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United States Government Accountability Office: 
GAO: 

Report to the Chairman, Committee on Small Business, House of 
Representatives: 

May 2014: 

Export Promotion: 

Trade Agencies Should Enhance Collaboration with State and Local 
Partners: 

GAO-14-393: 

GAO Highlights: 

Highlights of GAO-14-393, a report to the Chairman, Committee on Small 
Business, House of Representatives. 

Why GAO Did This Study: 

The 2010 National Export Initiative calls for the federal government 
to coordinate more with state and local governments and other public 
and private partners on export promotion. Recently, the TPCC 
identified three key initiatives to enhance collaboration among 
federal, state, and other partners. Congress requested that GAO review 
federal and state collaboration in export promotion.
This report examines (1) the main characteristics of federal and state 
export promotion efforts, including their collaboration, and (2) the 
extent to which the TPCC has advanced collaboration between state and 
federal efforts. GAO analyzed federal and state documents and data 
from 2012 and 2013; interviewed officials from federal, state, and 
other export promotion organizations; and visited federal and state 
trade offices and other relevant organizations in five states selected 
as a nongeneralizable sample based on their participation in the TPCC 
initiatives and other factors. 

What GAO Found: 

Federal and state governments share a common interest in promoting 
exports as a tool for economic growth and creating jobs. Both provide 
similar and overlapping export promotion services to similar clients, 
but their staffing, budgetary resources, and ways of measuring 
performance vary. Located across the country, Department of Commerce 
(Commerce), Small Business Administration (SBA), and state trade 
offices provide outreach, counseling and training, and trade leads, 
mostly to small businesses. In some states, state trade offices have 
more domestic staff than Commerce offices do. However, Commerce 
provides more overall coverage abroad, with offices in 72 countries, 
15 of which have no state trade office representation. In the five 
states GAO visited, federal and state collaboration on export 
promotion varied from working closely in the same location to not 
collaborating at all, depending on unique factors in each state. 

The federal interagency Trade Promotion Coordinating Committee (TPCC) 
has three initiatives designed to advance federal-state collaboration 
in promoting U.S. exports by strengthening and expanding networks of 
state and local governments and other partners. Results of these 
efforts have been limited, however, in part because their 
implementation has not consistently followed key collaboration 
practices. In prior work, GAO found that collaboration is generally 
enhanced by following key practices, such as articulating common 
outcomes; agreeing on roles and responsibilities; monitoring, 
evaluating, and reporting on results; and coordinating resource 
planning. In the states it visited, GAO found weaknesses in the 
implementation of Export Outreach Teams, a TPCC initiative. For 
example, in some cases, activities were missing key participants and 
were inconsistent with the activities’ objectives, in part because SBA 
is not fully monitoring implementation of the teams across its 68 
district offices. Similarly, GAO found that TPCC’s involvement in a 
Brookings Institution initiative to engage metropolitan areas in 
export promotion has unknown implications for federal export promotion 
efforts and resources because Commerce lacks a means to monitor the 
initiative’s results. Finally, an agreement between Commerce (the TPCC 
Chair) and a national group representing state trade offices expired 
without achieving its collaboration objective or enhancing client 
information sharing so states can share credit with Commerce for 
helping companies make export sales. According to Commerce, by law, it 
cannot release its clients’ confidential commercial information, and 
its policy is to make determinations on releasing information case by 
case, but it does not provide formal guidance to staff on what 
information sharing is allowable. 

Figure: TPCC Initiatives to Promote Federal-State Collaboration in 
Export Promotion: 

[Refer to PDF for image: table] 

Export Outreach Teams: 
SBA-led initiative to strengthen local networks of export service 
providers. 

Commerce Support of Global Cities Exchange: 
Brookings Institution effort to expand metro areas’ involvement in 
exports, e.g., mayor’s offices, economic development entities. 

Commerce and State International Development Organizations Agreement: 
Collaborative effort between Commerce and state trade offices’ 
organization to better coordinate export promotion services. 

Source: GAO based on Department of Commerce and state trade offices’ 
data. 

[End of figure] 

What GAO Recommends: 

GAO recommends that the TPCC take steps consistent with key practices 
for collaboration to (1) improve implementation of the Export Outreach 
Teams to better achieve their intended objectives; (2) enhance TPCC 
agencies’ collaboration on export promotion with nonfederal entities; 
and (3) enhance federal information sharing with state trade offices, 
where possible, on Commerce’s export promotion activities, for 
example, by providing formal guidance to staff on allowable 
information sharing. Commerce and SBA agreed with GAO’s 
recommendations. 

View GAO-14-393. For more information, contact Kimberly Gianopoulos at 
(202) 512-8612 or gianopoulosk@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

Federal and State Export Promotion Efforts Have Key Similarities but 
Vary in Staffing and Budgetary Resources, Performance Metrics, and 
Extent of Collaboration: 

TPCC Initiatives to Promote Federal-State Collaboration Have Had 
Limited Results, Due in Part to Inconsistent Use of Key Practices: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: Commerce and State Trade Office Representation Overseas: 

Appendix III: Comments from the Department of Commerce: 

Appendix IV: GAO Contact and Staff Acknowledgments: 

Table: 

Table 1: Export Promotion Services Provided by the Department of 
Commerce's (Commerce) Commercial Service, Small Business 
Administration (SBA), and State Trade Offices in the Five States GAO 
Visited: 

Figures: 

Figure 1: Total Dollar Value of Annual U.S. Exports, 2009 to 2013, and 
Export Level Needed to Meet 2014 National Export Initiative Goal: 

Figure 2: Overview of Commerce and State Trade Office Presence in 
Selected States: 

Figure 3: Top 10 Countries in Which State Trade Offices Had 
Representation as of February 2014: 

Figure 4: Dollar Value of Commercial Service Export Successes by State 
Groupings, in Fiscal Year 2012: 

Figure 5: Expected Outcomes, Suggested Membership, and Planned 
Activities of Export Outreach Teams: 

Figure 6: Metropolitan Export Initiative/Global Cities Exchange: 

Figure 7: Commerce and State Trade Office Representation Overseas: 

Abbreviations: 

Commerce: Department of Commerce: 

CS: Commercial Service: 

CTS: Client Tracking System: 

GPRA: Government Performance and Results Act: 

ITA: International Trade Administration: 

MOA: memorandum of agreement: 

MOI: memorandum of intent: 

NEI: National Export Initiative: 

SBA: Small Business Administration: 

SBDC: Small Business Development Center: 

SIDO: State International Development Organizations: 

STEP: State Trade Export Promotion: 

TPCC: Trade Promotion Coordinating Committee: 

USEAC: United States Export Assistance Center: 

[End of section] 

United States Government Accountability Office: 
GAO:
441 G St. N.W. 
Washington, DC 20548: 

May 21, 2014: 

The Honorable Sam Graves Chairman: 
Committee on Small Business: 
House of Representatives: 

Dear Mr. Chairman: 

Given the importance of U.S. exports in supporting economic growth, in 
2010, the President announced the National Export Initiative (NEI) 
aimed at doubling U.S. exports in the next 5 years.[Footnote 1] The 
Office of Management and Budget (OMB) subsequently identified the 
NEI's goal of doubling U.S. exports as one of 14 interim crosscutting 
priority goals under the GPRA Modernization Act.[Footnote 2] The NEI 
identifies increased coordination among the federal government and its 
nonfederal partners as a priority and a tool for increasing 
exports.[Footnote 3] Congress called for such coordination more than 
two decades ago in the Export Enhancement Act of 1992, which directed 
the President to establish the interagency Trade Promotion 
Coordinating Committee (TPCC) to coordinate U.S. government export 
promotion and export financing activities and develop a U.S. 
government-wide strategic plan for carrying out such federal programs. 
[Footnote 4] The act also called for the TPCC, chaired by the 
Secretary of Commerce, to review efforts by the states to promote U.S. 
exports and propose ways to develop cooperation between federal and 
state efforts.[Footnote 5] 

In light of the federal government's emphasis on the importance of 
promoting U.S. exports, you asked that we review federal and state 
collaboration in export promotion, which includes activities 
undertaken by government agencies to assist U.S. businesses with the 
process of bringing goods and services to market in other countries. 
This report examines (1) the main characteristics of federal and state 
export promotion efforts, including their collaboration, and (2) the 
extent to which the TPCC has advanced collaboration between state and 
federal efforts to promote U.S. exports. 

To determine the main characteristics of federal and state export 
promotion efforts, including their collaboration, we compared their 
services, types of clients, and performance measures using information 
collected from documents and interviews from the Department of 
Commerce's (Commerce) Commercial Service (CS), the Small Business 
Administration (SBA), and state trade offices in five states (Florida, 
Minnesota, Oregon, Pennsylvania, and Virginia). We chose these states 
based upon the following criteria: presence of relevant Commerce and 
SBA officials; participation in export promotion initiatives we were 
evaluating; state trade office presence overseas; extent of state-
level export promotion activities according to Commerce officials in 
Washington, D.C.; and state trade office staff size (mix of large and 
small). We chose these five locations to better understand and test 
federal initiatives to advance collaboration with state trade offices 
at the local level. This allowed us to assess federal implementation 
efforts overall, but these five locations are not representative of 
the situations in each of the individual 50 states. 

We also analyzed data collected by the State International Development 
Organizations (SIDO) in its annual member surveys for 2012 and 2013. 
[Footnote 6] We also determined the extent to which CS and state trade 
offices share operational costs and clients. We gained additional 
insights into how CS and state trade offices work together in 
providing their services by examining 2012 data in Commerce's Client 
Tracking System.[Footnote 7] 

To assess the extent to which TPCC has supported collaboration between 
federal and state efforts to promote U.S. exports, we focused on three 
initiatives identified by TPCC officials. We examined SBA guidelines 
for Export Outreach Teams, and the TPCC Interagency Communiqué about 
the teams; reviewed the memorandum of agreement (MOA) on the 
Metropolitan Export Initiative signed by Commerce and the Brookings 
Institution,[Footnote 8] as well as export plans for four metropolitan 
areas developed in the pilot phase of that initiative; and reviewed 
the memorandum of intent (MOI) signed by Commerce and SIDO, an 
agreement outlining plans to collaborate. We analyzed the information 
we gathered on the three initiatives to assess the extent to which 
their collaboration efforts were consistent with key practices and 
considerations for interagency collaboration identified by previous 
GAO work.[Footnote 9] We also interviewed officials from state trade 
offices; SBA District Offices; and U.S. Export Assistance Centers 
(USEAC) in Florida, Minnesota, Oregon, Pennsylvania, and Virginia. 
Where recommended in those states, we interviewed other entities 
including trade associations, economic development organizations, and 
Small Business Development Centers (SBDCs). In addition, we 
interviewed officials from the mayors' offices in Miami, Florida; 
Minneapolis, Minnesota; and Portland, Oregon. In Washington, D.C., we 
interviewed officials from the TPCC, Commerce's International Trade 
Administration (ITA), as well as from SIDO, the National Governors 
Association, and the Brookings Institution. We took into account past 
GAO work on export promotion and related performance audits by the 
Commerce Office of Inspector General. We also reviewed the TPCC 
authorizing legislation, current and past National Export Strategies, 
and the President's NEI. See appendix I for further details of our 
objectives, scope, and methodology. 

We conducted this performance audit from February 2013 to May 2014 in 
accordance with generally accepted government auditing standards. 
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 the 
evidence obtained provides a reasonable basis for our findings and 
conclusions based on our audit objectives. 

Background: 

Export promotion activities include efforts to raise awareness about 
exporting and to provide businesses with export counseling, training, 
and information on market opportunities; help connecting with 
potential buyers abroad; and help obtaining financing. Responsibility 
for export promotion is widely dispersed. Many federal and state 
agencies operate a wide variety of programs across the country and 
overseas that are intended, at least in part, to assist U.S. companies 
in entering foreign markets, or in expanding their existing presence 
in markets abroad. 

Some of the 20 TPCC member agencies directly assist small 
businesses[Footnote 10] to export overseas, including Commerce, SBA, 
the Export-Import Bank, the Departments of State and Agriculture, and 
the U.S. Trade Development Agency. This review of export promotion 
efforts focuses solely on Commerce and SBA because their activities in 
this area are similar to those of state governments. 

The TPCC Secretariat is housed in Commerce's ITA and takes the lead in 
coordinating the activities of federal export promotion activities and 
implementing the NEI through an annual National Export Strategy. The 
ITA also manages CS as part of its Global Markets unit. In most 
states, CS is the primary government entity providing federal export 
promotion services to non-agricultural businesses. Commerce's mission 
includes strengthening the international economic position of the 
United States by facilitating global trade and opening up new markets 
for U.S. goods and services. CS's network of domestic and 
international trade professionals seeks to increase exports of goods 
and services from the United States.[Footnote 11] While CS's mission 
identifies small businesses as a particular focus of its export 
promotion efforts, CS assists companies of all sizes. 

