Correspondence issued by the General Accounting Office with an abstract that begins "On June 4, 2003, GAO testified before the Senate Committee on Governmental Affairs at a hearing entitled "Transforming the Department of Defense Personnel System: Finding the Right Approach." This letter responds to a request that we provide answers to posthearing questions from Senator George V. Voinovich and Senator Thomas R. Carper concerning the proposed Department of Defense (DOD) Human Capital Reform."

Correspondence issued by the General Accounting Office with an abstract that begins "Despite a recent decline in the population that smokes, smoking is considered the leading cause of preventable death in this country. According to the Centers for Disease Control and Prevention (CDC), over 2 million deaths in the 5-year period from 1995 through 1999 were attributable to cigarette smoking. CDC, part of the Department of Health and Human Services (HHS), is a primary source of information on the health consequences of smoking tobacco. CDC reported its most recent estimates of selected health consequences of cigarette smoking in an April 2002 issue of its publication Morbidity and Mortality Weekly Report. CDC reported that, on average, over 440,000 deaths, 5.6 million years of potential life lost, $82 billion in mortality-related productivity losses, and $76 billion in medical expenditures were attributable to cigarette smoking each year from 1995 through 1999. CDC and others tasked with making such estimates face challenges. They build estimates on a set of assumptions and make choices about the data sources and methods used, each of which may have limitations that must be weighed against its advantages. Policymakers at both the state and federal levels have relied on …

Guidance issued by the General Accounting Office with an abstract that begins "This publication has been superseded by GAO-04-546G, Human Capital: A Guide for Assessing Strategic Training and Development Efforts in the Federal Government, March 2004. This guide introduces a framework, consisting of a set of principles and key questions that federal agencies can use to ensure that their training and development investments are targeted strategically and are not wasted on efforts that are irrelevant, duplicative, or ineffective. Effective training and development programs are an integral part of a learning environment that can enhance the federal government's ability to attract and retain employees with the skills and competencies needed to achieve results for the benefit of the American people. Training and developing new and current staff to fill new roles and work in different waqys will be a crucial part of a federal government's endeavors to meet its transformation challenges. Ways that employees learn and achieve results will also continue to transform how agencies do business and engage employees in further innovation and improvements."

Testimony issued by the General Accounting Office with an abstract that begins "In February 2003, the Securities and Exchange Commission (SEC) received the largest budget increase in the history of the agency. The increased funding was designed to better position SEC to address serious issues identified in the Sarbanes-Oxley Act and to better enable SEC to address numerous operational and human capital management challenges discussed in the GAO report entitled SEC Operations: Increased Workload Creates Challenges (GAO-02-302). To help ensure that SEC spends its budgetary resources in an efficient and effective manner, GAO was asked to review the SEC's efforts to address the issues raised in the 2002 report and to report on how SEC intends to utilize its new budgetary resources. GAO's final report on these matters is expected to be completed this Fall. This testimony provides requested information on the status of SEC's current spending plan and preliminary observations on SEC's strategic and human capital planning efforts."

Testimony issued by the General Accounting Office with an abstract that begins "In 1986, the United States entered into a Compact of Free Association with the Pacific Island nations of the Federated States of Micronesia, or FSM, and the Republic of the Marshall Islands, or RMI. The Compact provided about $2.1 billion in U.S. funds, supplied by the Department of the Interior, over 17 years (1987-2003) to the FSM and the RMI. These funds were intended to advance economic development. In a past report, GAO found that this assistance did little to advance economic development in either country, and accountability over funding was limited. The Compact also established U.S. defense rights and obligations in the region and allowed for migration from both countries to the United States. The three parties recently renegotiated expiring economic assistance provisions of the Compact in order to provide an additional 20 years of assistance (2004-2023). In addition, the negotiations addressed defense and immigration issues. The House International Relations and Resources Committees requested that GAO report on Compact negotiations. This testimony discusses negotiated changes to the levels and structure of future assistance, including the potential cost to the U.S. government. Further, it reviews accountability, defense, and …

