Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses (1) the status of the 2001 tax filing season, (2) the status of the Internal Revenue Service's (IRS) business systems modernization effort, and (3) the security of IRS' electronic filing system. GAO found that although the 2001 filing season appears to be running smoothly, some matters require further attention. For example, IRS has had problems with the personal identification number assigned to electronic filers. Although data indicate that taxpayers are having an easier time reaching IRS to ask questions, concerns persist about the productivity of its telephone assistors. With respect to business systems modernization, GAO has long held that IRS needs to establish fundamental modernization management controls before it begins to build and implement modernized systems. IRS has made some progress in this area, but it is still not where it needs to be. GAO is concerned that IRS is allowing its system acquisition projects to get ahead of its capabilities for managing them. Lastly, GAO's review of IRS' electronic filing systems last year showed that IRS had ineffective controls to ensure the security of those systems and electronically-transmitted taxpayer data. IRS moved promptly to …

Testimony issued by the General Accounting Office with an abstract that begins "GAO discusses the progress the National Nuclear Security Administration (NNSA) has made in implementing title 32 of the National Defense Authorization Act for Fiscal Year 2000. Title 32 established NNSA as a semiautonomous agency within the Department of Energy (DOE) with responsibility for the nation's nuclear weapons, nonproliferation, and naval reactors programs. GAO found that the agency is making progress in implementing changes to its organization; planning, programming, and budgeting functions; and use of personnel authority. However, it will be several months before real, tangible evidence of these changes will be seen. And it may be several years before these changes are fully implemented and can be definitively assessed. Important work remains to be done in (1) establishing an organization that clearly defines the roles and responsibilities of headquarters and field staff, moves program management officials as close to the action as possible, and establishes clear lines of authority between NNSA and its contractors; (2) implementing an integrated planning, programming, and budgeting system that can deliver information to decision makers and Congress in time for the 2003 budget deliberations; and (3) overcoming obstacles to using NNSA's Expected Service …

Testimony issued by the General Accounting Office with an abstract that begins "Gasoline prices in West Coast states are frequently among the highest in the nation and these states tend to see longer periods of high prices compared with other parts of the country, the West Coast gasoline market is characterized by a tight balance between supply and demand, and isolation from other U.S. gasoline markets. Both of these situations cause rapid price increases in reaction to supply disruptions. GAO's comparisons of gasoline prices in California, Oregon, and Washington found that individual markets in the three states are closely linked and are essentially part of a single market for gasoline on the West Coast. Gasoline prices for cities in these states generally followed similar patterns with respect to price increases and decreases. As a result, any event that a significantly changed prices in one state could affect gasoline prices in other West Coast states. Although California, Oregon, and Washington are essentially part of the same West Coast market, each state has attributes that tend to increase its respective gasoline prices. Moreover, within any given state, local market conditions may cause prices to vary considerably. GAO's analysis found that lifting the …

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses the implementation of the Paperwork Reduction Act of 1995 (PRA). The data indicate that federal paperwork increased by nearly 180 million burden hours during fiscal year 2000--the second-largest one-year increase since the act was passed. This increase is largely attributed to the Internal Revenue Service (IRS), which raised its paperwork estimate by about 240 million burden hours. The rest of the government decreased its burden estimate by about 70 million burden hours during the fiscal year. Within that non-IRS grouping, some agencies were more successful than others in reducing their paperwork estimates and some increased their estimates. In addition, federal agencies identified a total of 487 violations of the PRA during fiscal year 2000--fewer than the 710 they identified during fiscal year 1999. These 487 violations, however, represent substantial opportunity costs and many have persisted for years. GAO believes that the Office of Management and Budget can do more to ensure that agencies do not use information collections without proper clearance."

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses the status of the FTS 2001 long distance telecommunication program. The General Services Administration (GSA) failed to meet its goal of completing the transition from FTS 2000 to the FTS 2001 contracts by December 6, 2000. Several factors contributed to the delays, including staffing shortages and turnover, contractor billing problems, and contract-related modifications. As of April 11, 2001, the overall FTS 2001 transition was about 92 percent complete. The transition of voice services from FTS 2000 and FTS 2001 is almost entirely complete and switched data services and dedicated transmission services are about 82 and 88 percent complete, respectively. The remaining transition requirements are scheduled for completion by the end of June 2001. Nevertheless, the collective effect of delays encountered during this complex transition has jeopardized the timely achievement of FTS 2001's goals of (1) ensuring best service and price to the government and (2) maximizing competition. GSA has taken steps to position the FTS 2001 program for greater success, including developing better telecommunications planning procedures and improving contractor billing. This testimony summarizes a March 2001 GAO report, GAO-01-289."