SBA's key roles in export promotion are to conduct outreach and 
provide training, counseling, and export financing for small 
businesses. Within SBA, the Office of International Trade has primary 
responsibility for export promotion efforts. The Office of 
International Trade field staff are mainly responsible for providing 
outreach, training, and technical assistance on SBA's export finance 
programs. In addition, one person in each of SBA's 68 District Offices 
is designated as a District International Trade Officer and provides 
basic export assistance as a collateral duty. The District 
International Trade Officers are managed by a separate SBA office, 
SBA's Office of Field Operations. SBA partially funds SBDCs, which are 
located primarily at colleges and universities as a cooperative effort 
among SBA, the academic community, the private sector, and state and 
local governments. Our January 2013 report on the SBA's role in export 
promotion noted that in addition to providing general business 
services, SBDCs may help businesses interested in exporting, 
particularly those that are new to exporting and need assistance with 
preparing their business to export.[Footnote 12] The report also noted 
that while most SBDCs provide export assistance as one of many 
business-development services, some SBDCs meet SBA's criteria to be 
designated as International Trade Centers that focus primarily on 
providing export assistance to businesses. 

Every state government conducts some export promotion activities. 
State-level trade functions can be housed in various state government 
entities, including governors' offices, state departments of commerce, 
and state departments of economic development.[Footnote 13] State 
trade offices often have both domestic and international staff; while 
domestic staff generally are state employees, international staff may 
work directly for the state trade office or may work as contractors. 

Federal and State Export Promotion Efforts Have Key Similarities but 
Vary in Staffing and Budgetary Resources, Performance Metrics, and 
Extent of Collaboration: 

The federal government and state trade offices across the country work 
to promote exports, offering similar services to similar types of 
clients, primarily small businesses. When government agencies and 
state trade offices have similar goals, activities, strategies, or 
beneficiaries, their programs may overlap. This overlap may be 
beneficial for clients if federal and state offices collaborate to 
better address the demand for export promotion services. However, gaps 
in collaboration may result in an inefficient use of limited resources 
dedicated to export promotion. We found that although federal agencies 
and state trade offices overlap to varying degrees in their provision 
of export promotion services, their staffing levels, resource levels, 
and metrics for measuring program effectiveness often differ. 
Furthermore, we found that although increased collaboration may 
increase the efficiency and effectiveness of overlapping export 
promotion efforts, the extent of collaboration between federal 
agencies and individual state trade offices varies widely. 

Federal and State Trade Offices Provide Similar Services to Help Small 
Businesses Export: 

In seeking to promote exports, the federal government and state trade 
offices provide services that overlap to varying degrees. By 
definition, overlap occurs when programs have similar goals, engage in 
similar activities or strategies to achieve them, or target similar 
beneficiaries.[Footnote 14] Officials at both U.S. Export Assistance 
Centers (USEAC)[Footnote 15] and state trade offices that we visited 
told us that they are operating at capacity in terms of resources to 
meet the demand for their export promotion services. Consequently, 
officials at two USEACs and two state trade offices that we visited 
viewed the provision of similar services by different organizations as 
positive for beneficiaries of these services because the overlap meant 
that more resources were available to companies looking for help 
exporting. As we previously concluded, however, without enhanced 
collaboration, overlap may have a negative effect in that limited 
resources may not be used in the most effective and efficient 
manner.[Footnote 16] Furthermore, small business beneficiaries could 
be confused about how to access available services and unclear about 
who could best meet their needs. 

Federal and state efforts to provide export promotion services share 
the same goal: to strengthen the economy and create jobs. The 
President's National Export Initiative (NEI) articulates this goal in 
very specific terms, aiming to double U.S. exports (based on 2009 
export levels) by the end of 2014. Export promotion is also a 
component of many state strategies for economic development and job 
creation. U.S. exports have increased substantially since 2009, 
reaching record levels in 2013; nevertheless, they have fallen short 
of the levels needed to attain the NEI goal. Figure 1 illustrates 
progress toward this goal. 

Figure 1: Total Dollar Value of Annual U.S. Exports, 2009 to 2013, and 
Export Level Needed to Meet 2014 National Export Initiative Goal: 

[Refer to PDF for image: combined vertical bar and line graph] 

Year: 2009; 
Annual exports to meet goal: $1.58 billion; 
Actual exports: $1.58 billion. 

Year: 2010; 
Annual exports to meet goal: $1.81 billion; 
Actual exports: $1.84 billion. 

Year: 2011; 
Annual exports to meet goal: $2.08 billion; 
Actual exports: $2.11 billion. 

Year: 2012; 
Annual exports to meet goal: $2.39 billion; 
Actual exports: $2.21 billion. 

Year: 2013; 
Annual exports to meet goal: $2.75 billion; 
Actual exports: $2.27 billion. 

Year: 2014; 
Annual exports to meet goal: $3.16 billion (The President’s goal). 
Goal is to double U.S. exports over 2009 level. 

Source: GAO analysis; actual exports data from U.S. Bureau of Economic 
Analysis. 

Note: The line labeled in the legend "Annual exports to meet goal" 
represents the annual export totals required to achieve the 2014 goal 
of doubling exports over 2009 levels, assuming identical year-to-year 
percentage increases. Under this assumption, starting in 2010, export 
totals need to increase by 14.9 percent over the previous year's 
totals to double by 2014. Actual yearly export totals may vary from 
"Annual exports to meet goal." The "Actual exports" bars represent the 
actual annual exports from 2009 to 2013. 

[End of figure] 

Commerce and SBA provide some of the same types of export promotion 
services, such as outreach, counseling and training, and trade leads, 
as most states do through their state trade offices. For example, as 
shown in table 1, we found this to be true in the five states we 
visited. 

Table 1: Export Promotion Services Provided by the Department of 
Commerce's (Commerce) Commercial Service, Small Business 
Administration (SBA), and State Trade Offices in the Five States GAO 
Visited: 

Service: Outreach; 
Commerce: [Check}; 
SBA: [Check}; 
FL: [Check}; 
MN: [Check}; 
OR: [Check}; 
PA: [Check}; 
VA: [Check}. 

Service: Counseling and training; 
Commerce: [Check}; 
SBA: [Check}; 
FL: [Check}; 
MN: [Check}; 
OR: [Check}; 
PA: [Check}; 
VA: [Check}. 

Service: Trade leads; 
Commerce: [Check}; 
SBA: [Empty]; 
FL: [Check}; 
MN: [Check}; 
OR: [Check}; 
PA: [Check}; 
VA: [Check}. 

Service: Financing; 
Commerce: [Empty]; 
SBA: [Check}; 
FL: [Check}; 
MN: [Empty]; 
OR: [Empty]; 
PA: [Empty]; 
VA: [Empty]. 

Source: GAO analysis of Department of Commerce and SBA documents and 
information from state trade offices. 

[End of table] 

In prior work, we established the following definitions for the four 
types of export promotion services shown in table 1: [Footnote 17] 

* Outreach. Outreach can include any activity in which agencies 
generally increase public awareness about exporting, including seeking 
to inform businesses or other partners about the export promotion 
services offered by the federal government. Both Commerce and SBA 
conduct outreach to businesses. For example, outreach includes 
Commerce staff attending a trade show and counseling clients. 
Similarly, Commerce or SBA staff may conduct outreach at seminars and 
training sessions, where they meet businesses to identify potential 
clients interested in exporting.[Footnote 18] 

* Counseling and training. Counseling is specific to the needs of each 
business and can cover a variety of topics relating to international 
trade and exporting, such as helping a business identify a target 
export market or discussing logistics for shipping exported goods. For 
example, Commerce organizes trade missions for U.S. firms that want to 
explore and pursue export opportunities by meeting directly with 
potential clients in their markets. Commerce often refers businesses 
new to exporting to the SBDCs for export training. SBA also provides 
counseling and training, primarily through SBDCs. 

* Trade leads. Trade leads, also known as matchmaking, refers to the 
process of connecting businesses with overseas buyers. Commerce 
leverages its international network of Commercial Officers to help 
U.S. businesses set up appointments with potential buyers abroad and 
to notify businesses when foreign buyers are looking to import U.S. 
goods, also known as matchmaking. Also, Commerce organizes trade 
missions for U.S. firms that want to explore and pursue export 
opportunities by meeting directly with potential clients in their 
markets. Typically, SBA does not provide trade leads but does hosts or 
co-sponsors events that link businesses to export management 
companies--intermediaries that represent a company's product overseas 
and reduce some of the risks associated with exports by managing the 
logistics of the process. 

* Financing. SBA assists small businesses with export financing 
through its Office of International Trade. Of the states we visited, 
Florida is the only state that offers export financing; state trade 
offices generally refer interested clients to SBA and the Export-
Import Bank for export financing help. While Commerce is not involved 
in export financing, its Commercial Officers at USEACs often refer 
interested clients to SBA and the Export-Import Bank. 

Overlap of Federal and State Services: 

Like the state trade offices in the five states we visited, most of 
the 28 state trade offices that responded to a 2013 SIDO survey also 
provide export promotion outreach, counseling and training, and trade 
leads. While not all states provide all services, the survey results 
showed that state trade offices provide a range of services such as 
outreach, which can include providing marketing materials; counseling 
and training, which can include export counseling and export readiness 
training; and trade leads, which may result from participation in or 
coordination of trade shows. 

In our fieldwork, we found that the depth and breadth of services 
state trade offices provide vary depending on the availability of 
resources such as funding, staff, and overseas capacity. For example, 
the state of Florida's program provides export counseling, educational 
events, and international trade leads, including international trade 
missions and trade shows. Similarly, the Minnesota Trade Office offers 
organization of trade missions, export counseling, training programs 
on the export process, including creating an export plan, mitigating 
risk, and understanding trade regulations. Virginia also offers a 
number of export promotion services including counseling; training; 
trade missions; an array of services such as in-country market 
research provided by an extensive network of international 
consultants; and a 2-year business acceleration program for selected 
companies whose goal is to increase their export sales. 

While Commerce charges fees for certain services, including those that 
provide trade leads, some states provide their services for free, 
subsidize businesses' participation in trade missions and trade shows, 
or both. For example, the Philadelphia USEAC operated by Commerce 
provides export counseling, market research, and trade events for a 
fee. However, the Pennsylvania state trade office provides those same 
services, in addition to market-entry strategy development and 
technical support, at no cost to businesses; moreover, the state trade 
office awards some grants to businesses to pay for or partially 
subsidize some export-related activities. Because Commerce charges 
fees, businesses in some states sometimes opt to seek the same or 
similar services from the state trade office rather than from 
Commerce, according to one state trade office official. Both Commerce 
and a state official from one of the states that we visited noted that 
perceived quality of service also influences businesses' decisions in 
selecting a service provider for export promotion services. 

Overlap of Federal and State Clients: 

In addition to providing similar services, the federal agencies 
offering export promotion services at the state level--Commerce and 
SBA--and most state trade offices primarily serve small businesses. 
According to Commerce, the majority of its customers are small 
businesses, although firms of any size may request its services. SBA, 
by law, offers services exclusively to small businesses. In 2012, 97 
percent of the over 301,000 identified U.S. exporters that exported 
were small and medium-sized exporters.[Footnote 19] In the 2013 SIDO 
survey, of the 22 state trade offices that responded, most states 
reported that small businesses were their primary clients.[Footnote 
20] Four of the five state trade offices that we visited told us they 
work primarily with small businesses, although three said they also 
serve some larger companies. 

Federal and State Export Promotion Efforts Vary in Staff and Budgetary 
Resources and in Metrics Used to Track Results: 

Domestic Staffing Levels: 

In most states, federal agencies and state trade offices have 
different levels of domestic staff resources available for providing 
export-related assistance to companies. As of February 2014, there 
were 265 domestic Commerce CS staff in the 108 USEACs located in every 
state with the exception of Delaware and Wyoming.[Footnote 21] SBA 
also has staff in every state that provides export services, and 
partially funds more than 900 SBDCs across the country. Most states 
have trade offices that also provide export-related assistance to 
businesses. One state trade office reported only 2 staff while another 
reported having 28 staff dedicated to international trade, according 
to the 2013 SIDO survey.[Footnote 22] As shown in figure 2, for the 
five state trade offices that we visited, staff numbers ranged from 5 
full-time employees statewide to 30; the state export promotion 
employees in each state outnumbered the Commerce USEAC export 
promotion employees. 

Figure 2: Overview of Commerce and State Trade Office Presence in 
Selected States: 

[Refer to PDF for image: illustrated U.S. map with data table] 

State: Oregon; 
Number of U.S. Export Assistance Centers (USEAC) or state trade 
offices: 
USEAC: 1; 
State trade office(s): 1; 
Number of staff: 
USEAC: 4; 
State trade office(s): 5. 

State: Minnesota; 
Number of U.S. Export Assistance Centers (USEAC) or state trade 
offices: 
USEAC: 1; 
State trade office(s): 1; 
Number of staff: 
USEAC: 5; 
State trade office(s): 14. 

State: Pennsylvania; 
Number of U.S. Export Assistance Centers (USEAC) or state trade 
offices: 
USEAC: 3; 
State trade office(s): 12; 
Number of staff: 
USEAC: 9; 
State trade office(s): 30. 

State: Virginia; 
Number of U.S. Export Assistance Centers (USEAC) or state trade 
offices: 
USEAC: 2; 
State trade office(s): 6; 
Number of staff: 
USEAC: 7; 
State trade office(s): 17. 

State: Florida; 
Number of U.S. Export Assistance Centers (USEAC) or state trade 
offices: 
USEAC: 6; 
State trade office(s): 7; 
Number of staff: 
USEAC: 14; 
State trade office(s): 20. 

Source: GAO analysis of data from Department of Commerce and state 
trade offices. 

