Federally Leased Vehicles: Agencies Should Strengthen Assessment Processes to Reduce Underutilized Vehicles
GAO-16-136
Published: Jan 14, 2016. Publicly Released: Jan 14, 2016.
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Highlights
What GAO Found
The General Services Administration (GSA) provides guidance to agencies to assist them in reducing underutilized leased vehicles. This guidance can be written (such as bulletins) or advice from GSA's fleet service representatives (FSR) to agency fleet managers. FSRs assist agencies with leasing issues, and GSA expects its FSRs to communicate with fleet managers about vehicle utilization at least annually. However, 18 of 51 fleet managers GAO surveyed reported that they had never spoken to their FSR about vehicle utilization. GSA has no mechanism to ensure these discussions occur and therefore may miss opportunities to help agencies identify underutilized vehicles.
While the selected agencies—the Air Force, the Bureau of Indian Affairs (BIA), the National Aeronautics and Space Administration (NASA), the National Park Service (NPS) and the Veterans Health Administration (VHA)—took steps to manage vehicle utilization, their processes did not always facilitate the identification and removal of underutilized vehicles. Certain selected agencies (1) could not determine if all vehicles were utilized, (2) could not locate justifications for vehicles that did not meet utilization criteria, or (3) kept vehicles that did not undergo or pass a justification review. These agencies paid GSA about $8.7 million in fiscal year 2014 for leased vehicles that were retained but did not meet utilization criteria and did not have readily available justifications (see table).
Selected Leased Vehicles That Did Not Meet Utilization Criteria and Did Not Have Readily Available Justifications That Were Retained across Five Agencies
|
Agency |
Percentage of the agency's selected vehiclesa |
Cost paid to GSA in FY2014 |
|
Air Force |
8% |
$1.5 M |
|
Bureau of Indian Affairs |
22% |
$1.2 M |
|
National Aeronautics and Space Administration |
4% |
$0.1M |
|
National Park Service |
47% |
$2.9M |
|
Veterans Health Administration |
14% |
$3.0M |
|
Total for Selected Vehicles |
15% |
$8.7 M |
Source: GAO analysis of GSA and agency-provided data. | GAO-16-136
aThe selected vehicles include all GSA-leased sedans, station wagons, and light trucks, except those that were (1) leased by multiple agencies during fiscal year 2014; (2) tactical, emergency responder, or law enforcement vehicles; or (3) outside the continental United States, among other exclusions. Results for selected vehicles cannot be generalized to vehicles outside of the selected population.
Of the selected agencies, NASA and VHA did not apply their utilization criteria to nearly 400 vehicles, representing about $1.2 million paid to GSA in fiscal year 2014. However, these agencies have taken steps to rectify the issue. The Air Force, BIA, NPS, and VHA could not readily locate justifications for over 1,500 leased vehicles that did not meet utilization criteria, representing about $5.8 million. BIA and NPS are planning action to ensure justifications are readily available in the future. As of May 2015, NPS and VHA had retained more than 500 vehicles—costing $1.7 million in fiscal year 2014—that were not subjected to or did not pass agency justification processes. While costs paid to GSA may not equal cost savings associated with eliminating vehicles, without justifications and corrective actions, agencies could be spending millions of dollars on vehicles that may not be needed.
Why GAO Did This Study
Federal agencies spent about $1 billion in fiscal year 2014 to lease about 186,000 vehicles from GSA. Assessing the utilization of leased vehicles is important to agency efforts to manage their fleet costs.
GAO was asked to examine federal processes for assessing the utilization of leased vehicles. This report addresses, among other objectives, (1) GSA's role in identifying and reducing underutilized leased vehicles and (2) the extent to which the processes used by selected federal agencies facilitate the identification and removal of underutilized leased vehicles, and any cost savings that could be achieved by reducing underutilized vehicles. GAO selected five agencies using factors such as fleet size, and analyzed over 15,500 fiscal-year 2014 vehicle records. At the five agencies, GAO surveyed fleet managers with at least 20 leased vehicles; reviewed fleet policies and guidance; and interviewed federal officials. These findings are not generalizable to all agencies or fleet managers.