Testimony issued by the General Accounting Office with an abstract that begins "Although the Department of Veterans' Affairs (VA) has taken actions to improve many of its information technology (IT) management processes, it continues to face substantive challenges that, if left incomplete, could disrupt existing progress and threaten the viability of its existing and future IT spending. VA has yet to fill its full-time department chief information officer vacancy since the position's creation three years ago. In addition, sustained leadership and commitment are necessary to improve VA's departmentwide computer security program, especially as VA begins to move some of its information and services to veterans onto the Internet. And although VA has done a good job of posting privacy and security notices on its websites, it should focus more attention on complying with Office of Management and Budget policies prohibiting the use of persistent cookies. Furthermore, until VA defines and begins to implement a departmentwide, enterprise architecture, it will continue to encounter costly difficulties in achieving its "One VA" vision. Finally, VA faces important decisions on making greater use of the Decision Support System and on the continued development and wide-scale implementation of the compensation and pension replacement project. Continued …

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses (1) the relationship between Internal Revenue Service (IRS) audits of taxpayers and other programs IRS uses to ensure that taxpayers' returns are accurate and (2) how IRS is managing the increased workload in two of its programs--offers-in-compromise and innocent spouse claims. IRS audited more than 600,000 taxpayers in fiscal year 2000, either face-to-face or through the mail. IRS has several programs that use computerized screening procedures to review all tax returns to detect certain types of errors. These programs result in millions of contacts with taxpayers to inform them of adjustments IRS made to their liabilities, seek explanations for errors IRS believes were made, or ask taxpayers to check whether they erred on their returns. The programs vary in their similarity to audits; some of the programs are most similar to audits that IRS conducts through the mail. The programs that IRS uses to detect errors on tax returns rely completely on information that taxpayers report on the tax returns and that IRS receives from third parties. Therefore, audits remain an important tax enforcement tool. Several factors suggest that IRS may be gaining better management …

Testimony issued by the General Accounting Office with an abstract that begins "The rapid pace of technological change and innovation has offered unprecedented opportunities for both the government and commercial sectors to use information technology (IT) to improve performance, reduce costs, and enhance service. A range of issues have emerged about how to best manage and integrate complex information technologies and management processes so that they are aligned with mission goals, strategies, and objectives. Although IT can help the government provide services more efficiently and at lower costs, many challenges must be overcome to increase the government's ability to use the information resources at its disposal effectively, securely, and with the best service to the American people. A central focal point such as a federal Chief Information Officer (CIO) can help ensure that attention to IT issues is sustained and increase the likelihood that progress is charted and achieved. Although GAO's research has found that there is no one right way to establish a CIO position, critical success factors GAO found in leading organizations, such as aligning the position for value creation, are extremely important considerations. Finally, the experiences of statewide CIOs offer a rich set of experiences to draw …

Testimony issued by the General Accounting Office with an abstract that begins "The Regulatory Flexibility Act of 1980 requires federal agencies to examine the impact of their proposed and final rules on small businesses, small governmental jurisdictions, and small organizations and to solicit the ideas and comments of such entities for this purpose. Specifically, whenever agencies are required to publish a notice of proposed rulemaking, the act requires agencies to prepare an initial and a final regulatory flexibility analysis. However, those analytical requirements do not apply if the head of the agency certifies that the rule will not have a "significant economic impact on a substantial number of small entities." The Small Business Regulatory Enforcement Fairness Act of 1996 was enacted to strengthen the protections for small entities, and some of the requirements of that legislation are built on this significant impact determination. Although both of these reform initiatives have clearly affected how federal agencies regulate, their full promise has not been realized. The Regulatory Flexibility Act does not define what Congress meant by the terms "significant economic impact" and "substantial number of small entities" and does not give any entity the authority or responsibility to define them governmentwide. As …

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses the challenges facing the U.S. Postal Service. Overall the Service faces major challenges that collectively call for a structural transformation if it is to remain viable in the 21st century. The Service's financial outlook has worsened, and it is not clear how the Service will address its mounting financial difficulties and other challenges. These challenges include (1) reduced net income, (2) increased debt, (3) increased competition, (3) management-labor relations problems, and (4) statutory restrictions. Because of the Service's rapidly deteriorating financial situation, GAO is placing the Service on its high-risk list. GAO believes that several actions need to be taken to address the Service's continued problems. Such actions include (1) developing a comprehensive plan to address the financial, operational, and human capital challenges; (2) providing quarterly financial reports to Congress and the public; and (3) identifying, in conjunction with GAO and other stakeholders, improvement options that will cut costs and improve productivity."