Notes: The number of USEAC staff shown in this figure includes only 
those from the Department of Commerce. Department of Commerce USEAC 
and staff numbers are as of February 2014; state trade office figures 
vary in terms of month but are all for 2013. 

[End of figure] 

International Representation: 

Commerce has greater representation abroad than state trade offices. 
Commerce has 930 staff in offices in 72 countries abroad.[Footnote 23] 
In 15 of these countries, no state trade office maintains its own 
representation.[Footnote 24] An official from one state explained that 
Commerce's presence internationally is more important for state trade 
offices than Commerce's domestic offices in serving the needs of small 
businesses. This was because there is less overlap between states and 
the federal government overseas, according to this official, and a 
number of states do not have a presence overseas and rely entirely on 
Commerce for those services. 

Nevertheless, many state trade offices have their own international 
representatives that provide services to businesses from those states 
similar to the services offered by Commerce's Foreign Commercial 
Officers. This representation is provided by either state employees or 
contractors hired as service providers, or both, and they provide 
these services to a country from offices located in-country or on a 
regional basis from offices not located in-country. While 38 state 
trade offices collectively have representation in 83 countries abroad, 
the number of countries in which individual state trade offices have 
representation varies. For example, Pennsylvania operates abroad 
relatively independently from Commerce through its own network of 
overseas contractors located in 22 countries from which the 
contractors serve 73 countries. Similarly, Virginia utilizes a 
combination of its own staff (in 2 countries), and overseas 
contractors, which constitutes a network that reaches 57 countries. 
Conversely, Oregon relies almost exclusively on its own staff and 
contractors in 4 countries where it has representation, but it relies 
heavily on Commerce in all the countries where it has no formal 
representation. Figure 3 shows the top 10 countries in terms of state 
trade office representation, with China, Japan, and Mexico having the 
most. See appendix II for more details on Commerce's and the states' 
export promotion representation overseas. 

Figure 3: Top 10 Countries in Which State Trade Offices Had 
Representation as of February 2014: 

[Refer to PDF for image: vertical bar graph] 

Country: China; 
Number of state trade offices with representation: 29. 

Country: Japan; 
Number of state trade offices with representation: 22. 

Country: Mexico; 
Number of state trade offices with representation: 18. 

Country: Germany; 
Number of state trade offices with representation: 15. 

Country: United Kingdom; 
Number of state trade offices with representation: 13. 

Country: Canada; 
Number of state trade offices with representation: 12. 

Country: Brazil; 
Number of state trade offices with representation: 11. 

Country: Taiwan; 
Number of state trade offices with representation: 11. 

Country: Israel; 
Number of state trade offices with representation: 10. 

Country: France; 
Number of state trade offices with representation: 9. 

Source: GAO analysis of data from state trade offices. 

[End of figure] 

Budgetary Resources: 

* In fiscal year 2013, Commerce's ITA dedicated $267.5 million of its 
total budget to export promotion. SBA's Office of International Trade, 
which provides export financing and promotion services to small 
businesses, had fiscal year 2013 total program costs of approximately 
$9.8 million. Additionally, SBA's export-related loans amounted to 
approximately $1.2 billion in fiscal year 2013.[Footnote 25] The total 
amount of money spent on federal export promotion is unclear because 
comparable budget information for federal agencies involved in export 
promotion is not readily available, as we found in July 2013.[Footnote 
26] 

State governments vary greatly in the budgetary resources they provide 
for export promotion. According to the 2013 SIDO survey, among the 14 
state trade offices that responded to this question, office annual 
budgets ranged from $80,000 to $6.2 million, with 90 percent of the 14 
states having budgets ranging from $420,000 to $1.75 million.[Footnote 
27] The 5 state trade offices we visited had budgets for export 
promotion that ranged from $1.9 million to over $5 million annually 
for fiscal year 2013. In the 2013 SIDO survey, of the 23 states that 
responded to this survey question, over half reported no significant 
changes in their overall budgets from the previous year. 

Metrics Used to Measure Performance: 

Organizations define performance metrics to reflect priorities, 
measure achievement, and create incentives for management and staff. 
Measuring performance allows organizations to track the progress they 
are making toward their goals and gives managers crucial information 
on which to base their organizational and management decisions. 
[Footnote 28] Commerce primarily uses "export successes" to measure 
performance. When any Commerce trade-promotion activity successfully 
assists a U.S. company to export a product or service, Commerce staff 
document an export success that is verified by Commerce management. 
[Footnote 29] The total dollar value of Commerce export successes in 
each state varies greatly, with, for example, export successes from 
Alaska totaling $370,000 in 2012 and export successes from Washington 
exceeding $10 billion for that same year (see figure 4). 

Figure 4: Dollar Value of Commercial Service Export Successes by State 
Groupings, in Fiscal Year 2012: 

[Refer to PDF for image: illustrated U.S. map with data table] 

Export success amount: 

Over $500 million: 
Washington: $10.119 billion; 
California : $2.420 billion; 
Connecticut: $2.413 billion; 
Illinois: $2.096 billion; 
District of Columbia: $1.596 billion; 
Michigan: $1.458 billion; 
Virginia: $1.204 billion; 
New York: $1.200 billion; 
Pennsylvania: $1.171 billion; 
New Jersey: $775.18 million; 
Massachusetts: $745.00 million; 
Texas: $715.47 million; 
Maryland: $711.96 million. 

$100 - $499 million: 
Arizona: $479.17 million; 
Georgia: $355.48 million; 
Florida: $344.36 million; 
Oregon: $240.00 million; 
South Carolina: $172.10 million; 
Minnesota: $157.07 million; 
Kansas: $150.22 million; 
Ohio: $137.98 million; 
Wisconsin: $134.73 million; 
Oklahoma: $132.84 million; 
Indiana: $116.99 million. 

$11 - $99 million: 
Louisiana: $96.86 million; 
North Carolina: $67.14 million; 
Colorado: $64.69 million; 
Alabama: $55.05 million; 
North Dakota: $52.49 million; 
Iowa: $47.78 million; 
Missouri: $43.79 million; 
West Virginia: $40.46 million; 
Tennessee: $38.57 million; 
Nebraska: $16.64 million; 
Delaware: $16.29 million; 
Wyoming: $15.87 million; 
Kentucky: $14.43 million; 
Vermont: $13.19 million; 
Nevada: $12.27 million; 
Hawaii: $11.08 million; 
Utah: $10.86 million; 
Arkansas: $10.09 million. 

Under $10 million: 
Mississippi: $7.19 million; 
New Mexico: $5.06 million; 
New Hampshire: $4.63 million; 
Idaho: $4.19 million; 
South Dakotas: $3.96 million; 
Rhode Island: $3.30 million; 
Montana: $2.40 million; 
Maine: $0.92 million; 
Alaska: $0.37 million. 

Source: GAO analysis of Department of Commerce data; Map Resources 
(map). 

Note: Export successes reported for fiscal year 2012 represent those 
approved in fiscal year 2012, which include some export successes that 
occurred in previous calendar years. 

[End of figure] 

State trade offices use a variety of metrics to gauge progress, 
including measures similar to Commerce export successes. According to 
the 2013 SIDO survey, the 26 state trade offices that responded to 
these survey questions reported using one or more of the following 
categories to measure export promotion activities: [Footnote 30] 

* dollar amount of export transactions assisted by the state; 

* number of jobs created or retained; 

* number of new clients assisted; 

* quality of service provided to clients; 

* number of deals made; 

* number of deals anticipated; and: 

* total state export value. 

States that we visited also used a variety of metrics to measure 
export promotion activities. One trade office tracked export sales 
that it helped generate using a methodology similar to the one used by 
Commerce to track export successes, whereas another state trade office 
used client satisfaction surveys exclusively. This state trade office 
Director explained his office focuses on quality of services because 
his office has no direct influence on whether a given client company 
actually exports. In contrast, another state trade office uses a 
formula for measuring performance that incorporates several variables, 
such as the number of companies served annually, the number of export 
activities in which a company participates (i.e., attending a trade 
show, meeting with a distributor), and the total export sales assisted 
by the state trade office. 

The Extent of Federal and State Collaboration Varies Widely: 

In the five states we visited, we found that the extent of 
collaboration between federal and state trade offices ranged from no 
collaboration in one state, to very little collaboration in another, 
to close collaboration between federal and state export promotion 
providers in three states. According to federal and state officials 
with whom we spoke, factors affecting their level of collaboration 
included physical proximity, level of communication, and resource 
levels. In addition, we note that state offices report to their own 
executive and legislative bodies, and state trade offices determine 
their own priorities and are not obligated to collaborate with federal 
agencies.[Footnote 31] States that do choose to collaborate with 
federal partners in trade promotion primarily interact with Commerce 
but also collaborate with SBA, both to varying degrees. 

Among the five states we visited, we found little to no collaboration 
with federal agencies in two states. One state Director described the 
state's relationship with Commerce export promotion staff in his state 
as cordial but involving virtually no interaction. In another state, 
we found minimal interaction between the state trade office and the 
state's USEACs. In both states, local federal officials agreed that 
they had a limited relationship with their state counterparts. Both 
these state trade offices are well-funded and provide export 
assistance services through their networks of in-state trade offices 
and extensive networks of international offices staffed by contracted 
service providers. The Directors of both state trade offices noted 
that in most cases they opt not to work with Commerce because their 
experience has been that Commerce response times are slow and that the 
quality of the service inconsistent. For example, one state Director 
said that his state provides export promotion assistance faster, 
better, and cheaper than Commerce. However, both states collaborate 
with Commerce overseas when their staff or contractors are not located 
in a country or are unable to meet the demand for services from 
exporters. Both states also minimally collaborate with SBA; one state 
refers new-to-export companies to SBDCs for training, while the other 
state refers companies that need export financing to SBA. 

In contrast, we found that staff in three of the five state trade 
offices we visited work closely with Commerce. Officials from these 
state trade offices explained that the services their offices provided 
complement Commerce's services, and they cited colocation or proximity 
of offices and good communication as factors that facilitate 
collaboration.[Footnote 32] According to Commerce's client management 
system,[Footnote 33] for fiscal year 2012, state trade offices or 
other state government offices or agencies are among Commerce's most 
frequent partners in achieving export successes.[Footnote 34] 

* In one state, Commerce and state officials characterized their 
working relationship as seamless and their services and activities as 
complementary. For example, the state organizes trade missions while 
Commerce helps with recruiting companies and arranges one-on-one 
meetings with prospective buyers. Similarly, officials told us that in 
some cases the state trade office provides funding to businesses that 
is used to purchase Commerce's services. This state trade office and 
Commerce also occasionally provide joint counseling to some companies, 
according to state trade office officials. 

* In another state trade office, located in the same building as 
Commerce, the Director believed that a primary factor encouraging 
collaboration was that both offices had small staffs whose members 
knew each other well. According to state trade office officials, this 
state's trade staff and Commerce's staff provide joint counseling 
services and promote one another's services to businesses. This state 
trade office also collaborates with Commerce and SBA to deliver export-
focused training intended to provide introductory information to 
businesses on the exporting process and available federal resources to 
nonexporting companies. 

* A third state trade office described its relationship with Commerce 
as complementary and noted that the organizations collaborate on joint 
trade missions and activities that bring together businesses 
interested in exporting with potential buyers. State trade office 
officials noted that Commerce relies on the state for their export 
education programs and that the state works mostly with new-to-export 
companies. This state trade office refers only companies who require 
very basic assistance, such as basic accounting information, to SBDCs. 
The Director of the state trade office commented that any duplication 
in the services provided by Commerce and her office would not be a 
concern because the demand for export assistance in the state was so 
great. 

In two states we visited, SBA grants to state trade offices through 
the State Trade and Export Promotion (STEP) program have facilitated 
collaboration with Commerce and SBA.[Footnote 35] In those states, for 
instance, Commerce refers their clients to state trade offices for 
STEP funding. The state trade offices reported using STEP funds to 
expand their services or replace lost state funding and said they were 
able to provide for export-related activities such as attendance at 
trade shows and to purchases of Commerce services. For example, 
Minnesota's Trade Office was using STEP funds to provide matching 
funds to Minnesota businesses for export activities and their 
expenses, including trade missions. As another example, in partnering 
with a local SBDC, Florida's trade office was using STEP funds to help 
new-to-export businesses create strategic exporting plans. 

TPCC Initiatives to Promote Federal-State Collaboration Have Had 
Limited Results, Due in Part to Inconsistent Use of Key Practices: 

Three TPCC initiatives utilize networks of state and local governments 
and other partners to advance federal-state collaboration in promoting 
U.S. exports. These efforts have produced limited results, however, in 
part because they have not consistently implemented key collaboration 
practices. In prior work, we found that collaboration is enhanced when 
collaborating partners follow certain key practices, such as 
articulating common outcomes; agreeing on roles and responsibilities; 
monitoring, evaluating, and reporting on results; and leveraging 
resources. In states we visited, we found weaknesses in the 
implementation of Export Outreach Teams, a TPCC initiative that was to 
be co-led by Commerce and SBA. Similarly, we found that TPCC's 
involvement in a Brookings Institution effort to engage metropolitan 
area economic development groups in export promotion has unknown 
implications for federal export promotion efforts and resources. 
Finally, an agreement between Commerce (the TPCC Chair) and a national 
group representing state trade offices expired without achieving its 
collaboration objectives and without Commerce addressing ways for it 
to share within legal restrictions more information about its clients 
with state trade offices. 