Recommendations
GAO recommends, among other things, that GSA develop a mechanism to help ensure that FSRs speak with fleet managers about vehicle utilization, that the Air Force and VHA modify their processes for vehicle justifications, and that NPS and VHA take corrective action for vehicles that do not have readily accessible written justification or did not pass a justification review. Each agency concurred with the recommendations and discussed actions planned or underway to address them.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| General Services Administration | To help improve the accuracy of Drive-thru data to allow agencies to better manage their leased-vehicle fleet data, the Administrator of GSA should evaluate the 9,999-mile/month electronic safeguard for Drive-thru odometer readings to determine if a lower threshold could improve the accuracy of customer data and adjust this safeguard accordingly. |
Federal agencies spent about $1 billion in fiscal year 2014 to lease about 186,000 vehicles from GSA. As the lessor, GSA collects data on leased vehicles and offers it to agencies to help them manage their leased-vehicle fleets, and stores this information in a system called Drive-thru. In 2016, GAO reported that despite the overall indications that the selected Drive-thru data were accurate, its odometer data might be less accurate than most of the other information GAO studied. Specifically, GAO found that 3 percent of monthly odometer entries in May 2015 were lower than the previous month's odometer reading. An odometer reading that decreases from one month to the next indicates that there was an error at some point in time-either the previous month's entry was too high, or the current month's entry is too low. Agencies supply monthly odometer to GSA as part of the billing process and odometer errors result in temporary billing errors as agencies pay additional fees based on mileage. As part of this process, Drive-thru warned users that they may have entered incorrect data if their reported odometer reading was 9,999 miles greater than or less than the previous month's odometer reading. GSA officials stated that they chose the 9,999 mile warning point because they did not want the system to generate cautionary messages to customers when there was a valid reason for the mileage difference. However, using such a large mileage difference to trigger a warning means that GSA may be unlikely to catch the majority of errors. GAO found 52 cases where the mileage difference was 9,999 miles or greater, but more than 4,800 cases where the previous month's odometer reading exceeded the current month's reading. Although the resulting billing errors can be resolved the following month and the overall error rate is low, resolutions take time and resources for both GSA and the customer. Therefore, GAO recommend that the Administrator of GSA evaluate the 9,999-mile/month electronic safeguard for Drive-thru odometer readings to determine if a lower threshold could improve the accuracy of customer data, and that GSA adjust this safeguard accordingly. In 2019, GAO confirmed that GSA evaluated Drive-Thru's 9,999 mile safeguard and subsequently updated their system so that warnings would be triggered if the reported odometer reading was either: (1) 4,999 miles greater or less than the previous month's reported reading; or (2) more than three times the average monthly mileage. As a result of this change, GSA has greater assurance that the data entered into Drive-Thru are accurate and allow agencies to better manage their leased-vehicle fleet.
|
| General Services Administration | To provide better assurance that Fleet Service Representatives (FSR) are having conversations with leasing customers about utilization in accordance with GSA expectations, the Administrator of GSA should develop a mechanism to help ensure that these conversations occur. |
Assessing the utilization of leased vehicles is important to agency efforts to manage their fleet costs. In 2016, GAO reported that GSA has a limited role in identifying and reducing underutilized leased vehicles, as agencies are responsible for managing their vehicle fleets. Rather, GSA focuses on providing guidance and advice to federal agencies on utilization by (1) developing written guidance and reviewing agencies' Vehicle Allocation Methodology update submissions and (2) holding conversations with federal agencies' fleet managers to advise them about vehicle utilization at least annually. Specifically, GSA expects its fleet service representatives to hold these annual utilization-related conversations. However, 18 of the 51 fleet managers GAO surveyed reported that they had never discussed utilization with their FSR. GSA did not have a mechanism to help ensure that these discussions were occurring as expected. Without such a mechanism, GSA was not able to identify opportunities for FSRs to better assist agencies in identifying and managing their underutilized leased vehicles. Therefore, GAO recommended that GSA should develop a mechanism to help ensure that FSRs are having conversations with leasing customers about utilization in accordance with GSA expectations. In 2019, GAO confirmed that GSA had developed a checklist for FSRs to consult during conversations with fleet managers that included (1) discussing utilization based on mileage and (2) data points for low mileage vehicles to illustrate specific opportunities to right-size a customer's fleet. In addition, GSA reported that FSRs are continually reminded that they must discuss utilization with customers. As a result of these actions, GSA is better positioned to help agencies ensure that their leased fleet is optimum size.
