Question:
Why GAO Did This Study

The federal government provided $64 billion in SNAP benefits in fiscal year 2017 to help approximately 42 million low-income individuals purchase food. SNAP is administered by FNS in partnership with states. To help reduce the risk of improper receipt or use of SNAP benefits, states use data analytics, including data matching and data mining, to identify patterns or trends indicative of potential fraud in SNAP purchases. Based on concerns about potential SNAP benefit trafficking across state lines, GAO was asked to review out-of-state transactions and states' efforts to combat such fraud.
This report examines (1) the extent to which SNAP households in selected states made out-of-state purchases that may indicate potential fraud, (2) the advantages and challenges selected states have experienced in using data analytics to identify potential fraud, and (3) how FNS has assisted states in implementing leading practices for data analytics. GAO analyzed fiscal year 2017 data on SNAP purchases for North Dakota, Washington, and the District of Columbia, which had large percentages of non-border out-of-state purchases and interviewed FNS officials and officials in these states as well as in Massachusetts, Mississippi, New Mexico, and Wisconsin about their use of data analytics compared with leading practices.

What GAO Found

Supplemental Nutrition Assistance Program (SNAP) recipients are allowed to spend their benefits outside their state of residence, and GAO's analysis of fiscal year 2017 SNAP data in three selected states found that overall about 2 percent of households made purchases, both in state and out-of-state, potentially indicative of trafficking—the prohibited exchange of benefits for cash or nonfood goods or services. Also, GAO found little difference in potential trafficking behaviors between households that made one or more purchases out-of-state and those that shopped only in their home state.
Officials in all seven states GAO reviewed said they conducted data matching. Officials in five of these states stated that they use more sophisticated data analytics including data mining to help identify potential fraud (see figure). These officials cited advantages to using more sophisticated analytics to automate fraud detection and prioritize cases, allowing them to focus investigative resources on cases most likely to involve fraud. For example, officials in Mississippi reported that overpayment collections increased $2 million since the state incorporated more data techniques into its fraud detection efforts. However, officials in all seven selected states cited factors such as high cost, resource demands, data limitations and organizational support as challenges that affect their ability to use or maintain more advanced data-analytics techniques.
The U. S. Department of Agriculture's Food and Nutrition Service (FNS) has helped some states adopt certain leading practices for data analytics, but its current outreach is limited. FNS has provided assistance to some states through pilot projects, grants, and training, but, beyond a recently issued guide, FNS has done little to disseminate information more broadly about successful efforts to adopt data analytics. FNS officials said they are in the early stages of promoting data analytics for SNAP fraud prevention and detection, and their efforts have focused on assessing the current capability of states to use data analytics and determining analytic practices that are effective. State officials GAO interviewed said that training provided was helpful but expressed concern about their access to information on successful data analytic approaches. Disseminating information to states on successful strategies could help states address challenges.

What GAO Recommends

GAO recommends that FNS more widely disseminate information to states about successful strategies used by states to adopt data analytics. FNS agreed with this recommendation.


Question:
Why GAO Did This Study

The 2005 BRAC round was the costliest and most complex BRAC round ever. In contrast to prior rounds, which focused on the goal of reducing excess infrastructure, DOD's goals for BRAC 2005 also included transforming the military and fostering joint activities.
GAO was asked to review DOD's performance outcomes from BRAC 2005. This report examines the extent to which DOD has (1) measured the achievement of its goals for BRAC 2005 and (2) implemented prior GAO recommendations on BRAC 2005 and addressed any additional challenges to improve performance for any future BRAC round. GAO reviewed relevant documents and guidance; met with a nongeneralizable selection of 26 military organizations and 12 communities involved with BRAC 2005; and interviewed DOD officials.

What GAO Found

The Department of Defense (DOD) components generally did not measure the achievement of goals—reducing excess infrastructure, transforming the military, and promoting joint activities among the military departments—for the 2005 Base Realignment and Closure (BRAC) round. In March 2013, GAO recommended that, for any future BRAC round, DOD identify measures of effectiveness and develop a plan to demonstrate achieved results. DOD did not concur and stated that no action is expected. Without a requirement for DOD to identify measures of effectiveness and track achievement of its goals, Congress will not have full visibility over the expected outcomes or achievements of any future BRAC rounds.
Of the 65 recommendations GAO has made to help DOD address challenges it faced in BRAC 2005, as of October 2017 DOD had implemented 33 of them (with 18 pending DOD action).
DOD has not addressed challenges associated with communication and monitoring mission-related changes. Specifically:
Some military organizations stated that they could not communicate to BRAC decision makers information outside of the data-collection process because DOD did not establish clear and consistent communications. For example, Army officials at Fort Knox, Kentucky, stated that there was no way to communicate that excess facilities were ill-suited for relocating the Human Resources Command and moved forward without full consideration of alternatives for using better-suited excess space at other locations. As a result, DOD spent about $55 million more than estimated to construct a new building at Fort Knox.
DOD implemented BRAC recommendations that affected units' ability to carry out their missions because DOD lacked specific guidance to monitor and report on mission-related changes. For example, DOD spent about $27.7 million on a landing field for a Marine Corps F-35 training squadron at Eglin Air Force Base, Florida, even though it had been previously decided to station the F-35 aircraft and personnel at another base.
By addressing its communication and monitoring challenges, DOD could better inform decision making, better ensure that its infrastructure meets the need of its force structure, and better position itself to achieve its goals in any future BRAC round.

What GAO Recommends

Congress should consider requiring DOD to identify and track appropriate measures of effectiveness in any future BRAC round. Also, GAO recommends that in any future BRAC round DOD (1) take steps to establish clear and consistent communications while collecting data and (2) provide specific guidance to the military departments to monitor and report on mission-related changes during implementation. GAO also continues to believe that DOD should fully implement GAO's prior recommendations on BRAC 2005. DOD objected to Congress requiring DOD to identify and track performance measures, but GAO continues to believe this to be an appropriate action for the reasons discussed in the report. Lastly, DOD concurred with the two recommendations.


Question:
Why GAO Did This Study

The federal government spends close to $1 billion annually for advertising activities that, among other things, inform the public about programs and services. The government seeks to provide procurement opportunities for these services to businesses such as SDBs and those owned by minorities and women. SDBs are those primarily owned by one or more socially and economically disadvantaged individuals.
GAO was asked to analyze federal advertising obligations to these types of businesses. This report discusses (1) the amount federal agencies have obligated towards advertising contracts over the most recent 5 fiscal years (2013 through 2017) and the amount going to SDBs and businesses owned by minorities and women; and (2) the agencies that have directed the most advertising contract obligations to these businesses and how this has changed over time.
GAO analyzed data on advertising contracts from the Federal Procurement Data System – Next Generation database for fiscal years 2013 through 2017. GAO also interviewed Small Business Administration officials.
The Small Business Administration provided technical comments on this report, which GAO incorporated as appropriate.

What GAO Found

Federal advertising contract obligations to small disadvantaged businesses (SDB) and businesses of all sizes owned by minorities and women (specified businesses) generally increased from fiscal years 2013 through 2017, and constituted 13 percent of all advertising obligations over this period. This figure is consistent with the percentage of all federal contract obligations to these businesses over this period. Overall, advertising contract obligations to all three categories of businesses increased between fiscal years 2013 and 2017, as shown in the figure below. Within the minority-owned business category, which includes businesses owned by Asian-Pacific-, Subcontinent-Asian-, Black-, Hispanic-, and Native-Americans, over half of the obligations went to those owned by Hispanic-Americans.
Three agencies—the departments of Defense (DOD), Health and Human Services, and Homeland Security—were responsible for nearly three-quarters of advertising contract obligations to the three categories of businesses from fiscal years 2013 through 2017. These agencies were associated with much of the increase in these obligations to specified businesses over the 5-year period. Although some agencies obligated higher shares of their advertising contract obligations to these businesses, they generally obligated fewer dollars than DOD and the two other agencies. For example, the National Aeronautics and Space Administration directed 98 percent of its obligations to these businesses, but the agency's total advertising contract obligations were $21 million over the 5-year period. DOD obligated $2.6 billion for these contracts over the same period.


Question:
Why GAO Did This Study

DOD has used the Base Realignment and Closure (BRAC) process primarily to reduce excess infrastructure capacity, transform the force, and produce cost savings. DOD completed hundreds of base closures and realignments in previous BRAC rounds and intends to work with Congress to address remaining excess capacity. The NDAA for Fiscal Year 2016 required DOD to submit, among other things, a force structure plan and a categorical infrastructure inventory of worldwide military installations. In response, DOD submitted its infrastructure capacity report to Congress in October 2017.
The NDAA included a provision for GAO to evaluate DOD's report for accuracy and analytical sufficiency. In this report, GAO evaluates the extent to which (1) DOD's report included the required elements, and (2) DOD's methodology and analysis result in accurate and analytically sufficient information on excess capacity. To conduct this work, GAO reviewed DOD's 2017 report and compared it with the statutory requirements and generally accepted research standards. GAO also interviewed DOD and military service officials.