Collaboration Is Enhanced When Participants Follow Key Practices: 

In prior work, we found that federal agencies face a range of 
challenges and barriers when they attempt to work collaboratively. 
Such challenges and barriers also exist--and sometimes to an even 
greater degree--when federal agencies partner with state and local 
governments, nonprofit organizations, and the private sector. However, 
our prior work has also identified practices that can help to enhance 
and sustain collaboration among agencies and thereby maximize 
performance and results, and we have recommended that agencies follow 
them.[Footnote 36] Among the key collaboration practices we have 
identified and recommended in prior work are the following: 

* Define and articulate a common outcome. 

* Identify and address needs by leveraging resources. 

* Develop a mechanism to monitor, evaluate, and report on results. 

* Agree on roles and responsibilities. 

* We have also found that there are key issues to consider when 
implementing collaborative mechanisms. These include leveraging 
resources, such as human, information technology, physical, and 
financial resources to sustain a collaborative effort, and composing 
written guidance and agreements documenting how the parties to the 
agreement will collaborate and a way to update the guidance and 
agreements as needed.[Footnote 37] 

The enhanced federal-state collaboration in export promotion 
envisioned in the NEI calls for the implementation of some of these 
key collaboration practices. In its 2010 report to the President on 
the NEI, the Export Promotion Cabinet identified improved coordination 
with state government trade offices as a priority, and called for 
federal agencies to make joint planning the standard procedure in all 
states that have export promotion programs. The Export Promotion 
Cabinet also stated that interagency coordination could be 
strengthened and that federal-state partnership could be particularly 
helpful in identifying potential exporters to meet the NEI goal. In 
addition, the subsequent National Export Strategies highlighted 
collaboration with state and local governments as a priority.[Footnote 
38] 

TPCC Has Identified Three Initiatives to Enhance Federal-State 
Collaboration: 

In support of the NEI, the TPCC's two most recent National Export 
Strategies made enhancing federal-state collaboration on export 
promotion a priority. The 2011 and 2012 strategies called for 
increasing collaboration with state export promotion programs and 
metropolitan areas. Accordingly, the TPCC identified three initiatives 
intended to increase U.S. exports under the NEI and enhance 
collaboration between federal and state efforts: (1) Export Outreach 
Teams, created to increase local awareness of export promotion 
resources and facilitate collaboration among local networks of export 
promotion service providers; (2) collaboration with the Brookings 
Institution to support its Global Cities Exchange (initially referred 
to as the Metropolitan Export Initiative), as part of TPCC efforts to 
expand export promotion activities in metropolitan areas; and (3) a 
memorandum of intent (MOI) with a national organization that 
represents state trade offices from across the country, as part of 
TPCC efforts to work with national organizations with common 
interests. The TPCC highlighted the first two initiatives in its 2011 
and 2012 strategies, and TPCC officials told us that the MOI was 
important to federal-state collaboration. 

Efforts to Improve Local Networks of Export Promotion Service 
Providers Have Had Limited Results Due to Implementation Weaknesses: 

The TPCC promoted Export Outreach Teams as a mechanism for bringing 
together the various organizations that provide export promotion 
services in a locale to share information with small business service 
providers. The Export Promotion Cabinet's 2010 report to the president 
on NEI and the TPCC's 2011 and 2012 National Export Strategies discuss 
the role of these teams in leveraging state and local resources to 
help small businesses export successfully. Export Outreach Teams were 
originally a pilot program launched by SBA in 2010 as a way to inform 
small business service providers about local available export 
resources provided by the various federal agencies, state trade 
offices, and their partner organizations. Small business service 
providers include Small Business Development Centers, Women's Business 
Centers, SCORE offices,[Footnote 39] local economic development 
agencies, trade associations, and chambers of commerce. 

In 2012, the Export Promotion Cabinet and TPCC issued an interagency 
communiqué that expanded SBA's Export Outreach Teams across the 
country. In keeping with a key collaboration practice described above, 
the communiqué outlined two main purposes, or common outcomes, for the 
Export Outreach Teams: 

* to increase local small business service providers' awareness of 
available international trade expertise and: 

* to enhance communication and collaboration. 

According to the interagency communiqué, Export Outreach Teams were to 
serve as a forum for collaboration by including export promotion 
agencies from all levels of government--federal, state, and local. As 
a first step, the communiqué called for team members, including staff 
from Commerce's CS, SBA, SBDCs, state trade offices, and small 
business service providers to participate in workshops with activities 
meant to advance the program's objectives. One of those activities was 
the formation of referral protocols that would help to establish roles 
and responsibilities and to leverage available resources. These 
referral protocols were intended to help ensure that local businesses 
could find the right export promotion service provider for their 
particular needs. The interagency communiqué stated that Export 
Outreach Teams were to hold a workshop by September 30, 2013, and that 
the teams should convene quarterly thereafter. Figure 5 shows the 
expected outcomes, suggested membership, and planned activities of 
Export Outreach Teams. 

Figure 5: Expected Outcomes, Suggested Membership, and Planned 
Activities of Export Outreach Teams: 

[Refer to PDF for image: illustration] 

Export Outreach Teams: 

Expected Outcomes: 
* Increase local small business service providers’ awareness of 
available international trade expertise; 
* Enhance communication and collaboration. 

Suggested Membership: 

Local Small Business Service Providers: 
* Small Business Development Centers; 
* Local chambers of commerce;
* Local economic development agencies;
* Manufacturing Extension Partnership;
* SCORE[A];
* Trade associations;
* Women's Business Centers. 

International Trade Experts:
* Department of Commerce trade specialists; 
* Small Business Administration (SBA) Trade Finance Specialist; 
* U.S. Export-Import Bank official; 
* Freight forwarders; 
* International bankers; 
* State international trade office. 

Export Outreach Team Leadership: 
* SBA District Director; 
* SBA District International Trade Officer; 
* U.S. Export Assistance Center Director (Department of Commerce). 

Planned Activities: 

Conduct Export Outreach Team workshops to provide training with the 
following objectives: 
* Increase understanding of network of international trade resources; 
* Develop referral protocols and understand respective metrics; 
* Recognize client trade readiness/export potential and share clients; 
* Share best practices for client services. 

Meet quarterly to advance ongoing efforts generated from workshop. 

Source: GAO analysis of Trade Promotion Coordinating Committee 
Interagency Communiqué and SBA Export Outreach Team Facilitator's 
Guide. 

[A] SCORE is an SBA-supported nonprofit association that provides 
assistance to help start and expand small businesses though a network 
of over 11,000 volunteers nationwide. 

[End of figure] 

The interagency communiqué called for both Commerce and SBA to be co-
managers of the Export Outreach Teams, but SBA, whose role in federal 
export promotion efforts has grown in recent years,[Footnote 40] took 
the lead in implementing the initiative in its 68 SBA districts across 
the country. SBA provided detailed guidance to each District Office on 
how to conduct the initial team workshops described in the communiqué. 
SBA tracked the dates and numbers of attendees of the initial 
workshops of the Export Outreach Teams through 2013 and reported that 
all but one district held its initial workshop by the September 30, 
2013, deadline. In February 2014, SBA distributed to the District 
Offices a separate document to track the Export Outreach Teams' 
quarterly meetings; that document requested information from District 
Offices about the agencies represented, the activities planned, and 
the topics covered at the meetings. 

Despite TPCC and SBA efforts to provide guidance on achieving the 
objectives of the Export Outreach Teams, we found weaknesses in their 
implementation that limit their ability to enhance federal-state 
collaboration. 

* First, the team memberships and activities were inconsistent with 
the guidance. In some instances, not all relevant participants were 
present at the workshop, while in other instances, the events reported 
as Export Outreach Team workshops did not have the purpose of 
facilitating interagency collaboration. For example, in one location 
we visited, state trade office officials were not aware that the local 
Export Outreach Team existed, and at another site, the Export Outreach 
Team had not included state trade office representatives in its 
initial workshop. According to an SBA document that tracked the 
attendees at the first meetings of all Export Outreach Teams, the 
participants in the meetings varied widely. Teams reported from 4 to 
220 attendees at their initial workshops, [Footnote 41] and some 
meetings reported as Export Outreach Team events were larger 
conferences, presentations to small businesses, or other events not 
intended to serve as a forum for interagency and intergovernmental 
coordination. Officials at two locations we visited reported that 
presentations about SBA's export financing programs were Export 
Outreach Team workshops, and in one location we visited, the Export 
Outreach Team workshop was in fact a presentation to private 
companies, not the intended meeting to coordinate local export 
promotion resources. 

* Second, we identified and examined two referral protocols developed 
by Export Outreach Teams and both lacked important details that would 
facilitate the referral process and better communication and 
collaboration. Specifically, the protocols were not consistent with 
the key collaboration practice of agreeing on roles and 
responsibilities. For example, the protocols we examined lacked 
important details that would facilitate the referral process such as 
information about federal, state, and local agency responsibilities 
and the circumstances under which a business would be referred from 
one agency to another. Furthermore, SBA officials did not emphasize 
the importance of the referral protocols, rather stating that they 
were a desirable but not a necessary outcome of the teams. Referral 
protocols with clear roles and responsibilities can help federal and 
state officials determine when to refer businesses to each other, for 
assistance, and to avoid delays and confusion on the part of 
businesses seeking export assistance. 

* SBA recently created a document to track the Export Outreach Teams' 
quarterly meetings and, as of March 2014, plans to use it to collect, 
review, and use the information to manage the program. Without 
monitoring, evaluating, and reporting on results, SBA does not know 
whether the teams are reaching out to and including the appropriate 
organizations, such as state trade offices; whether the teams are 
meeting regularly as intended; and whether the teams are exploring 
ways to foster better collaboration through referral protocols or 
other means. Therefore, SBA has lacked pertinent information needed to 
make decisions in managing the program, including how to adjust the 
program to strengthen local networks of export promotion service 
providers so that businesses receive the best possible assistance. As 
a result, until the TPCC and SBA collect and review information on the 
program, they cannot ascertain the extent to which Export Outreach 
Teams are achieving their objectives to increase awareness of local 
export resources and enhance collaboration between federal and state 
agencies. 

Initiative to Engage Metropolitan Entities Has Unknown Implications 
for Federal Export Promotion Efforts: 

TPCC officials sought to enhance collaboration among regional, state, 
and local economic development entities to increase their involvement 
in export promotion through a Commerce collaboration with the 
Brookings Institution's Global Cities Exchange (hereafter referred to 
as Global Cities).[Footnote 42] Initially launched as the Metropolitan 
Export Initiative, Global Cities was established to engage 
metropolitan area governments and other local entities in 
collaboration with federal and state providers to increase exports and 
economic growth and to broaden global economic engagement. The TPCC's 
2011 and 2012 National Export Strategies describe this initiative as a 
tool for federal collaboration with state and local governments, and 
the TPCC has identified it as a mechanism to broaden export promotion 
efforts to include new partners and help reach the goal of the NEI. 
According to the 2012 strategy, collaboration with metropolitan areas 
is particularly important because metropolitan areas account for most 
of the nation's exports and are home to each region's unique 
concentration of capital, investment, and innovation. According to the 
Brookings Institution, Global Cities will increase U.S. exports by 
leveraging the knowledge and connections of local economic development 
leaders to proactively identify firms and sectors with the greatest 
export potential, coordinate fragmented export assistance providers, 
and leverage limited resources for maximum benefit. As shown in figure 
6, federal, state, and metropolitan agencies are to combine their 
varied missions, functions, and perspectives to achieve the Global 
Cities objective of enhancing each metropolitan area's exports. Other 
participating organizations include universities, chambers of 
commerce, and regional economic development organizations. In 2011, 
Global Cities started in Los Angeles, California; Minneapolis-St. 
Paul, Minnesota; Portland, Oregon; and Syracuse, New York. Another 16 
locations started the process as of December 2013.[Footnote 43] 
Ultimately, according to the Brookings Institution, Global Cities is 
to be implemented in a total of 28 metropolitan areas. 

Figure 6: Metropolitan Export Initiative/Global Cities Exchange: 

[Refer to PDF for image: illustration] 

Metropolitan area agencies: 
* Regional economic development organizations; 
* Mayors’ offices; 
* Build relationships with local businesses to create more export 
ready firms. 

State agencies: 
* State trade offices; 
* Governors’ offices; 
* Organize and support trade missions and prioritize exports in state 
economic strategies. 

Federal agencies: 
* Department of Commerce; 
* Provide trade expertise in U.S. and foreign markets; 
* Produce export data. 

Capitalize on the fact that metropolitan areas hold many assets that 
drive exports. 

Source: GAO analysis of Brookings Institution information; Map 
Resources (map). 

[End of figure] 

Los Angeles, Minneapolis-St. Paul, Portland, and Syracuse have 
completed metropolitan export plans, each of which includes 
performance measures. The export component of Global Cities' 
performance measures vary by location and include the value of exports 
as a percentage of regional gross domestic product, the increase in 
the number of new-to-export firms, the increase in the number of 
markets to which local companies export, and the number of new firms 
entering the export supply chain. A Brookings Institution 
representative noted that measuring performance across the large and 
diverse group of organizations involved in Global Cities' efforts is a 
challenge and that Global Cities is hoping to establish coordinated 
services and develop success stories with specific companies. 