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses GAO's analysis of security audits at federal agencies. The widespread interconnectivity of computers poses significant risks to federal computer systems and the operations and the infrastructures they support. GAO's evaluations show that federal computer systems are riddled with weaknesses that continue to put critical operations and assets at risk. GAO found weaknesses in following six areas: (1) security program management, (2) access controls, (3) software development and change controls, (4) segregation of duties, (5) operating systems controls, and (6) service continuity. Weaknesses in these areas place a broad range of critical operations and assets at risk for fraud, misuse, and disruption. Federal agencies have tried to address these problems, and many have good remedial efforts underway. However, these efforts will not be fully effective and lasting unless they are supported by a strong agencywide security management framework. Establishing such a management framework requires that agencies take a comprehensive approach that involves both (1) senior agency program managers who understand which aspects of their missions are the most critical and sensitive and (2) technical experts who know the agencies' systems and can suggest appropriate technical security …

Testimony issued by the General Accounting Office with an abstract that begins "GAO discussed the Department of Housing and Urban Development's (HUD) fiscal year 2002 budget request. Because HUD's 2002 budget request was released only two weeks before this testimony, GAO could only offer a general discussion of the budget's policy policy implications and program trade-offs. GAO found that, in recent years, HUD has had significant unexpended balances, making it difficult for Congress to assess the Department's need for new appropriations. Without accurate and timely information on the nature, the amount, and the availability of HUD's unexpended balances, decision-makers cannot fully and fairly evaluate HUD's funding needs. HUD has begun several short-term efforts to identify, quantify, and recapture some unexpended balances and has, in fact, recaptured about $3 billion each year between fiscal years 1998 and 2000. In spite of these efforts, HUD has not yet integrated the processes needed to routinely and accurately account for unexpended balances into its ongoing financial, program, and budget management. As a result, HUD lacks the information it needs to (1) determine with certainty how much of the unexpended balances should be recaptured and (2) clearly factor these funds into its budget requests."

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses three bills that would change the overall leadership and management of programs to combat terrorism. The three bills--H.R. 525, H.R. 1158, and H.R. 1292--vary in scope. H.R. 525 focuses on federal programs to prepare state and local governments for domestic terrorist attacks. Both H.R. 1158 and H.R. 1292 focus on the larger issue of homeland security, which includes terrorism and additional threats such as military attacks. The bills are similar in that they all advocate a single focal point for programs to combat terrorism. However, some bills place the focal point in the Executive Office of the President and others place it with a lead executive agency. In addition, the three bills provide the focal point with different, but often similar, duties to improve the management of federal programs. To the extent that these three bills--or some hybrid of them--address these problem areas, GAO believes that federal programs to combat terrorism will be improved. It will be important to develop a consensus on these matters and provide the focal point with legitimacy and authority through legislation are important tasks that lie ahead."

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses states' plans for operating their Temporary Assistance for Needy Families (TANF) programs in the event of an economic downturn. GAO found that the data available on the levels and adequacy of states' reserves is insufficient and misleading. Furthermore, most states have done little planning for economic contingencies. Many states cite obstacles to saving money for possible economic downturns. Although TANF funds can be set aside in a budgetary reserve, state officials said that they are concerned that the accumulation of unspent TANF funds might signal that the funds are not needed. Another option for states would be to save their own funds in a general purpose rainy day account, but state officials said that welfare would have to compete with other state priorities when these funds are released from state treasuries. There are now federal contingency mechanisms for states to access additional federal resources in the event of a recession or other emergency--the Contingency Fund for State Welfare Programs and the Federal Loan for State Welfare Programs. However, states generally found these programs too complex and restrictive, and would most likely find other ways to …