What GAO Found

The Department of Defense's (DOD) 2017 infrastructure capacity report addressed four of five required elements from section 2815 of the National Defense Authorization Act (NDAA) for Fiscal Year 2016. Specifically, DOD's report addressed the elements requiring it to submit
a force-structure plan,
a categorical inventory of worldwide military installations,
a discussion of categories of excess infrastructure, and
an assessment of the value of retaining certain excess infrastructure.
DOD's report partially addressed the element to include a description of the infrastructure capacity required to support the force structure. Specifically, DOD's report did not provide a complete picture of the infrastructure needed. For example, infrastructure at Air Force large aircraft installations was described by square yards of apron space, but did not include other infrastructure needs such as aircraft hangars and maintenance facilities.
DOD's excess capacity methodology and analysis has three key limitations that affect the accuracy and analytical sufficiency of the estimate. Specifically:
DOD used a 1989 baseline for excess capacity that may lead to inaccurate results. This 1989 baseline does not reflect updates in DOD facility standards and requirements or requirements associated with new weapon systems.
DOD's excess capacity methodology includes assumptions, such as not accounting for potential shortfalls—not having enough infrastructure to support the mission—that may not be reasonable. Specifically, when DOD's calculation identifies shortfall in capacity, DOD concludes that no excess capacity exists. As a result, DOD's analysis identifies no excess capacity in nearly half (14 of 32) mission categories. However, most installations support more than one mission and have more infrastructure present than the installation category metric measures. Thus, including potential capacity shortfalls could provide DOD and Congress with a more accurate estimate of excess capacity upon which to base decisions concerning the management of base infrastructure and excess capacity.
DOD's method for estimating excess capacity is not always sufficient because the installation selection process does not result in a generalizable sample. Furthermore, DOD's method is not always implemented effectively because the military departments did not follow a consistent approach.
According to DOD officials, specific department-wide guidance concerning DOD's methods for selecting installations in its analysis does not exist. Moreover, without developing guidance, the estimate of excess capacity may not be based on consistent methods across the department, resulting in inaccurate estimates. Furthermore, neither DOD nor Congress will have the necessary information to make decisions concerning the management of excess infrastructure capacity across the department.

What GAO Recommends

GAO is making three recommendations to DOD to update the baseline; use reasonable assumptions; and develop guidance to improve its methods for estimating excess capacity. In comments on a draft of this report, DOD concurred with one recommendation, partially concurred with two recommendations, and plans to incorporate them in any future capacity analysis.


Question:
Why GAO Did This Study

TSA is responsible for securing the nation's transportation systems and uses security technologies to screen airline passengers and their luggage to prevent prohibited items from being carried on commercial aircraft. TSA has special authority for using OTAs, which are not subject to certain federal contract laws and requirements. OTAs provide flexibility to help meet mission needs, but potentially carry the risk of reduced accountability and transparency.
GAO was asked to examine TSA's use of OTAs. This report addresses: (1) the extent and purposes of TSA's use of OTAs, and (2) how TSA ensures prices are reasonable and how it oversees OTAs.
To address TSA's use of OTAs, GAO analyzed data on OTA awards and obligations from the Federal Procurement Data System-Next Generation from fiscal years 2012 to 2016 (the most recent years for which data were available). GAO determined that data were sufficiently reliable to report on TSA's minimum use of OTAs. To examine how TSA prices and oversees OTAs, GAO selected a nongeneralizable sample of 29 OTAs from the 8 TSA programs that awarded them based on program size and OTA value. GAO reviewed relevant documentation, and interviewed contracting and program officials.

What GAO Found

During fiscal years 2012 through 2016, the Transportation Security Administration (TSA) awarded at least 1,039 other transaction agreements (OTA) and obligated at least $1.4 billion on them. These agreements, which are neither traditional contracts nor grants, were primarily used to reimburse airports and law enforcement agencies for the costs associated with TSA security programs. For example,
TSA awarded at least 109 OTAs and obligated at least $783 million from fiscal years 2012 through 2016 to reimburse airports for the allowable design and construction costs associated with installing, updating, or replacing checked baggage screening systems.
TSA also used OTAs for intelligence analysis and to offset the costs of providing canines for explosives detection, among other things.
TSA Used Other Transaction Agreements to Reimburse Airports for Design and Construction Costs Associated with Checked Baggage Screening Systems
For the selected 29 OTAs GAO reviewed, GAO found that the methods TSA used to determine price reasonableness varied depending on the complexity of the requirement. For example,
For complex design and construction projects, TSA compared independent government cost estimates with contractor bids. Certified program managers monitored project schedule and scope through site visits and status reports.
In contrast, TSA independently verified the rates set by the local power authority when reimbursing some airports for electricity costs to operate TSA screening equipment.
GAO also found that TSA has taken action to address prior lapses in oversight, resulting in improved compliance. In 2015, TSA identified significant gaps in OTA file documentation and data reported in the Federal Procurement Data System-Next Generation. TSA took action to address these deficiencies by (1) updating its policy, (2) requiring additional training for contracting officers, (3) instituting monthly data verification, and (4) monitoring compliance through quarterly reviews. GAO's analysis confirmed that the quality of the data had improved between fiscal year 2012 and 2016. Moreover, the 29 OTAs generally met key requirements of TSA's policy that GAO identified.

What GAO Recommends

GAO is not making any recommendations in this report.


Question:
Why GAO Did This Study

TSA employs about 43,000 TSOs who screen over 2 million passengers and their baggage each day at airports in the United States. TSA allocates TSOs to airports using both a computer-based staffing model and information from airports that are intended to provide each airport with the optimum number of TSOs. In the spring of 2016, long screening checkpoint lines at certain U.S. airports raised questions about TSA's process for allocating TSOs to airports.
The Aviation Security Act of 2016 includes a provision for GAO to review TSA's process for allocating TSOs. This report examines how (1) TSA modifies staffing assumptions and tailors staffing levels to airports' needs, (2) TSA monitors wait times and throughput and adjusts resources accordingly, and (3) TSA shares information with stakeholders about staffing and related screening procedures at airports. GAO reviewed TSA documentation describing how the agency modifies staffing assumptions and manages stakeholder coordination. GAO also analyzed passenger wait time and throughput data from January 2015 through May 2017 for the 28 airports monitored by headquarters. GAO visited eight airports selected on the basis of passenger volume and other factors and interviewed TSA officials and stakeholders at those locations.
GAO is not making any recommendations.

What GAO Found

The Transportation Security Administration (TSA) modifies staffing assumptions used in its computer-based staffing model (model) and tailors staffing levels to individual airport needs. Specifically, TSA works with a contractor annually to evaluate the assumptions used in the model and modifies the model's assumptions as needed. For example, TSA adjusted its model after contractor evaluations conducted in fiscal years 2016 and 2017 found that transportation security officers (TSO) needed more time to screen passengers and their baggage when using one type of screening equipment. Moreover, in 2016, TSA began using forecasts on the number of passengers screened at each airport's checkpoints (throughput) to better allocate staff commensurate with the expected rate of increase in passenger throughput at each airport. Furthermore, prompted by the long wait times at some airports in 2016, for the 2017 model TSA officials used actual expedited screening data, specific to each individual airport, rather than relying on the system-wide estimate used in 2016. TSA officials also use other information specific to each airport—such as staff training needs—to further tailor the TSO allocation because the initial allocation resulting from the model does not reflect the full range of operating conditions at individual airports.
TSA uses data to monitor passenger wait times and throughput on a daily basis and responds to increases. For example, TSA's Airport Operations Center (AOC) monitors daily wait times and passenger throughput from 28 airports that TSA officials say represent the majority of passenger throughput nationwide or are operationally significant. Furthermore, TSA officials at airports are required to report to the AOC when an event occurs—such as equipment malfunctions—that affects airport screening operations and results in wait times that are greater than 30 minutes in standard screening lanes. GAO analyzed wait time data for the AOC-monitored airports for the period of January 2015 through May 2017 and found that TSA's reported wait times met its standard of less than 30 minutes in standard screening 99 percent of the time. Within that time frame, two airports accounted for the longest wait times in the spring of 2016. TSA officials identified several tools, such as passenger screening canines, that they use to respond to increases in passenger wait times at these airports.
TSA has taken steps to improve information sharing with airline and airport officials (stakeholders) about staffing and related airport screening operations, and most stakeholders GAO interviewed reported improved satisfaction with information sharing. However, some stakeholders noted differences in the type and extent of information shared. According to TSA officials, stakeholders can elevate any problems they experience with information sharing within TSA to ensure information is shared regularly with stakeholders.


Question:
Why GAO Did This Study

To address concerns with the current Medicare FFS cost-sharing design, various groups have proposed modernizing the design to make it simpler and include features found in private plans. These proposals have generally included a single deductible, modified cost-sharing requirements (e.g., a uniform coinsurance), and the addition of a cap on beneficiaries' annual cost-sharing responsibilities.
GAO was asked to review how modernized cost-sharing designs would affect beneficiaries' costs over multiple years. This report describes implications of the current cost-sharing design; options for modernizing; and how modernized cost-sharing designs could directly and indirectly affect beneficiaries' costs.
GAO reviewed studies related to modernizing Medicare's cost-sharing design and interviewed authors of those studies and other experts. GAO also used summarized Medicare claims data from 2007 to 2014 (the most recent data available) to develop four illustrative modernized designs, each including a single deductible, uniform coinsurance, and an annual cap while maintaining Medicare program spending similar to the current design. For each design, GAO calculated how beneficiaries' annual cost-sharing responsibilities compared with the current design over a 1-, 4-, and 8-year time horizon.
The Department of Health and Human Services provided technical comments on a draft of this report, which GAO incorporated as appropriate.