Commerce has provided resources to support Global Cities in the form 
of staff time and expertise provided at the local level, as specified 
in the memorandum of agreement (MOA) that Commerce signed with the 
Brookings Institution in September 2011. Consistent with key practices 
for collaboration, the MOA specified how Commerce would participate in 
the initiative in terms of roles and responsibilities and what 
resources Commerce would devote in four pilot locations.[Footnote 44] 
Subsequently, Commerce made several contributions to the program under 
the MOA, including providing data on global demand for U.S. exports in 
each metropolitan area. Furthermore, Commerce staff in each of the 
four pilot cities provided expertise to help develop metropolitan 
export plans, which outline strategies for increasing exports in each 
location. In some Global Cities locations--such as Minneapolis-St. 
Paul, Minnesota; Portland, Oregon; and Tampa Bay, Florida--Commerce 
officials have participated in the planning, development, and 
implementation of Global Cities projects, including the development of 
a document describing local export-related resources, providing export-
related training to economic development professionals, and assisting 
with a survey of companies to understand the perceived challenges they 
face related to exporting their goods and services. 

The MOA expired in April 2012, and Commerce and the Brookings 
Institution do not plan to renew the agreement. However, Commerce will 
continue to support Global Cities through its USEACs at the local 
level as the program expands to a planned 28 metropolitan areas. A 
Brookings Institution representative stated that the MOA was only 
intended for the initial stage of the program. Similarly, Commerce 
officials told us they did not think it was necessary to renew the 
agreement with the Brookings Institution because they consider their 
role as limited to advising when requested and helping to inform 
Global Cities' participants in new metropolitan areas about federal 
export promotion programs and services. Furthermore, Commerce 
officials told us that, because the Global Cities projects are 
implemented locally and facilitated by the Brookings Institution 
nationally, Commerce does not need a process to track and report on 
the results of the initiative in each city. 

Brookings officials told us that their initiative was meant to 
increase interest in exporting, not to create new export promotion 
service providers. Thus, to the degree the initiative is successful, 
it will put new demands for export promotion services on federal and 
state export promotion agencies. Of the 20 currently established 
Global Cities locations, 6 are served by a Commerce office of one 
employee. In locations we visited, Commerce officials told us that a 
lack of staff resources was already a concern, which would make it 
challenging to respond to an increase in demand from local businesses 
for export promotion services. 

As mentioned previously, metropolitan areas participating in Global 
Cities plan to track their progress through performance metrics 
specified in their metropolitan export plans. However, to date, 
Commerce has not requested these data. Therefore, the impact of the 
initiative is still uncertain. Commerce has no plans to monitor 
results, which is inconsistent with key collaboration practices. With 
no system in place to monitor the results of the Global Cities 
initiative, Commerce lacks information needed to participate 
effectively because it cannot anticipate any increased demand for its 
export promotion services that the program may generate, or know when 
to shift resources to certain metropolitan areas with a greater 
potential for enhancing U.S. exports. Moreover, without such 
information, Commerce would be unable to identify the most successful 
Global Cities efforts and to draw lessons from them that could be 
applied more widely to enhance federal, state, and local collaboration 
to achieve NEI goals. 

Collaboration with SIDO and Other National Organizations Has Had 
Limited Results: 

The third initiative to enhance federal-state collaboration identified 
by TPCC officials aimed to improve collaboration with national 
organizations that have shared interests in expanding U.S. exports. 
This initiative focused on strengthening Commerce's relationship with 
the State International Development Organizations (SIDO), the only 
national organization devoted exclusively to supporting international 
trade development through state trade offices.[Footnote 45] TPCC 
agencies also work with other national nonprofit organizations, 
including the National Governors Association and the U.S. Conference 
of Mayors. For example, the National Governors Association is 
developing a means to track and share information on trade missions 
involving state governors. However, promoting trade is not the primary 
purpose of these two entities. 

SIDO's mission is to provide a forum for collaboration and sharing 
best practices, advocating for states' international trade and 
development issues, and supporting the goals of the NEI through 
coordination of federal and state resources. A SIDO official told us 
that while many states have good collaborative relationships with 
federal officials at the local level, there was less collaboration at 
the national level in Washington, D.C. Both Commerce and SIDO were 
hopeful that a formal agreement would encourage dialogue and improve 
collaboration. In September 2011, Commerce and SIDO signed a 
memorandum of intent (MOI) that articulated their commitment to work 
together to develop strategies and implement activities in three areas. 

* They agreed to enhance Commerce's partnership with state trade 
offices to coordinate and cooperate in the delivery of critical 
customer-focused services necessary to assist U.S. companies to 
successfully export their products and services and enter new foreign 
markets. 

* They agreed to identify opportunities and mechanisms for Commerce 
and the states, working through SIDO, to increase awareness among 
companies of available services, trade programs, and overseas events. 

* They agreed to create a formal consultation process between Commerce 
and SIDO to facilitate communication and coordination, exchange ideas, 
and identify joint activities to be carried out pursuant to a future 
agreement. 

The MOI represented a concerted effort on the part of Commerce and 
SIDO to improve collaboration consistent with two key collaboration 
practices. First, the MOI was a written agreement documenting how SIDO 
and Commerce believe collaboration should occur. Second, the MOI 
defines the three common outcomes listed above. Nonetheless, the MOI 
did not specify roles and responsibilities; provide a mechanism to 
monitor, evaluate, and report on results; address how to leverage 
state and federal resources; or identify activities to achieve the 
three outcomes. One Commerce official commented that there was no 
commitment embedded in the agreement, such as a list of specific 
actions and who would be responsible for carrying them out. Similarly, 
one SIDO member commented that, while the agreement had gotten the 
parties together, it was too general to help them move forward and 
accomplish much. In contrast, a draft memorandum of understanding 
(MOU) that had preceded the MOI, did call for specific actions, such 
as having Commerce and SIDO jointly organize a program of multistate 
trade missions to key markets worldwide and developing procedures to 
enable federal and state trade offices to share credit for successful 
export promotion efforts. According to SIDO members and Commerce 
officials, legal concerns about vetting such a specific agreement in 
the short time frames given prompted them to sign the MOI instead. 

Ultimately, the MOI, which was to be renewable annually, expired in 
September 2012 with limited results, according to SIDO officials. SIDO 
and Commerce officials reported diverging views about progress on 
achieving the three common outcomes. Regarding the first activity--
coordinating and cooperating in the delivery of critical customer-
focused services--SIDO officials noted a continued lack of joint 
planning. For example, several SIDO members had expressed frustration 
about being surprised by Commerce's announcements of new nationwide 
initiatives, including those for Export Outreach Teams and the 
precursor of Global Cities, the Metropolitan Export Initiative. 
Regarding the second activity--increasing awareness among companies of 
available services--SIDO officials stated that Commerce has not yet 
instituted a formal mechanism to notify state trade offices about 
upcoming events such as trade shows in time for state offices to 
assist or participate. Commerce officials, on the other hand, told us 
that it resolved this issue by sending SIDO a long list of TPCC 
upcoming activities twice a year, as well as regular postings on 
Commerce's export.gov website. Commerce officials pointed out that 
states also need to share with Commerce their plans regarding such 
events, which they said does not always occur, particularly since the 
states started obtaining additional funds through the STEP program. 
For example, the governors of Kentucky and Wyoming held a trade show 
for their mining equipment companies geared toward sales to China at 
the same time as Commerce's similar efforts. Regarding the third 
activity, formal consultation, Commerce and SIDO created a 
consultation process through which, at the onset, they met quarterly, 
according to Commerce officials. However, according to SIDO officials, 
the meetings neither generated any actions nor produced an agreement, 
as called for in the MOI. Moreover, a 2013 survey of SIDO members 
indicated that most believed that despite the NEI, federal-state 
collaboration in promotion exports had not improved in recent years. 

According the Commerce and SIDO officials, several factors contributed 
to the limited collaboration stemming from the MOI. These officials 
agreed that collaboration was a joint responsibility and a SIDO 
official said that they had not met with Commerce since April 2013. A 
SIDO official also said that recent personnel changes on both sides 
made it more challenging to maintain regular consultations. 
Furthermore, SIDO officials said that they were now giving more 
priority to working with SBA and Congress to maintain funding for 
STEP. Nevertheless, the MOI's consistency with key collaboration 
practices could have helped to enhance collaboration. Agreements to 
collaborate that define common outcomes but do not identify activities 
to achieve them or specify roles and responsibilities lack a roadmap 
to motivate parties to move forward. In addition, when such agreements 
lack a mechanism to monitor, evaluate, and report on results, they 
make it more difficult for the partners in collaboration to hold one 
another, and themselves, accountable for fulfilling their commitments. 

MOI Did Not Address Sharing Client Information: 

SIDO officials called sharing credit in the tracking of export 
promotion successes their number one priority to enhance federal-state 
collaboration, which, according to those officials, is why they sought 
to address this issue in the MOI. Sharing information is consistent 
with the key collaboration practice of leveraging resources, including 
information technology, to support a common outcome. However, Commerce 
pointed out that it is required by law to restrict the extent to which 
it can share information (e.g., clients' new export markets, export 
sales, customer satisfaction, services obtained), including 
information related to Commerce's export successes.[Footnote 46] State 
trade office officials in two of the five states we visited also 
mentioned sharing client information as important to federal-state 
collaboration. For instance, an official from one state stated that 
sharing their client lists with Commerce and vice versa ensured that 
their customers obtained the best service to meet their needs. 
Officials from a third state cited three specific issues related to 
sharing client information: 

* First, they said they had no way of knowing whether their referrals 
of clients to Commerce for Gold Key services resulted in export sales, 
leading to underreporting of the state trade office's results and 
limiting its ability to justify additional export promotion resources. 

* Second, they said that it is more difficult to advise companies 
effectively without knowing what information the companies may have 
already obtained from Commerce. 

* Third, the officials said that they and Commerce had to distribute 
separate evaluation forms after jointly sponsored training events, 
resulting in underreporting because participants generally did not 
want to fill out two forms. 

Commerce USEAC officials in three of the states we visited said that 
they were prohibited by law from sharing information on client 
services with state trade offices. A USEAC official in one of the 
three states explained that Commerce must keep a confidential 
relationship with clients so that clients will report to them their 
export successes, an important performance measure. A USEAC official 
in one state noted, however, that sharing export success information 
with his state trade office counterpart made sense because they used 
similar metrics. The official commented that the ability to share 
export successes with the states would encourage leveraging of 
resources through joint efforts. In addition, this same USEAC official 
reiterated that underreporting occurs because the state trade office 
and Commerce must distribute separate evaluation forms to clients that 
attend their joint trade shows and trade missions and most clients 
will not take the time to complete both forms. 

According to an official from Commerce's Office of General Counsel, 
Commerce is legally barred by the federal Trade Secrets Act[Footnote 
47] from sharing any information that would cause "substantial 
competitive harm" if released. The official commented that, as a 
general rule, companies are reluctant to release information to the 
government and that Commerce must obtain "affirmative permission" from 
each company in order to share nonpublic information with the states 
or other federal agencies. She stated the company must give permission 
in advance, in writing, through some formal process that would have to 
be captured in a database, with strict controls. She also stated that 
sharing client information with the state trade offices is 
particularly challenging because, unlike information Commerce shares 
with other federal agencies, information that Commerce discloses to a 
state government is automatically considered releasable to the public 
under the Freedom of Information Act.[Footnote 48] However, she noted 
that Commerce officials can share any information already publicly 
available, or information that would clearly not cause substantial 
competitive harm. She stated that examples of such publicly available 
information would include a press release about a company attending a 
trade mission or information in a company's annual report. Finally, 
the official reiterated that Commerce can share any information with 
the states if a company gives formal written permission in advance. 
[Footnote 49] 

Commerce officials from ITA stated that they are now exploring ways 
for clients to voluntarily give permission for CS to release their 
information but warned of several challenges.[Footnote 50] They noted 
that CS currently lacks the technical capability to record a client's 
advance permission to share their proprietary information, except in 
the case of fee-based services. In this regard, a Commerce official 
estimated that 15 percent of CS services are fee based. Finally, a 
Commerce official suggested that Commerce could aggregate the value of 
export successes by state. However, this would not indicate whether 
the state actually contributed to the export, thus preventing the 
state from documenting and sharing credit. 

Commerce has circulated guidance in the form of a slide presentation 
about the need to protect confidential commercial information 
consistent with limitations on disclosure in the Trade Secrets Act and 
the Privacy Act,[Footnote 51] which officials said they sent to CS 
offices. According to an official from Commerce's Office of General 
Counsel, Commerce had provided no official general guidance to its 
employees on what client information may be shared with other federal 
agencies, the states, or both, and in what situations. Instead, this 
official stated that Commerce lawyers assess information-sharing 
requests on a case-by-case basis and offer informal guidance. She 
noted that currently Commerce has no way to obtain formal permission 
from companies with regard to sharing information. However, without 
some formal, general guidance from Commerce on the types of 
information that can be shared consistent with legal restrictions, and 
without some effort by Commerce to obtain permission from its clients 
to share their information, federal and state export promotion 
providers have less opportunity to leverage resources, such as sharing 
clients and credit for export successes, and thus, less incentive to 
collaborate. 

