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Report to the Committee on Governmental Affairs, U.S. Senate: October 2002: PERFORMANCE AND ACCOUNTABILITY: Reported Agency Actions and Plans to Address 2001 Management Challenges and Program Risks: GAO-03-225: Letter: Background: Objective, Scope, and Methodology: Results in Brief: Agency Comments: Appendixes: Appendix I: Observations on the Department of Agriculture’s Efforts to Address Its Major Management Challenges: Appendix II: Observations on the Department of Commerce’s Efforts to Address Its Major Management Challenges: Appendix III: Observations on the Department of Education’s Efforts to Address Its Major Management Challenges: Appendix IV: Observations on the Department of Energy’s Efforts to Address Its Major Management Challenges: Appendix V: Observations on the Environmental Protection Agency’s Efforts to Address Its Major Management Challenges: Appendix VI: Observations on the Federal Emergency Management Agency’s Efforts to Address Its Major Management Challenges: Appendix VII: Observations on the General Services Administration’s Efforts to Address Its Major Management Challenges: Appendix VIII: Observations on the Department of Health and Human Service’s Efforts to Address Its Major Management Challenges: Appendix IX: Observations on the Department of Housing and Urban Development’s Efforts to Address Its Major Management Challenges: Appendix X: Observations on the Department of the Interior’s Efforts to Address Its Major Management Challenges: Appendix XI: Observations on the Department of Justice’s Efforts to Address Its Major Management Challenges: Appendix XII: Observations on the Department of Labor’s Efforts to Address Its Major Management Challenges: Appendix XIII: Observations on the National Aeronautics and Space Administration’s Efforts to Address Its Major Management Challenges: Appendix XIV: Observations on the Nuclear Regulatory Commission’s Efforts to Address Its Major Management Challenges: Appendix XV: Observations on the National Science Foundation’s Efforts to Address Its Major Management Challenges: Appendix XVI: Observations on the Office of Personnel Management’s Efforts to Address Its Major Management Challenges: Appendix XVII: Observations on the Small Business Administration’s Efforts to Address Its Major Management Challenges: Appendix XVIII: Observations on the Social Security Administration’s Efforts to Address Its Major Management Challenges: Appendix XIX: Observations on the Department of State’s Efforts to Address Its Major Management Challenges: Appendix XX: Observations on the Department of Transportation’s Efforts to Address Its Major Management Challenges: Appendix XXI: Observations on the Department of the Treasury’s Efforts to Address Its Major Management Challenges: Appendix XXII: Observations on the U.S. Agency for International Development’s Efforts to Address Its Major Management Challenges: Appendix XXIII: Observations on the Department of Veterans Affairs’ Efforts to Address Its Major Management Challenges: Appendix XXIV: GAO Contact and Staff Acknowledgments: Tables: Table 1: Number of Management Challenges on Which Agencies Reported: Table 2: Major Management Challenges for USDA: Table 3: Major Management Challenges for Commerce: Table 4: Major Management Challenges for Education: Table 5: Major Management Challenges for Energy: Table 6: Major Management Challenges for EPA: Table 7: Major Management Challenges for FEMA: Table 8: Major Management Challenges for GSA: Table 9: Major Management Challenges for HHS: Table 10: Major Management Challenges for HUD: Table 11: Major Management Challenges for Interior: Table 12: Major Management Challenges for Justice: Table 13: Major Management Challenges for Labor: Table 14: Major Management Challenges for NASA: Table 15: Major Management Challenges for NRC: Table 16: Major Management Challenges for NSF: Table 17: Major Management Challenges for OPM: Table 18: Major Management Challenges for SBA: Table 19: Major Management Challenges for SSA: Table 20: Major Management Challenges for State: Table 21: Major Management Challenges for DOT: Table 22: Major Management Challenges for Treasury: Table 23: Major Management Challenges for USAID: Table 24: Major Management Challenges for VA: Abbreviations: ACF: Administration for Children and Families: ADAMS: Agencywide Document Access and Management System: ATF: Bureau of Alcohol, Tobacco, and Firearms: BIS: Bureau of Industry and Security: BLM: Bureau of Land Management: CARES: Capital Asset Realignment for Enhanced Services: CDR : Continuing Disability Review: CFO : chief financial officer: CIP: Critical Infrastructure Protection: CISSCO: Consolidated Information Support Services: COPS: Community Oriented Policing Service: CPO: chief people officer: CMS : Centers for Medicare & Medicaid Services: CSRIC: Computer Security Incident Response Capability: DDB: dependent database: DEA: Drug Enforcement Administration: DOD: Department of Defense: DOE: Department of Energy: DOT: Department of Transportation: EDA: Economic Development Administration: EDP: electronic data processing: EIE: Electronic Information Exchange: EITC: Earned Income Tax Credit: EOWS: Executive Office for Weed and Seed: EPA : Environmental Protection Agency: ETA: Employment and Training Administration: FAA: Federal Aviation Administration: FDA: Food and Drug Administration: FECA: Federal Employees’ Compensation Act: FEMA: Federal Emergency Management Agency: FHA: Federal Housing Administration: FMFIA: Federal Managers’ Financial Integrity Act: FMS: Financial Management Service: FR: Financial Report of the U.S. Government: FSS: Federal Supply Service: FTE: full-time equivalents: FTS: Federal Technology Service: FWS: Fish and Wildlife Service: GISRA: Government Information Security Reform Act: GPRA: Government Performance and Results Act: GSA: General Services Administration: HEU: highly enriched uranium: HHS: Department of Health and Human Services: HUD: Department of Housing and Urban Development: IFS: Integrated Financial System: INS: Immigration and Naturalization Service: IRS: Internal Revenue Service: ISS: International Space Station: IT: information technology: ITA: International Trade Administration: MARAD: Maritime Administration: MBDA: Minority Business Development Agency: MIT: Management Improvement Team: NASA: National Aeronautics and Space Administration: NCLB: No Child Left Behind Act: NHC: National Hiring Center: NIF: National Ignition Facility: NIST: National Institute for Standards and Technology: NNSA: National Nuclear Security Administration: NOAA: National Oceanic and Atmospheric Administration: NSF: National Science Foundation: NRC: Nuclear Regulatory Commission: PBGC: Pension Benefit Guaranty Corporation: OASDI: Old Age, Survivors, and Disability Insurance: OGP: Office of Governmentwide Policy: OHREEO: Office of Human Resources and Equal Employment Opportunity: OIG: Office of Inspector General: OJP: Office of Justice Programs: OMB: Office of Management and Budget: OPM: Office of Personnel Management: PKI: public key infrastructure: PRA: Probabilistic Risk Assessment: REAP: Resource Estimation Allocation Process: RHIIP: Rental Housing Integrity Improvement Project: SBA: Small Business Administration: SES: Senior Executive Service: SSA: Social Security Administration: SSI: Supplemental Security Income: SSBG: Social Services Block Grant: TANF : Temporary Assistance for Needy Families: TSA: Transportation Security Administration: USAID: U.S. Agency for International Development: USDA: Department of Agriculture: VA: Department of Veterans Affairs: WIA: Workforce Investment Act: WtW: Welfare-to-Work: Letter: October 31, 2002: The Honorable Joseph I. Lieberman Chairman The Honorable Fred Thompson Ranking Minority Member Committee on Governmental Affairs United States Senate: This report is in response to your request that we examine the actions and plans agencies reported in addressing the high-risk areas and major management challenges that were previously identified by GAO in its January 2001 Performance and Accountability and High-Risk Series.