What GAO Found

GAO and others have raised concerns about the design of Medicare fee-for-service (FFS) cost-sharing—the portion of costs beneficiaries are responsible for when they receive care. The current cost-sharing design has been largely unchanged since Medicare's enactment in 1965, can be confusing for beneficiaries, and can contribute to overuse of services. Additionally, the design leaves some beneficiaries exposed to catastrophic costs that can exceed tens of thousands of dollars annually. The complexity of the design and lack of an annual cap on cost-sharing responsibilities also increases demand for supplemental insurance, which can cost beneficiaries thousands annually and further contribute to overuse of services.
Modernizing Medicare FFS's cost-sharing design to include features found in private plans could help address these concerns, but would involve design trade-offs. For example, adding an annual cap on cost-sharing responsibilities while maintaining Medicare's aggregate share of costs similar to the current design would involve a trade-off between the level of the cap and other cost-sharing requirements.
In analyzing four illustrative FFS cost-sharing designs, GAO found that the direct effect of modernizing the design on beneficiaries' cost-sharing responsibilities—that is, the effect when holding utilization and enrollment constant—would depend on the specific revisions and the time horizon examined. For example, GAO found that
During year 1, cost-sharing designs that feature relatively low deductibles (costs a beneficiary is responsible for before Medicare starts to pay) and relatively high caps would result in a median annual beneficiary cost-sharing responsibility close to or below that of the current design. In contrast, designs with relatively low caps—and therefore greater beneficiary protection from catastrophic costs—would result in a median annual cost-sharing responsibility above that of the current design.
By the end of 8 years, there would still be differences in the median annual beneficiary cost-sharing responsibility across different designs, but they would become less pronounced.
Modernizing the Medicare FFS cost-sharing design would also affect beneficiaries' costs indirectly through altered incentives. The studies GAO reviewed and experts GAO interviewed identified several types of behavioral responses that would influence the net effect of a modernized design on beneficiaries' out-of-pocket costs, including changes in beneficiaries' demand for and insurers' supply of supplemental insurance; changes in beneficiaries' use of services; changes in Medicare beneficiaries' enrollment in FFS versus Medicare's private plan alternative; and interactions among these and other behavioral responses, including effects on the price of supplemental insurance.


Question:
Why GAO Did This Study

Veterans suffer a disproportionately higher rate of suicide than the civilian population. VA has estimated that an average of 20 veterans die by suicide per day, and in 2018, VA identified suicide prevention as its highest clinical priority. VHA's suicide prevention media outreach campaign—its collective suicide prevention outreach activities—helps raise awareness among veterans and others in the community about suicide prevention resources. VHA has contracted with an outside vendor to develop suicide prevention media outreach content.
GAO was asked to examine VHA's suicide prevention media outreach campaign. This report examines the extent to which VHA (1) conducts activities for its suicide prevention media outreach campaign, and (2) evaluates the effectiveness of its campaign. GAO reviewed relevant VHA documents and data on the amount, type, and cost of suicide prevention outreach activities since fiscal year 2013. GAO also reviewed VHA's contract for developing suicide prevention outreach content and interviewed VA and VHA officials.

What GAO Found

The Department of Veterans Affairs' (VA) Veterans Health Administration (VHA) conducts national suicide prevention media outreach on various platforms to raise awareness about VHA's suicide prevention resources. The primary focus of this campaign since 2010 has been to raise awareness of the Veterans Crisis Line (VCL), VHA's national hotline established in 2007 to provide support to veterans in emotional crisis. GAO found that VHA's suicide prevention media outreach activities declined in recent years due to leadership turnover and reorganization. For example, the amount of suicide prevention content developed by VHA's contractor for social media decreased in fiscal years 2017 and the first 10 months of 2018 after increasing in each of the 4 prior years.
VHA officials reported not having leadership available for a period of time to make decisions about the suicide prevention media outreach campaign. GAO found that VHA did not assign key leadership responsibilities or establish clear lines of reporting, and as a result, its ability to oversee the outreach campaign was hindered. Consequently, VHA may not be maximizing its reach with suicide prevention media content to veterans, especially those who are at-risk.
VHA evaluates the effectiveness of its suicide prevention media outreach campaign by collecting data on metrics, such as the number of people that visit the VCL website. However, VHA has not established targets for the majority of these metrics. Officials said they have not established targets because, apart from one industry-wide target they use, they lack meaningful targets for evaluating the campaign. However, VHA could use information about how its metrics performed in the past to develop reasonable and meaningful targets for future performance. Without established targets for its metrics, VHA is missing an opportunity to better evaluate the effectiveness of its suicide prevention media outreach campaign.

What GAO Recommends

VHA should (1) establish an approach to oversee its suicide prevention media outreach campaign that includes clear delineation of roles and responsibilities, and (2) establish targets for its metrics to improve evaluation efforts. VA concurred with GAO's recommendations and described steps it will take to implement them.


Question:
Why GAO Did This Study

The number of vehicles affected by safety defect recalls increased sharply in recent years—from nearly 13 million in 2011 to over 51 million in 2016. Once a defect is identified, auto manufacturers are required to send written notification to vehicle owners by mail. NHTSA also aims to enhance awareness of auto recalls by providing information on its website, NHTSA.gov .
The Fixing America's Surface Transportation Act includes a provision requiring GAO to study the use of publicly available safety recall information. This report addresses: (1) how consumers and industry stakeholders use such information and (2) how easy to use do consumers find the auto recall areas of NHTSA.gov, among other objectives. To understand consumers' use of auto recall information and to test website usability, GAO conducted 12 focus groups with 94 consumers who had a recall. Focus groups were held in six locations selected for population and geographic variation. GAO identified key website usability practices and requested an evaluation by website usability professionals. GAO reviewed statutes, regulations, and NHTSA documents, and interviewed industry stakeholders—including 10 manufacturers selected based on sales market share and other factors.

What GAO Found

Consumers, manufacturers, and auto dealers use publicly available auto recall information differently. For example, the 94 consumers in 12 focus groups that GAO conducted used this information to decide whether to repair their vehicles. These consumers overwhelmingly cited safety risk and convenience as the two most influential factors they considered. Most consumers reported a preference for receiving recall notification by at least one electronic means, such as by e-mail or text message, in addition to mail. However, only 7 of 94 consumers reported receiving electronic notifications, suggesting a gap between the industry's auto recall notification practices and consumers' preferences. (See fig.). In response to a mandate in law, in September 2016, the National Highway Traffic Safety Administration (NHTSA) issued a proposed rule that, if finalized, would require manufacturers to notify consumers about auto recalls by electronic means in addition to mail.
Most consumers in GAO's focus group website usability tests found the auto recall areas of NHTSA's website—NHTSA.gov—easy to use; however, some consumers experienced difficulties when asked to complete auto recall related tasks. For example, when consumers attempted to search for recalls affecting their specific vehicles, some found the search results confusing, leading them to question the accuracy of the results. Similarly, some consumers were hampered in searching for recalls by their vehicles' year, make, and model because the website did not always display model options using plain language. GAO found that the auto recall areas of NHTSA.gov do not always reflect federal and industry key website usability practices, and that an independent evaluation conducted by website usability professionals at GAO's request identified similar issues. NHTSA is in the process of consolidating its websites and plans to conduct a website usability study of NHTSA.gov with consumers after the consolidation is complete. However, the agency has not determined a completion date for the consolidation effort—an essential step for organizations to effectively guide their information technology efforts. Without establishing a completion date and taking interim steps to improve the usability of NHTSA.gov, consumers will likely continue to experience difficulties, which may limit the effectiveness of the website's primary means of providing consumers with information about recalls affecting their vehicles.

What GAO Recommends

GAO recommends that NHTSA determine a completion date for its website consolidation effort and take interim steps to improve the usability of NHTSA.gov by addressing the website usability difficulties GAO identified. The Department of Transportation concurred with the recommendations.


Question:
Why GAO Did This Study

Coal accounts for 17 percent of domestic energy production. SMCRA requires coal mine operators to reclaim lands that were disturbed during mining and to submit a financial assurance in an amount sufficient to ensure that adequate funds will be available to complete reclamation if the operator does not do so. Recent coal company bankruptcies have drawn attention to whether financial assurances obtained by OSMRE and state agencies will be adequate to reclaim land once coal mining operations have ceased.
GAO was asked to review management of financial assurances for coal mine reclamation. This report describes, among other things, the amounts and types of financial assurances held for coal mine reclamation in 2017 and the challenges that OSMRE and state agencies face in managing these financial assurances. GAO collected and analyzed data from OSMRE and 23 state agencies; reviewed federal laws, regulations, and directives; and interviewed OSMRE and state agency officials and representatives from organizations associated with the mining and financial assurance industries and environmental organizations.

What GAO Found

State agencies and the Department of the Interior's Office of Surface Mining Reclamation and Enforcement (OSMRE) reported holding approximately $10.2 billion in surety bonds (guaranteed by a third party), collateral bonds (guaranteed by a tangible asset, such as a certificate of deposit), and self-bonds (guaranteed on the basis of a coal operator's own finances) as financial assurances for coal mine reclamation.
OSMRE and state agencies face several challenges in managing financial assurances, according to the stakeholders GAO interviewed. Specifically,
Obtaining additional financial assurances from operators for unanticipated reclamation costs, such as long-term treatment for water pollution, can be difficult.
Determining the financial stability of surety companies has been challenging in certain instances.
Self-bonding presents a risk to the government because it is difficult to (1) ascertain the financial health of an operator, (2) determine whether the operator qualifies for self-bonding, and (3) obtain a replacement for existing self-bonds when an operator no longer qualifies. In addition, some stakeholders said that the risk from self-bonding is greater now than when the practice was first authorized under the Surface Mining Control and Reclamation Act (SMCRA).
GAO's previous work examining environmental cleanup found that the financial risk to government and the amount of oversight needed for self-bonds are relatively high compared to other forms of financial assurances. GAO also previously reviewed federal financial assurance requirements for various energy and mineral extraction sectors and found that coal mining is the only one where self-bonding was allowed. However, because SMCRA explicitly allows states to decide whether to accept self-bonds, eliminating the risk that self-bonds pose to the federal government and states would require SMCRA be amended.

