 
consumer. The Bureau's statutory function to provide consumers with 
accessible information about financial products, services, and 
decisions creates an enormous opportunity to reach consumers at the 
right moment with targeted information that can increase their 
financial management skills and money confidence.  

We agree with your statement "that there is little evidence of 
duplication among existing federal financial literacy activities." 
Federal agencies involved in financial education have different 
missions, regulatory authorities, constituencies, and expertise.  

Our Financial Education, Servicemember Affairs, and Older Americans 
offices have pursued initiatives that advance financial education 
opportunities for American families in a manner that leverages, 
complements, and coordinates with federal efforts already underway.  

For example, the Office of Financial Education is engaged in ongoing 
efforts with Financial Literacy and Education Commission (FLEC) 
partners to implement the FLEC National Strategy, to delineate roles 
and responsibilities, to improve coordination, and avoid duplication 
while working to execute on our statutorily mandated responsibilities 
to educate and empower consumers to make informed financial decisions.
As part of our efforts to collaborate across agencies, the OFE also 
meets regularly with Department of the Treasury staff members in the 
Office of Financial Education and Financial Access to coordinate and 
leverage our respective activities. 

The Office of Servicemember Affairs, under the leadership of Holly
Petraeus, is working in partnership with the Department of Defense 
(DoD) to ensure that military personnel and families receive the 
financial education they need to make financial decisions best suited 
to their particular circumstances. A key component of the Office of 
Servicemember Affairs' direction is to identify opportunities to make 
improvements on existing efforts and to avoid duplication across 
agencies. 

Office of Servicemember Affairs staff members meet regularly with
Department of Defense officials. In particular, the Office of 
Servicemember Affairs has identified a significant opportunity to 
provide financial education training for Delayed Entry Program 
participants, a population that falls outside existing DoD financial 
literacy efforts.
Office of Servicemember Affairs staff have also observed financial 
education classes offered to new recruits and personnel undergoing 
their first advanced training at select Army, Marine Corps, and Navy 
sites as part of an ongoing effort to fulfill the Office of 
Servicemember Affairs' statutory mandate of ensuring that members of 
the military have a strong financial education. Recommended changes or 
modifications will be made to improve existing program performance. In 
addition, the Office of Servicemember Affairs helps to coordinate 
efforts among the Federal agencies and the States to improve consumer 
financial protection for military families. 

The CFPB's Office of Financial Protection for Older Americans 
functions to protect consumers aged 62 or older from unfair, 
deceptive, and abusive practices in the provision of financial 
products and services to older Americans. The Office will develop 
financial literacy goals for programs that assist seniors with one-on-
one financial counseling, consumer credit advocacy, and recognizing 
the warning signs of unsafe financial practices. The Office for Older 
Americans will also conduct research to identify best practices for 
seniors' personal financial management This research will cover topics 
such as long-term savings, and planning for retirement and long-term 
care. To achieve these goals in an effective and efficient manner, the 
Office for Older Americans will continue to meet with the Securities 
and Exchange Commission, the North American Securities Administrations 
Association, state commerce commissioners and others in the financial 
services industry. The Office will also work with several federal 
agencies, state and local governments, community-based organizations, 
and other stakeholders in senior financial education efforts. 

We would also like to take this opportunity to recognize and commend 
your emphasis on the importance of evaluating financial literacy 
efforts. We agree that there have been relatively few evidence-based 
evaluations of financial literacy programs. The CFPB is committed to 
ensuring that its activities are informed by data and analytics. As 
such, the CFPB's Office of Financial Education recently launched its 
initial Financial Education Program Evaluation Project Using rigorous 
quantitative methodologies, this project will assess the effectiveness 
of several existing financial education programs to identify which 
program elements do or do not increase consumers' money confidence, 
and why. We intend to use the insights from this study to provide 
direction to practitioners about how to design and support effective 
financial capability and money confidence programs. The results will 
be widely shared with participating FLEC agencies and other relevant 
stakeholders. As the research project proceeds, we will also 
facilitate the sharing of programmatic best practices, evaluation 
methodologies, and common metrics that promote effective financial 
education among practitioners and other researchers. 

The complex financial marketplace creates special challenges for 
consumers that require a range of strategies and approaches. We are 
very committed to thoughtfully focusing the talent of the Bureau on 
ensuring that American families understand the choices available to 
them as they manage their finances. 

We appreciate the opportunity to comment on this GAO report and we 
look forward to continuing to work with you on enhancing the money 
confidence and financial management skills of American consumers. 

Sincerely, 

Signed by: 

Camille M. Busette, PhD: 
Assistant Director: 
Office of Financial Education: 

[End of letter] 

Note: This letter includes comments on Area 32: Financial Literacy. 

Department of the Treasury: 
Washington, DC 20220: 

January 30, 2012: 

Alicia Cackley: 
Director, Financial Markets and Community Investment: 
Government Accountability Office: 

Dear Ms. Cackley: 

On behalf or the Department of the Treasury, I am responding to your 
request for comments on the Draft 2012 Annual Report: Opportunities to 
Reduce Duplication, Overlap and. Fragmentation, Achieve Savings and 
Enhance Revenue (the "draft report"). 

The Department of the Treasury appreciates the Government 
Accountability Office's (the "GAO") focus on the important issue of 
financial literacy, and the effort the GAO has taken to understand and 
assess the substantial number of financial literacy programs found 
across the government, as well as the role of the Financial Literacy 
and Education Commission (the "Commission"), which is chaired by the 
Secretary of the Treasury. The Department finds reasonable the GAO's 
approach to focusing its review on larger and more comprehensive 
financial literacy programs, and distinguishing these from housing 
counseling. It is clear from the draft report that GAO understands the 
diversity of federal agency efforts and approaches within the broad 
category of financial literacy. 

The Department of the Treasury concurs with the first recommendation 
contained on page 6 of the draft report. Specifically, we agree that 
federal agencies should evaluate the effectiveness of their financial 
literacy efforts anti, if appropriate, identify options for 
consolidating such efforts. We believe it would be necessary fur 
funding to be appropriated for such evaluation. Accordingly, we 
recommend that the first recommendation bullet be revised to read as 
follows: 

* Congress should require, and fund federal agencies to evaluate the 
effectiveness of their financial literacy efforts and it appropriate, 
identify options for consolidating such efforts... 

Such evaluation may also highlight areas of current effective 
practice, and suggest areas of better coordination among agencies. The 
Department also believes that continued and enhanced coordination 
among agencies may lead to greater effectiveness, in some cases, than 
consolidation. 

The Department understands that GAO is using FY 2010 expenditures as 
the most complete data available. However, it should be noted that 
some program changes and reductions may have occurred since 2010. 
Notably, the Department of the Treasury's Financial Education and 
Counseling Pilot has not received an appropriation since the 
Consolidated Appropriations Act, 2010. Finally, we recommend noting in 
both the text and Table X of the draft report, that Treasury serves as 
the staff and coordinator of the Commission, and thus generally bears 
costs of Commission operations, including, hilt not limited to, the 
Mymoney.gov website. The correct FY 2010 cost estimate for our office 
is $2.1 million, not $2.4 million. Accordingly, we recommend that you 
add a footnote to the last sentence of page 2. The footnote would read 
as follows: 

* When Congress established the Commission, it required the Department 
of the Treasury's Office of Financial Education to provide assistance 
to the Commission upon request and without reimbursement. 

In Table X of the draft report, we recommend revising the Department 
of the Treasury "Program name" description to read as follows: 

* Office of Financial Education and Financial Access (including Money 
Math, National Financial Capability, Challenge, Financial Literacy and 
Education Commission staff support, and other initiatives). 

We also recommend revising tie FY 2010 cost estimate from "2,400,000" 
to "2,100,000." 

Thank you again for the opportunity to provide you these comments, and 
please contact me if I can provide any further information or 
clarification. 

Sincerely, 

Signed by: 
Louis M. Quittman: 
Director, Financial Education: 
US Department of the Treasury: 
Office of Financial Education and Financial Access: 

[End of letter] 

Note: This letter includes comments on Area 39: Auto Recovery Office. 

U.S. Department of Labor: 
Director of Recovery for Auto Communities and Workers: 
Washington. D.C. 20210: 

February 7, 2012: 

Ms. A. Nicole Clowers: 
Acting Director, Financial Markets, and Community Investment Issues: 
United States Government Accountability Office: 
Washington, DC 20548: 

Dear Ms. Clowers: 

Thank you for the opportunity to review a copy of your draft language 
that will be included in GAO's 2012 Duplication Mandate report.
hi your transmittal letter to Department of Labor Secretary Hilda L. 
Solis, you state that the purpose of your Duplication Mandate report 
is to identify federal programs, offices, etc, which have "duplicative 
goals or activities" and to report to Congress on your findings. In 
your draft report you state that the Department's Office of Recovery of
Auto Communities and Workers (ORACW) has not uniquely assisted auto 
communities and that Congress should consider prohibiting any further 
funding for the Office. We believe that this conclusion is not only 
inconsistent with the report's own findings, it fails to adequately 
take into account the information presented by ORACW during the course 
of GAO's review. 

The report begins its analysis by referring to the success of the TARP 
program in providing the federal resources that were essential in the 
restructuring of the American automobile industry. However, the 
purpose of Executive Orders 13509 and 13578 is not to focus on the 
industry itself but on the 22 communities and thousands of working 
families who have been severely affected by that restructuring. While 
the auto industry is well on the path to recovery as a result of the 
efforts of the Obama Administration, both the President and the 
Secretary Solis realize that auto communities and workers continue to 
need assistance and support because of the lingering effects of the 
industry's restructuring. 

The report does not dispute the need for continued federal efforts 
targeted at supporting the recovery of these communities and workers. 
Moreover, the report recognizes ORACW's continuing role in furthering 
the goals of coordinating the federal response and reaching out to 
various stakeholders who can provide assistance and support to the 
affected auto communities and workers. However, the report states that 
ORACW has not measured its success in furthering these key goals of 
the Executive Order and it speculates that these goals can be 
accomplished by anther project which does not target the auto industry 
specifically and which is active in only one of the communities 
affected by the industry's restructuring_ Finally, the draft report 
claims that ORACW has not accomplished the goals of providing 
legislative advice and policy recommendations to the President 
regarding auto communities and workers. As detailed below, these 
conclusions simply fail to acknowledge the unique role played by
ORACW in implementing the Executive Orders. 

ORACW's unique role: 

As has been previously noted, the mission of the Office of Recovery 
for Auto Communities and Workers is to provide a coordinated response 
between affected automotive communities and workers and the federal 
programs and policies that may help address their concerns. We agree 
with GAO's assertion that there are other efforts within the executive 
branch to assist economically distressed communities. However, it 
remains our contention that there are no other programs within the 
executive branch which deal specifically with the unique needs of 
affected automotive communities across the country. GAO acknowledges 
within its recommendations that ORACW does provide specialized 
assistance to affected automotive communities. 

Other federal programs focused on assisting economically distressed 
communities do not have a means by which to regularly and consistently 
coordinate their efforts, and, as a consequence, one might observe 
that those efforts, however effective when judged individually, may be 
too diffuse to address effectively the extraordinary and multi-layered 
effects flowing from the restructuring of the automotive industry. Due 
to the depth and breadth of these effects in dozens of communities 
across the country, the President determined that a unique coordinated 
response was required. Consequently, ORACW was established to 
facilitate that coordination and to ensure a more effective and less 
diffuse federal response. 

GAO identifies the Strong Cities; Strong Communities (SC2) program as 
an example of a duplicative program. However, as articulated by GAO, 
of the six pilot cities comprising the Strong Cities; Strong 
Communities program, only one (Detroit) is recognized as an automotive 
community which has been assisted by ORACW. Further SC2 was not 
designed to deal with issues which are often unique to affected 
automotive communities. 