[Footnote 1] In fulfilling the request, except as otherwise noted, we reviewed the fiscal year 2001 performance report and fiscal year 2003 performance plan required by the Government Performance and Results Act of 1993 (GPRA) for 23 of the 24 Chief Financial Officers Act (CFO) agencies. The Department of Defense was not included in this review since it had not issued its combined performance report and performance plan. Background: Since 1990, GAO has periodically reported on government operations that it identifies as “high risk.” Historically, GAO has designated federal programs and operations, either at the agency level or governmentwide, as high risk because of their greater vulnerability to fraud, waste, abuse, and mismanagement. More recently, GAO has given added emphasis to identifying as high risk those major programs and operations that need urgent attention in order to ensure our national government functions in the most economical, efficient, and effective manner possible. GAO removes the high-risk designations when legislative and agency actions, including those in response to our recommendations, result in significant progress toward resolving a high-risk problem, or when other factors affect a high-risk area, such as the occurrence of a time-related event. In January 1999, GAO first issued a special series of reports entitled the Performance and Accountability Series: Major Management Challenges and Program Risks. The reports in this series described the major management challenges and high-risk areas that the agencies needed to address to improve their performance and accountability. Updated 2 years later, the 2001 Performance and Accountability Series covered 21 agencies, including each cabinet department, most major independent agencies, and the U.S. Postal Service. This report describes agencies’ reported progress in addressing the two governmentwide high-risk areas, information security and strategic human capital management, as well as in addressing the major management challenges and high-risk issues that GAO identified at each agency in the 2001 Performance and Accountability and High-Risk Series. Hereafter, we refer to the two governmentwide high risks, agency major management challenges, and agency high-risk issues collectively as “major management challenges.”: In January 2003, we will issue our latest performance and accountability series, which will discuss agencies’ progress and identify new management challenges and program risks. Objective, Scope, and Methodology: The objective of this report was to review for each of the major management challenges we discussed in our January 2001 series actions agencies reported in their fiscal year 2001 performance reports, as well as the goals, measures, and strategies agencies reported in their fiscal year 2003 performance plans. To assess agency responses to the management challenges, we reviewed the fiscal year 2001 GPRA performance report and fiscal year 2003 performance plan for 22 of the 24 CFO agencies. The Department of Education did not submit a performance report or performance plan; instead, it submitted a report of its Management Improvement Team, which we reviewed in lieu of the report and plan. As noted above, the Department of Defense did not submit a fiscal year 2001 performance report or fiscal year 2003 performance plan and was not included in our review. In evaluating agency responses to the information security management challenge, we also considered certain agency reports, including accountability reports, and prior GAO work. For each challenge, we evaluated whether the agency (1) discussed its progress in addressing its major management challenges and (2) had performance goals and measures directly or indirectly related to the challenge and, if not, whether it had management strategies to deal with the challenge. Unless otherwise noted, our review was based on the fiscal year 2001 performance reports and fiscal year 2003 performance plans. We did not include any changes or modifications the agencies may have made to the reports or plans after they were issued, except in cases in which agency comments provided information from a published update to a report or plan. Although many agencies chose to discuss how they are addressing their management challenges, such as those identified by GAO, in their performance reports and plans, there is no legal requirement to do so. However, according to Office of Management and Budget guidance to agencies,[Footnote 2] performance goals for management problems should be included in the annual plan, particularly for problems whose resolution is mission critical or which could potentially impede achievement of program goals. Also, that an agency chose not to discuss its efforts to address major management challenges in its performance reports or plans does not necessarily mean that the agency is not addressing the challenges. Furthermore, because of the scope and timing of this review, information on the progress agencies may have made on addressing their management challenges during fiscal year 2002 was not yet available. We conducted our review from September through October 2002, in accordance with generally accepted government auditing standards. Results in Brief: As shown in table 1, 18 of the 23 federal agencies in our review reported in their fiscal year 2001 performance reports that they had made progress on all of the major management challenges. For example, the Department of Energy, in response to the strategic human capital management challenge, reported that it held a human capital summit, and the Department of Housing and Urban Development, in response to an agency-specific challenge, discussed undertaking a number of initiatives to improve oversight of its single-family mortgage programs. However, 5 of the agencies did not discuss progress on one or more of the challenges. In their fiscal year 2003 performance plans, the agencies discussed, for the most part, performance goals and measures directly or indirectly related to the major management challenges. Specifically, 8 of the 23 agencies discussed directly related goals and measures for all of the challenges, and 8 others listed directly related goals and measures for most of the challenges. The 15 agencies that did not provide directly related goals and measures for all of their challenges varied in the extent to which they did address the challenges. Nine of the 15 agencies discussed goals and measures that were indirectly related to at least one of their major management challenges. Nine of the 15 agencies discussed strategies for addressing at least one of the challenges, but did not