What GAO Recommends

GAO recommends that Congress consider amending SMCRA to eliminate self-bonding. Interior neither agreed nor disagreed with GAO's recommendation.


Question:
Why GAO Did This Study

In fiscal year 2016, VHA's 733 CBOCs provided care to more than 3 million veterans at a cost of $5.3 billion. Although most of these clinics are VHA-owned and -operated, 101 are operated through contracts with non-VHA organizations. VHA policy states that CBOCs, whether VHA-operated or contracted, must provide one standard of care that is of high quality.
GAO was asked to review VHA's use of contracts to carry out core functions. This report examines, among other issues, the extent to which VHA oversees CBOC operations.
To conduct this work, GAO reviewed VHA's policies and CBOC Report. GAO also interviewed officials from VHA's central office and from a nongeneralizable sample of eight CBOCs and their four respective VAMCs and VISNs. The CBOCs were selected for variation in factors such as contract status and geographic area.

What GAO Found

Community-based outpatient clinics (CBOC) are an important part of the Department of Veterans Affairs' (VA) Veterans Health Administration (VHA) health care delivery system. These clinics are geographically separate from VA medical centers (VAMC) and provide outpatient services, including primary care and mental health care. GAO found weaknesses in VHA's oversight of CBOCs:
Incomplete policy implementation. VHA has not implemented certain CBOC oversight requirements as outlined in its policy. Specifically, VHA has not developed guidelines for monitoring the quality and comprehensiveness of care in CBOCs and officials said they have no plans to do so. Officials told GAO they believe the requirement was met as part of their regular oversight of Veterans Integrated Service Networks (VISN)—regional networks responsible for oversight of VAMCs and CBOCs. However, VHA may miss CBOC performance problems that are not identifiable in VISN-level data. Further, although policy requires VHA central office officials to review CBOC performance as part of quarterly VISN performance reviews, officials said they do not specifically do so unless the VISN identifies a problem. Officials from three of the four VISNs in GAO's review said they largely delegate CBOC oversight to VAMCs, and do not separately review clinic performance unless a VAMC identifies a problem.
An inaccurate and incomplete CBOC Report. VHA's CBOC Report is prepared by VHA central office and distributed to VISNs and VAMCs quarterly and at year-end. The CBOC Report could be useful to compare clinical quality of care between VHA-operated and contracted CBOCs, but it is inaccurate and incomplete. Specifically, VHA officials have used their judgment to classify certain sites as CBOCs in the report, rather than use the official classifications in policy. GAO found that 22 percent of sites were incorrectly classified as CBOCs when they were other types of sites, including VAMCs. As a result, the report is of limited usefulness to VHA as an oversight tool.
Lack of guidance or training on the CBOC Report. VHA central office officials do not provide guidance or training specific to understanding the CBOC Report to assist VISNs and VAMCs in their oversight of CBOCs. GAO found that in several places in the report, shorthand text and acronyms were used, but not defined. In addition, several VISN and VAMC officials stated that guidance or training would be helpful.
No requirement to use the CBOC Report. VHA officials told GAO that VAMCs and VISNs are expected to use the CBOC Report as an oversight tool, but GAO found that VHA lacks a requirement that they do so. Officials from three of the four VISNs and three of the four VAMCs in GAO's review were not using the report.
These weaknesses potentially lead to inconsistent oversight and create a risk that VHA is not providing one standard of care that is of high quality to veterans across VHA-operated and contracted CBOCs.

What GAO Recommends

GAO recommends that VHA (1) implement oversight requirements that align with existing policy; (2) establish a process to ensure the CBOC Report is accurate and complete; (3) provide guidance or training to VISNs and VAMCs on how to use the CBOC Report; and (4) require use of the CBOC Report as an oversight tool. VA concurred with all of GAO's recommendations and identified actions it is taking to implement them.


Question:
Why GAO Did This Study

NASA is undertaking a trio of closely related programs to continue human space exploration beyond low-Earth orbit. All three programs (SLS, Orion, and EGS) are working toward a launch readiness date of no earlier than October 2019 for the first test flight. Each program is a complex technical and programmatic endeavor. Because all three programs must work together for launch, NASA must integrate the hardware and software from the separate programs into a working system capable of meeting its goals for deep space exploration.
The House Committee on Appropriations report accompanying H.R. 2578 included a provision for GAO to assess the progress of NASA's human space exploration programs. This report assesses (1) the benefits and challenges of NASA's approach for integrating these three programs and (2) the extent to which cross-program risks could affect launch readiness. GAO examined NASA policies, the results of design reviews, risk data, and other program documentation and interviewed NASA and other officials.

What GAO Found

The approach that the National Aeronautics and Space Administration (NASA) is using to integrate its three human spaceflight programs into one system ready for launch offers some benefits, but it also introduces oversight challenges. To manage and integrate the three programs—the Space Launch System (SLS) vehicle; the Orion crew capsule; and supporting ground systems (EGS)—NASA's Exploration Systems Development (ESD) organization is using a more streamlined approach than has been used with other programs, and officials GAO spoke with believe that this approach provides cost savings and greater efficiency. However, GAO found two key challenges to the approach:
The approach makes it difficult to assess progress against cost and schedule baselines. SLS and EGS are baselined only to the first test flight. In May 2014, GAO recommended that NASA baseline the programs' cost and schedule beyond the first test flight. NASA has not implemented these recommendations nor does it plan to; hence, it is contractually obligating billions of dollars for capabilities for the second flight and beyond without establishing baselines necessary to measure program performance.
The approach has dual-hatted positions, with individuals in two programmatic engineering and safety roles also performing oversight of those areas. As the image below shows, this presents an environment of competing interests.
These dual roles subject the technical authorities to cost and schedule pressures that potentially impair their independence. The Columbia Accident Investigation Board found in 2003 that this type of tenuous balance between programmatic and technical pressures was a contributing factor to that Space Shuttle accident.
NASA has lowered its overall cross-program risk posture over the past 2 years, but risk areas—related to software development and verification and validation, which are critical to ensuring the integrated body works as expected—remain. For example, delays and content deferral in Orion and SLS software development continue to affect ground systems software development and could delay launch readiness. GAO will continue to monitor these risks.

What GAO Recommends

Congress should consider directing NASA to establish baselines for SLS and EGS's missions beyond the first test flight. NASA's ESD organization should no longer dual-hat officials with programmatic and technical authority responsibilities. NASA partially concurred with our recommendation and plans to address it in the next year. But NASA did not address the need for the technical authority to be independent from programmatic responsibilities for cost and schedule. GAO continues to believe that this component of the recommendation is critical.


Question:
Why GAO Did This Study

The threat posed by the proliferation of nuclear and radiological weapons remains a pressing national security challenge. DNN implements nuclear nonproliferation programs worldwide. To carry out its mission, for fiscal year 2018 DNN requested an appropriation of about $1.5 billion for its 4 major programs and their 13 subprograms.
A House Armed Services Committee report, accompanying a bill for the National Defense Authorization Act for Fiscal Year 2017, included a provision for GAO to review and assess DNN's project and program management processes and systems. GAO's report examines the extent to which (1) selected DNN subprograms use program management leading practices to manage schedule and cost (2) DNN has incorporated leading practices in its revised program management policy.
GAO selected 4 DNN subprograms to review that had defined end dates and/or work scope and that GAO had not recently examined. GAO reviewed documentation on DNN and NNSA's program management policies and practices; reviewed selected leading practices published by PMI and GAO; and interviewed agency officials.

What GAO Found

The 4 selected subprograms from the National Nuclear Security Administration's (NNSA) Office of Defense Nuclear Nonproliferation (DNN) GAO reviewed generally do not use selected program management leading practices to manage schedule and cost. According to generally recognized leading practices from the Project Management Institute (PMI) and GAO, programs should (1) establish schedules necessary to achieve the program's goal, (2) establish life-cycle cost estimates, and (3) measure performance against schedule and cost baselines. However, none of the DNN subprograms have schedule and cost estimates covering their planned life cycles and none measure performance against schedule and cost baselines. The following figure illustrates the extent to which the selected subprograms have established schedule and cost estimates compared to their planned life cycles.
NNSA officials said that the subprograms do not have schedules and cost estimates that cover their life cycles and do not measure performance against baselines, in part, because DNN management does not require such estimates or baseline measurements.
The lack of a requirement is consistent with the limitations in DNN's revised program management policy, which does not address leading practices on establishing schedule estimates, estimating life-cycle costs, and measuring against such baselines. According to leading practices, in developing schedule and cost estimates a program should define assumptions tailored to the program such as its life-cycle phases. Updating the DNN policy to include requirements and guidance on cost estimating and tracking performance against schedule and cost baselines could help ensure that NNSA managers and Congress have better information on how much DNN programs and subprograms may cost, the time they may need to achieve their goals, and how effectively they are being executed compared to plans.

What GAO Recommends

GAO recommends that DNN revise its program management policy to require DNN programs and subprograms to follow life-cycle program management, such as requiring life-cycle estimates and measuring against baselines. NNSA neither agreed nor disagreed with the recommendation but plans to take action to revise its policy.