GAO suggests that the Administration's SO initiative, which is a multi-
agency proposal borne out of discussions spearheaded by this Office, 
could replace ORACW. This suggestion simply fails to recognize the 
important, though distinct, roles that these separate initiatives play 
in supporting efforts in communities which are suffering in the 
current economy. 

As we have attempted to clarify previously, the Executive Order which 
outlines a mandate to coordinate the federal response to issues facing 
auto communities defines the responsibilities this Office is to meet. 
ORACW is in fact within the Office of the Secretary of Labor, and 
performs its functions within the Department and in coordination with 
the White House and other agencies within the executive branch. 

Advising on pending legislation and federal policies and programs: 

In practice, ORACW meets the goals of the Executive Order, consistent 
with the authorities delegated to the Secretary of Labor and the 
various Executive departments and agencies, by routinely participating 
in administrative review of pending legislation; participating in the 
preparation of the President's budget (which is a primary vehicle for 
proposing policy); and coordinating legislative review and budget 
preparation with other agencies that have specific, statutory 
responsibility for issues affecting and the ability to help auto 
communities. 

ORACW has consistently engaged with the National Economic Council's 
(NEC) Office of Manufacturing Policy to inform policy decisions 
affecting proposed manufacturing legislation. Specifically, the Small 
Business Credit Initiative in the Small Business Jobs
Act, was shaped and informed by the direct participation of ORACW.
ORACW also played in integral role in developing the policy which 
eventually led to the creation of the $773 million dollar RACER Trust. 
ORACW's input helped to ensure that the unique interests of automotive 
communities were protected and balanced with respect to bidders 
seeking to redevelop former automotive manufacturing sites within 
those communities. 

ORACW was responsible for commissioning an important report by the 
Center for Automotive Research (CAR) containing case studies of how 
local communities have recovered from the consequences of industrial 
restructuring. This study serves as a basis, along with the active 
support and unique expertise of ORACW staff, for policy development 
and program coordination with government officials both at the local 
and federal level. 

The Office of Recovery for Auto Communities and Workers does not 
administer a specific program; its responsibility is to facilitate a 
complex process that involves many different issues in the affected 
communities and many potential responses from across the federal 
government. 

We continue to maintain that the creation of a forum for raising and 
considering issues faced by auto communities has provided an efficient 
and effective way to avoid duplication of requests and responses 
between multiple representatives from multiple auto communities 
attempting to communicate with multiple federal agencies regarding 
multiple issues and possible responses. In short, ORACW has helped to 
avoid the very duplication of federal services and support programs 
that your report sought to highlight. 

ORACW adding value: 

The GAO interviews with some auto community's representatives suggest 
that since funds did not flow from this Office directly to each of 
those communities, ORACW added no value. There is no reference to 
interviews with other Federal agencies, the MAC, RACER Trust, the 
Funders' Network, or any other interested party in building a 
strategic response to the issues being confronted by the auto 
communities. We would suggest GAO again give consideration to the 
following: 

Flint, MI: 

Bayne Walling, the Mayor of Flint, Michigan, acknowledged the 
importance of ORACW's role as coordinator and facilitator in July 
2011: "I applaud President Obama's leadership in creating the Office. 
The President's leadership came at a critical time and saved thousands 
of jobs and dozens of companies right here in mid-Michigan. What
President Obama recognized, and what Secretary Solis's leadership has 
emphasized, is that this is really about jobs and families and 
communities. 

Through the Auto Communities Office's previous efforts, Flint has been 
better able to address critical issues through expanded Federal 
funding for firefighters and police officers, for neighborhood 
stabilization and master planning, for cleanup efforts led by the EPA 
so that we have land put back into use for economic development and 
jobs. We've also enjoyed recent visits by Transportation Secretary 
LaHood and a Commerce Assistant Secretary on behalf of the White House 
Business Council, to add to this comprehensive approach. This kind of 
coordination across the Federal government for auto communities has 
proven to be a success, and we have all seen the progress that has 
been made in the last two years under very difficult circumstances." 

Kokomo, IN: 

Kokomo, Indiana was one of the first communities that ORACW engaged 
with in its efforts to assist communities confronted with the closure 
of auto facilities. In June 2009 the Executive Director of ORACW 
visited Kokomo, Indiana with then-Senator Evan Bayh, Congressman Joe 
Donnelly, and other local leaders and Federal agency panthers to see 
first-hand the needs of the community. Since then, ORACW staff has 
been in regular communication with community leaders in an effort to 
work through a number of key issues identified then and in subsequent 
meetings. 

Howard County, where Kokomo is situated, had been seeking the payment 
of $12.9 million in personal property taxes due in 2009 and $12.3 
million owed in 2010 by Chrysler. Chrysler's failure to pay its full 
property tax obligation could have caused significant fiscal 
difficulties for the school system and public services. When Chrysler 
filed for bankruptcy protection in 2009, the county, with ORACW 
support, started discussions about the payment of the taxes. After 
months of negotiations, an agreement was reached in early 2010 whereby 
Howard County received 100% of the taxes owed for 2009 and 2010. 

ORACW worked to connect the Economic Development Administration (EDA) 
with key stakeholders and Indiana's Office of Community and Rural 
Affairs (OCRA). At our suggestion, the City of Kokomo worked with OCRA 
on the submission of an application for a recovery coordinator, as 
well as for other services that could benefit Kokomo and the 
surrounding economic region. 

This application was awarded in September 2010, in the amount of 
$148,886 to OCRA to support a regional economic development strategic 
plan for six north central Indiana counties. The goal of the grant is 
to encourage creative approaches to job and income creation in the 
region. The plan is currently under development and is expected to be 
completed no later than September 2012. 

The Mayor of Kokomo, Indiana, Greg Goodnight, recently wrote of 
ORACW's engagement with the city: "The Obama Administration and the 
Auto Recovery Office have been extremely supportive of our efforts 
here in Kokomo over the past few years. Like most of the country, we 
have faced some tough times, and our community is working together to 
get through it. In fact, we were recently recognized as the Indiana
Chamber of Commerce 2011 Community of the Year We're headed in the 
right direction, and we are very appreciative of what the 
Administration and the Auto Recovery Office have done for us. We have 
utilized our CDBG funds to improve our city's neighborhoods and 
economic landscape. And we have great business partners such as 
Chrysler, Delphi and GMCH here that are also helping to lead the way 
to recovery. I know we can count on Mr. Williams and the Auto Recovery 
Staff to help us when we need it." 

Fremont, California: 

In September 2009, New United Motor Manufacturing Inc. (NUMMI) 
announced that it would close its Fremont, California plant in March 
2010. Local leaders reached out to the Office of Recovery of Auto 
Communities and Workers. In November 2009 ORACW brought a team of 
Federal officials to Fremont to determine what Federal resources might 
be helpful to the community. 

With the closure of NUMMI still months away, the Federal agency 
partners were able to begin preparing well in advance. The Department 
of Labor worked closely with the eight affected workforce investment 
boards as they coordinated rapid response efforts to support the soon-
to-be dislocated workers. In November 2009, well before the actual 
closing, TAA was approved to provide additional benefits to the 
plant's 4,700 affected workers. In the first half of 2010, TAA 
petitions were also approved for over 20 NUMMI suppliers benefiting 
over 2400 workers. 

Transition to other federal programs: 

Within its recommendations GAO states that ORACW should determine when 
and how the specialized assistance provided by the Office can be 
transitioned to existing federal programs. ORACW acknowledges that its 
mission is not one to exist in perpetuity. 

However, further evidence of the continued relevance of ORACW can be 
seen in the recent closure announcements with respect to automotive 
plants in the communities of Indianapolis, Indiana; Walton Hills, 
Ohio; Shreveport, Louisiana; and St. Paul, Minnesota. ORACW has 
already begun to engage those communities in advance of the plant 
closures to ensure a smooth start to what is certain to be a very 
difficult process of transition. 

To continue ORACW's ongoing efforts with affected communities in 
Indiana and to assist local officials to begin planning the transition 
that will follow the announced closure, the Office's Executive 
Director traveled to Indianapolis in November 2011. 

Likewise, the ORACW Executive Director has met with Members of 
Congress representing of Walton Hills, Ohio and other local officials, 
and a meeting with stakeholders in the community is being planned for 
early 2012. 

In addition, ORACW's staff has reached out to officials in Shreveport 
and is planning a trip to the community in the first quarter of 2012. 
The director will also be traveling to St. Paul, Minnesota on February 
13-14, 2012 to meet with local officials to discuss the best path 
forward in light of the recent closure announcement of a Ford plant. 

Concurrence: 

Within its report GAO stated the following: 

As of February 2012, the Secretary of Labor still needs to take 
actions on recommendations included in GAO's May 2011 report, such as:
Directing the Auto Recovery Office to (1) document the office's 
achievements to date, including its assistance to various auto 
communities; (2) establish a process for measuring the office's 
results; and (3) determine when and how the specialized assistance 
provided by the office can be transitioned to existing federal 
programs. 

As stated in our response to GAO dated November 29, 2011, we 
acknowledged that difficult questions of measurement are still under 
discussion. However, ORACW generally concurs with these 
recommendations, and remains committed to incorporating them as an 
ongoing part of our operations. 

We appreciate the opportunity to provide these comments. Please 
contact me if you have any questions about this response, or the 
Office of Recovery for Auto Communities and Workers. 

Sincerely, 

Signed by: 

Jay Williams: 

[End of letter] 

Note: This letter includes comments on Area 42: U.S. Currency. 

Board Of Governors Of The: 
Federal Reserve System: 
Louise L. Roseman: 
Director, Division Of Reserve Bank Operations And Payment Systems: 
Washington, D.C. 20551: 

January 30, 2012: 

Ms. Lorelei St. James: 
Director: 
Physical Infrastructure Issues: 
U.S. Government Accountability Office: 
441 G Street, N.W. 
Washington, D.C. 20548: 

Dear Ms. St. James: 

Thank you for the opportunity to comment on the GAO's draft discussion 
of replacing the $1 note with the $1 coin in its 2012 Duplication and 
Cost Savings report. The GAO has projected a financial benefit to the 
government of about $4.4 billion over 30 years. We believe this 
projection overstates the net financial benefit to the government, 
perhaps substantially. 

The report states that the cost of producing sufficient coins to 
replace all $1 notes is never fully recovered during the 30-year 
analysis; all savings are attributable to increased seigniorage 
income.[Footnote 1] In fact, there is no year in the study in which 
estimated non-seigniorage benefits exceed costs. Moreover, the 
analysis does not adequately address the costs to the Federal Reserve 
of such a replacement and does not address at all the broader societal 
costs to consumers, retailers and other businesses, and state and 
local governments.[Footnote 2] 

In addition, replacing the $1 note with the $1 coin may increase the 
risk of counterfeiting. The current low rate of counterfeiting helps 
maintain global confidence in U.S. currency. Unlike the $1 note, the 
$1 coin does not have any effective machine-readable or publicly-
usable counterfeit deterrent features. Several countries that have 
converted low denomination notes to coins have reported higher levels 
of counterfeiting for low-denomination coins than previously observed 
for low-denomination notes, and the U.S. Sacagawea $1 coin was 
counterfeited in some Latin American countries soon after the U.S. 
Mint issued it. 