|
| General Services Administration | To help strengthen the leased-vehicle justification processes across federal agencies, the Administrator of GSA should examine the Federal Property Management Regulations to determine if these regulations should be amended to require that vehicle justifications are clearly documented and readily available, and adjust them accordingly. |
In 2014, federal agencies spent about $1 billion to lease vehicles from the General Services Administration (GSA) to carry out agencies' missions, such as transporting personnel or hauling equipment. Assessing the utilization of leased vehicles is important to agency efforts to manage their fleet costs. Agencies are responsible for managing their vehicles' utilization in a manner that allows them to fulfill their missions and meet various federal requirements. Federal provisions on vehicle justification and determining what makes a vehicle "utilized" are detailed in the Federal Property Management Regulations (FPMR). In 2016, GAO reported that the FPMR provide some guidance to federal agencies on how to justify vehicle utilization, but they do not require agencies to have clearly-documented justifications available for examination or to have any mechanism for ensuring that these justifications take place. GAO also reported that the FPMR did not require agencies to take any action for unjustified vehicles, which are vehicles that neither meet the agency's utilization criteria nor pass the justification process. GAO found that most of the agencies in its review did not have readily available justifications for all vehicles and did not take action for all unjustified vehicles. GAO also reported that GSA has not examined these regulations. By not examining the FPMR, GSA may be missing an opportunity to help ensure that agencies are appropriately justifying all vehicles in their fleet and determining if their leased vehicle fleet contains vehicles that should be eliminated. Therefore, GAO recommended that the Administrator of GSA examine the FPMR to determine if these regulations should be amended to require that vehicle justifications are clearly documented and readily available, and adjust them accordingly. In 2020, GAO confirmed that GSA had examined the FPMR and determined that it should be amended. Specifically, GSA determined that utilization guidelines should be consistent across the entire federal fleet -- agency-owned, GSA-leased or commercially-leased -- and that isolating leased vehicles for unique requirements created confusion for both use and reporting purposes. Since the FPMR pertains only to GSA-leased assets, GSA concluded that references to justification should be removed, and agencies should operate under the regulations and guidance established for the entire federal fleet. As a result of its examination, GSA is better positioned to ensure that justifications for leased vehicles are consistent across the federal fleet, which satisfies the spirit of GAO's recommendation.
|
| Department of Defense | To improve the justification process, the Secretary of the Department of Defense should direct the Secretary of the Air Force to modify the current process to ensure that each leased vehicle in the agency's fleet meets the agency's utilization criteria or has readily available justification documentation. |
Federal agencies spent about $1 billion in fiscal year 2014 to lease about 186,000 vehicles from GSA to carry out agencies' missions. Agencies may own or lease the vehicles in their fleets and are responsible for managing their vehicles' utilization in a manner that allows them to fulfill their missions and meet various federal requirements. Agencies determine the number and type of vehicles they need to own or lease and when a vehicle is no longer needed to achieve the agency's mission. Under federal regulations, agencies can define the utilization criteria for the vehicles they use, such as mileage or days used. According to GSA, the only requirement in the utilization portion of the regulations is for agencies to justify every full-time vehicle in in their respective fleets. GAO selected five agencies for this review using factors related to the agencies' leased vehicles. The Air Force was one of these agencies and uses a software algorithm with over 2,600 criteria as its utilization criteria. In 2016, GAO reported that the Air Force officials could not readily provide the justification for 413 vehicles that did not meet the Air Force's software algorithm. The agency paid $1.5 million to GSA in 2014 for these vehicles. According to officials, vehicles that did not meet the utilization criteria in the Air Force's algorithm are subject to the agency's justification process, the results of which were stored in the agency's Fleet Management Information System (FMIS). However, GAO found that the Air Force's FMIS did not include information on all agency vehicles. Agency officials said justifications for these 413 vehicles were not stored in the Air Forces' FMIS and would be difficult to locate because these vehicles were used by the Air National Guard, which has its own justification process. However, Air Force is administratively responsible for these vehicles, according to agency officials. Without readily available written justification, the Air Force was limited in its ability to exercise oversight over key vehicle retention decisions. Therefore, GAO recommended that the Department of Defense direct the Air Force to modify the current process to ensure that each leased vehicles in the agency's fleet meets the agency's utilization criteria or has readily available justification documentation. In 2018, GAO confirmed that DOD modified its process for vehicle justifications. DOD issued a memorandum to all DOD Fleet Managers on their management of underutilized leased vehicles, including the Air Force. This memorandum requires DOD Fleet Managers to conduct written assessments of all vehicles that fall below a mileage threshold. This memorandum states that the assessment should validate the mission requirement for the vehicle, specify the utilization metric that will be used to justify maintaining this vehicle in the fleet inventory, and that the assessment will be retained in the vehicle jacket or the Defense Property Accountability System. As result, GAO believes that the memorandum more than addresses the intent of this recommendation and should ensure that all DOD leased vehicles meet utilization criteria or have readily-available justification documentation.