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses internal control weaknesses in the Department of Education's payment process. GAO identified internal control weaknesses that sharply increase Education's vulnerability to improper payments. GAO classified the weaknesses into the following four broad categories: (1) poor segregation of duties, (2) lack of supervisory review, (3) inadequate audit trails, and (4) inadequate computer systems' application controls. GAO found that some individuals at Education can control the entire payment process for some transactions. As a result, individuals could be using agency funds for personal expenses. GAO also found that Education has serious deficiencies in its process for reviewing and approving purchases made with government credit cards. During fiscal year 2000, Education employees made more than $8 million in purchases using their government purchase cards. Without proper review and approval of these expenditures, improper use of the government charge cards may go undetected. Regarding audit trails, Education lacks adequate control over changes made to sensitive information for certain types of payments, including contracting and third party drafts. Finally, weaknesses in Education's information systems controls increases the risk of unauthorized access or disruption in services and make Education's sensitive grant …

Testimony issued by the General Accounting Office with an abstract that begins "This testimony discusses the management challenges that continue to face the Internal Revenue Service (IRS). These challenges include (1) computer security, (2) financial management, (3) organizational modernization and performance management, and (4) business systems modernization management. IRS must make progress in all four areas to improve the agency's efficiency and to significantly improve service to taxpayers. IRS has taken important steps in all of these areas, but significant obstacles remain. In the area of computer security, IRS corrected many previously reported weaknesses and is launching a computer security management program that should help it manage its risks in this area. However, serious weaknesses persist that could impair IRS' ability to perform vital functions. In financial management, IRS was able to prepare financial statements this year that received an unqualified opinion. However, this achievement came through the use of substantial, costly, and time-consuming processes to work around IRS' system deficiencies. IRS has reorganized into four taxpayer-focused divisions and has developed a performance management approach consistent with management principles contained in the IRS Restructuring and Reform Act and the Government Performance and Results Act. However, much work remains to be …

A letter report issued by the General Accounting Office with an abstract that begins "The Government Performance and Results Act calls for agencies to address human capital in the context of performance-based management. The act requires that annual performance plans describe how agencies will use their human capital to accomplish their goals and objectives. Designing, implementing, and maintaining a strategic human capital management focus are critical to maximizing performance and ensuring that government is accountable to the American people. GAO found that the human capital challenges described in fiscal year 2001 performance plans reflected the different levels of attention agencies are to pay this critical issue. GAO contends that the breadth, depth, and specificity of many related human capital goals and strategies needs to be increased. The plans' discussions of human capital increasingly need to focus on describing human capital challenges. The plans need to specify the what, why, how, and when of the strategies to address those challenges. The discussions should also better link human capital management and the agencies' strategic and program planning to maximize performance and ensure optimal resource allocation. Overall, the fiscal year 2001 plans showed that substantial opportunities exist for goals and strategies as they …

A letter report issued by the General Accounting Office with an abstract that begins "In November 1997, the President called for the Department of Veterans Affairs (VA) and the Department of Defense (DOD) to create an interface that would allow the two agencies to share patient health information. By allowing health care providers to electronically share comprehensive patient information, computer-based patient record's (GCPR) should help VA, DOD, and the Indian Health Service (IHS) to improve the quality of care for their beneficiaries. But without a lead entity, a clear mission, and detailed planning to achieve that mission, it is difficult to monitor progress, identify project risks, and develop appropriate contingency plans to keep the project moving forward and on track. Critical project decisions were not made, and the agencies were not bound by those that were made. The VA and DOD Chief Information Officers' (CIO) action to focus on short-term deliverables and to capitalize on existing technologies is warranted and a step in the right direction. However, until problems with the two agencies' existing systems and issues regarding planning, management, and accountability are resolved, project costs will likely continue to increase and implementation of the larger GCPR effort--and its expected …

A letter report issued by the General Accounting Office with an abstract that begins "This report reviews the Department of Justice's Antitrust Division's overall policies and procedures for carrying out its statutory responsibilities, particularly as they apply to the agriculture industry. GAO describes (1) the Division's interaction with the Federal Trade Commission (FTC) and the Department of Agriculture (USDA) with regard to antitrust matters in the agriculture industry, (2) the number of complaints and leads in the agriculture industry received by the Division for fiscal years 1997 through 1999, and (3) the number and types of closed matters in the agriculture industry for fiscal years 1997 through 1999. GAO also describes the Division's policies for and procedures for investigating potential anti-trust violations. GAO found that the Division (1) maintains a cooperative working relationship with regard to anticompetitive matters in the agriculture industry with FTC and USDA, (2) received an estimated 165 complaints and leads related to the agriculture industry in fiscal years 1997 through 1999, (3) closed 1,050 matters during that period."