provide goals or measures. Five agencies--the departments of Agriculture, Justice, Transportation, and the Treasury, and the United States Agency for International Development (USAID)--mentioned no goals, measures, or strategies for one or more challenges. However, as noted in appendix XI, a Justice official stated that Justice believes that those challenges are no longer significant enough to be addressed in their performance report or plan. Furthermore, as noted in appendix XXI, Treasury has made progress in addressing two challenges, improving performance measures related to criminal access to firearms and the management of its asset forfeiture program. All 23 agencies in our review discussed progress in dealing with strategic human capital management, and 21 of the 23 agencies discussed information security. However, not all the agencies provided performance measures for evaluating progress on these challenges. For example, in the area of strategic human capital management, the Environmental Protection Agency reported having a specific target for fiscal year 2003 of having five offices use its newly developed workforce planning model. In contrast, the Federal Emergency Management Agency (FEMA) has goals of streamlining its organization and developing its workforce, but listed no measures to gauge progress for either goal. In the area of information security, the Department of the Interior reported it has a specific target of fiscal year 2003 for having its critical computer systems achieve compliance level 3 on the Federal Information Technology Security Assessment Framework,[Footnote 3] and of fiscal year 2005 for achieving level 5, the highest possible. On the other hand, FEMA stated that information technology presented several management challenges, but did not present specific performance measures designed to measure the effectiveness of information security. Table 1: Number of Management Challenges on Which Agencies Reported: Agency: Agriculture; Number of challenges: 9; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 9; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 6; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 1; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 2. Agency: Commerce; Number of challenges: 6; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 6; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 6; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: Education; Number of challenges: 6; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 4; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 5; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 1; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: Energy; Number of challenges: 8; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 8; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 8; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: EPA; Number of challenges: 4; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 4; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 2; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: FEMA; Number of challenges: 5; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 2; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 3; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: GSA; Number of challenges: 2; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 2; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: HHS; Number of challenges: 7; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 7; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 5; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: HUD; Number of challenges: 5; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 5; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 5; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: Interior; Number of challenges: 4; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 4; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 2; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: Justice; Number of challenges: 14; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 10; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 9; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 1; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 4. Agency: Labor; Number of challenges: 5; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 5; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 5; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: NASA; Number of challenges: 5; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 5; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 4; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 3; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 1; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: NRC; Number of challenges: 6; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 5; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 4; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: NSF; Number of challenges: 2; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 2; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: OPM; Number of challenges: 2; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 2; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: SBA; Number of challenges: 6; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 6; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 1; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 1; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 4; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: SSA; Number of challenges: 6; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 6; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 5; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 1; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: State; Number of challenges: 7; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 7; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 6; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 1; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Agency: Transportation; Number of challenges: 8; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 8; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 3; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 4; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 1. Agency: Treasury; Number of challenges: 7; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 7; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 3; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 2. Agency: USAID; Number of challenges: 5; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 4; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 1; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 2; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 1; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 1. Agency: VA; Number of challenges: 6; Challenges on which agencies reported progress in fiscal year 2001 performance reports: 6; Fiscal year 2003 performance plan: Challenges with directly related goals and measures: 6; Fiscal year 2003 performance plan: Challenges with indirectly related goals and measures: 0; Fiscal year 2003 performance plan: Challenges with strategies but no goals or measures: 0; Fiscal year 2003 performance plan: Challenges with no goals, measures, or strategies: 0. Note: The columns for fiscal year 2003 represent