Correspondence issued by the General Accounting Office with an abstract that begins "Wildland fires burned over 8 million acres during the 2000 wildfire season, making it one of the worst in the past 50 years. As a result, a National Fire Plan was implemented beginning in 2001 to better prevent, prepare for, respond to, and repair damage caused by wildland fires. In fiscal years 2001 through 2003, Congress provided $4.9 billion to the U.S. Department of Agriculture's (USDA) Forest Service to implement the National Fire Plan on land that it manages. Of this amount, Congress earmarked $212 million to fund the rehabilitation of land burned by wildland fires. In general, rehabilitation covers long-term efforts to improve lands unlikely to recover naturally from wildland fire damage. In some cases, rehabilitation may include removing timber from burnt land to, among other things, reduce hazardous fuels. Questions have been raised, however, about whether it is appropriate to use rehabilitation funds for removing such timber, which can be sold. Trees that are removed from National Forest System land can be either green and healthy or dead or dying as a result of disease or wildland fire. Depending on their value, the trees may be …

Correspondence issued by the General Accounting Office with an abstract that begins "The Department of Defense (DOD) faces financial and related management problems that are pervasive, complex, long-standing, and deeply rooted in virtually all business operations throughout the department. These problems have impeded the department's ability to provide complete, reliable, and timely business information to the Congress, DOD managers, and other decision makers. Of the 25 areas on our governmentwide "high-risk" list, 6 are DOD program areas, and the department shares responsibility for 3 other high-risk areas that are governmentwide in scope. DOD's problems in each of these areas hinder the efficiency of operations, and leave the department vulnerable to fraud, waste, and abuse. For fiscal year 2003, DOD's information technology (IT) budget request was over $26 billion. More specifically, to support its business operations, DOD reports that it currently relies on about 2,300 systems, including accounting, acquisition, logistics, and personnel systems that will cost about $18 billion--nearly $5.2 billion for business systems and $12.8 billion primarily for business systems infrastructure--in fiscal year 2003 to operate, maintain, and modernize. As we have previously reported, this environment was not designed to be, but rather has evolved into, an overly complex and …

Correspondence issued by the General Accounting Office with an abstract that begins "The Bonneville Power Administration (BPA) provides about 45 percent of all electric power consumed in the Pacific Northwest--Idaho, Montana, Oregon, and Washington. The power that BPA markets and distributes is generated in large part at hydroelectric projects including dams in the Federal Columbia River Power System. BPA also owns and operates about 75 percent of the region's services. Under the Pacific Northwest Electric Power Planning and Conservation Act of 1980, BPA is responsible for ensuring an adequate, efficient, economical, and reliable power supply for the Pacific Northwest. To do so, BPA balances the needs of its customers against the highly variable water resources available for generating electricity. In maintaining this balance, BPA sometimes buys and sells or otherwise exchanges power with utilities with entities within and outside the Pacific Northwest. In addition to providing power, BPA is required under the 1980 act, various other laws, treaties and court cases, to "protect, mitigate, and enhance" fish and wildlife resources. Recently, BPA has witnessed a substantial deterioration in its financial condition. For example, BPA's cash reserves of $811 million at the end of fiscal year 2000 had fallen $188 million …

Correspondence issued by the General Accounting Office with an abstract that begins "The Internal Revenue Service (IRS), along with other components of the Department of the Treasury, collects and distributes excise tax receipts to government trust funds. As the nation's tax collector, IRS plays a critical role in this process. Consequently, trust funds and their administrators depend on IRS to have sound procedures and controls over this process to ensure that excise taxes are appropriately distributed. This report is a follow-up to two reports we recently issued discussing procedures we performed to assist the Department of Transportation's Office of Inspector General (Transportation IG) in ascertaining whether the net excise tax collections and excise tax certifications reported by IRS for the fiscal year ended September 30, 2002, were supported by underlying records. The agreed-upon procedures, along with our audit of IRS's fiscal year 2002 financial statements, provided a sufficient basis to assist the Transportation IG in forming an opinion on the departmentwide financial statements and the financial statements of the trust funds administered by the department, including the Highway Trust Fund and the Airport and Airway Trust Fund."