Finally, the GAO did not provide a sensitivity analysis that reflects 
differing assumptions, such as possible changes in the public's means 
of making payments over the next several decades. Although the value 
of Federal Reserve notes in circulation continues to increase more 
than 7 percent annually over the past several years, the growth rate 
for $1 notes has been on average only 2 percent per year. It is 
possible that the elimination of the $1 note could accelerate the 
shift of consumer payments to debit cards and other electronic payment 
alternatives. In addition to potential shifts in consumer payment 
methods, the analysis did not consider potential increases in raw 
material costs for coins, or changes in discount rates. Given the 
certainty of the near-term expenses associated with the transition and 
uncertainty of the long-term forecasted benefits, it is possible that 
no savings will ever be realized from the replacement of $1 notes with
$1 coins. Sensitivity analysis for these factors would provide a 
confidence level around the GAO's long-term savings projections. In 
fact, changes in assumptions have reduced the GAO's average annual 
discounted net benefit projections from $550 million in its 2000 
study, to $186 million in its 2011 study, to $146 million in this 
report. 

Proponents of replacing $1 notes with $1 coins often cite similar 
steps that have been taken in other economies in recent decades as an 
indication that such a change has strong financial benefits. In 
general, the low-denomination note that was replaced by a coin had a 
far shorter useful life (typically three to six months) than is the 
case with the $1 note, which currently has a useful life of about 56 
months. Further, these decisions were typically made when electronic 
payment substitutes to cash were less mature than in the current U.S. 
environment. Therefore, the decisions of other economies have been 
based on very different circumstances than exist in the United States. 

We believe that a fuller societal cost-benefit analysis and a 
sensitivity analysis that varies key assumptions that are subject to 
material uncertainty would provide policy-makers with a more complete 
basis for considering the future of the $1 note and $1 coin. 

Sincerely, 

Signed by: 

Louise L. Roseman: 

Footnotes: 

[1] The Congressional Budget Office does not score seigniorage in its 
budget calculations. 

[2] With respect to Federal Reserve costs, the Federal Reserve 
cancelled plans to build additional storage space for $1 coins 
following the Treasury 's announcement to suspend minting of 
Presidential $1 coins for circulation. If $1 coins were to replace $1 
notes, however, the Reserve Banks would need to build or expand vaults 
around the country with reinforced floors to accommodate the heavier 
weight of coins in order to manage coin inventories. 

[End of letter] 

[End of section] 

Footnotes: 

[1] Pub. L. No. 111-139, § 21, 124 Stat. 29 (2010), 31 U.S.C. § 712 
Note. 

[2] 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). 

[3] 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). 

[4] An issue area was considered "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 needed in that area were addressed. 

[5] Pub. L. No. 111-352, 124 Stat. 3866 (2011); Pub. L. No. 103-62, 
107 Stat. 285 (1993). 

[6] For some issue areas, agencies were not able to readily provide 
programmatic information. Similarly, in some cases, we did not report 
budgetary information because such information was either not 
available or not sufficiently reliable. 

[7] The statutory requirement calling for this report also asked GAO 
to identify specific areas where Congress may wish to cancel budget 
authority it has previously provided--a process known as rescission. 
To date, GAO's work has not identified a basis for proposing specific 
funding rescissions. 

[8] In 2005, GAO reported that, since the terrorist attacks of 2001, 
agencies had formed numerous working groups to protect agriculture. 
For example, DHS created a Food and Agriculture Sector Coordinating 
Council to help the federal government and industry share ideas about 
how to mitigate the risk of an attack on agriculture. See GAO, 
Homeland Security: Much Is Being Done to Protect Agriculture from a 
Terrorist Attack, but Important Challenges Remain, [hyperlink, 
http://www.gao.gov/products/GAO-05-214] (Washington, D.C.: Mar. 8, 
2005). 

[9] See, for example, GAO, Combating Terrorism: Evaluation of Selected 
Characteristics in National Strategies Related to Terrorism, 
[hyperlink, http://www.gao.gov/products/GAO-04-408T] (Washington, 
D.C.: Feb. 3, 2004). 

[10] Irregular warfare is defined as a violent struggle among state 
and nonstate actors for legitimacy and influence over the relevant 
population(s). Irregular warfare favors indirect and asymmetric 
approaches, though it may employ the full range of military and other 
capacities, in order to erode an adversary's power, influence, and 
will. 

[11] Potential near-peer adversaries include countries capable of 
waging large scale conventional war on the United States. These nation-
states are characterized as having nearly comparable diplomatic, 
informational, military, and economic capacity to the United States. 

[12] The $37.5 billion amount includes funding for the development, 
procurement, sustainment, military construction and personnel, and war 
funding to support UAS activities in then year dollars identified in 
the President's 2012 budget submission. 

[13] Duncan Hunter National Defense Authorization Act for Fiscal Year 
2009, Pub. L. No. 110-417, §144 (2008). 

[14] In 2009, the Office of the Secretary of Defense directed the 
military services to develop a common control station service-oriented 
architecture for implementation into the military services' control 
stations to help acquire, integrate, and extend the capabilities of 
current control stations across the UAS portfolio. The Air Force has 
decided to implement a "complementary" architecture. 

[15] This total represents appropriations and rescissions made to the 
Joint Improvised Explosive Device Defeat Fund for JIEDDO. Prior to the 
establishment of JIEDDO in 2006, no single entity was responsible for 
coordinating DOD's counter-IED efforts. A primary role for JIEDDO is 
to provide funding and assistance to rapidly develop, acquire, and 
field counter-IED solutions. 

[16] 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.: March 1, 
2011). 

[17] The specific capability gap addressed by this technology is 
classified and therefore not discussed in this report. 

[18] See Department of Defense Directive 5101.14, DoD Executive Agent 
and Single Manager for Military Ground-Based Counter Radio-Controlled 
Improvised Explosive Device Electronic Warfare (CREW) Technology, ¶ 
5.3.1 (June 11, 2007) (requiring the Secretary of the Navy to 
designate a single manager). 

[19] Joint Improvised Explosive Device Defeat Organization Office of 
Internal Review, Joint Improvised Explosive Device Defeat 
Organization: Information Technology Investment Management, Report of 
Audit 2011-07-002 (September 6, 2011). 

[20] General purpose forces are the regular armed forces of a country, 
other than nuclear forces and special operations forces, that are 
organized, trained, and equipped to perform a broad range of missions 
across the range of military operations. 

[21] The Defense Language Office, within the Office of the Under 
Secretary of Defense for Personnel and Readiness, provides strategic 
direction and programmatic oversight to the DOD components, including 
the services and combatant commands, on present and future 
requirements related to language, as well as on regional and cultural 
proficiency. The office's director reports to the Deputy Assistance 
Secretary of Defense for Readiness, who has been designated as the DOD 
Senior Language Authority. 

[22] DOD defines distributed learning as structured learning mediated 
with technology that does not require the physical presence of the 
instructor. Distributed learning models can be used in combination 
with other forms of instruction or it can be used to create wholly 
virtual classrooms. 

[23] GAO, Human Capital: A Guide for Assessing Strategic Training and 
Development Efforts in the Federal Government, [hyperlink, 
http://www.gao.gov/products/GAO-04-546G] (Washington, D.C.: March 
2004). 

[24] Department of Defense, Strategic Plan for the Next Generation of 
Training for the Department of Defense (Sept. 23, 2010). 

[25] DOD's largest humanitarian assistance program is the Overseas 
Humanitarian, Disaster, and Civic Aid-funded humanitarian assistance 
program. 

[26] GAO, Standards for Internal Control in the Federal Government, 
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1] 
(Washington, D.C.: November 1999). 

[27] GAO, Results-Oriented Government: Practices That Can Help Enhance 
and Sustain Collaboration among Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-06-15] (Washington, D.C.: Oct. 21, 
2005). 

[28] The number of programs administered by Commerce, HUD, SBA, and 
USDA that were identified in [hyperlink, 
http://www.gao.gov/products/GAO-11-477R] as supporting entrepreneurial 
efforts decreased from 54 to 53 because Commerce merged its Minority 
Business Opportunity Center program and Minority Business Enterprise 
Center program into one program that is now called Minority Business 
Center. In addition, two of the original Commerce programs identified 
in GAO's March and May 2011 reports--Community Trade Adjustment 
Assistance and Research and Evaluation--have been replaced with two 
other Commerce programs--Trade Adjustment Assistance for Firms and the 
Economic Development-Support for Planning Organizations--because one 
of the original programs had temporary funding and the other original 
program was misclassified as an economic development program. The two 
new Commerce programs that have been added should have been included 
in the March and May 2011 reports, according to Commerce officials. 
See appendix III for a list of the 53 programs GAO is currently 
reviewing that support entrepreneurs and their 2010 enacted 
appropriations. 

[29] GAO excluded the portion of the Community Development Block Grant 
funding that HUD reported is not used to support economic development. 
The total enacted appropriations for these 53 programs was about $5.6 
billion for fiscal year 2010. 

[30] SBA administers the two programs that solely provide 
entrepreneurs with assistance in obtaining government contracts: the 
HUBZone program, which supports small businesses located in 
economically distressed areas, and the Procurement Assistance to Small 
Businesses program, which serves small businesses located in any area. 

[31] GAO characterizes economically distressed areas as those 
communities with high concentrations of low-and moderate-income 
families and high rates of unemployment and/or underemployment. 

[32] GAO characterizes disadvantaged communities include as those with 
concentrations of minority populations, among other factors. 

[33] GAO characterizes disadvantaged businesses as those owned by 
women, minority groups and veterans, among other factors. 

[34] The definition of rural varies among these programs, but 
according to USDA--the agency that administers many of the economic 
development programs that serve rural areas--the term "rural" 
typically covers areas with population limits ranging from less than 
2,500 to 50,000. 

[35] SBA administers a total of 19 programs that support 
entrepreneurs. Six of its programs provide technical assistance only, 
5 provide financial assistance only, 2 provide only contracting 
assistance, 3 can provide both technical and financial assistance, 1 
provides technical and government contracting assistance, and 2 
provide financial and government contracting assistance. 

[36] Pub. L. No. 111-352 (2011). 

[37] The BEDI program received $17.5 million in enacted appropriations 
for fiscal year 2010, which is the fiscal year funding data that GAO 
is currently reporting for the 53 programs that support entrepreneurs. 
In addition, while a number of programs that GAO is reviewing received 
$0 during fiscal year 2010, they are still considered to be active 
programs by the executive branch. In addition, these active programs 
could receive funding in the future (see appendix III). 

[38] An unknown amount of the funding went to projects that benefit 
freight. These programs have broad eligibility and may be used for a 
variety of types of projects that benefit freight to greater or lesser 
degrees. 

[39] 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). 

[40] S. 1813, 112TH Cong. (2011). 

[41] H.R. 7, 112TH Cong. (2012). 

[42] Congress created NNSA as a semi-autonomous agency within the 
Department of Energy in 1999 (Title 32 of the National Defense 
Authorization Act for Fiscal Year 2000, Pub. L. No. 106-65, § 3201 et 
seq.). 

[43] Over the same period, the sites' total annual support function 
costs increased from about $5.0 billion to about $5.3 billion in 
constant 2007 dollars. As discussed in GAO's January 2012 report, 
Energy sites' support costs for more recent years are not fully known, 
because Energy changed its data collection approach in 2010 to improve 
the quality of its cost data. Also, Energy has not yet fully 
implemented a quality control process for these more recent data but 
intends to do so in fiscal year 2012. 

[44] The Cooperative Border Security Program was an independent 
program at the time of GAO's audit on the coordination of federal 
programs involved in combating nuclear smuggling overseas. However, 
the program is no longer an independent program, and its functions 
were merged into the International Nonproliferation Export Control 
Program in June 2010. 

[45] Pub. L. No. 108-458 (2004) (codified at 50 U.S.C. § 435b). 

[46] Exec. Order No. 13467, Reforming Processes Related to Suitability 
for Government Employment, Fitness for Contractor Employees, and 
Eligibility for Access to Classified National Security Information 
(June 30, 2008). 