the number of challenges that agencies have addressed in each category and are not mutually exclusive. Therefore, the numbers in these columns may not add to the total number of challenges. Source: GAO analysis. [End of table] Appendixes I through XXIII have detailed information for each of the agencies reviewed concerning the response to each agency’s challenges. Agency Comments: We sent drafts of all agency appendixes to the respective agencies for comments. The comments we received were largely of a technical nature, and these were incorporated where appropriate. The Department of Transportation (DOT) commented that it was not possible to address all of its management challenges in the 2001 performance report, since the 2001 performance plan, which served as the basis for the 2001 performance report, was published in March 2000--several months before we issued our management challenges report. While we agree that DOT could not predict all of the challenges we were to cite and develop related targets, there was nothing to preclude DOT from discussing in its 2001 performance report the progress it had made in addressing its major management challenges. DOT also commented that it has taken or is in the process of taking a number of actions not addressed in the plan to address concerns we raised under some of the management challenges. These actions address issues concerning the Deepwater Acquisition Project, information security, air traffic control modernization, aviation, and safety and security. As noted above, we recognize that agencies may have taken actions or made plans to address their major management challenges that were not discussed in their performance reports or plans. As agreed with your offices, unless you announce the contents of this report earlier, we plan no further distribution until 30 days after its date. At that time, we will send copies to the President, the Director of the Office of Management and Budget, the congressional leadership, other Members of the Congress, and the heads of major departments and agencies. If you have any questions about this report, please contact me or Elizabeth Curda on (202) 512-6806 or daltonp@gao.gov. Major contributors to this report are listed in appendix XXIV. Patricia A. Dalton Director, Strategic Issues: Signed by Patricia A. Dalton: [End of section] Appendixes: Appendix I: Observations on the Department of Agriculture’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Agriculture (USDA), including the governmentwide, high-risk areas of strategic human capital management and information security. The first column lists the major management challenges identified by our office. The second column discusses what progress, as discussed in their fiscal year 2001 performance report, the agency has made in resolving these challenges. The third column discusses the extent to which USDA’s fiscal year 2003 performance plans include performance goals and measures to address the challenges that we identified. We found that USDA’s performance report discussed the agency’s progress in resolving all of its challenges, except that USDA stated that it could not directly address GAO’s recommendation to establish a single food safety agency because such an action is beyond the legal authority of any federal department. Of the agency’s nine major management challenges, its performance plan had: 1. goals and measures that were directly related to 6 of the challenges, 2. goals and measures that were indirectly applicable to the one of the challenges, including: * strategic human capital management: 3. no goals and measures related to two of the challenges, although USDA did discuss strategies to address the challenges, which were: * food safety and: * forest service performance accountability. Table 2: Major Management Challenges for USDA: [See PDF for image] [End of section] Appendix II: Observations on the Department of Commerce’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Commerce, which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, Commerce made in resolving its challenges. The third column discusses the extent to which Commerce’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that Commerce’s performance report discussed the agency’s progress in resolving these challenges. For the most part, the progress was discussed either under the departmental management section of the performance report or in the sections detailing the progress of the Bureau of Industry and Security (BIS) (formerly called the Bureau of Export Administration), the Economic Development Administration (EDA), the International Trade Administration (ITA), the Minority Business Development Agency (MBDA), and the National Oceanic and Atmospheric Administration (NOAA). The agency’s performance plan has goals and measures that were directly related to all six of the major management challenges. Table 3: Major Management Challenges for Commerce: [See PDF for image] [End of table] [End of section] Appendix III: Observations on the Department of Education’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Education (Education), including the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office in 2001. The second column discusses the progress Education made in resolving its challenges, as reported in its Management Improvement Team (MIT) Accomplishments Report. Education did not submit a Government Performance and Results Act report for fiscal year 2001 because, according to agency officials, the department was revising its strategic plan. Instead, Education issued a MIT Accomplishments Report in October 2001 to reflect some of the department’s progress in resolving its challenges.[Footnote 4] The third column discusses the extent to which Education’s 2002-2003 annual plan includes goals, strategies and performance measures to address the challenges that we identified[Footnote 5]. We found that Education’s MIT Accomplishments Report discussed the agency’s progress in resolving many of its challenges, but it did not discuss the agency’s progress in resolving the following challenges: * encouraging states to improve performance information and upgrade federal evaluations used to assess how well all children reach challenging academic standards and: * promoting coordination with other federal agencies and school districts to help build a solid foundation of learning for all children. Of the agency’s six major management challenges, its performance plan had: 1. goals and measures that were directly related to five of the challenges and: 2. no goals and measures related to one of the challenges, but discussed strategies to partly address: * promoting coordination with other federal agencies and: * school districts to help build a solid foundation of learning for all children. Table 4: Major Management Challenges for Education: [See PDF for image] [End of table] [End of section] Appendix IV: Observations on the Department of Energy’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Energy (DOE), including the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, DOE made in resolving its challenges. The third column discusses the extent to which DOE’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that DOE’s performance report discussed the agency’s progress in resolving its challenges. The agency’s performance plan had goals and measures that were directly related