Correspondence issued by the General Accounting Office with an abstract that begins "Under section 1308 of the National Defense Authorization Act for Fiscal Year 2001 (P.L. 106-398), the Department of Defense is to submit an annual report to Congress on its Cooperative Threat Reduction (CTR) program no later than the first Monday in February of each year. The report should include a five-year plan that discusses the amount and purpose of funding needed over the term of the plan and a description of efforts conducted by the United States to ensure that CTR assistance is fully accounted for and used for its intended purposes. The Act requires the Comptroller General to assess this five-year plan and the description of efforts to account for CTR assistance within 90 days of the report's submission to Congress. The Department submitted its CTR annual report for fiscal year 2004 to Congress on April 18, 2003. We analyzed the 2004 report to determine whether (1) the five-year plan addressed the legislative requirements and presents accurate information, (2) the accountability section addressed legislative requirements and presents accurate information, and (3) the presentation and usefulness of the CTR annual report could be improved."

Correspondence issued by the General Accounting Office with an abstract that begins "In June 2002, the National Science Foundation (NSF) awarded a 3-year, $14.8 million contract for a business analysis plan to support three key management areas at the foundation: its business processes, human capital, and information technology. The contract is to be completed by September 30, 2005, and is to result in seven deliverables, including a project plan to guide the contractor's work. The Chairman, Senate Committee on Appropriations, Subcommittee on VA, HUD, and Independent Agencies, asked us to obtain information on (1) the status of contract funds budgeted to the key management areas and contract deliverables, and overall plans for the contract; (2) the extent to which the contract will address management issues previously reported by audit and oversight bodies; and (3) NSF's management of the contract and plans for integrating any recommendations made by the contractor."

Correspondence issued by the General Accounting Office with an abstract that begins "The Thrift Savings Plan (TSP) is a retirement savings and investment plan for federal employees, governed by the Federal Retirement Thrift Investment Board (Board). The TSP is a defined contribution retirement plan available to eligible federal employees. The TSP had about 2.6 million participants and held about $100.6 billion in Net Assets Available for Benefits as of December 31, 2001, and about 3 million participants and $102.3 billion in Net Assets Available for Benefits as of December 31, 2002. In 1997, the Board awarded a contract to American Management Systems, Inc. (AMS) to develop and implement a new record-keeping system for the TSP. In 2001, after several implementation delays, the Board terminated the contract, and the Board's former Executive Director filed a lawsuit against the contractor on behalf of the TSP. On June 20, 2003, 2 days after we provided a draft of this report to the Board for its review, a settlement between the parties was reached. Then, on June 23, 2003, the net unrecovered cost from the system development failure was allocated to participant account balances as recommended in our draft report. While the loss has …

A statement of record issued by the General Accounting Office with an abstract that begins "Accurate credit reports are critical to the credit process--for consumers attempting to obtain credit and to lending institutions making decisions about extending credit. In today's sophisticated and highly calibrated credit markets, credit report errors can have significant monetary implications to consumers and credit granters. In recognition of the importance of this issue, the Senate Committee on Banking, Housing, and Urban Affairs asked GAO to (1) provide information on the frequency, type, and cause of credit report errors, and (2) describe the impact of the 1996 amendments to the Fair Credit Reporting Act (FCRA) on credit report accuracy and potential implications of reporting errors for consumers."

Correspondence issued by the General Accounting Office with an abstract that begins "The Centennial of Flight Commission (Commission) was created on November 13, 1998, by the Centennial of Flight Commemoration Act (Public Law 105-389, as amended by Public Law 106-68). The purpose of the Commission is to commemorate the 100th anniversary of the Wright Brothers' flight at Kitty Hawk, North Carolina, on December 17, 1903. The Commission is to provide recommendations and advice to the President, the Congress, and federal agencies on the most effective ways to encourage and promote national and international participation and sponsorships in commemoration of the centennial of powered flight. We are required by the act to audit the financial transactions of the Commission. This report presents the results of our audit of the Commission's fiscal year 2002 financial transactions, with cumulative information since the Commission's inception. We previously reported the results of our audits on Commission financial transactions for fiscal years 1999 and 2000, and 2001."

