Skip to Highlights
Highlights

The Federal Protective Service (FPS) is a fee-funded agency in the Department of Homeland Security (DHS) responsible for providing physical security to over 9,000 federal facilities. In 2003 FPS transferred to DHS from the General Services Administration and for the first time was to fully recover its costs. GAO recently reported that stakeholders were concerned about FPS's ability to determine security costs, and the strategies used to address funding challenges had adverse effects on FPS. In this context, Congress directed GAO to evaluate FPS's resource levels. This report (1) analyzes FPS's fee design and proposed alternatives, and (2) examines how FPS's security fees challenge FPS and customer agency budget formulation and execution. GAO reviewed legislation and agency documentation and interviewed FPS and customer agency officials in headquarters and four FPS regions.

Skip to Recommendations

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Homeland Security 1. The Secretary of Homeland Security should direct the Director of the Federal Protective Service to conduct regular reviews of FPS's security fees and use this information to inform its fee setting.
Closed - Implemented
In April 2014, FPS finalized its Activity Based Cost Model Independent Verification and Validation Report that, along with FPS's fiscal year 2015 congressional budget justification, demonstrate FPS's ability to conduct regular, timely, and substantive fee reviews critical for fee funded organizations like FPS.
Department of Homeland Security 2. The Secretary of Homeland Security should direct the Director of the Federal Protective Service to include systemwide capital investments when estimating costs and include them when setting basic security fee rates.
Closed - Implemented
In July 2013, FPS officials said they had implemented the FPS acquisition review process to evaluate acquisition needs and provide investment oversight throughout the lifecycle to achieve budget goals and objectives. FPS officials said this process informs the activity based costing model used to identify all agency costs and inform fee setting.
Department of Homeland Security 3. The Secretary of Homeland Security should direct the Director of the Federal Protective Service to make information on the estimated costs of key activities as well as the basis for these cost estimates readily available to affected parties to improve the transparency and credibility--and hence the acceptance by stakeholders--of the process for setting and using the fees.
Closed - Implemented
FPS's fiscal year 2015 congressional budget justification (CJ) provides a transparent description of its funding model to FPS's stakeholders. The CJ describes the purpose of each fee, what each fee funds, and how the rate for each fee is established. The CJ also describes FPS's key activities and their cost basis. It also identifies the agencies from which most of FPS's revenues come and how much thses agencies pay in the respective fees.
Department of Homeland Security 4. The Secretary of Homeland Security should direct the Director of the Federal Protective Service, in implementing our previous recommendation to evaluate the current fee structure and determine a method for incorporating facility risk, to assess and report to Congress on: (1) the current and alternative fee structures, to include the options and trade-offs discussed in this report, and if appropriate, and (2) options to fund FPS through a combination of fees and direct appropriations, to include the options and trade-offs discussed in this report;
Closed - Implemented
In January 2015, the Federal Protective Service (FPS) completed its assessment of fee schedule alternatives. Among other things, FPS analyzed alternatives for ensuring cost alignment, transparency, and stable fee revenue. FPS used its activity based costing model and facility security profile (which represents facility risk) to inform its analysis. Upon completion of this analysis, FPS determined the current fee structure, with a fee increase, was the best option. FPS stated it will review its fees biannually.
Department of Homeland Security 5. The Secretary of Homeland Security should direct the Director of the Federal Protective Service to evaluate and report to Congress on options to mitigate challenges agencies face in budgeting for FPS security costs, such as: (1) an alternative account structure for FPS to increase flexibility, while retaining or improving accountability and transparency or (2) an approved process for estimating fee rates.
Closed - Implemented
In June 2016, FPS officials said the agency had identified several strategies to address the challenges agencies face in budgeting for FPS security costs. Specifically, FPS developed best practices for planning and managing physical security resources to assist agencies in making physical security management decisions. These efforts will improve the building specific countermeasure decision-making of their customer agencies. FPS officials said they worked with the General Services Administration to ensure that property leases include details of the security measures associated with the facility according to security standards so agencies can better predict security costs. And finally, FPS officials said they work with agencies to amortize the costs of countermeasures valued at over $50,000. These actions serve to provide security cost information agencies need for budgeting earlier than they had been.
Department of Homeland Security 6. The Secretary of Homeland Security should direct the Director of the Federal Protective Service to work with customer agencies to collect and maintain an accurate list of points of contact of customer agency officials responsible for budget and billing activities as well as facility designated points of contact as we previously recommended.
Closed - Implemented
In July 2013 FPS provided an agency customer billing contact list with the individuals and their contact information for FPS's customer agencies. FPS also updated the information available on their Rent on the Web invoices to show FPS billing contact information to its customer agencies.

Full Report

GAO Contacts