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entitled 'Department of State (State) and United Nations relief and 
Works Agency (UNRWA) Actions to Implement Section 301(c) of the Foreign 
Assistance Act of 1961' which was released on November 17, 2003.

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United States General Accounting Office:

Washington, DC 20548:

November 17, 2003:

The Honorable Mitch McConnell:


The Honorable Patrick Leahy:

Ranking Member:

Subcommittee on Foreign Operations:

Committee on Appropriations:

United States Senate:

The Honorable Jim Kolbe:


The Honorable Nita M. Lowey:

Ranking Member:

Subcommittee on Foreign Operations, Export Financing, and Related 

Committee on Appropriations:

United States House of Representatives:

Subject: Department of State (State) and United Nations Relief and 
Works Agency (UNRWA) Actions to Implement Section 301(c) of the Foreign 
Assistance Act of 1961:

Established in 1949 by the United Nations, UNRWA provides assistance to 
Palestinian refugees in the Middle East. UNRWA assistance is primarily 
education, health, and relief and social services. More than 4 million 
Palestinian refugees are eligible to receive these services in UNRWA's 
five areas of operation--Jordan, Lebanon, Syria, the West Bank, and 

In section 301(c) of the 1961 Foreign Assistance Act (PL 87-195) as 
amended, Congress has directed that "No contributions by the United 
States shall be made to [UNRWA] except on the condition that [UNRWA] 
take all possible measures to assure that no part of the United States 
contribution shall be used to furnish assistance to any refugee who is 
receiving military training as a member of the so-called Palestine 
Liberation Army or any other guerrilla type organization or who has 
engaged in any act of terrorism.":

In 2003, Congress approved the Consolidated Appropriations Resolution, 
2003 (PL 108-7), section 580, which required the General Accounting 
Office (GAO) to report to the appropriations committees on State 
Department compliance with section 301(c) of the 1961 Foreign 
Assistance Act and the implementation of procedures established to meet 
State standards for section 301(c). To fulfill this mandate, we:

are reporting on State Department actions and UNRWA's implementation of 
procedures to address section 301(c). As agreed, we briefed your staff 
on our findings on November 6, 2003[Footnote 1]. Enclosure I documents 
the information we presented to your staff. UNRWA and the Department of 
State provided technical comments on a draft of this briefing, which we 
incorporated as appropriate.


UNRWA employs more than 24,000 staff. More than 90 percent of its staff 
are Palestinian refugees. UNRWA's mission does not involve 
administering or policing refugee camps. Relevant civil authorities in 
each area of operations are responsible for camp administration and 
security. Approximately 1.3 million refugees live in such camps, while 
almost 2.8 million refugees do not live in camps.

In calendar 2000-2002, UNRWA spent about $1 billion. During this 
period, the United States provided about $332 million to UNRWA. The 
State Department provided about $300 million during this period, while 
the U.S. Agency for International Development (USAID) granted UNRWA 
another $32 million.


State has taken actions to implement section 301(c). For example, State 
requires UNRWA to certify that in accepting each contribution from the 
United States, UNRWA is taking all possible measures to assure that U.S 
funds do not benefit terrorists or refugees receiving military training 
from guerrilla groups. State has also acted to improve monitoring by 
(1) placing a Refugee Coordinator in Amman, Jordan, whose main duty is 
to monitor UNRWA; (2) funding additional UNRWA international staff to 
inspect facilities; and (3) requesting that UNRWA report regularly on 
301(c) compliance. State has also urged UNRWA to adopt a more formal 
monitoring program. However, State has not defined key terms used in 
section 301(c).

UNRWA's implementation of procedures to address section 301(c) is 
constrained by several factors. First, while it relies on host 
governments to review local job applicants for UNRWA employment in 
Jordan, Syria, and Lebanon, it does not have similar arrangements with 
authorities in the West Bank and Gaza, where UNRWA also lacks access to 
data on arrests of its local staff. Second, UNRWA uses international 
staff to inspect its facilities and requires non-UNRWA groups to obtain 
permission before using those facilities, but it has not been able to 
prevent armed incursions. Finally, UNRWA is constrained in determining 
if its beneficiaries meet section 301(c) criteria, owing to concerns 
for its staff's safety and its inability to verify beneficiary 

Scope and Methodology:

To describe State Department actions, we reviewed State and USAID 
records for fiscal 1999-2003 and met with State and USAID officials in 
Washington, D.C.; Jerusalem; Tel Aviv, Israel; and Amman, Jordan.

To describe UNRWA's implementation of procedures, we reviewed UNRWA, 
State, and USAID documents. We also met with United States officials in 
Washington, Amman, and Jerusalem. We met with UNRWA management 
(including the directors of each of its five operating areas), staff, 
and beneficiaries in Jerusalem; in Bethlehem and Ramallah, in the 
Israeli-occupied West Bank; and in Amman, Jordan. In addition, we met 
with Israeli officials in Washington and Jerusalem and with Jordanian 
officials in Amman.

We performed our review from April 2003 through October 2003 in 
accordance with generally accepted government auditing standards.

We are sending copies of this report to the Honorable Colin Powell, 
Secretary of State, and to interested congressional committees. Copies 
will be made available to others upon request. In addition, this report 
will be available at no charge on our Web site at

If you or your staff have any further questions regarding this 
assessment, please contact me at (202) 512-3149. Cheryl Goodman, Pierre 
Toureille, and Ella Mann also made key contributions to this report.

David B. Gootnick:

Director, International Affairs and Trade:

Signed by David B. Gootnick:


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[1] Section 580 required GAO to report to the committees by November 1, 
2003. Although we were prepared to present our findings by that date, 
we agreed to your staff's request that we defer our briefing to 
accommodate congressional deliberations on the supplemental 
appropriations bill.