Conclusions: 

Federal and state governments share an interest in helping small 
businesses export in order to promote economic development and create 
good-paying jobs. Given the overlap of federal and state export 
promotion efforts and the current environment of constrained 
government resources, enhancing federal-state collaboration is 
important to help ensure that export promotion programs operate as 
efficiently and effectively as possible. It is also important for 
minimizing any potential barriers to small businesses seeking export 
promotion assistance. Nevertheless, collaboration is a two-way street, 
and the nature and extent of the federal and state relationship varies 
widely by state, depending on the unique factors in each state. The 
three recent TPCC initiatives to improve federal collaboration with 
states at the national and local levels recognize the varying nature 
of the collaborative relationship. Unfortunately, the federal 
initiatives have had limited success and only partially incorporated 
key collaboration practices. We found weaknesses in the implementation 
of Export Outreach Teams that limit their ability to achieve their 
objectives and enhance federal-state collaboration. Collaborative 
agreements with partners on the other two initiatives have expired 
with unknown or limited results. Nevertheless, these initiatives have 
demonstrated that fruitful opportunities exist to improve local 
networks of export promotion service providers, to expand activities 
to better include metropolitan area economic development agencies, and 
to work with national organizations representing state and local 
governments. Renewed effort by the TPCC agencies to implement these 
initiatives with greater attention to key collaboration practices can 
help improve the support available to small businesses hoping to 
export, as well as bolster, federal efforts to achieve national export 
goals. 

Recommendations for Executive Action: 

To improve federal-state collaboration in providing export promotion 
services in accordance with the National Export Initiative, and the 
Export Enhancement Act of 1992, we recommend that the Secretary of 
Commerce, as Chair of the TPCC, take the following three actions: 

* Improve implementation of the Export Outreach Teams to better 
achieve their intended outcomes. This could include taking steps, 
including better monitoring, to ensure that key local participants are 
invited, that meetings are held as expected, and that the Export 
Outreach Teams seek to both increase awareness of available export 
resources and enhance interagency and intergovernmental collaboration. 

* Take steps consistent with key practices for collaboration to 
enhance TPCC agencies' partnering on export promotion with nonfederal 
entities, such as SIDO and Global Cities. This could include 
reassessing and strengthening the TPCC's intergovernmental 
partnerships by clarifying expected outcomes, defining roles and 
responsibilities, monitoring results, and planning resource needs. 

* Take steps consistent with key practices to enhance, where possible, 
federal information sharing with state trade offices on Commerce's 
export promotion activities. This could include more formal guidance 
to Commerce staff regarding the circumstances, in light of legal 
restrictions, in which information can be shared with state trade 
offices and other nonfederal entities, and exploring ways for clients 
to give permission to release information useful to such nonfederal 
entities. 

Agency Comments: 

We provided a draft of this report to Commerce and SBA for review and 
comment. In its written comments on the draft, which are reprinted in 
appendix III, Commerce concurred with our overall assessment that 
collaboration can be enhanced through strategic management. Commerce 
stated in its letter that our analysis was helpful in pointing out 
areas where TPCC agencies can enhance their relationship with state 
and local government partners. Commerce also noted that while our 
analysis of the status of federal cooperation with state trade 
promotion entities raises important issues, to make broader program 
decisions, Commerce would need to obtain input from a wider variety of 
state trade promotion entities beyond the five state programs that 
were the focus of our fieldwork. Commerce stated its intention to 
obtain comprehensive data on the overall federal relationship with 
state trade promotion entities and that once it obtained that 
additional data it would work to identify and implement strategies to 
enhance TPCC agencies' collaboration with state entities on trade 
promotion. Commerce also described steps that are ongoing or planned 
to address each of our three recommendations. 

* Consistent with our recommendation on Export Outreach Teams, 
Commerce noted that it will help SBA implement its reform plan to 
improve the Export Outreach Teams, including defining representative 
entities at the local level that should be included in the teams. 

* Commerce also noted that it is working with the Brookings 
Institution on raising awareness of best practices under the Global 
Cities Exchange program and working with Brookings and participating 
cities to assess the program's impact. Commerce stated its intention 
to monitor the impacts of Global Cities through data collected by the 
Census Bureau on the number of exporters in metropolitan areas. 

* Finally, Commerce noted that it has begun transmitting to SIDO 
information on federal activities, such as trade missions, earlier in 
the planning cycle; is working with SIDO to further analyze what makes 
for good federal-state cooperation; and plans to hold quarterly calls 
with state trade promotion entities on mutually agreed-on topics. 

Commerce also stated in its letter that our analysis of the Export 
Outreach Teams paralleled that of SBA in its review of the new 
program; and that SBA is taking a number of steps that align with our 
recommendation, such as defining representative entities at the local 
level that should be included in the Export Outreach Teams. 

In addition, on May 1, 2014, the SBA Deputy Associate Administrator 
for International Trade provided us with comments in an e-mail on the 
draft, stating that our analysis and conclusions regarding its 
implementation of Export Outreach Teams were largely accurate and that 
SBA will allow the implementation process to unfold over the next 
year, after which it will review and assess any need for improvements, 
in line with our recommendations. SBA also clarified that the Export 
Outreach Teams were a TPCC initiative co-led by Commerce and SBA, as 
reflected in the mandate in the original TPCC Communiqué; we 
incorporated this change. 

As agreed with your office, unless you publicly announce the contents 
of this report earlier, we plan no further distribution until 14 days 
from the report date. At that time, we will send copies to the 
Secretary of Commerce, the SBA Administrator, and other interested 
parties or congressional committees. In addition, the report will be 
available at no charge on the GAO Website at [hyperlink, 
http://www.gao.gov]. 

If you or your staff have any questions about this report, please 
contact me at (202) 512-8612 or at gianopoulosk@gao.gov. Contact 
points for our Offices of Congressional Relations and Public Affairs 
may be found on the last page of this report. GAO staff who made key 
contributions to this report are listed in appendix IV. 

Sincerely yours, 

Signed by: 

Kimberly Gianopoulos: 
Acting Director, International Affairs and Trade: 

[End of section] 

Appendix I: Objectives, Scope, and Methodology: 

In this report, we examine (1) the main characteristics of federal and 
state export promotion efforts, including their collaboration, and (2) 
the extent to which the Trade Promotion Coordinating Committee (TPCC) 
has advanced collaboration between state and federal efforts to 
promote U.S. exports. 

While some of the 20 TPCC member agencies directly assist small 
businesses to export overseas, this review focuses solely on the 
Department of Commerce (Commerce) and the Small Business 
Administration (SBA). This is because the other TPCC agencies 
generally provide export promotion services comparable to those that 
state trade offices provide.[Footnote 52] We conducted our work in 
Washington, D.C., and through fieldwork in five states: Florida, 
Minnesota, Oregon, Pennsylvania, and Virginia. We chose these states 
based upon the following criteria: presence of a District 
International Trade officer, SBA District Office, and Commerce U.S. 
Export Assistance Center in the metropolitan areas we planned to 
visit; initiation of Export Outreach Teams; state trade office 
presence overseas; participation in Global Cities Exchange; extent of 
collaboration with federal export promotion providers according to 
Commerce officials in Washington, D.C.; and state trade office staff 
size (mix of large and small). We chose these locations to better 
understand and test federal initiatives to advance collaboration with 
state trade offices at the local level; these five locations allowed 
us to assess federal implementation efforts overall but are not 
representative of the situations in each of the individual 50 states. 

To determine the main characteristics of federal and state export 
promotion efforts, we compared their sizes, services, types of 
clients, and performance measures using information collected from 
interviews and site visits to offices of Commerce's Commercial Service 
(CS) and state trade offices in five states (Florida, Minnesota, 
Oregon, Pennsylvania, and Virginia).[Footnote 53] State trade office 
Directors and their staff provided detailed information regarding 
their office locations, staffing numbers, services provided, clients 
served, annual budgets, and the metrics used to measure their programs 
for fiscal years 2012 and 2013. To assess the reliability of these 
data, we created a standard set of questions that was sent to each of 
the five states. We cross-checked these data with similar fields in 
the SIDO 2012 and 2013 survey data. We also collected information on 
SBA services, clients, and resources from documents and interviews 
with SBA officials. We analyzed data collected by the State 
International Development Organizations (SIDO) in its annual member 
surveys for 2012 and 2013. To assess the reliability of the survey 
data from SIDO, we interviewed the SIDO representative responsible for 
developing and implementing the survey, performed a formal review of 
the survey questionnaire for methodological quality, and performed 
data testing. All variables from the survey in this report were 
determined to be sufficiently reliable for the purposes of this 
engagement. To calculate export successes and partnerships with state 
trade offices associated with export successes, we analyzed data from 
the Commerce's Client Tracking System (CTS).[Footnote 54] CTS, an 
operational database used by field specialists and local office 
management, tracks fee-based and non-fee-based activities. CTS is the 
principal database used for tracking "export successes"--the primary 
performance measure for CS. We conducted analysis of CTS data for 
fiscal year 2012 that identified export successes by state and types 
of partnerships. On the basis of interviews with knowledgeable agency 
officials and our assessment of the data for missing data, outliers, 
and obvious errors, we concluded that all data elements we assessed in 
the export successes data provided to us by Commerce were sufficiently 
reliable for the purpose of this report. To determine the extent of 
federal and state collaboration on export promotion, we met with 
cognizant officials from CS and state trade offices in the five states 
we visited. We compiled information from state trade office websites 
on their international presence abroad. If information was not readily 
available, we contacted staff in the state trade offices by e-mail or 
telephone for information about their overseas presence. We cross-
checked these data with similar fields in the SIDO survey data. U.S. 
trade data prepared by the U.S. Bureau of Economic Analysis are used 
in the report to illustrate the progress toward the National Export 
Initiative (NEI) goal of doubling 2009 export levels by 2015. 

To address the extent to which the TPCC has supported collaboration 
between federal and state efforts to promote U.S. exports, we reviewed 
the Export Enhancement Act of 1992, which directed the President to 
establish the TPCC; Executive Order 12870 (Sept. 30, 1993) that 
established the TPCC in accordance with the 1992 act; and Executive 
Order 13534 (Mar. 11, 2010) announcing the NEI, as well as the 2011 
and 2012 editions of the TPCC's annual National Export Strategy 
reports to Congress. We also asked the TPCC to identify their main 
efforts to collaborate with state and local agencies that have a role 
in export promotion. They identified three initiatives: Export 
Outreach Teams, the Global Cities Exchange (initially referred to as 
the Metropolitan Export Initiative), and the memorandum of 
understanding (MOU) between Commerce and SIDO. To evaluate the three 
initiatives, we interviewed staff of the TPCC Secretariat, which is 
housed in Commerce, as well as cognizant Commerce and SBA officials at 
headquarters. We analyzed the documents that provide a framework and 
guidance for the administration of Export Outreach Teams, as well as 
documents that describe the Global Cities Exchange and Commerce's 
relationship with the Brookings Institution and SIDO. These documents 
include a TPCC interagency communiqué formalizing the Export Outreach 
Teams and the subsequent program guidance issued by SBA, data 
collected about the first Export Outreach Team meetings, formal 
agreements between Commerce and the Brookings Institution and between 
Commerce and SIDO, and documents from the Brookings Institution that 
describe the goals of the Global Cities Exchange. We also interviewed 
representatives from the Brookings Institution and SIDO to obtain 
their perspectives and discuss relevant ongoing changes to their 
programs and other efforts.[Footnote 55] In reviewing the Commerce-
SIDO MOU, we reviewed the Trade Secrets Act and pertinent legal 
opinions regarding the act's applicability, and we consulted with a 
representative of Commerce's Office of General Counsel regarding that 
office's views on how the act affects Commerce's ability to share 
information with other federal, state, and local agencies. Finally, we 
met with a number of national organizations that represent the 
interests of local government entities to obtain their perspectives 
and ascertain their roles in promoting U.S. exports. The organizations 
we contacted include the National Governors Association, United States 
Conference of Mayors, National Association of Counties, and the 
National League of Cities. 

We also reviewed GAO's guidance regarding good practices for 
coordinating and managing multiagency initiatives as described in 
other GAO reports, including those discussing implementation of the 
Government Performance and Results Act (GPRA) of 1993 and the GPRA 
Modernization Act of 2010.[Footnote 56] In states we visited, we 
interviewed staff at state trade offices, federal officials from 
Commerce and the SBA District Offices. On the basis of recommendations 
from federal or state officials in those states, we met with other 
local entities, including trade associations, economic development 
organizations, Small Business Development Centers (SBDCs), 
representatives from District Export Councils, local chambers of 
commerce, and the mayor's offices in Miami, Florida; Minneapolis, 
Minnesota; and Portland, Oregon, to obtain information about local 
approaches to interagency collaboration and about implementation of 
the three TPCC initiatives. We then discussed what we found on our 
site visits with officials from TPCC, Commerce, and SBA in 
headquarters to obtain their input. 

We conducted this performance audit from February 2013 to May 2014 in 
accordance with generally accepted government auditing standards. 
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. 

[End of section] 

Appendix II: Commerce and State Trade Office Representation Overseas: 

Figure 7 identifies countries in which the Department of Commerce 
(Commerce) and state trade offices have representation overseas. 
Commerce representation consists of U.S. Commercial Service staff 
located in offices overseas. State trade office representation 
includes state employees located in offices in-country and contractors 
hired as service providers who provide services to a country from 
offices located in-country, or on a regional basis from offices not 
located in-country, or both. 