[47] The Performance Accountability Council is currently comprised of 
representatives from 11 executive branch agencies, including DOD and 
the Office of the Director of National Intelligence. 

[48] While the National Reconnaissance Office is an agency within DOD, 
it is beginning to invest in an electronic system distinct from DOD's 
system. 

[49] President Barack Obama Cyberspace Policy Review: Assuring a 
Trusted and Resilient Information and Communications Infrastructure 
(Washington, D.C.: May 29, 2009). 

[50] See GAO, High Risk Series: An Update [hyperlink, 
http://www.gao.gov/products/GAO-11-278] (Washington, D.C.: February 
2011). 

[51] The National Initiative for Cybersecurity Education began in 
March 2010 as an expansion of Initiative 8 of the Comprehensive 
National Cybersecurity Initiative, which focused on efforts to educate 
and improve the federal cybersecurity workforce. According to the 
interagency committee recommendations establishing the National 
Initiative for Cybersecurity Education, it is to provide program 
management support and promote intergovernmental efforts to improve 
cybersecurity awareness, education, workforce structure, and training. 

[52] The responsibility for managing spectrum was divided between NTIA 
(an executive agency) and FCC (a federal independent regulatory 
commission) to avoid concentrating licensing power into one executive 
agency, while at the same time taking into account the President's 
responsibility for both national defense and fulfilling agency 
missions. 

[53] See National Telecommunications and Information Administration 
Act, title I, § § 103, 112 (1992) codified as amended at 47 U.S.C. §§ 
902 (b)(2)(L)(i), 922, and Memorandum of Understanding Between the 
Federal Communications Commission and the National Telecommunications 
and Information Administration, signed January 31, 2003. 

[54] Pub. L. No. 108-494, title II, 118 Stat. 3991 (2004). 

[55] [hyperlink, http://www.gao.gov/products/GAO-11-908] provides more 
information about OMB's Partnership Fund for Program Integrity 
Innovation, which funds efforts to improve the efficiency of federal 
assistance programs. 

[56] [hyperlink, http://www.gao.gov/products/GAO-12-118]. 

[57] Specifically, about 94 percent of federal funding for medical 
sciences research in fiscal year 2008 was obligated by these three 
federal agencies, according to data from the National Science 
Foundation. 

[58] With respect to DOD, we obtained data on obligations of funds 
made available for research, development, testing, and evaluation in 
the annual appropriation for the Defense Health Program. With respect 
to VA, we obtained data on obligations of its appropriation for 
Medical and Prosthetic Research. 

[59] Principal investigators are typically individuals designated by 
the applicant organization, such as a university receiving federal 
grants, to have the appropriate level of authority and responsibility 
to direct the project or program to be supported by the award. 

[60] Agency officials told us that multiple agencies cannot fund the 
same research application unless they work together to jointly fund it. 

[61] In some instances, research is initiated in response to 
congressional direction. For example, according to DOD, the Office of 
Congressionally Directed Medical Research Programs is funded through 
the annual Defense Appropriations Act and manages research in many 
areas, including breast cancer. According to DOD, funds identified 
during the appropriations process at the request of members of the 
House and Senate are used for congressionally directed research. 
[hyperlink, http://cdmrp.army.mil/about/fundingprocess.shtml] (last 
visited Dec. 2, 2011). Future GAO work is expected to examine the 
Office of Congressionally Directed Medical Research Programs. 

[62] GAO recognizes that, in some instances, it is 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 purposes of this report, the term "unnecessary duplication" refers 
to duplicative research funding that is not necessary to corroborate 
or replicate prior research results for scientific purposes. 

[63] Officials at NIH, DOD, and VA also stated that they consider the 
opinions of peer reviewers, who are typically scientists or professors 
who score proposals for scientific merit, to determine whether 
applications may be duplicative of other research. NIH and VA 
applications have a required section where principal investigators and 
other key personnel must list all current funding they receive and all 
other applications they have submitted at the time of their 
application. Peer reviewers generally have access to this information 
when scoring the proposals. 

[64] According to VA officials, NIH's database contains information on 
about one quarter of all VA-funded health research applications. VA 
officials told us that they are working to add information on most VA- 
funded applications to this database by August 2012. In addition, NIH 
officials stated that they search NIH's database for information on 
proposals funded by NIH. 

[65] NIH, DOD, and VA officials told us that they also may search 
other databases, such as clinicaltrials.gov, DeployMed ResearchLINK, 
and PubMed, which contain information on federally funded health 
research. 

[66] NIH officials said the system that provides information to NIH's 
database may contain additional information for VA applications, such 
as the actual application and supporting documentation; however, this 
information is only available to NIH and VA officials. 

[67] Officials told us that they check this information prior to 
funding to ensure that the application is not duplicative of other 
federally funded research conducted by the principal investigator. 

[68] This tool will be completed by June 28, 2012, according to VA's 
contractor. After its completion, VA plans to use it internally to 
analyze its research portfolio and to identify potential duplication 
across research funded by various entities. VA also plans to make some 
information resulting from its use of the tool available to the public. 

[69] The searches we performed were not comprehensive or generalizable. 

[70] President's Commission on Care for America's Returning Wounded 
Warriors, Serve, Support, Simplify (July 2007). 

[71] The 2007 Dole-Shalala Commission report outlined a vision for a 
recovery care continuum that provides continuous and integrated care 
management across both DOD and VA to create seamless transitions 
between the many providers and facilities recovering servicemembers 
and veterans must navigate. 

[72] Operation Enduring Freedom, which began in October 2001, supports 
combat operations in Afghanistan and other locations, and Operation 
Iraqi Freedom, which began in March 2003, supported combat operations 
in Iraq and other locations. Beginning September 1, 2010, Operation 
Iraqi Freedom was referred to as Operation New Dawn. 

[73] The Department of Defense established three injury categories-- 
mild, serious, and severe. Servicemembers with "mild" wounds, 
illnesses, or injuries are expected to return to duty in less than 180 
days; those with "serious" wounds, illnesses, or injuries are unlikely 
to return to duty in less than 180 days and possibly may be medically 
separated from the military; and those who are "severely" wounded, 
ill, or injured are highly unlikely to return to duty and also likely 
to medically separate from the military. 

[74] For the purposes of this report, clinical services include 
services such as scheduling medical appointments and providing 
outreach education about medical conditions such as post-traumatic 
stress disorder. Nonclinical services include services such as 
assisting servicemembers with financial benefits and accessing 
accommodations for families. 

[75] 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. 

[76] 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. 

[77] The Air Force Warrior Survivor Care Program is an overarching 
wounded warrior program, which includes a care coordination component 
called the Air Force Recovery Care Program and a case management 
component called the Air Force Wounded Warrior Program. 

[78] The Marine Wounded Warrior Regiment provides nonclinical case 
management services to its enrollees. Although it does not provide 
clinical case management services, the program does facilitate access 
to medical programs and care needs that have been identified for its 
servicemembers. 

[79] According to the Army, they have been providing care to severely 
wounded, ill, and injured servicemembers since 2004. 

[80] According to a U.S. Special Operations Command's Care Coalition 
Recovery Program official, when an enrollee is dually enrolled in 
another wounded warrior program, the U.S. Special Operations Command's 
Care Coalition Recovery Program takes the lead for providing 
nonclinical case management. 

[81] While FRCP coordinators are generally not expected to provide 
services directly to enrollees, they may do so in certain situations, 
such as when they cannot determine whether a case manager has taken 
care of an issue for an individual or when asked to make complicated 
arrangements, such as assisting enrollees with adaptive housing grants 
or obtaining medical equipment or prosthetics. 

[82] The Senior Oversight Committee is supported by several internal 
work groups devoted to specific issues, such as DOD and VA care 
coordination and case management. Participants in the committee's care 
management work group include officials from the FRCP and the RCP. 

[83] The amount appropriated since fiscal year 2005 does not include 
amounts appropriated in fiscal year 2012. In addition to fiscal year 
funding from 2005 through 2011, this amount includes $4 billion 
appropriated in fiscal year 2009 through the American Recovery and 
Reinvestment Act of 2009 (Pub. L. No. 111-5, 123 Stat. 115, 129-30), 
which includes $10 million for salaries and expenses to manage, 
administer, and oversee the grant programs. 

[84] Formula grant programs are noncompetitive awards based on a 
predetermined formula. Discretionary grants are awarded on the basis 
of a competitive process. A cooperative agreement is a type of federal 
financial assistance similar to a grant except the federal government 
is more substantially involved with the grant. Payment programs at 
Justice typically take the form of reimbursements to state and local 
law enforcement entities for purchases such as body armor or the cost 
to border states for prosecuting criminal cases. 

[85] U.S. Department of Justice Office of the Inspector General, Audit 
Report 03-27, Streamlining of Administrative Activities and Federal 
Financial Assistance Functions in the Office of Justice Programs and 
the Office of Community Oriented Policing Services (Washington, D.C.: 
August 2003). 

[86] Reviewing and validating that grantees actually used the funds 
for the articulated purposes was not within GAO's scope. GAO's review 
focused on what the grantees proposed in their applications and 
Justice's review and approval of those applications. 

[87] The three granting agencies support criminal justice 
interventions targeted at the community level. 

[88] Because Justice grant programs can last from 1 to 5 years, the 
total number of active Justice grant programs can be higher than what 
is presented in the table, which is a single year of grant program 
solicitations. 

[89] The COPS Office hiring grant awarded to this county was for 
fiscal year 2009. COPS Office hiring grants last up to 3 years and the 
county used the grant in fiscal years 2010 and 2011. 

[90] The fiscal year 2012 Justice Congressional Budget Justification, 
however, recognized the potential for consolidation by stating that 
"whenever possible, the President's Budget proposes to consolidate 
existing programs into larger, more flexible programs that offer 
state, local, and tribal grantees greater flexibility in using grant 
funding and developing innovative approaches to their criminal justice 
needs." 

[91] The Domestic Working Group is comprised of 18 federal government 
inspectors general and other state and local audit organizations, and 
is chaired by the Comptroller General of the United States. 

[92] OJP reports that its Crimesolutions.gov website uses rigorous 
research to inform practitioners and policy makers about what works in 
criminal justice, juvenile justice, and crime victim services. Though 
the categories on the website were not intended to categorize federal 
funding programs or exhaustively categorize every aspect of the 
criminal justice system, according to Justice officials, they do 
address the areas relevant to practitioners' and researchers' work. 

[93] Illinois was among the top five highest state recipients of JAG 
funding. However, state officials did not respond to GAO inquiries. 
Therefore GAO substituted Pennsylvania, which was the sixth largest 
recipient. In addition, Tennessee was not within these two categories 
but provided additional insight. 

[94] This total is based on Congressional Research Service data and 
GAO analysis, and includes firefighter assistance grants and emergency 
management performance grants. See Congressional Research Service, 
Department of Homeland Security Assistance to States and Localities: A 
Summary of Issues for the 111TH Congress, R40246 (Washington, D.C.: 
Apr. 30, 2010). 

[95] 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.: March 1, 
2011). 

[96] 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.: February 
28, 2012). 

[97] [hyperlink, http://www.gao.gov/products/GAO-11-318SP]. 

[98] [hyperlink, http://www.gao.gov/products/GAO-12-303]. 

[99] See 6 U.S.C. §§ 604, 605. 

[100] A designated state administrative agency is responsible for 
managing the State Homeland Security Program and Urban Areas Security 
Initiative programs at the state level. This management includes 
processing project applications prior to submitting them to FEMA, 
"passing though" federal funds to regional or local entities, and 
ensuring that local grant recipients comply with various statutory and 
grant requirements. 