Question:
Why GAO Did This Study

“Got milk?” and “Pork: The Other White Meat” are examples of advertising campaigns undertaken by 2 of the 22 federal agricultural research and promotion programs, commonly known as commodity check-off programs. These programs, funded by a fraction of the sale of each unit of a commodity, are led by boards consisting of industry members appointed by the Secretary of Agriculture. The programs conduct research and promotion activities to strengthen a commodity's position in the market. In 2016, check-off funds totaled over $885 million. By law, funds cannot be used for lobbying or disparaging other commodities, among other things. AMS has primary responsibility for overseeing the check-off programs.
GAO was asked to review AMS's oversight of the check-off programs. This report examines (1) the extent to which AMS has addressed previously identified weaknesses in its oversight and (2) how the effectiveness of the programs has been evaluated and what the results have indicated. GAO selected a sample of 8 such programs—selected, in part, based on total funds collected—and reviewed laws, regulations, and agency guidance. GAO interviewed agency officials, check-off board executives, and economists.

What GAO Found

The U.S. Department of Agriculture's (USDA) Agricultural Marketing Service (AMS) has improved its oversight of check-off programs since USDA's Office of Inspector General (OIG) made recommendations in a 2012 report. In response to two OIG recommendations, AMS developed and implemented standard operating procedures, which outline specific oversight responsibilities of AMS, and began to conduct internal reviews of its oversight functions. However, GAO found that AMS does not consistently review subcontracts—a legal agreement between a contractor and third party—or ensure that certain documents are shared with stakeholders on program websites.
Subcontracts. Under AMS's 2015 guidelines for check-off programs, which cover broad oversight activities, staff are to review a sample of subcontracts during agency reviews of program operations. However, AMS did not revise its standard operating procedures to match its guidelines with this responsibility, and GAO found that AMS reviewed subcontracts for only one check-off program in its sample of eight. Without revising the standard operating procedures to include a review of subcontracts, AMS's ability to prevent misuse of funds is impaired.
Transparency. According to leading business principles, transparency is central to stakeholders' access to regular, reliable, and comparable information. However, GAO found that four of the eight check-off programs reviewed posted all key documents, such as budget summaries and evaluations of effectiveness, to program websites. GAO found that AMS's guidelines state that budget summaries should be posted on program websites, while the other key documents are to be available on the website or otherwise made available to stakeholders. Agency officials said that boards would supply documentation if contacted by a stakeholder. Industry representatives GAO interviewed said that transparency of how funds are used and the effectiveness of programs are important to their members. Without including in its guidelines and standard operating procedures that all key documents should be posted on a check-off program's website, AMS may miss an opportunity to ensure that stakeholders have access to information on program operations and effectiveness.
Independent economic evaluations of the effectiveness of check-off programs, required by law to be conducted every 5 years, have generally shown positive financial benefits. For the eight evaluations GAO reviewed, benefits ranged from an average of $2.14 to $17.40 for every dollar invested in the programs. However, the evaluations varied in the methods used and had certain methodological limitations. For example, some evaluations did not account for the effects of promotion from competing commodities, which could overstate the programs' benefits. AMS's standard operating procedures state that the agency should review the evaluations to ensure that there is a credible methodology, among other things; however, AMS did not consistently document reviews of the evaluations or have criteria by which to review the evaluations. Without developing criteria to assess the methodology and results of evaluations, the agency's assessments of independent economic evaluations may be inconsistent across check-off programs and misleading to stakeholders.

What GAO Recommends

GAO is making five recommendations, including that USDA revise its standard operating procedures to include the review of subcontracts, include key documents on check-off program websites, and develop criteria to assess evaluations. USDA generally agreed with GAO's recommendations.


Question:
Why GAO Did This Study

VHA operates one of the largest health care delivery systems in the nation, serving over 9 million enrolled veterans. In providing health care services to veterans, VAMCs use RME which must be reprocessed—that is, cleaned, disinfected, or sterilized—between uses. Improper reprocessing of RME can negatively affect patient care. To help ensure the safety of veterans, VHA policy establishes requirements VAMCs must follow when reprocessing RME and requires a number of related oversight efforts.
GAO was asked to review VHA's reprocessing of RME. This report examines (1) VHA's oversight of VAMCs' adherence to RME policies and (2) challenges VAMCs face in operating their Sterile Processing Services programs, and any efforts by VHA to address these challenges. GAO reviewed relevant VHA documents including RME policies and VISN inspection results for fiscal year 2017. GAO interviewed officials from VHA, all 18 VISNs, and four VAMCs, selected based on geographic variation, VAMC complexity, and data on operating room delays. GAO examined VHA's oversight in the context of federal internal control standards on communication, monitoring, and information.

What GAO Found

GAO found that the Department of Veterans Affairs' (VA) Veterans Health Administration (VHA) does not have reasonable assurance that VA Medical Centers (VAMC) are following policies related to reprocessing reusable medical equipment (RME). Reprocessing involves cleaning, sterilizing, and storing surgical instruments and other RME, such as endoscopes. VHA has not ensured that all VAMCs' RME inspections have been conducted because it has incomplete information from the annual inspections by Veterans Integrated Service Networks (VISN), which oversee VAMCs. For fiscal year 2017, VHA did not have 39 of the 144 VISN reports from the VISNs' inspections of their VAMCs' Sterile Processing Services departments. VISNs were able to provide GAO with evidence that they had conducted 27 of the 39 missing inspections; top areas of non-adherence in these inspections were related to quality and training, among other things. Although VHA has ultimate oversight responsibility, a VHA official told GAO that VHA had not been aware it lacked complete inspection results because it has largely relied on the VISNs to ensure complete inspection result reporting. Without analyzing and sharing complete information from inspections, VHA does not have assurance that its VAMCs are following RME policies designed to ensure that veterans receive safe care.
GAO also found that VAMCs face challenges operating their Sterile Processing Services programs—notably, addressing workforce needs. Almost all of the officials from all 18 VISNs and selected VAMCs GAO interviewed reported Sterile Processing Services workforce challenges, such as lengthy hiring timeframes and limited pay and professional growth potential. According to officials, these challenges result in programs having difficulty maintaining sufficient staffing. VHA officials told GAO that the office is considering studying Sterile Processing Services staffing at VAMCs, although VHA does not have definitive plans to do so. VHA's Sterile Processing Services workforce challenges pose a potential risk to VAMCs' ability to ensure access to sterilized medical equipment, and VHA's failure to address this risk is inconsistent with standards for internal control in the federal government. Until VHA examines these workforce needs, VHA won't know whether or to what extent the reported challenges adversely affect VAMCs' ability to effectively operate their Sterile Processing Services programs and ensure access to safe care for veterans.

What GAO Recommends

GAO is making three recommendations to VHA, including that it ensure all RME inspections are being conducted and complete results reported, and that it examine Sterile Processing Services workforce needs and make adjustments, as appropriate. VA concurred with these recommendations.


Question:
Why GAO Did This Study

The federal government spends tens of billions of dollars each year on IT products and services. Competition is a key component to achieving the best return on investment for taxpayers. Federal acquisition regulations allow for noncompetitive contracts in certain circumstances. Some noncompetitive contracts act as “bridge contracts”—which can be a useful tool to avoid a lapse in service but can also increase the risk of the government overpaying. There is currently no government-wide definition of bridge contracts.
GAO was asked to review the federal government's use of noncompetitive contracts for IT. This report examines (1) the extent that agencies used noncompetitive contracts for IT, (2) the reasons for using noncompetitive contracts for selected IT procurements, (3) the extent to which IT procurements at selected agencies were bridge contracts, and (4) the extent to which IT procurements were in support of legacy systems. GAO analyzed FPDS-NG data from fiscal years 2013 through 2017 (the most recent and complete data available). GAO developed a generalizable sample of 171 fiscal year 2016 noncompetitive IT contracts and orders awarded by DOD, DHS, and HHS—the agencies with the most spending on IT, to determine the reasons for using noncompetitive contracts and orders, and the extent to which these were bridge contracts or supported legacy systems.

What GAO Found

From fiscal years 2013 through 2017, federal agencies reported obligating more than $15 billion per year, or about 30 percent, of information technology (IT) contract spending on a noncompetitive basis (see figure).
GAO found, however, that Departments of Defense (DOD), Homeland Security (DHS), and Health and Human Services (HHS) contracting officials misreported competition data in the Federal Procurement Data System-Next Generation (FPDS-NG) for 22 of the 41 orders GAO reviewed. GAO's findings call into question competition data associated with nearly $3 billion in annual obligations for IT-related orders. DHS identified underlying issues resulting in the errors for its orders and took corrective action. DOD and HHS, however, had limited insight into why the errors occurred. Without identifying the issues contributing to the errors, DOD and HHS are unable to take action to ensure that competition data are accurately recorded in the future, and are at risk of using inaccurate information to assess whether they are achieving their competition objectives.
GAO found that DOD, DHS, and HHS primarily cited two reasons for awarding a noncompetitive contract or order: (1) only one source could meet the need (for example, the contractor owned proprietary technical or data rights) or (2) the agency awarded the contract to a small business to help meet agency goals.
GAO estimates that about 8 percent of 2016 noncompetitive IT contracts and orders at DOD, DHS, and HHS were bridge contracts, awarded in part because of acquisition planning challenges. GAO previously recommended that the Office of Federal Procurement Policy define bridge contracts and provide guidance on their use, but it has not yet done so. GAO believes that addressing this recommendation will help agencies better manage their use of bridge contracts.
Additionally, GAO estimates that about 7 percent of noncompetitive IT contracts and orders were used to support outdated or obsolete legacy IT systems. Officials from the agencies GAO reviewed stated these systems are needed for their mission or that they are in the process of modernizing the legacy systems or buying new systems.

What GAO Recommends

GAO recommended DOD and HHS identify the reasons why competition data for certain orders in FPDS-NG were misreported and take corrective action. DOD and HHS concurred.