Figure 7: Commerce and State Trade Office Representation Overseas: 

[Refer to PDF for image: illustrated table] 

China: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Washington, Florida, Georgia, Missouri, Illinois, Maryland, North 
Carolina, Colorado, Ohio, Tennessee, Iowa, Mississippi, Indiana, 
Michigan, Minnesota, Oregon, Alaska, Idaho, Oklahoma, South Carolina, 
Arkansas, Hawaii, Nebraska, California, District of Colombia. 

Japan: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Florida, 
Georgia, Missouri, Illinois, North Carolina, Colorado, Ohio, 
Tennessee, Iowa, Mississippi, Indiana, Oregon, Alaska, South Carolina, 
Arkansas, Kentucky, Montana, Nebraska, West Virginia, Alabama. 

Mexico: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Florida, Georgia, Missouri, Illinois, North Carolina, Colorado, Ohio, 
Tennessee, Iowa, Michigan, Idaho, Oklahoma; Kansas, Arizona, Texas. 

Germany: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Washington, Florida, Georgia, North Carolina, Colorado, Tennessee, 
Iowa, Mississippi, Indiana, Minnesota, South Carolina, Kentucky. 

United Kingdom: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Washington, Florida, Georgia, Missouri, North Carolina, Colorado, 
Ohio, Tennessee, Mississippi, New York. 

Canada: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Florida, 
Florida, Georgia, Missouri, Illinois, North Carolina, Colorado, Ohio, 
Tennessee, Michigan. 

Brazil: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Florida, 
Florida, Georgia, Missouri, Illinois, Colorado, Ohio, Michigan, 
Minnesota. 

Taiwan: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Florida, Missouri, 
Maryland, Indiana, Alaska, Idaho, Hawaii, Montana, New Mexico. 

Israel: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Florida, 
Georgia, Illinois, Maryland, Ohio, New York, Oklahoma, New Mexico. 

France: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Washington, Florida, Maryland, North Carolina, Colorado, Oregon. 

Korea: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Florida, 
Georgia, Missouri, Maryland, North Dakota, Minnesota, Oregon. 

India: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Missouri, Illinois, Maryland, Ohio. 

Ireland: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Washington, 
Florida, Georgia, North Carolina, Colorado. 

South Africa: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Florida, Illinois, New York. 

Belgium: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Washington, Illinois. 

Chile: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Georgia. 

Czech Republic: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Florida. 

Hong Kong: 
Has Commerce Office; 
State trade office representation: Missouri, Illinois, North Carolina, 
North Dakota. 

Italy: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Washington, 
North Carolina. 

Netherlands: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Washington. 

Russia: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
Maryland. 

Ukraine: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin, 
North Dakota. 

Australia: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Bahrain: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Denmark: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Washington. 

Indonesia: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Kuwait: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

New Zealand: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Norway: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Washington. 

Oman: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Poland: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Qatar: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Saudi Arabia: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Singapore: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Missouri. 

Spain: 
Has Commerce Office; 
State trade office representation: Virginia, Washington, Florida. 

Sweden: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Washington. 

Thailand: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Washington. 

Turkey: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, North 
Dakota. 

United Arab Emirates: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia, Wisconsin. 

Vietnam: 
Has Commerce Office; 
State trade office representation: Virginia, Washington, Maryland. 

Austria: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Washington. 

Botswana: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Bulgaria: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Colombia: 
Has Commerce Office; 
State trade office representation: Virginia, Maryland. 

Croatia: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Estonia: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Finland: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Hungary: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Jordan: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Kazakhstan: 
Has Commerce Office; 
State trade office representation: Pennsylvania, North Dakota. 

Latvia: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Lesotho: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Lithuania: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Luxembourg: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Malawi: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Malaysia: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Mauritius: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Mozambique: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Namibia: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Philippines: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Romania: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Serbia: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Slovak Republic: 
Has Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Slovenia: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Virginia. 

Swaziland: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Switzerland: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, West Virginia. 

Tanzania: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Zambia: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania, Wisconsin. 

Angola: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania. 

Argentina: 
Has Commerce Office; 
State trade office representation: Virginia. 

Belarus: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania. 

Costa Rica: 
Has Commerce Office; 
State trade office representation: Virginia. 

Democratic Republic of Congo: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania. 

Egypt: 
Has Commerce Office; 
State trade office representation: Pennsylvania. 

Greece: 
Has Commerce Office; 
State trade office representation: Pennsylvania. 

Madagascar: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania. 

Montenegro: 
Does Not Have Commerce Office; 
State trade office representation: Maryland. 

Panama: 
Has Commerce Office; 
State trade office representation: Virginia. 

Peru: 
Has Commerce Office; 
State trade office representation: Virginia. 

Portugal: 
Has Commerce Office; 
State trade office representation: Washington. 

Seychelles: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania. 

Yemen: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania. 

Zimbabwe: 
Does Not Have Commerce Office; 
State trade office representation: Pennsylvania. 

Afghanistan: 
Has Commerce Office; 
State trade office representation: None. 

Algeria: 
Has Commerce Office; 
State trade office representation: None. 

Dominican Republic: 
Has Commerce Office; 
State trade office representation: None. 

El Salvador: 
Has Commerce Office; 
State trade office representation: None. 

Ghana: 
Has Commerce Office; 
State trade office representation: None. 

Guatemala: 
Has Commerce Office; 
State trade office representation: None. 

Honduras: 
Has Commerce Office; 
State trade office representation: None. 

Iraq: 
Has Commerce Office; 
State trade office representation: None. 

Kenya: 
Has Commerce Office; 
State trade office representation: None. 

Lebanon: 
Has Commerce Office; 
State trade office representation: None. 

Libya: 
Has Commerce Office; 
State trade office representation: None. 

Morocco: 
Has Commerce Office; 
State trade office representation: None. 

Nigeria: 
Has Commerce Office; 
State trade office representation: None. 

Pakistan: 
Has Commerce Office; 
State trade office representation: None. 

Uruguay: 
Has Commerce Office; 
State trade office representation: None. 

Total: 
Has Commerce Office: 72; 
State trade office representation: 
Pennsylvania: 73; 
Virginia: 57; 
Wisconsin: 36; 
Washington: 16; 
Florida: 14; 
Georgia: 11; 
Missouri: 11; 
Illinois: 10; 
Maryland: 10; 
North Carolina: 9; 
Colorado: 8; 
Ohio: 6; 
Tennessee: 5; 
Iowa: 5; 
Mississippi: 5; 
North Dakota: 4; 
Indiana: 4; 
Michigan: 4; 
Minnesota: 4; 
Oregon: 3; 
Alaska: 3; 
Idaho: 3; 
New York: 3; 
Oklahoma: 3; 
South Carolina: 2; 
Arkansas: 2; 
Hawaii: 2; 
Kentucky: 2; 
Montana: 2; 
Nebraska: 2; 
New Mexico: 2; 
West Virginia: 2; 
Alabama: 1; 
Arizona: 1; 
California: 1; 
District of Colombia: 1; 
Texas: 1. 

Source: GAO analysis of data from Department of Commerce and state 
trade offices. 

[End of figure] 

[End of section] 

Appendix III: Comments from the Department of Commerce: 

United States Department of Commerce: 
Office of the Secretary: 
Washington, DC 20230: 
	
May 8, 2014: 

Mr. Adam Cowles: 
Assistant Director: 
International Affairs and Trade: 
U.S. Government Accountability Office: 
441 G Street NW: 
Washington, DC 20548: 

Dear Mr. Cowles: 

Thank you for the opportunity to comment on the draft report entitled 
Export Promotion: Trade Agencies Should Enhance Collaboration with 
State and Local Partners (GAO-14-393). With the Secretary of Commerce 
as Chair of the Trade Promotion Coordinating Committee (TPCC), we 
appreciate the GAO team's work on how Federal Government trade 
agencies can improve their work with state and local entities. State 
and local involvement is critical to assisting U.S. businesses, 
especially small business. in the global marketplace. 

We concur with the overall assessment that collaboration can be 
enhanced through strategic management. The analysis provided is 
helpful and points out a number of areas where TPCC agencies can 
enhance their relationship with state and local government partners. 
It also raises issues that we need to explore further before 
implementing some of the recommendations. 

On the Export Outreach Teams (EOT), the analysis and recommendation 
parallel those of the Small Business Administration (SBA) in its 
review of this new program, with all districts having recently 
completed their first set of workshops. The SBA and Department of 
Commerce teams involved in the EOT program should be commended, as the 
roll-out and acceptance of the POT concept are impressive, considering 
how many organizations had to be brought together during this first 
full year. SBA is now taking a number of steps, including defining
representative entities at the local level that should be included on 
the EOTs. This step aligns with the GAO recommendation. 

The analysis of the overall status of cooperation with state trade 
promotion entities raises important issues; however, the sample size 
for purposes of the report is too limited to make broader program 
decisions. We need to obtain input on these important questions from a 
wider variety of state trade promotion entities beyond the large state 
programs interviewed for this report. The five states interviewed had 
a trade promotion budget of between $1.5 and $5 million, which puts 
them at the top end of state spending on trade promotion. We will 
obtain more comprehensive data on the overall relationship with the 
state trade promotion entities, taking into account the size of their 
export promotion programs and the impact of these programs on U.S. 
businesses, including the impact of the collocation of federal and 
state trade promotion entities. The states surveyed by GAO reported 
that collocation enhances cooperation, but there is no analysis in the 
report linking collocation to the impact on businesses. Once we have 
this additional data, we will work to identify and implement 
strategies to enhance the TPCC agencies' collaboration with state 
entities on trade promotion. 

Two of the states contacted stated that the reason they do not work 
with their federal counterparts is that "Commerce response times are 
slow and the quality of services are inconsistent." The Department of 
Commerce's International Trade Administration (ITA) received similar 
feedback through its customer service survey. Addressing concerns and 
perceptions about the timing and consistency of service quality will 
be a priority for ITA under the National Export Initiative (NEI) this 
coming year. 

Regarding the Global Cities project, we are working with the Brookings 
Institution and participating cities to assess program impact. As the 
report notes, each metropolitan area measures success in a different 
way. The Brookings Institution brings together staff from 
participating metropolitan areas once a year to compare best 
practices. In our experience with economic development organizations, 
sharing best practices is an effective way to determine what works and 
what does not work and to ensure that these metropolitan areas run the 
most effective programs. We will monitor the impact of programs 
through data collected by the Census Bureau on the number of exporters 
in a metropolitan area. In addition, we will work with metropolitan 
areas and the Census Bureau to identify ways to increase the use of 
Census Bureau data to make decisions when developing an export plan. 

Thank you again for this report. I will work with the TPCC member 
agencies to expand the use of key collaboration practices. In 
addition, as part of NEI/Next, the Commerce Department will focus on 
(1) helping SBA to implement its reform plan for the EOTs,
(2) working with the State International Development Organizations 
(SIDO) to further analyze what makes for good federal-state 
cooperation, (3) begin transmitting our information about activities, 
such as trade missions, to SIDO earlier in the planning cycle, (4) 
holding quarterly calls with state trade promotion entities on 
mutually agreed-on topics, and (5) continuing to work with the 
Brookings Institution on raising awareness of best practices under the 
Global Cities program. 

Sincerely, 

Patrick Gallagher: 
NIST Director Performing the Duties of the Deputy Secretary: 

[End of section] 

Appendix IV: GAO Contact and Staff Acknowledgments: 

Contact: 

Kimberly Gianopoulos, (202) 512-8612, or gianopoulosk@gao.gov. 

Staff Acknowledgments: 

In addition to the contact named above, Adam Cowles (Assistant 
Director), Qahira El'Amin, Nina Pfeiffer, and Cristina Ruggiero made 
key contributions to this report. Gezahegne Bekele, David Dayton, 
David Dornisch, Etana Finkler, and Ernie Jackson provided technical 
assistance. 

[End of section] 

Footnotes: 

[1] The President launched the National Export Initiative in his 
January 2010 State of the Union Address. Subsequently, in Executive 
Order 13534 (Mar. 11, 2010), the President established a new body, the 
Export Promotion Cabinet, to develop and coordinate the implementation 
of the NEI. The Export Promotion Cabinet is coordinated by a White 
House official, has most of the same member agencies as the Trade 
Promotion Coordinating Committee (TPCC), and is to coordinate its 
efforts with the TPCC. For a list of TPCC member agencies, see 
[hyperlink, http://export.gov/advocacy/eg_main_022762.asp]. 

[2] This act calls upon OMB to develop long-term, outcome-oriented 
goals for a limited number of crosscutting policy areas and to provide 
information on how they will be achieved. Parts of the act do not come 
into effect until the 2015 budget is issued, but the act requires OMB 
to develop interim goals starting with the 2013 budget. Pub. L. No. 
111-352, 124 Stat. 3866 (2011) (amending the Government Performance 
and Results Act of 1993, Pub. L. No. 103-62, 107 Stat. 285 (1993)). 
For comments on each of the interim crosscutting priority goals 
provided in the President's budget, see GAO, Managing for Results: 
GAO's Work Related to the Interim Crosscutting Priority Goals under 
the GPRA Modernization Act, [hyperlink, 
http://www.gao.gov/products/GAO-12-620R] (Washington, D.C.: May 31, 
2012). 