[101] Investment justifications are one component of the State 
Homeland Security Program, the Urban Areas Security Initiative, the 
Port Security Grant Program, and the Transit Security Grant Program 
applications for grant funding. They provide narrative information on 
proposed activities (investments) that will be accomplished with the 
grant funds and are described in more detail later in this report. The 
investment justifications must demonstrate how proposed investments 
address gaps and deficiencies in current capabilities, and also 
demonstrate adherence to program guidance. 

[102] In August 2009, FEMA established the Reporting Requirements 
Working Group to compile a list of select grant reporting activities, 
collect grant stakeholder feedback, and make recommendations regarding 
future data collection policies. FEMA utilized the working group's 
analysis and recommendations in a May 2011 Report to Congress. 

[103] See FEMA, Redundancy Elimination and Enhanced Performance for 
Preparedness Grants Act: Initial Report to Congress (Washington, D.C.: 
May 23, 2011) for their findings and recommendations. 

[104] We reviewed investment justification and Biannual Strategy 
Implementation Report information--The Biannual Strategy 
Implementation Report is a reporting requirement submitted by states 
to FEMA regarding the progress of certain grants--for the 1,957 grant 
projects awarded through the four grant programs to five urban areas: 
Houston, Jersey City/Newark, New York City, San Francisco, and Seattle 
for fiscal years 2008 through 2010. 

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

[106] This total is comprised of preparedness grant programs in FEMA's 
state and local programs account, which does not include firefighter 
assistance grants and emergency management performance grants. 

[107] See H.R. Rep. No. 112-331, at 175-77 (2011) (Conf. Rep.). 

[1078] GAO is referring to facilities that are under GSA's control and 
custody as GSA-owned or leased facilities. 

[109] The ISC, composed of representatives from 50 federal agencies 
and departments, was established under Executive Order 12977 to 
enhance the quality and effectiveness of security and protection of 
buildings and facilities in the United States occupied by federal 
employees for nonmilitary activities. 

[110] FPS is responsible for coordinating with tenant agencies to 
determine a facility's security level, which ranges from I (lowest 
risk level) to V (highest risk level). 

[111] In addition to risk assessments, the $236 million in basic 
security fees funds security services including ongoing review of 
facility countermeasures to ensure they are functioning as designed; 
assistance with emergency planning and exercises; response to criminal 
incidents and reports of suspicious activity; patrol of facilities to 
deter and detect criminal activity; and awareness training to inform 
tenants how to prevent and react to events in the facility. 

[112] The Federal Enterprise Architecture is intended to provide 
federal agencies and other decision makers with a common frame of 
reference or taxonomy for informing agencies' individual enterprise 
architecture efforts and their planned and ongoing investment 
activities, and to do so in a way that identifies opportunities for 
avoiding duplication of effort and launching initiatives to establish 
and implement common, reusable, and interoperable solutions across 
agency boundaries. 

[113] GAO, Information Technology: OMB Needs to Improve Its Guidance 
on IT Investments, [hyperlink, http://www.gao.gov/products/GAO-11-826] 
(Washington, D.C.: Sept. 29, 2011). 

[114] GAO, Financial Management Systems: OMB's Financial Management 
Line of Business Initiative Continues but Future Success Remains 
Uncertain, [hyperlink, http://www.gao.gov/products/GAO-09-328] 
(Washington, D.C.: May 7, 2009). 

[115] GAO, Information Technology: The Federal Enterprise Architecture 
and Agencies' Enterprise Architectures Are Still Maturing, [hyperlink, 
http://www.gao.gov/products/GAO-04-798T] (Washington, D.C.: May 19, 
2004). 

[117] 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.: February 17, 
2012. 

[116] The 10 federal agencies are the Departments of Agriculture, 
Commerce, Defense, Health and Human Services, Homeland Security, 
Justice, Transportation, the Treasury, and Veterans Affairs, and the 
National Aeronautics and Space Administration. 

[118] In 2004, we found that the per capita labor cost of an American 
direct hire staff was almost eight times higher than that of a local 
hire. 

[119] Department of State and the U.S. Agency for International 
Development, Leading Through Civilian Power: The First Quadrennial 
Diplomacy and Development Review (Washington, D.C.: Dec. 15, 2010). 

[120] We were unable to determine the total amount of money spent on 
training foreign government officials to detect fraudulent travel 
documents because the agencies involved did not consistently track the 
cost of individual training sessions. 

[121] The NRO is responsible for research and development, 
acquisition, launch, deployment, and operation of overhead 
reconnaissance systems, and related data-processing facilities to 
collect intelligence and information to support national and DOD 
mission and other United States Government needs. 

[122] National Space Policy of the United States of America, 28 June 
2010. 

[123] An indefinite delivery, indefinite quantity contract is a type 
of contract that provides for an indefinite quantity, within stated 
limits, of supplies or services during a fixed period of time under 
which the government places orders for individual requirements. 
Federal Acquisition Regulation (FAR), § 16.504(a). 

[124] The booster core is the main body of a launch vehicle. ULA uses 
common booster cores to build all of the Atlas V and Delta IV launch 
vehicles. Medium and intermediate launch vehicles use one core each, 
while the Delta IV Heavy launch vehicle requires three. 

[125] Nitrogen oxides are regulated pollutants commonly known as NOx 
that, among other things, contribute to the formation of ozone. 
Particulate matter is an ubiquitous form of air pollution commonly 
referred to as soot. 

[126] Non-road engines are those used in machines, such as 
construction equipment, agricultural equipment, and airport service 
vehicles. 

[127] The American Recovery and Reinvestment Act of 2009 provided 
about $870 million of this funding. All dollar amounts reported in 
this analysis are in nominal dollars. 

[128] Under DOT's State Infrastructure Banks program, states may use 
allocated federal transportation funds to capitalize state 
infrastructure banks, which in turn provide loans and other nongrant 
financial assistance to eligible projects. 

[129] Biodiesel fuel is an alternative to petroleum-based 
transportation fuel. U.S. biodiesel is made from soybeans and other 
plant oils, such as cottonseed and canola; animal fats, such as beef 
tallow, pork lard, and poultry fat; and recycled cooking oils. A 
diesel fuel emulsion is a mixture of diesel, water, and additives. 

[30] The biodiesel tax credits include an income tax credit, as well 
as an excise tax credit for the production and use of biodiesel. 

[131] GAO did not determine whether the federal agencies that provided 
this funding were aware of each other's actions. 

[132] GAO, Leveraging Federal Funds for Housing, Community, and 
Economic Development, [hyperlink, 
http://www.gao.gov/products/GAO-07-768R] (Washington, D.C.: May 25, 
2007). 

[133] GAO, The Government Performance and Results Act: 1997 
Governmentwide Implementation Will Be Uneven, [hyperlink, 
http://www.gao.gov/products/GAO/GGD-97-109] (Washington, D.C.: June 
1997). 

[134] The Government Performance and Results Act (GPRA) of 1993, Pub. 
L. No. 103-62 (1993). 

[135] Pub. L. No. 111-352 (2011). 

[136] MITRE Corporation, Center for Environment, Resources, and Space, 
Assessment of the Scientific and Technical Laboratories and Facilities 
of the U.S. Environmental Protection Agency (McLean, Va.: May 1994). 

[137] The four national program offices that operate laboratories are 
the Office of Air and Radiation, the Office of Enforcement and 
Compliance Assurance, the Office of Chemical Safety and Pollution 
Prevention, and the Office of Solid Waste and Emergency Response. 

[138] GAO, Executive Guide: Effectively Implementing the Government 
Performance and Results Act, [hyperlink, 
http://www.gao.gov/products/GAO/GGD-96-118] (Washington, D.C.: June 
1996). 

[139] GAO, Results-Oriented Government: Practices That Can Help 
Enhance and Sustain Collaboration among Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-06-15] (Washington, D.C.: Oct. 21, 
2005). 

[140] For some of these programs, the calculation of the offset is not 
a significant issue. Supplemental Security Income (SSI) provides 
financial assistance to eligible individuals who are age 65 or older, 
blind or disabled, and who have limited income and resources. While 
SSI provides benefits to individuals with disabilities, the Disability 
Insurance (DI) program, also administered by SSA, uses the same 
definition of disability as SSI. SSI is a means-tested program, and 
the amount of the DI benefit is considered as income when determining 
whether an individual with a disability also qualifies for SSI. While 
individuals who receive SSI and DI have their SSI benefit offset based 
on the amount of their DI benefit, the appropriate offset calculation 
is not an issue since SSA administers both programs. Social Security 
also allows a person to receive both SSI and Temporary Assistance for 
Needy Families payments, but Temporary Assistance for Needy Families 
benefits are also considered income for SSI purposes, and will reduce 
the SSI payment. Other assistance received, such as from the 
Supplemental Nutrition Assistance Program and home energy assistance, 
is not considered income for SSI and thus does not offset the amount 
of the benefit received. 

[141] See [hyperlink, http://www.gao.gov/products/GAO-01-367] for more 
information. Also, workers' compensation benefits are generally exempt 
from federal income taxes, so the IRS does not have any data on 
receipt of workers' compensation benefits. 

[142] This offset was enacted in response to concern about individuals 
receiving excessive benefits as a result of receiving DI and workers' 
compensation benefits concurrently. An exception to the offset was 
made, however, for such individuals if they resided in states whose 
laws already reduce their workers' compensation benefits (making a 
reduction in DI benefits unnecessary). Such state provisions are 
referred to as reverse offsets, and in these cases, SSA does not 
offset the DI benefit if it recognizes the state provision. The 
reverse offset exception only applies to state provisions that were in 
effect on February 18, 1981. 

[143] In February 2011, the SSA Office of Inspector General found 
payment errors and estimated there were about $4 million in payments 
with errors resulting in underpayments and about $3.8 million in 
payments with errors resulting in overpayments related to the workers' 
compensation offset. 

[144] Prior to July 2001, the Centers for Medicare & Medicaid Services 
was known as the Health Care Financing Administration. Throughout this 
report, we refer to the agency as Centers for Medicare & Medicaid 
Services, even when describing initiatives taken prior to its name 
change. 

[145] 5 U.S.C. § 8101 et seq. 

[146] Social Security Administration, Office of Inspector General, 
Federal Employees Receiving Both Federal Employees' Compensation Act 
and Disability Insurance Payments, A-15-09-19008 (Baltimore, Md.: Oct. 
14, 2010). 

[147] The total does not include other types of emergency assistance. 
For loan programs, these obligations represent the expected credit 
subsidy costs for loan commitments made in fiscal year 2010. These 
estimates are revised in subsequent years and the ultimate cost will 
not be known until the loans mature. The amount of obligations we 
reported for fiscal year 2010 may include funds appropriated in the 
American Recovery and Reinvestment Act of 2009. 

[148] Summing tax expenditure estimates does not take into account 
interactions between individual provisions. This total also does not 
include the exclusion of imputed net rental income. Imputed net rental 
income is the amount that owner-occupiers would have paid to rent a 
home, less nondeductible costs such as depreciation and maintenance 
expense. It is not subject to tax. The Department of the Treasury 
lists the exclusion of imputed net rental income as a tax expenditure 
and estimated the expenditure at $41 billion for fiscal year 2010. 
However, the Joint Committee on Taxation does not list the exclusion 
as a tax expenditure because it views measuring and taxing net imputed 
rental income as administratively infeasible. 

[149] See appendix III for the list of programs, tax expenditures, and 
other tools that supported homeownership and rental housing in fiscal 
year 2010 and their related budgetary information. Many of these 
programs/activities incurred no obligations in fiscal year 2010 for a 
number of reasons, such as the program/activity was not part of the 
federal budget or was inactive during the year. 