Question:
Why GAO Did This Study

Federal agencies use heavy equipment such as cranes and forklifts to carry out their missions, but there is no government-wide data on federal agencies' acquisition or management of this equipment.
GAO was asked to review federal agencies' management of heavy equipment. This report, among other objectives, examines: (1) the number, type, and costs of heavy equipment items that are owned by 20 federal agencies and (2) the heavy equipment that selected agencies recently acquired as well as how they decided whether to purchase or lease this equipment.
GAO collected heavy equipment inventory data as of June 2017 from the 24 agencies that have chief financial officers responsible for overseeing financial management. GAO also selected three agencies (using factors such as the heavy equipment fleet's size) and reviewed their acquisitions of and guidance on heavy equipment. These agencies' practices are not generalizable to all acquisitions but provide insight into what efforts these agencies take to acquire thousands of heavy equipment items. GAO also interviewed officials at the three selected agencies.

What GAO Found

Of the 24 agencies GAO reviewed, 20 reported owning over 136,000 heavy equipment items such as cranes, backhoes, and forklifts, and spending over $7.4 billion (in 2016 dollars) to acquire this equipment. The remaining 4 agencies reported that they do not own any heavy equipment.
The three selected agencies GAO reviewed in-depth—the Air Force within the Department of Defense (DOD), and the Fish and Wildlife Service and the National Park Service within the Department of the Interior (Interior)—spent about $360 million to purchase about 3,500 heavy equipment assets in calendar years 2012 through 2016 and over $5 million to lease heavy equipment from fiscal years 2012 through 2016. Officials from all three agencies stated that they consider mission needs and the availability of equipment leases when deciding whether to lease or purchase heavy equipment. Federal regulations provide that agencies should consider whether it is more economical to lease or purchase equipment when acquiring heavy equipment, and federal internal control standards require that management clearly document all transactions in a manner that allows the documentation to be readily available for examination. However, in reviewing selected leases and purchases of heavy equipment from these three agencies, GAO found that officials did not consistently conduct or document lease-versus-purchase analyses. Officials at the Air Force and Interior said that there was a lack of clarity in agency policies about when they were required to conduct and document such analyses. Without greater clarity on when lease-versus-purchase analyses should be conducted and documented, these agencies may not be spending funds on heavy equipment effectively.

What GAO Recommends

The Department of the Interior and the Air Force should clarify the circumstances in which lease-versus-purchases analyses for heavy equipment acquisitions are to be conducted and documented. The Departments of the Interior and Defense concurred with these recommendations.


Question:
Why GAO Did This Study

DOD requested about $60 billion for fiscal years 2009 - 2017 to purchase goods and services overseas and reimburse service-members for costs incurred while stationed abroad. DOD uses foreign currency exchange rates to budget and pay (that is, disburse amounts) for these expenses. It also manages the FCFD account to mitigate a loss in buying power that results from foreign currency rate changes.
GAO was asked to examine DOD's processes to budget for and manage foreign currency fluctuations. This report (1) describes DOD's revision of its foreign currency budget rates since 2009 and the relationship between the revised rates and projected O&M and MILPERS funding needs; (2) evaluates the extent to which DOD has taken steps to reduce costs in selecting foreign currency rates to disburse funds to liquidate O&M obligations, and determined whether opportunities exist to gain additional savings; and (3) assesses the extent to which DOD has effectively managed the FCFD account balance. GAO analyzed data on foreign currency rates, DOD financial management regulations, a non-generalizable sample of foreign currency disbursement data, and FCFD account balances.

What GAO Found

The Department of Defense (DOD) revised its foreign currency exchange rates (“budget rates”) during fiscal years 2014 through 2016 for each of the nine foreign currencies it uses to develop its Operation and Maintenance (O&M) and Military Personnel (MILPERS) budget request. These revisions decreased DOD's projected O&M and MILPERS funding needs. DOD's revision of the budget rates during these years also decreased the expected gains (that is, buying power) that would have resulted from an increase in the strength of the U.S. Dollar relative to other foreign currencies. DOD did not revise its budget rates in fiscal years 2009 through 2013. For fiscal year 2017, DOD changed its methodology for producing budget rates, resulting in rates that were more closely aligned with market rates. According to officials, that change made it unnecessary to revise the budget rates during the fiscal year.
DOD has taken some steps to reduce costs in selecting foreign currency rates used to pay (that is, disburse amounts) for goods and services, but DOD has not fully determined whether opportunities exist to achieve additional savings. The Army has estimated potential savings of up to $10 million annually by using a foreign currency rate available 3 days in advance of paying for goods or services rather than a more costly rate available up to 5 days in advance. The Army has converted to the use of a 3-day advanced rate. GAO's analysis suggests that DOD could achieve cost savings if the services reviewed and consistently selected the most cost-effective foreign currency rates when paying for their goods and services. Absent a review, DOD is at risk for paying more than it would otherwise be required to conduct its transactions.
DOD used the Foreign Currency Fluctuations, Defense (FCFD) account to cover losses (that is, less buying power) due to unfavorable foreign currency fluctuations in 6 of the 8 years GAO reviewed. Since 2012, DOD has maintained the FCFD account balance at the statutory limit of $970 million, largely by transferring unobligated balances before they are cancelled from certain DOD accounts into the FCFD. However, DOD has not identified the appropriate FCFD account balance needed to maintain program operations by routinely analyzing projected losses and basing any transfers into the account on those expected losses. Thus, DOD may be maintaining balances that are hundreds of millions of dollars higher than needed, and that could have been used for other purposes or returned to the Treasury Department (see figure).

What GAO Recommends

GAO is making four recommendations, including that DOD review opportunities to achieve cost savings by more consistently selecting the most cost-effective foreign currency rates used for the payment of goods and services, and analyze projected losses to manage the FCFD account balance. DOD generally concurred with the recommendations.


Question:
Why GAO Did This Study

VA provides health care services to approximately 9 million veterans and their families and relies on its health information system—VistA—to do so. However, the system is more than 30 years old, is costly to maintain, and does not fully support exchanging health data with DOD and private health care providers. Over nearly 2 decades, VA has pursued multiple efforts to modernize the system. In June 2017, the department announced plans to acquire the same system—the Cerner system—that DOD is implementing. VA plans to continue using VistA during the decade-long transition to the Cerner system.
GAO was asked to review key aspects of VistA and VA's plans for the new acquisition of the Cerner system. The objectives of the review were to (1) determine the extent to which VA has defined VistA, (2) evaluate VA's annual costs to develop and sustain VistA, and (3) describe the actions VA has taken to transition from VistA to the Cerner system.
GAO analyzed documentation that defines aspects of VistA and identifies components to be replaced; evaluated the reliability of cost data, including obligations associated with the development and sustainment of VistA for fiscal years 2015, 2016, and 2017; and reviewed program documentation related to VA's program, governance, and plans to transition to Cerner.

What GAO Found

The Department of Veterans Affairs (VA) has various documents and a database that describe parts of the Veterans Health Information Systems and Technology Architecture (VistA); however, the department does not have a comprehensive definition for the system. For example, VA has identified components that comprise VistA, identified interfaces related to the system, and collected system user guides and installation manuals. VA has also conducted analyses to better understand customization of VistA components at various medical facilities. Nevertheless, the existing information and analyses do not provide a thorough understanding of the local customizations reflected in about 130 versions of VistA that support health care delivery at more than 1,500 sites. Program officials stated that they have not been able to fully define VistA due to the decentralization of the development of the system for more than 30 years. Cerner's contract to provide a new electronic health record system to VA calls for the company to conduct comprehensive assessments to identify site-specific requirements where its system is planned to be deployed. Three site assessments have been completed and additional assessments are planned. If these assessments provide a thorough understanding of the 130 VistA versions, the department should be able to define VistA and be better positioned to transition to the new system.
VA identified costs for VistA and its related activities adding up to approximately $913.7 million, $664.3 million, and $711.1 million in fiscal years 2015, 2016, and 2017, respectively—for a total of about $2.3 billion over the 3 years. However, of the $2.3 billion, the department was only able to demonstrate that approximately $1 billion of these costs were sufficiently reliable. In addition, the department omitted VistA-related costs from the total. The lack of a sufficiently reliable and comprehensive total cost for VistA is due in part to not following a well-documented methodology that describes how the department determined the costs for the system. As a result of incomplete cost data and data that could not be determined to be sufficiently reliable, the department, legislators, and the public do not have a complete understanding of how much it has cost to develop and maintain VistA. Further, VA lacks the information needed to make decisions on sustaining the many versions of the system.
VA has initiated a number of actions to prepare for the transition from VistA to the Cerner system. These actions include taking steps to establish and begin to staff a program office, forming a governance structure, conducting assessments at the initial sites, preparing program plans to guide the initial system implementation, and setting a program baseline to help guide implementation at the initial sites. The department's actions in these important areas are ongoing. Additional actions are in progress to address GAO's September 2018 recommendation that VA clearly define the role and responsibilities of the joint Department of Defense (DOD) and VA Interagency Program Office in the department's governance plans for the new electronic health record system. VA intends to continue maturing and fully establishing a program management organization and a program governance structure to track program progress.

What GAO Recommends

GAO is recommending that VA develop and implement a methodology for reliably identifying and reporting the total costs of VistA. VA agreed with the recommendation.