to all eight of the major management challenges. Table 5: Major Management Challenges for Energy: [See PDF for image] [End of section] Appendix V: Observations on the Environmental Protection Agency’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Environmental Protection Agency (EPA), including the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, EPA made in resolving its challenges. The third column discusses the extent to which EPA’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that EPA’s performance report discussed the agency’s progress in resolving all of its challenges. Of the agency’s four major management challenges, its performance plan had: 1. goals and measures that were directly related to two of the challenges and: 2. no goals and measures related to two of the challenges but discussed strategies to address the challenges, which were: * environmental and performance information management to set priorities and measure program results and: * working relationships with states. Table 6: Major Management Challenges for EPA: [See PDF for image] [A] U.S. General Accounting Office, Environmental Protection: Observations on Elevating the Environmental Protection Agency to Cabinet Status, GAO-02-552T (Washington, D.C.: Mar. 21, 2002.): [B] U.S. General Accounting Office, Environmental Protection: Overcoming Obstacles to Innovative State Regulatory Programs, GAO-02- 268 (Washington, D.C.: Jan. 31, 2002.): [C] GAO-02-552T. [D] GAO-02-268. [End of table] [End of section] Appendix VI: Observations on the Federal Emergency Management Agency’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Federal Emergency Management Agency (FEMA), including the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, FEMA made in resolving its challenges. The third column discusses the extent to which FEMA’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that the FEMA 2001 performance report discussed the agency’s progress in resolving all its challenges. However, for three challenges, it is difficult to discern how FEMA addresses these challenges because they are not clearly linked to a specific goal, including: * strategic human capital management, * information security, and: * reduce the cost of disaster assistance. FEMA does not have a specific goal for strategic human capital management but does consider it a future management challenge that is discussed generally in the report. Of the agency’s 5 major management challenges, its 2003 performance plan had: 1. goals and measures that were directly related to 3 of the challenges, including: * determine the cost-effectiveness of disaster mitigation efforts, * reduce the cost of disaster assistance, and: * improve the financial condition of the National Floor Insurance Program (NFIP): 2. goals and measures that were indirectly applicable to 2 of the challenges, including: * strategic human capital management and: * information security. Table 7: Major Management Challenges for FEMA: [See PDF for image] [End of table] [End of section] Appendix VII: Observations on the General Services Administration’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the General Services Administration (GSA), which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, GSA made in resolving its challenges. The third column discusses the extent to which GSA’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that GSA’s performance report discussed the agency’s progress in resolving both of its challenges. In addition, we noted that GSA’s fiscal year 2003 performance plan had goals and measures that directly and indirectly related to both governmentwide management challenges. Table 8: Major Management Challenges for GSA: [See PDF for image] [End of table] [End of section] Appendix VIII: Observations on the Department of Health and Human Service’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Health and Human Services (HHS), including the governmentwide, high-risk areas of strategic human capital management and information security. The first column lists the major management challenges identified by our office. The second column discusses what progress, as discussed in their fiscal year 2001 performance reports, HHS and three of its component agencies--the Centers for Medicare & Medicaid Services (CMS)[Footnote 6], the Food and Drug Administration (FDA), and the Administration for Children and Families (ACF)--have made in resolving these challenges. We chose to review these agencies’ plans because they are the responsible agencies for addressing the five agency-specific management challenges. The third column discusses the extent to which HHS’s, CMS’s, FDA’s, and ACF’s fiscal year 2003 performance plans include performance goals and measures to address the challenges that we identified. We found that all seven of the major management challenges identified by GAO were discussed, to some extent, in at least one or more of the agencies’ fiscal year 2001 performance reports. Regarding how the department and its agencies addressed the government-wide challenge of strategic human capital in their fiscal year 2003 performance plans, we found that, although HHS and its component agencies did not directly address all four elements of the challenge, each had some goals that related to some aspects of human capital management. Regarding the government-wide challenge of information security, we found that HHS only referred to having goals to address this challenge and CMS had a specific goal that directly addressed it, but FDA and ACF did not. Because HHS and the agencies we reviewed were uneven in their approach to these government-wide management challenges, we considered them to have goals and measures indirectly related to these challenges. Of the agency’s seven major management challenges, its performance plan had: 1. goals and measures that were directly related to the five agency- specific challenges and: 2. goals and measures that were indirectly applicable to both of the governmentwide management challenges, including: * strategic human capital management and: * information security. Table 9: Major Management Challenges for HHS: [See PDF for image] [End of section] Appendix IX: Observations on the Department of Housing and Urban Development’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Housing and Urban Development (HUD), including the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, HUD made in resolving its challenges. The third column discusses the extent to which HUD’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that HUD’s performance report discusses actions the agency has taken to address all of the management challenges we identified in January of 2001. In its performance plan, HUD reported that it fully focused on resolving the remaining high-risk issues and management challenges. The agency’s performance plan had goals and measures that were directly related to all five of the challenges. Table 10: Major Management Challenges for HUD: [See PDF for image] [End of table] [End of section] Appendix X: Observations on the Department of the Interior’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of the Interior, including the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, Interior made in resolving its challenges. The third column discusses the extent to which Interior’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that