[150] The GPRA Modernization Act of 2010 established a new, 
crosscutting, and integrated framework for achieving results and 
improving government performance. It requires OMB to coordinate with 
agencies to establish outcome-oriented goals covering a limited number 
of crosscutting policy areas and to develop a governmentwide 
performance plan for making progress toward achieving those goals. The 
executive branch and Congress could use this process to identify and 
address program areas where strengthened interagency coordination is 
needed to better achieve results as well as areas of fragmentation, 
overlap, and duplication. 

[151] Fiscal year 2010 is the latest date for which actual obligations 
have been reported, and funding data for two programs were not 
reported in budget justifications but obtained from federal agencies. 
This figure includes funding for the 12 programs GAO identified as 
having an explicit purpose of providing early learning or child care 
for children. It does not include federal programs with other purposes 
that permit the use of funds for early learning and child care as an 
allowable activity or that provide supporting services such as food 
and nutrition. For example, the figure does not include funding for 
two multipurpose block grants--the Social Services Block Grant and 
Temporary Assistance for Needy Families (TANF)--or for Title I Grants 
to Local Educational Agencies. 

[152] J. Shonkoff and D. Phillips, Eds, From Neurons to Neighborhoods: 
The Science of Early Childhood Development (Washington, D.C.: National 
Academy Press, 2000). 

[153] In identifying these programs, the criteria GAO used were that 
these programs (1) fund or support early education or child care 
services, (2) are provided to children under age 5, and (3) deliver 
services in an educational or child care setting. 

[154] GAO considers a program as having an explicit early learning or 
child care purpose when the program objectives in the Catalog of 
Federal Domestic Assistance or other agency documents refer to early 
learning or child care. 

[155] This figure excludes American Recovery and Reinvestment Act of 
2009 funds. Pub. L. No. 111-5. See appendix III for information on 
fiscal year 2010 program obligations for early learning and child care 
programs. 

[156] GAO has described the fragmentation and overlap of these and 
other nutrition assistance programs in Domestic Food Assistance: 
Complex System Benefits Millions, but Additional Efforts Could Address 
Potential Inefficiency and Overlap among Smaller Programs, [hyperlink, 
http://www.gao.gov/products/GAO-10-346] (Washington, D.C.: Apr. 15, 
2010). 

[157] Two of the five tax expenditures--Exclusion Of Benefits Provided 
Under Cafeteria Plans and Exclusion of Income Earned by Voluntary 
Employees Beneficiary Associations--include revenue used for health 
care and other benefits besides child care. 

[158] In September 2005, GAO recommended that the Office of Management 
and Budget (OMB), in consultation with the Secretary of the Treasury, 
develop and implement a framework to review tax expenditures. In March 
2011, GAO reported that OMB, in its fiscal year 2012 budget guidance, 
instructed agencies, where appropriate, to analyze how to better 
integrate tax and spending policies that have similar goals and 
objectives. See 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 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). 

[159] These tax provisions primarily benefit families with higher 
incomes than those eligible for CCDF or Head Start. For example, more 
than half of the beneficiaries of the Child and Dependent Care Tax 
Credit earned incomes of at least $50,000 annually in fiscal year 
2009. In contrast, the Child Care and Development Fund generally 
limits eligibility to families at or below 200 percent of the federal 
poverty guidelines (that is, about $37,000 or less for a family of 3 
in 2011), and Head Start eligibility is closer to 100 percent of the 
poverty guidelines. 

[160] Preliminary fiscal year 2009 data are the latest available for 
number of children served under CCDF. 

[161] As GAO noted in earlier work, tax returns generally do not 
collect information necessary to assess how often a tax expenditure is 
used and by whom unless the IRS needs the information or collection is 
legislatively mandated. See [hyperlink, 
http://www.gao.gov/products/GAO-05-690]. 

[162] The Improving Head Start for School Readiness Act of 2007 
required the governor of each state to designate or establish State 
Advisory Councils, and funds provided under the American Recovery and 
Reinvestment Act of 2009 were used to support them. Pub. L. No. 110- 
134, § 11(b) (codified at 42 U.S.C. § 9837b(b)(1)(A)) and Pub. L. No. 
111-5, 123 Stat. 115, 178. 

[163] Pub. L. No. 111-352 (2011). 

[164] See the related GAO products section. 

[165] Those that (1) fund or support early education or child care 
services, (2) are obtained on behalf of children under 5, and (3) 
forgo taxes that can be used to purchase child care services occurring 
in an educational or child care setting. 

[166] U.S. Census Bureau, Americans with Disabilities: 2005. 
(Washington, D.C.: December 2008). Data come from the Survey of Income 
and Program Participation, June - September 2005. 

[167] In commenting on a draft of this section, a Department of 
Defense official requested that GAO add two programs that he believed 
to be within the scope of this review. GAO has added the two programs 
to the list in appendix III. GAO will pursue additional information on 
these programs for a final report on employment support for people 
with disabilities, to be issued later in 2012. 

[168] Specifically, five programs--two of which were demonstration 
studies of limited duration--had ended by December 2011 and agency 
officials expected one more to sunset by the end of fiscal year 2012. 
The Department of Education's fiscal year 2012 budget request proposed 
eliminating or consolidating an additional three programs into its 
Vocational Rehabilitation State Grants program in order to reduce 
duplication of effort and administrative costs, streamline program 
administration at the federal and local levels, and improve efficiency 
and accountability. However, funds were appropriated for all three 
programs in fiscal year 2012. GAO did not include or review programs 
that may have been created or revised after fiscal year 2010. 

[169] Programs that serve wounded, ill, or injured servicemembers were 
included within the scope of analysis. 

[170] VOW to Hire Heroes Act of 2011, Pub. L. No. 112-56, § 241(c), 
125 Stat. 712, 728. 

[171] GAO, Results-Oriented Government: Practices That Can Help 
Enhance and Sustain Collaboration among Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-06-15] (Washington, D.C.: Oct. 21, 
2005). 

[172] Pub. L. No. 111-352, 124 Stat. 3866 (2011). 

[173] Exec. Order No. 13,548, 75 Fed. Reg. 45,039 (July 30, 2010). 

[174] Exec. Order No. 13,583, 76 Fed. Reg. 52,847 (Aug. 23, 2011). 

[175] Specifically, in order to be considered within GAO's scope, 
agencies must have reported that their programs met at least one of 
the following criteria and provided an employment-related service in 
fiscal year 2010: (1) people with disabilities are mentioned in the 
legislation as a targeted group, (2) people are eligible for the 
program wholly because of a disability, (3) people are eligible for 
the program partially because of a disability, (4) people with 
disabilities are given special consideration in eligibility 
determinations, (5) people with disabilities are given priority in 
being served, or (6) employers of people with disabilities are a 
targeted group. 

[176] Pub. L. No. 111-358, § 101 (2011). 

[177] For purposes of GAO's engagement, we defined a federally funded 
STEM education program as a program funded in fiscal year 2010 by 
congressional appropriation or allocation that includes one or more of 
the following as a primary objective: (1) attracting and preparing 
students throughout their academic careers in STEM areas, (2) 
improving teacher education in STEM areas, (3) improving or expanding 
the capacity of K-12 schools or postsecondary institutions to promote 
or foster education in STEM fields, or (4) conducting research to 
enhance the quality of STEM education provided to students. 

[178] These strategic planning documents were required under the 
Government Performance and Results Act (GPRA) and continue to be 
required under the GPRA Modernization Act of 2010. We did not assess 
agencies' plans and reports for compliance with GPRA and the GPRA 
Modernization Act of 2010 requirements, and our findings that some 
agencies did not include STEM education programs in their plans and 
reports should not be read to suggest that we identified instances of 
noncompliance. For example, we did not assess whether a particular 
STEM education program is a "program activity" as that term is defined 
by GPRA for purposes of determining what STEM education programs are 
required to be covered in agency performance plans and reports. 31 
U.S.C. § 1115(h)(11). 

[179] According to GAO's criteria, significant financial literacy and 
education activities and programs were those whose primary goals were 
to educate, inform, or encourage individuals to make informed 
judgments and take effective actions regarding the current and future 
use and management of money. However, GAO excluded (1) those for which 
financial literacy was only a minimal component; (2) programs that 
provided financial information related to the administration of the 
program itself (e.g., information on applying for student financial 
aid or evaluating Medicare choices) rather than information aimed at 
increasing the beneficiaries' financial literacy and comprehension 
more generally; (3) activities or programs that were purely internal 
to the agency, such as information provided to agency employees on 
their employment and retirement benefits; and (4) activities that 
represented individualized services or advice (e.g. assistance with 
tax preparation or development of a debt management plan). For the 
purposes of this report, GAO counted as a federal agency 
NeighborWorks® America, a government-chartered, nonprofit corporation 
that receives federal funding for housing counseling, including 
through an annual appropriation from Congress. 

[180] These programs are the Federal Housing Administration's Home 
Equity Conversion Mortgage, Community Development Block Grant, HOME 
Investment Partnership Program, Second Mortgage Assistance for First-
Time Homebuyers, Rural Housing Stability Grant Program, Public Housing 
Operating Fund, Section 8 Tenant-Based Rental Assistance Homeownership 
Option, Demolition and Disposition of Public Housing, Family Self-
Sufficiency, Public Housing Resident Homeownership Programs, 
Conversion of Distressed Public Housing to Tenant-Based Assistance, 
Low Income Housing Preservation and Resident Homeownership Act 
Prepayment Options, Native American Housing Assistance and Self 
Determination Act Housing Block Grants, Native Hawaiian Housing Block 
Grants, and Section 8 Rental Assistance. 

[181] The Financial Literacy and Education Counseling Pilot Program 
was appropriated $2 million in fiscal year 2009 and $4.15 million in 
fiscal year 2010; the program was not appropriated funds in fiscal 
years 2011 and 2012. 

[182] The Federal Trade Commission's Division of Consumer and Business 
Education plans, develops, and implements various web-based financial 
literacy activities that focus on consumer protection, some of which 
has focused on scams targeted at seniors. The Department of Labor's 
Retirement Savings Education Campaign seeks to increase retirement 
savings through workplace plans so that employees are better prepared 
for a secure retirement. The Social Security Administration's Special 
Initiative to Encourage Savings focuses on saving and retirement 
issues and informing the public about SSA's programs related to old-
age, survivors, and disability insurance system. 

[183] The Air Force calls its main dining facilities "mission 
essential feeding facilities." GAO uses the term main dining 
facilities to refer to these appropriated fund dining facilities in 
this report. 

[184] The National Defense Authorization Act for Fiscal Year 2012 
contains a provision requiring the Secretary of the Air Force to 
submit certain information regarding the Food Transformation 
Initiative prior to further implementation. See Pub. L. No. 112-81, § 
352 (2011). The report may provide an opportunity to evaluate the 
opportunities for reducing food service costs under the initiative. 

[185] Department of Defense Instruction 5100.73, Major DOD 
Headquarters Activities (Dec. 1, 2007). 

[186] Applicable limits to major DOD headquarters personnel are 
included in sections 143, 194, 3014, 5014, and 8014 of Title 10 of the 
U.S. Code. In some circumstances, statutory waivers, exceptions, 
exemptions and authorities to adjust those limits may apply. For 
example, acquisition personnel hired under an expedited hiring 
authority are exempt from the baseline personnel limitations, 
established under the previously mentioned sections of Title 10. 

[187] Span of control refers to the number of subordinates or 
activities under the control of a single commander. 

[188] National Defense Authorization Act for Fiscal Year 2010, Pub. L. 
No. 111-84, §1109 (2009), codified at 10 U.S.C. §115a. The Defense 
Manpower Requirements Report is an annual report to Congress that 
displays DOD's manpower requirements, to include military and 
civilians, as reflected in the President's budget request for the 
current fiscal year. 