A statement of record issued by the General Accounting Office with an abstract that begins "Hospitals have increasingly relied on purchasing intermediaries--GPOs--to keep the cost of medical-surgical products in check. By pooling purchases for their hospital customers, GPOs'in awarding contracts to medical-surgical product manufacturers--may negotiate lower prices for these products. Some manufacturers contend that GPOs are slow to select products to place on contract and establish high administrative fees that make it difficult for some firms to obtain a GPO contract. The manufacturers also express concern that certain contracting strategies to obtain better prices have the potential to limit competition when practiced by GPOs with a large share of the market. GAO was asked to examine certain GPO business practices. It focused on seven large GPOs serving hospitals nationwide regarding (1) their processes to select manufacturers' products for their hospital customers and the level of administrative fees they receive from manufacturers, (2) their use of contracting strategies to obtain favorable prices from manufacturers, and (3) recent initiatives taken to respond to concerns about GPO business practices."

Testimony issued by the General Accounting Office with an abstract that begins "No government should waste its taxpayers' money, whether we are operating during a period of budget surpluses or deficits. Further, it is important for everyone to recognize that fraud, waste, abuse, and mismanagement are not victimless activities. Resources are not unlimited, and when they are diverted for inappropriate, illegal, inefficient, or ineffective purposes, both taxpayers and legitimate program beneficiaries are cheated. Both the Administration and the Congress have an obligation to safeguard benefits for those that deserve them and avoid abuse of taxpayer funds by preventing such diversions. Beyond preventing obvious abuse, government also has an obligation to modernize its priorities, practices, and processes so that it can meet the demands and needs of today's changing world. More broadly, the federal government must reexamine the entire range of policies and programs--entitlements, discretionary, and tax incentives--in the context of the 21st century."

Testimony issued by the General Accounting Office with an abstract that begins "SARS is a highly contagious respiratory disease that infected more than 8,000 individuals in 29 countries principally throughout Asia, Europe, and North America and led to more than 800 deaths as of July 11, 2003. Due to the speed and volume of international travel and trade, emerging infectious diseases such as SARS are difficult to contain within geographic borders, placing numerous countries and regions at risk with a single outbreak. While SARS did not infect large numbers of individuals in the United States, the possibility that it may reemerge raises concerns about the ability of public health officials and health care workers to prevent the spread of the disease in the United States. GAO was asked to assist the Subcommittee in identifying ways in which the United States can prepare for the possibility of another SARS outbreak. Specifically, GAO was asked to determine 1) infectious disease control measures practiced within health care and community settings that helped contain the spread of SARS and 2) the initiatives and challenges in preparing for a possible SARS resurgence."

Testimony issued by the General Accounting Office with an abstract that begins "GAO, the Department of the Interior, and others have reported on the National Park Service's efforts to develop an effective maintenance management process that would, among other things, enable the agency to accurately and reliably estimate the amount of deferred maintenance on its assets. Over the years, the agency's estimates of the amount of its deferred maintenance have varied widely--sometimes by billions of dollars. Currently, the agency estimates that its deferred maintenance backlog is over $5 billion. In April 2002, GAO reported on the status of efforts to develop better deferred maintenance data. (National Park Service: Status of Efforts to Develop Better Deferred Maintenance Data)(Apr. 12, 2002, GAO-02-568R) This testimony presents the results of GAO's April report and updates the progress the Park Service is making in implementing its new asset management process."