the Department of the Interior’s performance report discussed the agency’s progress in resolving all of its challenges. Of the agency’s four major management challenges, its performance plan had: 1. goals and measures that were directly related to two of the challenges: * improve management of national parks and: * improve management of ecosystem restoration efforts: 2. no goals and measures related to two of the challenges, but discussed strategies to address the challenges, which were: * address persistent management problems in Indian trust programs and: * address challenges in managing an expanding land base. Table 11: Major Management Challenges for Interior: [See PDF for image] [End of table] [End of section] Appendix XI: Observations on the Department of Justice’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Justice’s (Justice) including the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, Justice made in resolving its challenges. The third column discusses the extent to which Justice’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that Justice’s performance report discussed the agency’s progress in resolving many its challenges, but it did not discuss the agency’s progress in resolving the following challenges, including: * Asset Forfeiture Program, * program management weaknesses remain in Weed and Seed Program, * internal control weaknesses at the Drug Enforcement Administration (DEA), and: * efforts to reduce unauthorized employment face impediments. Of the agency’s 14 major management challenges, its performance plan had: 1. goals and measures that were directly related to 9 of the challenges: 2. goals and measures that were indirectly applicable to the 1 of the challenges, including: * strategic human capital management and: 3. no goals, measures or strategies to address four of the challenges, including: * Asset Forfeiture Program, * program management weaknesses remain in Weed and Seed Program, * internal control weaknesses at DEA, and: * efforts to reduce unauthorized employment face impediments. A Justice official stated that it did not address these challenges because Justice believes that those challenges are no longer significant enough to be addressed in their performance report or plan. Table 12: Major Management Challenges for Justice: [See PDF for image] [A] U.S. General Accounting Office. Police Corps: Some Problems Resolved, But Most Positions Remain Unfilled, (GAO/GGD-00-69, Washington, D.C.: Feb. 22, 2000). [End of section] Appendix XII: Observations on the Department of Labor’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Labor (Labor), which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, Labor made in resolving its challenges. The third column discusses the extent to which Labor’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found Labor’s performance report discussed the agency’s progress in resolving its challenges. The agency’s performance plan has goals and measures that were directly related to all five of the major management challenges. Table 13: Major Management Challenges for Labor: [See PDF for image] [A] See U.S. General Accounting Office, Department of Labor: Major Management Challenges and Program Risks, GAO-01-251 (Washington, D.C., Jan. 2001). [B] Labor defines substantially achieved as attaining 80 percent or more of the targeted goal. [End of section] Appendix XIII: Observations on the National Aeronautics and Space Administration’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the National Aeronautics and Space Administration (NASA) which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, NASA made in resolving its challenges. The third column discusses the extent to which NASA’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that NASA’s performance report discussed the agency’s progress in resolving all of its challenges. Of the agency’s five major management challenges, its performance plan had: 1. goals and measures that were directly related to four of the challenges, including: * strategic human capital management, * information security, * contract management, and: * international space station costs: 2. goals and measures that were indirectly applicable to three of the challenges, including: * strategic human capital management, * contract management, and: * faster, better, cheaper approach to space exploration projects: 3. no goals related to one of the challenges, but discussed measures and/or strategies to address the challenge, which was: * faster, better, cheaper approach to space exploration projects. Table 14: Major Management Challenges for NASA: [See PDF for image] [A] National Aeronautics and Space Administration, Audit Report: Validation And Verification Of Selected NASA Fiscal Year 2001 Performance Data Related To The Government Performance And Results Act, IG-02-025 (Sept. 27, 2002). [End of section] Appendix XIV: Observations on the Nuclear Regulatory Commission’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Nuclear Regulatory Commission (NRC), which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, NRC made in resolving its challenges. The third column discusses the extent to which NRC’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that NRC’s performance report discussed the agency’s progress in resolving many of its challenges, but it did not discuss NRC’s progress in resolving the challenge relating to its new document system. Of NRC’s six major management challenges (as determined by GAO), its performance plan had: 1. goals and measures that were directly related to two of the challenges, including; * development and implementation of a risk-informed approach for commercial nuclear power plants and: * inherent difficulties in applying a risk-informed approach to nuclear material licensees: 2. no goals related to four of the challenges, but discussed measures and/or strategies to address the challenges, which were: * strategic human capital management, * information security, * improving financial management systems, and: * information technology issues. Table 15: Major Management Challenges for NRC: [See PDF for image] [End of table] [End of section] Appendix XV: Observations on the National Science Foundation’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the National Science Foundation (NSF) in the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, NSF made in resolving its challenges. The third column discusses the extent to which NSF’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that NSF’s performance report discussed the agency’s progress in resolving its challenges. NSF’s performance plan had goals and measures directly related to both major management challenges. Table 16: Major Management Challenges for NSF: [See PDF for image] [End of table] [End of section] Appendix XVI: Observations on the Office of Personnel Management’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Office of Personnel Management (OPM), which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, OPM made in resolving its challenges. The third column discusses the extent to which OPM’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that OPM’s performance report discussed the agency’s progress in resolving both of its major management challenges--strategic human capital management and information security. In addition, we found that OPM’s performance plan had goals