|
| Department of Veterans Affairs | To improve their justification process, the Secretary of the Department of Veterans Affairs should direct the Under Secretary for Health to modify the current process to ensure that each leased vehicle in the agency's fleet meets the agency's utilization criteria or has readily available justification documentation. |
In 2014, federal agencies spent about $1 billion to lease vehicles from the General Services Administration (GSA) to carry out agencies' missions such as transporting personnel or hauling equipment. Assessing the utilization of leased vehicles is important to agency efforts to manage their fleet costs. Agencies are responsible for managing their vehicles' utilization in a manner that allows them to fulfill their missions and meet various federal requirements. Federal provisions on vehicle justifications and determining what makes a vehicle "utilized" are detailed in the Federal Property Management Regulations (FPMR). Specifically, the FPMR provide how agencies can define utilization criteria for the vehicles that they use. However, if vehicles do not meet the utilization criteria defined in agency policy, the FPMR provides that agencies must justify vehicles in another manner. VA's Veterans Health Administration (VHA) uses the FPMR's miles-traveled guidelines as well as other miles-traveled metrics and days per month as utilization criteria, which an official said reflects the agency mission of delivering health care. In 2016, GAO reported that VHA could not determine if vehicles met the agency's utilization criteria or could not provide justifications for vehicles. VHA's process for managing utilization data did not always facilitate the identification of underutilized leased vehicles, although the agency had taken steps to rectify the identified issues. VHA also was unable to locate justifications for 181 vehicles for which it had data indicating that the vehicle had not met VHA's utilization criteria. The agency paid $0.6 million to GSA in fiscal year 2014 for these vehicles. Because VHA's process did not consistently facilitate the identification of underutilized vehicles, the agency may not have known which vehicles should be eliminated. Specifically, without readily accessible written justification, agencies are limited in their ability to exercise oversight over key vehicle retention decisions. Therefore, GAO recommended that VHA modify its justification process to ensure that each leased vehicle in the agency's fleet meets the agency's utilization criteria or has readily available justification documentation. In 2019, GAO confirmed that VHA modified its justification process to ensure that each vehicle in its inventory meets utilization criteria or is justified. Specifically, VHA identified that its fleet vehicle database contained data errors. In response, VHA fleet coordinators-data collectors-completed training on data entry and the database to improve its data quality. Following this training, VHA required each region to update the data in its database. After each region completed the update, VHA developed underutilization reports for each region for fiscal year 2017. Those reports, which can be accessed by the VHA fleet manager and each region, include justifications for each vehicle in VHA's fleet that did not pass the agency's utilization process. VHA has an ongoing process to continually update its database and annually conduct reviews of vehicle utilization, which include vehicle justifications. As a result of these actions, VHA is better positioned to exercise oversight over vehicle retention decisions for vehicles that cost millions of dollars annually, which meets the intent of GAO's recommendation.