[189] Section 1111 of the Duncan Hunter National Defense Authorization 
Act for Fiscal Year 2009, Pub. L. No. 110-417 (2008), allows for the 
adjustment of statutory personnel limits to fill a gap in DOD's 
civilian workforce, identified by the Secretary of Defense in a 
strategic human capital plan submitted to Congress, or to accommodate 
increases in workload or modify the type of personnel required to 
accomplish work for purposes specified in section 1111(c) of the Act. 

[190] Department of Defense Instruction 5100.73, Major DOD 
Headquarters Activities (Dec. 1, 2007). 

[191] Section 2667 of Title 10 of the United States Code provides 
authority to secretaries of the military departments to lease 
nonexcess real property under the control of the respective 
departments, subject to certain conditions. 

[192] 10 U.S.C. § 2667. 

[193] In the enhanced use leasing context, the fair market value of 
the lease is determined by the appropriate departmental secretary. 

[194] GAO, 21st Century Challenges: Reexamining the Base of the 
Federal Government, [hyperlink, 
http://www.gao.gov/products/GAO-05-325SP] (Washington, D.C.: February 
2005). 

[195] 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. 

[196] Congressional Budget Office, Long-Term Implications of the 2012 
Future Years Defense Program, Pub. No. 4281, June 2011. 

[197] Defense Business Board, Focusing a Transition, January 2009. 

[198] The Ike Skelton National Defense Authorization Act for Fiscal 
Year 2011 (Pub. L. No. 111-383 (2010)) was not accompanied by a 
conference report. In lieu of a formal conference report and joint 
explanatory statement, House Armed Services Committee Print No. 5 
(Dec. 2010) was provided to show congressional intent and maintain 
legislative history. 

[199] The Military Health System refers to DOD's health operations as 
a whole, and consists of the Office of the Assistant Secretary of 
Defense for Health Affairs; the medical departments of the Army, the 
Navy, the Air Force and Joint Chiefs of Staff; the Combatant Command 
surgeons; and the TRICARE network of health care providers. 

[200] DOD, Quadrennial Defense Review Report, (Washington, D.C.: Feb. 
1, 2010). 

[201] For purposes of this report, the Office of the Assistant 
Secretary of Defense for Health Affairs will be called Health Affairs. 

[202] 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.: March 1, 
2011). 

[203] This estimate is based on a May 2006 report by the Center for 
Naval Analyses and were adjusted by GAO from 2005 to 2010 dollars. 

[204] DOD monitors the annual increase in costs for enrollees in its 
TRICARE Prime benefit and measures it against a civilian benchmark. 

[205] This group is chaired by the Assistant Secretary of Defense for 
Health Affairs and includes the Surgeons General from the Army, the 
Navy, and the Air Force; the Joint Staff Surgeon; and four Deputy 
Assistant Secretaries of Defense. 

[206] GAO, Combating Terrorism: Evaluation of Selected Characteristics 
in National Strategies Related to Terrorism, [hyperlink, 
http://www.gao.gov/products/GAO-04-408T] (Washington, D.C.: Feb. 3, 
2004). 

[207] [hyperlink, http://www.gao.gov/products/GAO-04-408T]. 

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

[209] GAO, Results-Oriented Government: Practices That Can Enhance and 
Sustain Collaboration Among Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-06-15] (Washington, D.C.: Oct. 21, 
2005). 

[210] Operation and maintenance funding provides for a large number of 
expenses. With respect to DOD installations, operation and maintenance 
funding provides for such aspects as base operation support and 
sustainment, restoration, and modernization of buildings and 
infrastructure. 

[211] These costs do not include (1) supplementary funding provided to 
support ongoing operations, (2) costs reimbursed by tenant 
organization at installations in the U.S. Pacific Command's area of 
responsibility, and (3) personnel costs for troops stationed at 
installations in the U.S. Pacific Command's area of responsibility. 

[212] Defense Acquisition University, Defense Acquisition Guidebook, 
Section 3.3 "Analysis of Alternatives" (accessed Mar. 19, 2010). 

[213] GAO, Information Technology: Federal Agencies Need to Strengthen 
Investment Board Oversight of Poorly Planned and Performing Projects, 
[hyperlink, http://www.gao.gov/products/GAO-09-566] (Washington, D.C.: 
June 30, 2009). 

[214] Executive Order No. 13509, 74 Fed. Reg. 30903 (June 23, 2009). 

[215] In September 2011, GM announced that it planned to reopen its 
Spring Hill, Tennessee, plant where it had previously halted 
production. 

[216] Executive Order No. 13578, 76 Fed. Reg. 40591 (July 6, 2011). 

[217] GAO, Results-Oriented Government: Practices That Can Help 
Enhance and Sustain Collaboration among Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-06-15] (Washington, D.C.: Oct. 21, 
2005). 

[218] 40 U.S.C. § 321(d)(2), which requires cost recovery "so far as 
practicable." 

[219] Over time, GAO's estimate has changed due to a variety of 
reasons, including the increased lifespan of the $1 note and different 
assumptions in its analyses. 

[220] Traditionally, seigniorage is defined as the difference between 
the face value of coins and their cost of production. As long as there 
is public demand, the government creates this net value when it puts 
coins into circulation. Similarly, when the Federal Reserve issues 
notes, it creates an analogous net value for the federal government, 
equal to the face value of the notes less their production costs. 

[221] In March 2011, GAO estimated that replacing the $1 note with a 
$1 coin would provide a net financial benefit to the government of 
about $5.5 billion over 30 years. 

[222] In April 2011, the Federal Reserve put in place new equipment to 
process notes that extended the life of the $1 note to approximately 
56 months; GAO used an estimated note life of 40 months in its 2011 
report. In December 2011, the Treasury Department decided to stop 
producing $1 coins for circulation, relying on coins currently stored 
at the Federal Reserve to meet the relatively small transactional 
demand for $1 coins. 

[223] A discounted net value uses a rate, known as the discount rate, 
to convert the value of payments or receipts expected in future years 
to today's value, taking into account that the further into the future 
an amount is paid or received, the smaller its value is today. 
Applying a discount rate establishes a consistent basis for comparing 
alternative investments that will have differing patterns of costs and 
benefits over many years. 

[224] Presidential $1 Coin Act of 2005, Pub. L. No. 109-145 (2005), 
codified at 31 U.S.C. § 5112(p)(3)(D). 

[225] Twelve regional Federal Reserve banks order coins from the 
United States Mint, which distributes coins directly to those banks. 
The Federal Reserve banks distribute coins as well as notes to 
commercial banks to meet the demand of retailers and the public. Some 
coins and notes are returned by commercial banks as deposits to the 
Federal Reserve banks, where they are processed for storage or 
recirculation. According to Federal Reserve officials, each new 
presidential coin design is delivered in units of 1,000. 

[226] Currency Optimization, Innovation, and National Savings Act, 
H.R. 2977, 112th Cong. (2011). Other legislation has been proposed 
that would postpone the minting of new $1 coins until the inventory of 
stored $1 coins has been reduced (Currency Efficiency Act of 2011, S. 
1624, 112th Cong. (2011). 

[227] Board of Governors of the Federal Reserve System, Annual Report 
to the Congress on the Presidential $1 Coin Program (June 2011). 

[228] Pub. L. No. 82-137 (Aug. 31, 1951), codified at, 31 U.S.C. § 
9701. 

[229] User fees assessed under the Independent Offices Appropriation 
Act's authority must be (1) fair and (2) based on costs to the 
government, the value of the service or thing to the recipient, public 
policy or interest serviced, and other relevant facts. Fees collected 
under this authority are deposited in the general fund of the U.S. 
Treasury and are generally not available to the agency or the activity 
generating the fees. Unless otherwise authorized by law, the act 
requires that agency regulations establishing a user fee are subject 
to policies prescribed by the President. 

[230] Pub. L. No. 101-576 (Nov. 15, 1990), codified at, 31 U.S.C. § 
902. The CFO Act requires agencies to report on "fees, royalties, 
rents, and other charges imposed by the agency for services and things 
of value it provides." For the purposes of this discussion, GAO 
collectively refers to all of these as user fees. 

[231] Twenty-three of the 24 departments covered by the CFO Act and 
OMB Circular No. A-25 responded to GAO's survey. The Department of 
Defense did not respond to GAO's survey. The Department of Education 
and the National Science Foundation reported no fees. The Department 
of Commerce's National Technical Information Service is a fee-based 
agency that charges more than 3 million different fees as a clearing 
house for government-funded, technical, engineering and business 
related information. The service reported these as a single fee. For 
all Department of Commerce Bureaus, other than the U.S. Patent and 
Trademark Office, fee collections are as of June 30, 2010, per the 
Department of Commerce. The U.S. Patent and Trademark Office reported 
collections for all of fiscal year 2010. There may be some duplication 
of reported fees as both the Department of Commerce and Department of 
State reported collecting fees for Commercial Services.The Mint 
reported a single fee and collection amount for the fees related to 
all Numismatic products which account for $3.25 billion of the 
Department of the Treasury's total collections. 

[232] Agency documentation of these fee reviews varied, limiting GAO's 
ability to corroborate individual fee reviews and the recency and 
frequency of these fee reviews. 

[233] Abusive tax avoidance transactions range from tax schemes based 
on clearly frivolous arguments to highly technical and abusive tax 
shelters. 

[234] In March 2010, pursuant to the Patient Protection and Affordable 
Care Act, information reporting requirements were expanded to cover 
payments for goods as well as services and payments to corporations. 
Pub. L. No. 111-148, § 9006. Later in September 2010, pursuant to the 
Small Business Jobs Act of 2010 information reporting requirements 
were expanded to include landlords who have generally not been 
considered to be engaged in a trade or business. Pub. L. No. 111-240, 
§ 2101.These provisions were repealed by the Comprehensive 1099 
Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act 
of 2011. Pub. L. No. 112-9, §§ 2(a), 3 (2011). 

[235] Improper payments may be made as a result of several causes, 
such as submissions of duplicate claims or fraud, waste, and abuse. 

[236] We did not validate the data provided in November 2011. 

[237] GAO, Department of Homeland Security: Billions Invested in Major 
Programs Lack Appropriate Oversight, [hyperlink, 
http://www.gao.gov/products/GAO-09-29] (Washington, D.C.: Nov. 18, 
2008) and Department of Homeland Security: Assessments of Selected 
Complex Acquisitions, GAO-10-588SP (Washington. D.C.: June 30, 2010). 

[238] 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) and [hyperlink, http://www.gao.gov/products/GAO-10-588SP]. 

[239] According to OMB Circular A-11, performance measurement should 
include program accomplishments in terms of outputs (quantity of 
products or services provided) and outcomes (results of providing 
outputs in terms of effectively meeting intended agency mission 
objectives), as well as indicators, statistics or metrics used to 
gauge program performance. See OMB, Preparation, Submission, and 
Execution of the Budget, Circular A-11 (Washington, D.C.: August 2011). 

[240] Clinger-Cohen Act of 1996, 40 U.S.C. §§ 11101-11703, and OMB 
Circular A-130, Management of Federal Information Resources 
(Washington, D.C., Nov. 30, 2000). 

[241] Pub. L. No. 111-352, 124 Stat. 3866 (2011). 

[242] GAO, Cost Estimating and Assessment Guide: Best Practices for 
Developing and Managing Capital Program Costs, GAO093SP (Washington, 
D.C.: March 2009). 

[243] National Strategy for Counterterrorism (Washington, D.C.: June 
28, 2011). 