A letter report issued by the General Accounting Office with an abstract that begins "This report discusses the facts surrounding the ability of the Clinton White House to preserve certain electronic mail (e-mail) deemed official government records. GAO found that two malfunctions occurred in the White House e-mail system that prevented official records from being properly recorded in the Automated Records Management System (ARMS). The first problem involved an anomaly with incoming Internet e-mail users of the "Mail2" e-mail server. The second problem surfaced while the contractor was trying the resolve the first problem. During its efforts to determine the cause of the Mail2 e-mail errors, the letter D was deleted from a key piece of software, causing the ARMS scanner to skip e-mail accounts of users with first names beginning with the letter D. The White House began a costly and time-consuming project to recover e-mail records that had not been effectively managed. Several factors contributed to the cost and scope of the tape restoration project, including the contractor's performance of tape management and systems maintenance and legal scrutiny of e-mail malfunctions by external authorities."

A letter report issued by the General Accounting Office with an abstract that begins "GAO audited the financial statements of the Capitol Preservation Fund for fiscal years 2000 and 1999. GAO found that the financial statements were presented fairly in conformity with U.S. generally accepted accounting principles, contained no material weaknesses in internal control over financial reporting (including safeguarding assets) and complied with the provisions of laws and regulations tested."

A letter report issued by the General Accounting Office with an abstract that begins "This report reviews the Department of Defense's (DOD) management practices for demilitarizing excess ammunition. Specifically, GAO evaluates (1) the extent to which the excess ammunition stockpile has been reduced and whether the liability associated with excess ammunition has been fully identified, (2) the Army's reliance on contracted demilitarization and the impact of doing so on government facilities that use similar environmentally friendly processes, and (3) the feasibility of using excess ammunition for U.S. training needs. GAO found that DOD's reported stockpile of excess ammunition has grown rather than decreased, rising from 354,000 tons in 1993 to 493,000 tons at the end of 2000. In addition, the reported stockpile does not include all excess ammunition, which understates DOD's ultimate liability for demilitarizing ammunition. In recent years, the Army has devoted 50 percent of its excess ammunition demilitarization budget to contractors that use environmentally friendly demilitarization processes. Although a congressional directive resulted in greater emphasis on contractor demilitarization, the Army began and later expanded this effort without considering the effect it would have on government facilities. With increased contractor demilitarization, the Army has retained and underutilized environmentally friendly …

A letter report issued by the General Accounting Office with an abstract that begins "The General Services Administration (GSA), the federal government's real property manager, it is responsible for identifying, funding, and completing needed repairs and alterations at federal buildings. This report examines (1) GSA's process for assessing and selecting prospectus-level major repair and alteration design projects for funding, (2) the obstacles that impede GSA from satisfying its repair and alteration requirements, and (3) the consequences associated with deferring needed repairs and alterations at selected buildings. GAO found that in fiscal year 2001, GSA assessed the merits of 27 prospectus-level repair and alteration design projects and recommended 12 for funding. These projects were selected by a multifaceted process that relied on empirical data and professional judgment coupled with specific selection criteria and computer analysis that compared competing projects. GSA explained its decisions when it recommended lower-ranked projects for repairs. However, because of insufficient funding, those projects were placed on GSA's growing repair and alteration inventory. GSA has faced long-standing obstacles, including inadequate program data, the lack of a multiyear repair and alteration plan, and limited funding, in reducing this multibillion-dollar inventory. In addition, funding limitations remain a major obstacle. Delaying …

A letter report issued by the General Accounting Office with an abstract that begins "The Internal Revenue Service (IRS) must significantly improve telephone assistance if it is to meet its long-term goal of providing world-class customer service to the tens of millions of taxpayers who call. Although IRS has tried to analyze its performance and identify ways to improve, these efforts have been incomplete. IRS' analyses did not cover all of the key management decisions and other key factors that affect telephone performance. Designing and conducting a comprehensive analysis of the key management decisions and other key factors that affect telephone performance in each filing season will be difficult because the factors that affect performance are multiple and interrelated. However, without a more comprehensive analysis of the factors that affect performance, IRS lacks the information it needs to make decisions to improve performance."