Question:
Why GAO Did This Study

The nation's critical infrastructure includes cyber and physical assets and systems across 16 different sectors whose security and resilience are vital to the nation. The majority of critical infrastructure is owned and operated by the private sector. Multiple federal entities, including DHS, work with infrastructure owners and operators to assess their risks.
GAO was asked to review DHS's risk assessment practices for critical infrastructure. This report describes:(1) DHS's risk assessment practices in 3 of 16 critical infrastructure sectors and private sector representatives' views on the utility of this risk information, and (2) how this risk information influences DHS's strategic planning and private sector outreach.
GAO selected 3 of 16 sectors–Critical Manufacturing; Nuclear Reactors, Materials, and Waste; and Transportation Systems–to examine based on their varied regulatory structures and industries. GAO reviewed DHS guidance related to infrastructure protection, the QHSR and DHS Strategic Plan, and plans for the selected critical infrastructure sectors. GAO interviewed DHS officials responsible for critical infrastructure risk assessments, and the owner and operator representatives who serve as chairs and vice-chairs of coordinating councils for the 3 selected sectors. Information from the 3 sectors is not generalizable to all 16 sectors but provides insight into DHS's risk management practices.
GAO provided a draft of this report to DHS and relevant excerpts to the council representatives interviewed during this review. Technical comments provided were incorporated as appropriate.

What GAO Found

The Department of Homeland Security (DHS) primarily conducts assessments for each of the three elements of risk—threat, vulnerability, and consequence—for critical infrastructures from the three sectors GAO reviewed—Critical Manufacturing; Nuclear Reactors, Materials, and Waste; and Transportation Systems. In limited circumstances, DHS generates risk assessments that both incorporate all three elements of risk and cover individual or multiple subsectors.
Threat : DHS's Office of Intelligence and Analysis assesses threats—natural or manmade occurrences, entities, or actions with the potential to cause harm, including terrorist attacks and cyberattacks—and disseminates this information to critical infrastructure owners and operators. For example, the Transportation Security Administration provides threat intelligence to mass transit security directors and others through joint classified briefings.
Vulnerability : DHS officials provide various tools and work directly with owners and operators to assess asset and facility vulnerabilities—physical features or operational attributes that render an asset open to exploitation, including gates, perimeter fences, and computer networks. For example, DHS officials conduct voluntary, asset-specific vulnerability assessments that focus on physical infrastructure during individual site visits.
Consequence : DHS officials also assess consequence— the effect of occurrences like terrorist attacks or hurricanes resulting in losses that impact areas such as public health and safety, and the economy—to better understand the effect of these disruptions on assets.
These assessments help critical infrastructure owners and operators take actions to improve security and mitigate risks. Six private sector representatives told GAO that threat information is the most useful type of risk information because it allows owners and operators to react immediately to improve their security posture. For example, one official from the Transportation Systems sector said that government threat information is credible and is critical in supporting security recommendations to company decision-makers.
DHS uses the results of its risk assessments to inform the department's strategic planning and to guide outreach to infrastructure owners and operators. Critical infrastructure risk information is considered within DHS's strategic planning. Specifically, according to DHS officials, risk information informs the Department's Quadrennial Homeland Security Review (QHSR)—a process that identifies DHS's critical homeland security missions and its strategy for meeting them. DHS also uses risk information to guide outreach to critical infrastructure owners and operators. For example, DHS officials annually prioritize the most critical assets and facilities nationwide and categorize them based on the severity of the estimated consequences of a significant disruption to the asset or facility. DHS officials then use the results to target their assessment outreach to the infrastructure owners and operators categorized as higher risk. DHS officials also told GAO that they use risk information after an incident, such as a natural disaster, to quickly identify and prioritize affected infrastructure owners and operators to help focus their response and recovery assistance outreach.


Question:
Why GAO Did This Study

The federal government plans to invest almost $96 billion in IT in fiscal year 2018. Historically, these investments have too often failed, incurred cost overruns and schedule slippages, or contributed little to mission-related outcomes. In December 2014, Congress and the President enacted FITARA, aimed at improving covered agencies' acquisitions of IT. Further, in February 2015, GAO added improving the management of IT acquisitions and operations across government to its high-risk list.
This statement summarizes agencies' progress in improving the management of IT acquisitions and operations. Among others, GAO summarized its published reports on (1) data center consolidation, (2) incremental software development practices, (3) IT acquisitions, (4) IT workforce, and (5) legacy IT.

What GAO Found

The Office of Management and Budget (OMB) and federal agencies have taken steps to improve the management of information technology (IT) acquisitions and operations through a series of initiatives, to include (1) data center consolidation, (2) implementation of incremental development practices, (3) approval of IT acquisitions, (4) implementation of key IT workforce practices, and (5) addressing aging legacy IT systems. As of March 2018, the agencies had fully implemented about 59 percent of the approximately 800 related recommendations that GAO made during fiscal years 2010 through 2015. However, important additional actions are needed.
Consolidating data centers . OMB launched an initiative in 2010 to reduce data centers, which was codified and expanded by a law commonly referred to as the Federal Information Technology Acquisition Reform Act (FITARA). GAO has since noted that, while this initiative could potentially save the government billions of dollars, weaknesses exist in areas such as optimization and OMB's reporting on related cost savings. Accordingly, GAO has made 160 recommendations to OMB and agencies to improve the initiative; however, about half of GAO's recommendations have not yet been implemented.
Implementing incremental development . OMB has emphasized the need for agencies to deliver investments in smaller increments to reduce risk and deliver capabilities more quickly. Further, GAO has issued reports highlighting actions needed by OMB and agencies to improve their implementation of incremental development. In these reports, GAO made 42 related recommendations, but the majority of GAO's recommendations have not yet been addressed.
Approval of IT acquisitions . OMB's FITARA implementation guidance required covered agencies' chief information officers (CIO) to review and approve IT acquisition plans. In January 2018, GAO reported that many agencies' CIOs were not reviewing and approving acquisition plans, as required by OMB. GAO made 39 recommendations to improve the review and approval of IT acquisitions, but they have not yet been implemented by the agencies.
Implementation of key IT workforce practices . Effective IT workforce planning can help agencies improve their ability to acquire IT. In November 2016, GAO reported on agencies' IT workforce planning activities. GAO noted that five selected agencies had not fully implemented key workforce planning activities and recommended that they do so, but the agencies have not yet addressed the recommendations.
Addressing aging legacy IT systems. Legacy IT investments across the federal government are becoming increasingly obsolete and consuming an increasing amount of IT dollars. In May 2016, GAO reported that many agencies were using systems which had components that were, in some cases, at least 50 years old. GAO noted, however, that several agencies did not have specific plans with time frames to modernize or replace these investments. GAO recommended that 12 agencies plan to modernize or replace legacy systems; all of which have not yet been implemented.

What GAO Recommends

From fiscal years 2010 through 2015, GAO made about 800 recommendations to OMB and federal agencies to address shortcomings in IT acquisitions and operations. Among other recommendations, GAO made recommendations to improve the oversight and execution of the data center consolidation initiative, incremental development policies, the review and approval of IT acquisitions, implementation of key workforce planning activities, and aging federal IT systems. Most agencies agreed with GAO's recommendations. In addition, from fiscal year 2016 to present, GAO has made more than 200 new recommendations in this area. GAO will continue to monitor agencies' implementation of these recommendations.


Question:
Why GAO Did This Study

Technology companies are a major source of high-paying U.S. jobs, but some have questioned the sector's commitment to equal employment opportunity. EEOC provides federal oversight of nondiscrimination requirements by investigating charges of discrimination, and OFCCP enforces federal contractors' compliance with affirmative action requirements. GAO was asked to review workforce trends in the technology sector and federal oversight.
This report examines (1) trends in the gender, racial, and ethnic composition of the technology sector workforce; and (2) EEOC and OFCCP oversight of technology companies' compliance with equal employment and affirmative action requirements. GAO analyzed workforce data from the American Community Survey for 2005-2015 and EEOC Employer Information Reports for 2007-2015, the latest data available during our analysis. GAO analyzed OFCCP data on compliance evaluations for fiscal years 2011-2016. GAO interviewed agency officials, researchers, and workforce, industry, and company representatives.

What GAO Found

The estimated percentage of minority technology workers increased from 2005 to 2015, but GAO found that no growth occurred for female and Black workers, whereas Asian and Hispanic workers made statistically significant increases (see figure). Further, female, Black, and Hispanic workers remain a smaller proportion of the technology workforce—mathematics, computing, and engineering occupations—compared to their representation in the general workforce. These groups have also been less represented among technology workers inside the technology sector than outside it. In contrast, Asian workers were more represented in these occupations than in the general workforce. Stakeholders and researchers GAO interviewed identified several factors that may have contributed to the lower representation of certain groups, such as fewer women and minorities graduating with technical degrees and company hiring and retention practices.
Both the U.S. Equal Employment Opportunity Commission (EEOC) and the Department of Labor's Office of Federal Contract Compliance Programs (OFCCP) have taken steps to enforce equal employment and affirmative action requirements in the technology sector, but face limitations. While EEOC has identified barriers to recruitment and hiring in the technology sector as a strategic priority, when EEOC conducts investigations, it does not systematically record the type of industry, therefore limiting sector-related analyses to help focus its efforts. EEOC has plans to determine how to add missing industry codes but has not set a timeframe to do this. In addition, OFCCP's regulations may hinder its ability to enforce contractors' compliance because OFCCP directs contractors to set placement goals for all minorities as a group rather than for specific racial/ethnic groups. OFCCP also has not made changes to its establishment-based approach to selecting entities for review in decades, even though changes have occurred in how workplaces are structured. Without taking steps to address these issues, OFCCP may miss opportunities to hold contractors responsible for complying with affirmative action and nondiscrimination requirements.