and measures to address both of the governmentwide management challenges. Table 17: Major Management Challenges for OPM: [See PDF for image] [End of table] [End of section] Appendix XVII: Observations on the Small Business Administration’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Small Business Administration (SBA), which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, SBA made in resolving its challenges. The third column discusses the extent to which SBA’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that SBA’s performance report discussed the agency’s progress in resolving all of its challenges. Of the agency’s six major management challenges, its performance plan had: 1. goals and measures that were directly related to the challenge of streamlining and automating disaster loan processing and improving timeliness, 2. goals and measures that were indirectly applicable to the challenges of focusing the 8(a) program on helping firms obtain contracts to increasing procurement opportunities, and: 3. no goals and measures related to four of the challenges, but discussed strategies to address the challenges, which were: * strategic human capital management, * information security, * strengthen human capital, information technology, budget, and financial management practices to help modernize SBA, and: * continue to improve oversight of SBA’s lending partners to correct oversight weaknesses. Table 18: Major Management Challenges for SBA: [See PDF for image] [A] U.S. General Accounting Office, Small Business Administration: Workforce Transformation Plan is Evolving, GAO-02-931T (Washington, D.C.: July 16, 2002). [End of section] Appendix XVIII: Observations on the Social Security Administration’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Social Security Administration’s (SSA) in the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, SSA made in resolving its challenges. The third column discusses the extent to which SSA’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that SSA’s performance report discussed the agency’s progress in resolving all of its challenges. Of the agency’s six major management challenges, its performance plan had: 1. goals and measures that were directly related to five of the challenges and: 2. no goals and measures related to one of the challenges, but discussed strategies to address the challenge, which was: * information security. Table 19: Major Management Challenges for SSA: [See PDF for image] [End of section] Appendix XIX: Observations on the Department of State’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of State (State), including the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, State made in resolving its challenges. The third column discusses the extent to which State’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that State’s 2001 performance report discussed its progress in meeting all of its challenges; however, it provided little information on what is being done to realign the U.S. workforce overseas with the U.S. government’s mission (also referred to as rightsizing, the process for determining the appropriate size and locations of the U.S. overseas presence). Of the agency’s seven major management challenges, its performance plan had: 1. goals and measures that were directly related to six of the challenges, and: 2. goals and measures that were indirectly applicable to one of the challenges, which was: * realigning the U.S. workforce overseas.[Footnote 7] Table 20: Major Management Challenges for State: [See PDF for image] [A] U.S. General Accounting Office, Staffing Shortfalls and Ineffective Assignment System Compromise Diplomatic Readiness at Hardship Posts, GAO-02-626 (Washington, D.C.: June 18, 2002). [B] U.S. General Accounting Office, Overseas Presence: Framework for Assessing Embassy Staff Levels Can Support Rightsizing Initiatives, GAO-02-780 (Washington, D.C.: July 26, 2002). : [C] U.S. Department of State, Accountability Report, Fiscal Year 2001 (Washington, D.C.: February 2002). [End of table] [End of section] Appendix XX: Observations on the Department of Transportation’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Transportation’s (DOT) in the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, DOT made in resolving its challenges. The third column discusses the extent to which DOT’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that DOT’s performance report discussed, in varying levels of detail, the agency’s progress in resolving all of its challenges. Of the agency’s eight major management challenges, its performance plan had: 1. goals and measures that were directly related to three of the challenges, 2. no goals and measures related to four of the challenges, but discussed strategies to address the challenges, which were: * strategic human capital management, * acquisitions and disposals, * financial accountability, and: * enhance competition and consumer protection in aviation and freight rail industries to ensure reasonable fares, rates, and service: 3. no goals, measures or strategies to address one of the challenges, which was: * strengthen the financial condition of Amtrak. Table 21: Major Management Challenges for DOT: [See PDF for image] [A] Based on preliminary data. [End of section] Appendix XXI: Observations on the Department of the Treasury’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of the Treasury (Treasury), which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, Treasury made in resolving its challenges. The third column discusses the extent to which Treasury’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that the Treasury’s performance report discussed the agency’s progress in resolving all of its challenges. Of the agency’s seven major management challenges, its performance plan had: 1. goals and measures that were directly related to three of the challenges, 2. goals and measures that were indirectly applicable to two of the challenges, including: * Internal Revenue Service (IRS) modernization and: * need to improve Customs Service’s regulation of commercial trade while protecting against entry of illegal goods at U.S. borders: 3. no goals, measures or strategies to address two of the challenges, including: * need to improve the Bureau of Alcohol, Tobacco, and Firearm’s performance measures to better determine the progress in denying criminals access to firearms, and: * need to improve the management of Treasury’s asset forfeiture program. However, Treasury has made significant progress in addressing these two challenges. Table 22: Major Management Challenges for Treasury: [See PDF for image] [A] U.S. General Accounting Office Tax Administration: Continued Progress Modernizing IRS Depends on Managing Risks. GAO-02-715T (Washington, D.C.: May 14, 2002). [B] U.S. General Accounting Office IRS Telephone Assistance: Opportunities to Improve Human Capital Management. GAO-01-144 (Washington, D.C.: Jan. 30, 2001); and U.S. General Accounting Office IRS Telephone Assistance: Limited Progress and Missed Opportunities to Analyze Performance in the 2001 Filing Season. GAO-02-212 (Washington, D.C.: Dec. 7, 2001). [C] U.S. General Accounting Office Performance Management Systems: IRS’s Systems for Frontline Employees and Managers Align with Strategic Goals but Improvements Can be Made. GAO-02-804 (Washington, D.C.: July 12, 2002). [D] U.S. General