[244] See Pub. L. No. 107-71, § 118(a) (2001) (codified as amended at 
49 U.S.C. § 44940). In general, the fees collected offset the account 
that finances the activities and services for which the fee is 
imposed. Specifically, the fees collected offset amounts appropriated 
to TSA's "aviation security" account. See, e.g., Department of 
Homeland Security Appropriations Act, 2010, Pub. L. No. 111-83 (2009). 
See also 49 U.S.C. § 44940(f)(1). 

[245] See 49 U.S.C. § 44940(a)(2) (authorizing the collection of the 
air carrier fees if passenger security fee collections were 
insufficient to pay for the costs of providing civil aviation security 
services). TSA collected approximately $280 million in air carrier 
fees in fiscal year 2010 and expects to have collected an estimated 
$420 million in fiscal year 2011 and each fiscal year thereafter. 

[246] See, e.g., Southwest Airlines, Co. v. Transp. Sec. Admin., 650 
F.3d 752 (D.C. Cir. 2011) (denying airlines' petition for review of 
TSA's determination to use $420 million as the basis for its 
calculation of the cost to air carriers for screening passengers and 
property in calendar year 2000). As of this most recent ruling by the 
Court of Appeals, it remains unclear if air carriers will continue to 
dispute the amount of the fee imposed by TSA. 

[247] In addition, pursuant to the Chief Financial Officers Act of 
1990, agencies must review fees and other charges for services and 
things of value biennially, and based on these reviews make 
recommendations, as appropriate, on revising the fees to reflect costs 
incurred. See 31 U.S.C. § 902(a)(8). Similarly, OMB Circular A-25 
provides that each agency will review user charges biennially. These 
reviews include (1) assuring that existing charges are adjusted to 
reflect unanticipated changes in costs or market values, and (2) 
reviewing of all other agency programs to determine whether fees 
should be assessed for government services or the user of government 
goods or services. In accordance with OMB guidance, TSA reviews the 
passenger security fee, which is a user fee, biennially, but TSA does 
not have authority to adjust the fee beyond the maximum amount 
established in statute, if warranted. 

[248] International Civil Aviation Organization, Policies on Charges 
for Airports and Air Navigation Services (Doc 9082), Eighth Edition, 
2009. The International Civil Aviation Organization is a specialized 
agency of the United Nations that sets standards and regulations 
related to aviation safety, security, and aviation environmental 
protection, among other things. 

[249] The Canadian Air Transport Security Authority, created after 
September 11, 2001, is a governmental entity responsible for providing 
core civil aviation security functions, such as screening passengers 
and baggage at Canadian airports. The Air Travelers Security Charge is 
imposed on flights departing from any of the 89 airports regulated by 
the Canadian Air Transport Security Authority. GAO did not compare the 
costs of civil aviation security in Canada to those in the United 
States. 

[250] The amount of Air Travelers Security Charges imposed on 
travelers varies depending on flight segment, such as domestic (one-
way), domestic (round-trip), transborder (to the United States), and 
other international flights. The fee is charged to passengers who use 
airports in which the Security Authority performs security-related 
services. Dollar amounts shown above are in Canadian dollars. When 
converted to U.S. dollars, the Air Travelers Security Charge would 
have been $7.56 in 2002 and $7.36 in 2010. 

[251] GAO's inflation adjustment factor is derived from the Consumer 
Price Index (for urban consumers) compiled by the Bureau of Labor 
Statistics using 2002 as the base year. GAO divided the annual 
Consumer Price Index for 2010 by that of 2002 to get the adjustment 
factor for 2010. 

[252] See D.W. Gillen, W.G. Morrison, and C. Stewart, Air Travel 
Demand Elasticities: Concepts, Issues, and Management, Department of 
Finance, Government of Canada (January 2003). 

[253] Note that this is the fare for a whole trip; since a trip may 
entail more than one enplanement, the fee increase as a percentage of 
enplanement fare would be slightly higher but still very small. 

[254] The average ticket price reflects a weighted average price of 
domestic and international flights. 

[255] In this context, demand elasticity refers to the degree to which 
the demand for air travel changes with price. Our analysis assumes a 
demand elasticity of -1.122. This is the median of 254 estimates from 
21 studies analyzed in a 2003 study conducted by the Department of 
Finance, Government of Canada. See D.W. Gillen, W.G. Morrison, and C. 
Stewart. In addition, a 2007 study claims that this demand is less 
elastic (less responsive to price changes especially when those price 
changes apply to all national routes). The 2007 study estimates this 
national level elasticity to be -0.8. In this case, the reduction in 
total enplanements could be even lower. See Intervistas Consulting 
Group, Estimating Air Travel Demand Elasticities, Final Report 
(December 2007). 

[256] Note that the reduction in enplanements by 26 million could also 
result in some lost revenues from excise and segment taxes levied on 
air travel. GAO estimated this to be about $295 million. 

[257] 8 U.S.C § 1356(d). 

[258] Because ICE does not analyze air passenger collections 
information separately, GAO estimated ICE's collections using CBP's 
data and the allocation rate between ICE and CBP. 

[259] As of January 2012, ICE officials said they were evaluating 
fiscal year 2010 data and did not know whether collections covered 
costs for that year. 

[260] In September 2007, GAO recommended that, if air passenger 
immigration inspection activity costs exceed collections, the 
Secretary of Homeland Security should develop a legislative proposal 
in consultation with Congress to adjust the immigration fee to recover 
costs as closely as possible, per statute. As of November 2011, this 
recommendation remains open pending the completion of ICE's cost study. 

[261] In September 2007, GAO recommended that the Secretary of 
Homeland Security complete development of and report on ICE's activity 
costs to ensure the air passenger immigration inspection fee is 
divided between ICE and CBP according to their respective proportion 
of air passenger immigration inspection activity costs. As of November 
2011, this recommendation remains open pending the completion of ICE's 
cost study. 

[262] Iraqi security forces include the Iraqi army, navy, and air 
force under the Ministry of Defense and the Iraqi police, federal 
police, and border enforcement under the Ministry of Interior. 

[263] Duncan Hunter National Defense Authorization Act for Fiscal Year 
2009, Pub. L. No. 110-47 (Oct. 14, 2008). 

[264] Strategic Framework Agreement for a Relationship of Friendship 
and Cooperation between the United States of America and the Republic 
of Iraq (Nov. 17, 2008), effective January 1, 2009. 

[265] The range that GAO estimated reflects uncertainty regarding what 
portion of funds set aside for FMS purchases and paid as letters of 
credit has been recorded as expenditures by the Ministry of Finance 
and is therefore included in expenditure totals. 

[266] Consolidated Appropriations Act, 2012, Pub. L. No. 112-74, Dec. 
23, 2011. 

[267] 42 U.S.C. § 5170. In addition to major disaster declarations, 
the President may issue emergency declarations. If the President 
declares an emergency, the federal government may provide immediate 
and short-term assistance that is necessary to save lives, protect 
property and public health and safety, or lessen or avert the threat 
of a catastrophe. 42 U.S.C. § 5192. Federal assistance may not exceed 
$5 million under an emergency declaration unless continued emergency 
assistance is immediately required; there is a continuing and 
immediate risk to lives, property, public health or safety; and 
necessary assistance will not otherwise be provided on a timely basis. 
42 U.S.C. § 5193. 

[268] The Public Assistance Program provides for debris removal, 
emergency protective measures, and the repair, replacement, or 
restoration of disaster-damaged, publicly owned facilities and the 
facilities of certain private nonprofit organizations that provide 
services otherwise performed by a government agency. 

[269] FEMA's obligations of $78.7 billion exclude obligations for 
disasters declared before fiscal year 2004 that had yet to be closed 
out by October 1, 2004, and, therefore, remained eligible for 
additional obligations in fiscal year 2004 and subsequent years. 

[270] In addition to the 13 disasters that have currently exceeded a 
billion dollars in obligations, other disasters declared during fiscal 
years 2004 to 2011 that are still open could reach obligations of over 
$1 billion as FEMA continues to obligate funds for them. 

[271] Statements of The Honorable W. Craig Fugate, Administrator, 
FEMA, before the House Committee on Transportation and Infrastructure, 
Subcommittee on Economic Development, Public Buildings, and Emergency 
Management, Streamlining Emergency Management: Improving Preparedness, 
Response, and Cutting Costs (Washington, D.C.: Oct. 13, 2011). 

[272] Statements of The Honorable W. Craig Fugate, Administrator, 
FEMA, before the House Committee on Homeland Security, Subcommittee on 
Emergency Preparedness, Response, and Communications, Five Years 
Later: An Assessment of the Post Katrina Emergency Management Reform 
Act (Washington, D.C.: Oct. 25, 2011). 

[273] See GAO, 21st Century Challenges: Reexamining the Base of the 
Federal Government, [hyperlink, 
http://www.gao.gov/products/GAO-05-325SP] (Washington, D.C.: February 
2005). 

[274] 42 U.S.C. § 5170. The intent of the Stafford Act is to, among 
other things, provide an orderly and continuing means of assistance by 
the federal government to state and local governments in carrying out 
their responsibilities to alleviate the suffering and damage from 
disasters. 42 U.S.C. §5121(b). 

[275] See 44 C.F.R. § 206.48(a)(5). 

[276] 6 U.S.C. § 749. 

[277] GAO has previously reported on the importance of metrics, for 
example, see GAO, Measuring Disaster Preparedness: FEMA Has Made 
Limited Progress in Assessing National Capabilities, [hyperlink, 
http://www.gao.gov/products/GAO-11-260T] (Washington, D.C.: March 17, 
2011). 

[278] See GAO, Standards for Internal Control in the Federal 
Government, [hyperlink, 
http://www.gao.gov/products/GAO/AIMD-00-21.3.1] (Washington, D.C.: 
November 1999). 

[279] 51 Fed. Reg. 13,332 (Apr. 18, 1986). 

[280] 51 Fed. Reg. at 13,333. 

[281] 64 Fed. Reg. 47,697 (Sept. 1, 1999). When FEMA published the 
rule establishing the formal public assistance criteria in 1999, FEMA 
set the public assistance per capita indicator at $1.00. 

[282] 64 Fed. Reg. at 47,697; 64 Fed. Reg. 3910, 3911 (Jan. 26, 1999). 

[283] For example, per capita income does not include income produced 
in a state unless it is received as income by a state resident. Thus, 
profits retained by corporations for business investment, though 
potentially subject to state taxation, are not included in a state per-
capita income measure because they do not represent income received by 
state residents. 

[284] Another potential method for calculating the public assistance 
damage estimate indicator is through the use of Total Taxable 
Resources, an indicator developed by the Department of the Treasury, 
which measures resources that are potentially subject to state 
taxation. GAO previously reported in 2001 that Total Taxable Resources 
provide a more sensitive adjustment for growth over time in a state's 
fiscal capacity than the consumer price index. 

[285] To date, this work has not identified a basis for proposing 
specific funding rescissions. 

[286] We recognize that there could be instances where some degree of 
program duplication, overlap, or fragmentation may be warranted due to 
the nature or magnitude of the federal effort. 

[287] The MAX Information System is used to support the federal budget 
process. The system has the capability to collect, validate, analyze, 
model, and publish information relating to governmentwide management 
and budgeting activities and can also be used as an information 
sharing and communication portal between government organizations. 

[288] GAO, Results-Oriented Government: Practices That Can Help 
Enhance and Sustain Collaboration among Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-06-15] (Washington, D.C.: Oct. 21, 
2005). 

[289] GAO, Streamlining Government: Key Practices from Select 
Efficiency Initiatives Should Be Shared Governmentwide, [hyperlink, 
http://www.gao.gov/products/GAO-11-908] (Washington, D.C.: Sept. 30, 
2011). 

[290] GAO, Federal User Fees: A Design Guide, [hyperlink, 
http://www.gao.gov/products/GAO-08-386SP] (Washington, D.C.: May 29, 
2008). 

[End of section] 

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