[3] In September 2010, the Export Promotion Cabinet issued the Report 
to the President on the National Export Initiative, which is its plan 
for doubling U.S. exports in 5 years. All further references to the 
NEI in this report include the Export Promotion Cabinet and its 
activities. 

[4] Pub. L. No. 102-429, § 201, 106 Stat. 2186 (15 U.S.C. § 4727). 

[5] Id. 

[6] To assess the reliability of the survey data from the SIDO, we 
interviewed the SIDO representatives responsible for developing and 
implementing the survey, performed a formal review of the survey 
questionnaire for methodological quality, and performed data testing. 
We determined that some of the survey data were reliable for the 
purposes of this report. 

[7] On the basis of interviews with knowledgeable agency officials and 
our assessment of the data for missing data, outliers, and obvious 
errors, we concluded that all data elements we assessed in the export 
successes data provided to us by Commerce were sufficiently reliable 
for the purposes of this report. 

[8] The Brookings Institution is nonprofit public policy organization 
based in Washington, D.C. 

[9] 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). We identified these practices through interviews with experts 
on collaboration and a review of findings from a number of our 
previous reports on collaboration in the federal government; and 
Managing for Results: Key Considerations for Implementing Interagency 
Collaborative Mechanisms, [hyperlink, 
http://www.gao.gov/products/GAO-12-1022] (Washington, D.C.: Sept. 27, 
2012). To develop these considerations, we reviewed relevant 
literature, including our prior work, and interviewed experts in the 
area of collaboration. 

[10] Throughout this report, we use the term "small businesses" in 
keeping with SBA's definition of a small business as an enterprise 
that is independently owned and operated, organized for profit, and 
not dominant in its field. SBA's definition of a small business also 
sets industry-specific standards for other factors, including maximum 
number of employees and annual revenue, to identify how large a 
company may be and still qualify for SBA assistance. 

[11] See 15 U.S.C. § 4721. 

[12] See GAO, Export Promotion: Small Business Administration Needs to 
Improve Collaboration to Implement Its Expanded Role, [hyperlink, 
http://www.gao.gov/products/GAO-13-217] (Washington, D.C.: Jan. 30, 
2013). SBA concurred with our recommendations. 

[13] In this report, we refer to all state government entities 
providing export promotion as "state trade offices." 

[14] GAO, 2013 Annual Report: Actions Needed to Reduce Fragmentation, 
Overlap, and Duplication and Achieve Other Financial Benefits, 
[hyperlink, http://www.gao.gov/products/GAO-13-279SP] (Washington, 
D.C.: April 2013). 

[15] USEACs are the more than 100 domestic offices where Commerce's CS 
operates, including where SBA, the Export-Import Bank, and sometimes 
state trade offices have staff colocated with Commerce's staff. USEACs 
were established to act as "one-stop shops" that would provide 
coordinated guidance on export promotion services and available 
financing. SBA's field staff--Export Finance Specialists--are 
colocated with Commerce in 19 USEACs throughout the United States. 

[16] GAO, Entrepreneurial Assistance: Opportunities Exist to Improve 
Programs' Collaboration and Performance Management for Financial 
Assistance Programs, [hyperlink, 
http://www.gao.gov/products/GAO-14-335T] (Washington, D.C.: Feb. 6, 
2014). 

[17] [hyperlink, http://www.gao.gov/products/GAO-13-217]. For a full 
list of services provided by Commerce, SBA, and other TPCC agencies, 
visit [hyperlink, http://export.gov]. 

[18] SBA field staff engage in a variety of activities but are 
primarily responsible for providing technical assistance, outreach, 
and training on SBA's export finance programs. 

[19] Based on U.S. Census Bureau 2012 Preliminary Profile of U.S. 
Exporting Companies (Dec. 4, 2013). 

[20] Twenty-eight states responded to the 2013 SIDO survey; however, 
not all states provided a response to all survey questions. 

[21] According to Commerce officials, Delaware businesses are served 
by the Philadelphia USEAC, and Wyoming businesses are served through 
the Denver USEAC. Currently, 11 USEACs are unstaffed. 

[22] In this survey, for example, 18 states provided numbers on their 
full-time equivalent (FTE) employees currently employed by their 
international economic development agencies; the numbers reported were 
to include all domestic personnel and personnel abroad, including 
state employees and contracted representatives. The mean number of 
officials reported was 13, with the middle 90 percent of states 
reporting in the range of 2.5 to 28 FTEs. The mean number of FTEs and 
ranges were similar for the 2012 SIDO data. 

[23] Commerce overseas staffing levels are as of November 2013. 

[24] We previously found that Commerce could improve its resource 
allocation planning practices to maximize the effectiveness of limited 
resources and that it could take steps to gather more complete 
information about export successes, one of the main Commerce 
performance metrics. See GAO, National Export Initiative: U.S. and 
Foreign Commercial Service Should Improve Performance and Resource 
Allocation Management, [hyperlink, 
http://www.gao.gov/products/GAO-11-909] (Washington, D.C.: Sept. 29, 
2011). 

[25] Congressional Research Service, Small Business Administration 
Trade and Export Promotion Programs, R43155 (Washington, D.C.: Jan. 
22, 2014). 

[26] GAO, Export Promotion: Better Information Needed About Federal 
Resources, [hyperlink, http://www.gao.gov/products/GAO-13-644] 
(Washington, D.C.: July 17, 2013). 

[27] In this survey, 14 states provided numbers on their state trade 
promotion budgets, including both domestic costs and costs for 
overseas offices and contractors. The average 2013 budget reported by 
these states was about $960,000, with the totals ranging from $72,000 
to $3.3 million, and with all but three of the 14 states having 
budgets between $200,000 and $1.74 million. The average budget and 
overall range for the 21 states that responded to the budget question 
on the 2012 SIDO data were similar to those for 2013. Note that these 
data are only illustrative and cannot be generalized to all states as 
many did not respond to this question in the SIDO survey. 

[28] GAO, Entrepreneurial Assistance: Opportunities Exist to Improve 
Programs' Collaboration, Data-Tracking, and Performance Management, 
[hyperlink, http://www.gao.gov/products/GAO-13-452T] (Washington, 
D.C.: Mar. 20, 2013). 

[29] An export success is defined as a Commerce service, rendered by 
locally employed staff, Foreign Service Officers, or USEAC staff that 
facilitates (1) a sale of a product or service; (2) a commercial 
agreement (distribution, wholesale, or joint venture); or (3) an 
overseas activity resulting in revenue for a U.S. company or its 
affiliate or subsidiary. 

[30] Some states also reported that they had separate performance 
measures for overseas offices. 

[31] We previously reported that Commerce and the majority of states 
provide many of the same types of export promotion services, but that 
some states have limited budgets and staff. Partly as a result of this 
limited capacity, most states reported that Commerce's services are 
important to their export promotion capabilities and have partnered 
with Commerce's offices. See GAO, Export Promotion: Commerce Needs 
Better Information to Evaluate Its Fee-Based Programs and Customers, 
[hyperlink, http://www.gao.gov/products/GAO-09-144] (Washington, D.C.: 
Mar. 4, 2009). 

[32] Fifteen USEACs are colocated (share office space) with a state 
economic development partner, which may include state trade office 
staff. In an example of proximity, Commerce and Business Oregon are 
located in the same building, which makes collaboration among their 
staff easier because it allows them to be more aware of and more 
easily build on each other's work. 

[33] Commerce's client management system for tracking fee-based and 
non-fee-based activities, including interactions with clients, does 
not require staff to complete the field where a partnership on an 
export success may be reported. 

[34] Also, a 2012 Commerce Inspector General survey reported that 
state trade offices are among Commerce's most frequent collaboration 
partners. Other partners included other federal agencies and private 
sector organizations. 

[35] STEP was a 3-year pilot trade and export initiative authorized by 
Section 1207 of the Small Business Jobs Act of 2010 (Pub. Law 111-240, 
Sept. 27, 2010) and funded at $30 million per year for the first 2 
years. Under the program, SBA made matching-fund grants to states to 
assist "eligible small business concerns" enter and succeed in the 
international marketplace. Services under the program were funded in 
part by SBA but were provided to eligible small business concerns--or 
"STEP Clients"--by STEP grant recipients located in most states and 
territories and the District of Columbia. During the first 2 years of 
this program, SBA awarded approximately $60 million. 

[36] [hyperlink, http://www.gao.gov/products/GAO-06-15]. 

[37] [hyperlink, http://www.gao.gov/products/GAO-12-1022]. 

[38] Furthermore, the Export Enhancement Act of 1992 called for the 
TPCC to review efforts by the states to promote U.S. exports and 
propose ways to develop cooperation between federal and state efforts. 
A Commerce official noted that federal agencies do not have authority 
over state trade offices and can only encourage their willingness to 
cooperate. 

[39] SCORE is an SBA-supported nonprofit association that provides 
assistance to help start and expand small businesses though a net work 
of over 11,000 volunteers nationwide. 

[40] [hyperlink, http://www.gao.gov/products/GAO-13-217]. 

[41] Some locations did not provide a final tally of all attendees. 

[42] The Global Cities Exchange is a component of the Brookings 
Institution's Global Cities Initiative. According to a representative 
of the Brookings Institution, the Global Cities Initiative aims to 
catalyze a shift in economic growth policy that results in more 
globally competitive metropolitan areas by positioning them for high-
quality growth and better jobs for more workers in the 21st century. 

[43] As of December 2013, Global Cities had expanded from the first 
four locations to also include the following cities: Atlanta, Ga.; 
Charleston, S.C.; Chicago, Ill.; Columbus, Ohio; Des Moines, Iowa; 
Greenville, S.C.; Indianapolis, Ind.; Jacksonville, Fla.; Louisville/ 
Lexington, Ky.; Milwaukee, Wisc.; Phoenix, Ariz.; Sacramento, Calif.; 
San Antonio, Tex.; San Diego, Calif.; Tampa, Fla.; and Wichita, Kans. 
As of April, 2014, the Brookings Institution has not announced the 
remaining eight locations. 

[44] Under the MOA, Brookings had primary responsibility for 
implementation--including the identification of local leaders for the 
program and providing data analysis. Brookings also provided technical 
assistance in developing metropolitan export plans and in surveying 
local exporting businesses. 

[45] SIDO members include state international trade agencies across 
the country. Through close partnership with the Council of State 
Governments, SIDO provides a forum where states regularly engage in 
trade promotion activities by bringing together state and local level 
international development professionals to share ideas and enhance 
skills. SIDO is based in Washington, D.C., but relies primarily on the 
active involvement of state trade directors across the country, 
including its board of directors, to ensure that all activities focus 
on the immediate needs of the states. 

[46] As previously discussed, Commerce measures progress, in part, by 
tracking what it terms "export successes"--any trade promotion 
activity involving Commerce that successfully assists a U.S. company 
to export a product or service. 

[47] 18 U.S.C. §1905. 

[48] 5 U.S.C. § 552. 

[49] GAO recommended in January 2013 that federal agencies involved in 
export promotion identify ways to increase, where possible, sharing of 
client information. [hyperlink, 
http://www.gao.gov/products/GAO-13-217]. 

[50] In November 2012, the Commerce Inspector General (IG) found that 
restrictions on sharing Commerce's client information hamper 
collaboration between USEACs and their partners. The IG recommended 
that Commerce explore the possibility of requiring CS clients to waive 
confidentiality, in whole or in part, as a condition for receiving 
services. See Department of Commerce, Office of Inspector General, 
International Trade Administration: U.S. Export Assistance Centers 
Could Improve Their Delivery of Client Services and Cost Recovery 
Efforts, OIG-13-101-1 (Washington, D.C.: Nov. 30, 2012). 

[51] 5 U.S.C. § 552a. 

[52] The Department of State and U.S. Trade and Development Agency 
support some export promotion but focus their efforts internationally. 
The U.S. Department of Agriculture provides export promotion services 
through industry organizations and other mechanisms. 

[53] In this report, we defined "export promotion activities" as 
previously defined in a recent GAO report on export promotion. See 
[hyperlink, http://www.gao.gov/products/GAO-13-217], Export Promotion: 
Small Business Administration Needs to Improve Collaboration to 
Implement Its Expanded Role (Washington, D.C.: Jan. 30, 2013). Export 
promotion activities are defined as programs and services conducted by 
federal agencies that involve direct contact with U.S. exporters and 
have export promotion as their stated goal. Such activities include 
providing small businesses with export counseling, training, and 
financial assistance; they do not include activities such as advocacy, 
commercial diplomacy, and policy development and negotiations. 

[54] CTS does not require that fields that indicate partnerships be 
completed; consequently, the data analyzed do not provide a complete 
picture of the extent to which state trade offices and CS collaborate 
to achieve export successes. 

[55] It should be noted that, although states are SIDO members, SIDO 
itself is a professional association without the ability to take 
binding actions on behalf of its members, and so its positions and 
actions do not necessarily reflect the views of all its members. 

[56] 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). We identified these practices through interviews with experts 
on collaboration and a review of findings from a number of our 
previous reports on collaboration in the federal government; and 
Managing for Results: Key Considerations for Implementing Interagency 
Collaborative Mechanisms, [hyperlink, 
http://www.gao.gov/products/GAO-12-1022] (Washington, D.C.: Sept. 27, 
2012). To develop these considerations, we reviewed relevant 
literature, including our prior work, and interviewed experts in the 
area of collaboration. 

[End of section] 

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