Accounting Office Tax Administration: Impact of Compliance and Collection Program Declines on Taxpayers. GAO-02-674 (Washington, D.C.: May 22, 2002). [E] U.S. General Accounting Office Tax Administration: Impact of Compliance and Collection Program Declines on Taxpayers. GAO-02-674 (Washington, D.C.: May 22, 2002). [F] U.S. General Accounting Office Department of the Treasury: Status of Achieving Key Outcomes and Addressing Major Management Challenges. GAO-01-712 (Washington, D.C.: June 15, 2001). [End of section] Appendix XXII: Observations on the U.S. Agency for International Development’s Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the U.S. Agency for International Development (USAID), which includes the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, USAID made in resolving its challenges. The third column discusses the extent to which USAID’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that USAID’s performance report discussed the agency’s progress in resolving many of its challenges, but it did not discuss the agency’s progress in resolving the following challenge: * information security: Of the agency’s five major management challenges, its performance plan had: 1. goals and measures that were directly related to one of the challenges, 2. goals and measures that were indirectly applicable to two of the challenges, including: * strategic human capital management and: * financial management information unreliable/financial statements inaccurate and do not measure program results: 3. no goals and measures related to one of the challenges, but discussed strategies to address the challenge, which was: * challenges with developing reliable performance measures and accurately reporting results of programs: 4. no goals, measures or strategies to address one of the challenges: * information security. Table 23: Major Management Challenges for USAID: [See PDF for image] [End of table] [End of section] Appendix XXIII: Observations on the Department of Veterans Affairs’ Efforts to Address Its Major Management Challenges: The following table identifies the major management challenges confronting the Department of Veterans Affairs (VA), which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office. The second column discusses what progress, as discussed in its fiscal year 2001 performance report, VA has made in resolving its challenges. The third column discusses the extent to which VA’s fiscal year 2003 performance plan includes performance goals and measures to address the challenges that we identified. We found that VA’s performance report discussed the agency’s progress in resolving all of its major challenges that GAO identified or some aspect of those challenges. For example, while VA discusses its plan to report to the Congress in 2004 the outcomes of its 3-year pilot study of assisted living, it does not provide information on the full continuum of services needed to provide long-term care. Similarly, not all aspects of each of the agency’s six major management challenges were fully addressed. For example, the plan notes that it has undertaken several initiatives to address third-party collections weaknesses, but it does not have a performance measure for third-party collections. Table 24: Major Management Challenges for VA: [See PDF for image] [End of table] [End of section] Appendix XXIV: GAO Contact and Staff Acknowledgments: GAO Contact: Elizabeth H. Curda, (202) 512-4040: Acknowledgments: In addition to the individual named above, the following individuals made significant contributions to this report: Charles M. Adams, Michael Alexander, Cornelia M. Ashby, Sheila K. Avruch, James Beard, Ronald W. Beers, Steven J. Berke, Daniel Bertoni, Amy Bevan, J. Michael Bollinger, Elaine M. Boudreau, Barbara D. Bovbjerg, Lisa M. Brown, John Brummet, Jeannie M. Bryant, Susan H. Campbell, Richard Cheston, Amy M. Choi, Steven L. Cohen, Robert F. Dacey, Kirk Daubenspeck, Peter J. Del Toro, William J. Dowdal, Patrick Dugan, E. Jeanette Espinola, Fred Felder, Charles R. Fox, Mark Gaffigan, Jonathan M. Gill, Dianne D. Guensberg, Richard Harada, Margaret K. Harris, Richard J. Herley, Anne M. Hilleary, Samuel L. Hinojosa, Tim D. Hopkins, Albert H. Huntington, III, David W. Irvin, Ronald Y. Ito, Shirley B. Johnson, John V. Kelly, Karen L. Kemper, Edward D. Kennedy, Jeffrey Knott, Edward A. Kratzer, Carol Langelier, Kathy Larin, Lynn Lavalle, Evelyn Logue, Jeffery D. Malcolm, Charles W. Malphurs, Patty Manthe, Weldon McPhail, Carolyn K. McGowan, Valerie Melvin, Edmond E. Menoche, Mary A. Mohiyuddin, Robin M. Nazzaro, Tim Outlaw, Robert Owens, Susan Ragland, Paula M. Rascona, Patricia Rennie, William B. Ritt, William H. Roach, Jr., Mark Shaw, Andrew Sherrill, Nancy A. Simmons, Karen Sloan, George H. Stalcup, Gerald Stankosky, Keith Steck, Tamara Stenzel, Edward H. Stephenson, John B. Stephenson, Carolyn M. Taylor, Anjali Tekchandani, William Thompson, Charles Vrabel, William F. Wadsworth, Elwood D. White, Gregory C. Wilshusen, Ellen T. Wolfe, Ronnie E. Wood, and Anthony J. Wysocki. FOOTNOTES: [1] Performance and Accountability Series, GAO-01-241 through 262 (Washington, D.C.: January 2001) and High-Risk Series: An Update, GAO- 01-263 (Washington, D.C.: January 2001). [2] Office of Management and Budget, Circular A-11, Part 6, Preparation and Submission of Strategic Plans, Annual Performance Plans, and Annual Program Performance Reports, Sec. 220.3(f). [3] The National Institute of Standards and Technology developed a security assessment framework and related tools that agencies can use to determine the status of their information security programs and that describe standards for five levels of information security status. [4] In April 2001, the Secretary of Education established a Management Improvement Team (MIT) comprised of senior-level managers within Education to formulate strategies to address key financial and management problems. [5] In March 2002, the Department of Education published its Annual Plan: 2002-2003. This document lists goals, measures, and strategies for the department over an 18-month period. [6] In this appendix, we refer to the Centers for Medicare & Medicaid Services (CMS), formerly known as the Health Care Finance Administration (HCFA) as “CMS” throughout the text because that is how the agency referred to itself in its Performance Report and Plan. [7] State had an indirectly related goal, but no measures or strategies to address this challenges. GAO’s Mission: The General Accounting Office, the investigative arm of Congress, exists to support Congress in meeting its constitutional responsibilities and to help improve the performance and accountability of the federal government for the American people. GAO examines the use of public funds; evaluates federal programs and policies; and provides analyses, recommendations, and other assistance to help Congress make informed oversight, policy, and funding decisions. GAO’s commitment to good government is reflected in its core values of accountability, integrity, and reliability. Obtaining Copies of GAO Reports and Testimony: The fastest and easiest way to obtain copies of GAO documents at no cost is through the Internet. GAO’s Web site ( www.gao.gov ) contains abstracts and full-text files of current reports and testimony and an expanding archive of older products. 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