Testimony issued by the General Accounting Office with an abstract that begins "The circumstances of armed conflicts in Bosnia, Kosovo, and Afghanistan differed in many respects, but in all three cases the United States and the international community became involved in the wars and post-conflict assistance because of important national and international interests. Over the past 10 years, GAO has done extensive work assessing post-conflict assistance in Bosnia and Kosovo and, more recently, has evaluated such assistance to Afghanistan. GAO was asked to provide observations on assistance efforts in these countries that may be applicable to ongoing assistance in Iraq. Specifically, GAO assessed (1) the nature and extent of post-conflict assistance in Bosnia, Kosovo, and Afghanistan; (2) essential components for carrying out assistance effectively; (3) challenges to implementation; and (4) mechanisms used for accountability and oversight."

Testimony issued by the General Accounting Office with an abstract that begins "The Department of Defense (DOD) faces many risks in its use of globally networked computer systems to perform operational missions--such as identifying and tracking enemy targets--and daily management functions--such as paying soldiers and managing supplies. Weaknesses in these systems, if present, could give hackers and other unauthorized users the opportunity to modify, steal, inappropriately disclose, and destroy sensitive military data. GAO was asked, among other things, to discuss DOD's efforts to protect its information systems and networks from cyber attack, focusing on its reported progress in implementing statutory information security requirements."

Testimony issued by the General Accounting Office with an abstract that begins "Recent news articles in over 30 states and prominent mental health advocacy organizations have described the difficulty many parents have in accessing mental health services for their children. As these reports documented, some parents choose to place their children in the child welfare or juvenile justice systems in order to obtain the mental health services that their children need. Senators Susan Collins and Joseph Lieberman of the Senate Committee on Governmental Affairs asked GAO to testify on: (1) the number and characteristics of children voluntarily placed in the child welfare and juvenile justice systems to receive mental health services, (2) the factors that influence such placements, and (3) promising state and local practices that may reduce the need for child welfare and juvenile justice placements. This testimony is based on our April 2003 report on the results of a study addressing these same objectives. For that report, we surveyed state child welfare directors in all states and the District of Columbia and juvenile justice officials in 33 counties in the 17 states with the largest populations of children under age 18. We surveyed juvenile justice officials at the …

Testimony issued by the General Accounting Office with an abstract that begins "The five Great Lakes, which comprise the largest system of freshwater in the world, are threatened on many environmental fronts. To address the extent of progress made in restoring the Great Lakes Basin, which includes the lakes and surrounding area, GAO (1) identified the federal and state environmental programs operating in the basin and the funding devoted to them, (2) evaluated the restoration strategies used and how they are coordinated, and (3) assessed overall environmental progress made in the basin restoration effort."

Testimony issued by the General Accounting Office with an abstract that begins "GAO has been providing ongoing assistance to the Capitol Preservation Commission and the Senate and House Appropriations Committees in their monitoring and oversight of the Capitol Visitor Center construction project. Given the current decisions facing the Congress, this testimony covers (1) management of the project, (2) the estimated cost for the project, (3) the status of the project's schedule, and (4) actions that Congress and the AOC should consider taking to address funding gaps and other current project issues and risks."

Testimony issued by the General Accounting Office with an abstract that begins "DOE is the largest civilian-contracting agency in the federal government, and relies primarily on contractors to operate its sites and carry out its diverse missions. For fiscal year 2003, DOE will spend about 90 percent of its total annual budget, or $19.8 billion, on contracts, including $9.4 billion to operate 16 of its research laboratories (called federally funded research and development centers). Since 1990, GAO has identified DOE's contract management as high-risk for fraud, waste, abuse, and mismanagement. In 1994, DOE began reforming its contracting practices to, among other things, improve contractor performance and accountability. As part of that effort, DOE has at times used competition in awarding contracts to manage and operate its research laboratories. In September 2002, GAO reported on the status of contract reform efforts in DOE. (Contract Reform: DOE Has Made Progress, but Actions Needed to Ensure Initiatives Have Improved Results) (Sep. 2002, GAO-02-798) This testimony discusses some of the findings in that report. GAO was asked to testify on DOE's rationale for deciding whether to compete a laboratory research contract, the extent to which DOE has competed these contracts, and the role of …