|
| Department of the Interior | To facilitate the elimination of unnecessary vehicles, the Secretary of the Department of the Interior should direct the NPS Director to take corrective action to address each leased vehicle that has not met the agency's utilization criteria or passed the justification process. This corrective action could include (1) reassigning vehicles within the agency to ensure they are utilized or (2) returning vehicles to GSA. |
AIn 2014, federal agencies spent about $1 billion to lease vehicles from the General Services Administration (GSA) to carry out agencies' missions such as transporting personnel or hauling equipment. Assessing the utilization of leased vehicles is important to agency efforts to manage their fleet costs. Agencies are responsible for managing their vehicles' utilization in a manner that allows them to fulfill their missions and meet various federal requirements. Federal provisions on vehicle justifications and determining what makes a vehicle "utilized" are detailed in the Federal Property Management Regulations (FPMR). In 2016, GAO reported that the FPMR do not require agencies to take any action for unjustified vehicles, which are vehicles that neither meet the agency's utilization criteria nor pass the justification process. However, federal internal control standards call for agencies to be accountable for stewardship of government resources. GAO found that the Department of Interior's National Park Service retained 109 vehicles that did not meet agency-defined utilization criteria and did not pass the agency's justification process. The agency paid GSA $0.4 million in fiscal year 2014 for these vehicles. By not taking corrective action on vehicles that did not meet the utilization criteria and did not pass a justification process, NPS could be spending money on vehicles that were not needed. Therefore, GAO recommended that NPS should take corrective action to address each leased vehicle that has not met the agency's utilization criteria or passed the justification process. In 2020, GAO confirmed that NPS had established a process to ensure that each leased vehicle is either justified, reassigned, or returned to GSA. NPS officials provided GAO with data on specific vehicles that had been justified, as well as data on specific vehicles that had been returned to GSA. NPS has also conducted training on GSA-leased utilization and justification policies as well as management reviews of GSA-leased vehicle utilization. Through these efforts, NPS has reduced the likelihood that the agency is spending money on vehicles that may not be needed, which meets the intent of GAO's recommendation.
|
| Department of Veterans Affairs | To facilitate the elimination of unnecessary vehicles, the Secretary of the Department of Veterans Affairs should direct the Under Secretary for Health to take corrective action to address each leased vehicle that has not met the agency's utilization criteria or passed the justification process. This corrective action could include (1) reassigning vehicles within the agency to ensure they are utilized or (2) returning vehicles to GSA. |
In 2014, federal agencies spent about $1 billion to lease vehicles from the General Services Administration (GSA) to carry out agencies' missions such as transporting personnel or hauling equipment. Assessing the utilization of leased vehicles is important to agency efforts to manage their fleet costs. Agencies are responsible for managing their vehicles' utilization in a manner that allows them to fulfill their missions and meet various federal requirements. Federal provisions on vehicle justifications and determining what makes a vehicle "utilized" are detailed in the Federal Property Management Regulations (FPMR). In 2016, GAO reported that the FPMR do not require agencies to take any action for unjustified vehicles, which are vehicles that neither meet the agency's utilization criteria nor pass the justification process. However, federal internal control standards call for agencies to be accountable for stewardship of government resources. VA had established an approach to address unjustified vehicles, which can include placing them into a shared pool, transferring them to a new mission, rotating them with higher-mileage vehicles, or eliminating them from their fleet. VA took actions to reduce vehicles that did not meet the agency's utilization criteria or pass its justification process. However, VA's Veterans Health Administration (VHA) retained 393 vehicles that did not meet the agency-defined utilization criteria and did not pass the agency's justification process. The agency paid $1.3 million to GSA in fiscal year 2014 for these vehicles. VHA policy did not require justification for all vehicles that did not meet utilization criteria. As a result, these 393 vehicles were never subject to a justification process. By not taking corrective action on vehicles that did not meet the utilization criteria and did not pass a justification process, VHA could be spending money on vehicles that were not needed. Therefore, GAO recommended that VHA should take corrective action to address each leased vehicle that has not met the agency's utilization criteria or passed the justification process. In 2019, GAO confirmed that VHA had instructed all regional fleet managers to provide justification for any vehicle that had insufficient justifying documentation. Using this updated information on justified vehicles, VHA developed regional reports of underutilized vehicles that were then sent to each regional fleet manager for action. The regional fleet managers justified vehicles, transferred vehicles, or returned them to GSA. As a result, VHA has reduced the likelihood that the agency is spending millions of dollars on vehicles that may not be needed, which meets the intent of GAO's recommendation.
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