What GAO Recommends

GAO makes 6 recommendations, including that EEOC develop a timeline to improve industry data collection and OFCCP take steps toward requiring more specific minority placement goals by contractors and assess key aspects of its selection approach. EEOC neither agreed nor disagreed with its recommendation, and OFCCP stated the need for regulatory change to alter placement goal requirements. GAO continues to believe actions are needed, as discussed in the report.


Question:
Why GAO Did This Study

To achieve Medicare DME savings, Congress required CMS to implement a CBP in certain geographic areas for certain DME items. Beginning in 2011, CMS began implementing the CBP in several phases. The agency estimates that the CBP will save the Medicare program $19.7 billion between 2013 and 2022.The Patient Protection and Affordable Care Act required CMS to use CBP information to adjust fee-for-service payment rates for certain DME items in non-bid areas. On January 1, 2016, adjusted rates for 393 items went into effect in non-bid areas. CMS estimated these adjustments will save the Medicare program about $3.6 billion between fiscal years 2016 and 2020.
GAO was asked to review the potential effects of reduced payment rates for DME in non-bid areas. In this report, GAO examines (1) payment rate reductions and any changes in the number of suppliers; (2) any changes in the utilization of rate-adjusted items; and (3) available evidence related to potential changes in beneficiaries' access to rate-adjusted items.
GAO compared non-adjusted 2015 fee-for-service payment rates to adjusted 2016 and 2017 rates and reviewed Medicare claims data from 2010 through 2016. GAO also reviewed CMS's monitoring activities and interviewed CMS officials. In addition, GAO interviewed select beneficiary advocacy groups and DME industry trade organizations.

What GAO Found

The Centers for Medicare & Medicaid Services (CMS) implemented a competitive bidding program (CBP) for certain durable medical equipment (DME), such as wheelchairs and oxygen, in 2011 that is currently operating in 130 designated U.S. areas. On January 1, 2016, CMS used information from the CBP to start adjusting Medicare fee-for-service payment rates for certain DME throughout the country in areas that had previously not been subject to the CBP (known as non-bid areas). For the first year adjusted rates were in effect in non-bid areas, GAO found:
Reductions in payment rates were generally significant but varied by category of DME item. The unweighted average reduction in payment rates for the five rate-adjusted DME items with the highest expenditures in 2016 within each DME category was 46 percent.
Changes in the number of suppliers furnishing rate-adjusted items were generally consistent with the years before adjusted rates went into effect. GAO found that the number of suppliers furnishing rate-adjusted items in non-bid areas in 2016 decreased 8 percent compared to 2015.
GAO's review of Medicare claims data found that beneficiary utilization of rate-adjusted items in non-bid areas in 2016 showed little change compared to 2015. GAO also found that CMS's activities to monitor beneficiary access, including changes in health outcomes, showed little change between 2015 and 2016.
GAO interviewed several stakeholder groups that reported anecdotal examples of specific beneficiary access concerns they attributed to the rate adjustments, but stakeholders could not provide evidence to substantiate that the access issues were widespread. GAO's findings are consistent with CMS's monitoring results, which indicate that there were no widespread effects on beneficiary access in the year after the adjusted rates went into effect. However, some effects may take longer to appear, underscoring the importance of CMS's continued monitoring activities.
The Department of Health and Human Services provided technical comments on a draft of this report, which GAO incorporated as appropriate.


Question:
Why GAO Did This Study

Medicaid has grown by over 50 percent over the last decade, with about $370 billion in federal spending in fiscal year 2017. CMS is responsible for assuring that expenditures—reported quarterly by states—are consistent with Medicaid requirements and matched with the correct amount of federal funds. CMS's review of reported expenditures has become increasingly complex due to variation in states' Medicaid programs and an increasing number of different matching rates.
GAO was asked to examine CMS's oversight of state-reported Medicaid expenditures. In this report, GAO examined how CMS assures that (1) expenditures are supported and consistent with requirements; and (2) the correct federal matching rates were applied to expenditures subject to a higher match. GAO also examined the financial impact of resolved errors. GAO reviewed documentation for the most recently completed quarterly reviews by 3 of CMS's 10 regional offices for six states that varied by Medicaid program expenditures and design. GAO also reviewed policies, procedures, and data on resolved errors; and interviewed CMS and state officials. GAO assessed CMS's oversight processes against federal standards for internal control.

What GAO Found

The Centers for Medicare & Medicaid Services (CMS), which oversees Medicaid, has various review processes in place to assure that expenditures reported by states are supported and consistent with Medicaid requirements. The agency also has processes to review that the correct federal matching rates were applied to expenditures receiving a higher than standard federal matching rate, which can include certain types of services and populations. These processes collectively have had a considerable federal financial benefit, with CMS resolving errors that reduced federal spending by over $5.1 billion in fiscal years 2014 through 2017.
However, GAO identified weaknesses in how CMS targets its resources to address risks when reviewing whether expenditures are supported and consistent with requirements.
CMS devotes similar levels of staff resources to review expenditures despite differing levels of risk across states. For example, the number of staff reviewing California's expenditures—which represent 15 percent of federal Medicaid spending—is similar to the number reviewing Arkansas' expenditures, which represents 1 percent of federal Medicaid spending.
CMS cancelled in-depth financial management reviews in 17 out of 51 instances over the last 5 years. These reviews target expenditures considered by CMS to be at risk of not meeting program requirements.
CMS told GAO that resource constraints contributed to both weaknesses. However, the agency has not completed a comprehensive assessment of risk to (1) determine whether oversight resources are adequate and (2) focus on the most significant areas of risk. Absent such an assessment, CMS is missing an opportunity to identify errors in reported expenditures that could result in substantial savings to the Medicaid program.
GAO also found limitations in CMS's processes for reviewing expenditures that receive a higher federal matching rate.
Internal guidance for examining variances in these expenditures was unclear, and not all reviewers in the three CMS regional offices GAO reviewed were investigating significant variances in quarter-to-quarter expenditures.
Review procedures for expenditures for individuals newly eligible for Medicaid under the Patient Protection and Affordable Care Act were not tailored to different risk levels among states. For example, in its reviews of a sample of claims for this population, CMS reviewed claims for the same number of enrollees—30—in California as for Arkansas, even though California had 10 times the number of newly eligible enrollees as Arkansas.
Without clear internal guidance and better targeting of risks in its review procedures for expenditures receiving higher matching rates, CMS may overpay states.

What GAO Recommends

GAO is making three recommendations, including that CMS improve its risk-based targeting of oversight efforts and resources, and clarify related internal guidance. The Department of Health and Human Services concurred with these recommendations.


Question:
Why GAO Did This Study

FTZs allow companies to reduce, eliminate, or defer duty payments on foreign goods imported into FTZs for distribution or as components of other products before transferring the finished goods into U.S. commerce or exporting them overseas. The value of foreign and domestic goods admitted to FTZs in 2016 exceeded $610 billion. Responsibilities of the Board, consisting of officials from the Departments of Commerce (Commerce) and the Treasury, include evaluating production notifications and applications on the basis of factors such as the proposed activity's net effect on the U.S. economy. Federal regulations set forth requirements, pursuant to the Foreign-Trade Zones Act of 1934, for these evaluations.
GAO was asked to review the Board's evaluation processes. This report examines the extent to which the Board has established and followed procedures aligned with regulations for evaluating (1) notifications and (2) applications. GAO analyzed the Board's regulations and procedures and interviewed Commerce, Treasury, and U.S. Customs and Border Protection officials. GAO also analyzed a nongeneralizable sample of 59 of 293 notifications the Board evaluated from April 2012 through September 2017, which GAO selected to include a range of Board decisions and exclude pending decisions. GAO also analyzed all three applications the Board issued decisions on during that period.

What GAO Found

The U.S. Foreign-Trade Zones Board (the Board) has procedures that generally align with its regulations for evaluating production notifications and followed these procedures for all 59 notifications GAO reviewed. Notifications are filed by companies proposing to bring foreign components into a foreign-trade zone (FTZ) for use in manufacturing finished products, among other purposes. GAO found, for example, that, following Board procedures, Board staff evaluating the notifications collected and considered comments from the general public, industry specialists, and U.S. Customs and Border Protection and recommended to the Board whether to authorize companies' proposed activities. Of the 59 notifications GAO reviewed for seven industry categories, 49 notifications either were approved or were approved with restrictions—for example, the proposed activity was authorized for a limited time period or certain duty benefits were denied for one or more foreign components. Ten notifications were denied for reasons such as new or complex policy issues that required further review.
The Board also has procedures that generally align with its regulations for evaluating production applications and followed these procedures for the three applications GAO reviewed. The applications were submitted by three of the companies whose notifications were denied. According to Board staff, if a notification is not approved or is approved with restrictions, a company may submit an application with additional details. Following Board procedures, Board staff, for example, collected and considered comments and recommended to the Board whether to authorize the proposed activities. Two of the applications were approved with restrictions, and the third was not approved. While the regulations require consideration of a number of criteria—for example, consistency with U.S. trade and tariff law—Board staff did not document consideration of all required criteria for two of the three applications, and the procedures do not require such documentation. Board staff said they document only the most relevant criteria in their reports. Standards for Internal Control in the Federal Government states that management should document its rationale for determining a criterion is not relevant and make this documentation readily available for examination. Without such documentation, the Board lacks an institutional record that all required criteria were considered and also lacks assurance that its decisions comply with U.S. trade and tariff law and public policy.

What GAO Recommends

Commerce should require Board staff to document consideration of all criteria required in the regulations when evaluating production applications. Commerce concurred with this recommendation.