Department of Justice: Alternative Sources of Funding Are a Key Source of Budgetary Resources and Could Be Better Managed
Highlights
What GAO Found
Alternative sources of funding—collections by the Department of Justice (DOJ) from sources such as fines, fees, and penalties—made up about 15 percent of DOJ's total budgetary resources in fiscal year 2013. Specifically, DOJ collected about $4.3 billion from seven major alternative sources of funding—including the Assets Forfeiture Fund, the Crime Victims Fund (CVF), and noncriminal fingerprint checks fees, among others—which were available to DOJ. Agency flexibility regarding the use of the seven funding sources varied with laws specifying funding purposes, amounts, and availability by, for instance, limiting obligations from a source or limiting the period in which funds may be obligated.
DOJ can improve management of two alternative sources of funding. Specifically:
-
DOJ has the authority to deposit up to 3 percent of amounts collected from civil debt collection activities in the Three Percent Fund. Collections are used to defray the costs of DOJ's civil debt collection activities. DOJ does not analyze its unobligated balances by, for example, estimating projected collections or developing future year fund reserves to conduct Three Percent Fund activities. As a result, DOJ consistently had end-of-year unobligated balances that were at least twice as large as the amount DOJ reported was required to remain in the fund at the end of the year. Moreover, DOJ asserted that the Three Percent Fund could not support more activities during the fiscal years than what had been obligated.
- The Federal Bureau of Investigation's (FBI) Criminal Justice Information Services (CJIS) Division collected $396 million in fees for providing non-criminal justice fingerprint checks during fiscal year 2013. The fee is made up of a cost recovery and automation portion but the breakout between the two portions of the fee is not explicitly communicated to stakeholders. As a result, stakeholders do not have complete information for providing meaningful feedback. Additionally, CJIS sets fees, in part, based on projected volume of transactions. Actual volumes have exceeded projected volumes, resulting in CJIS bringing in more than anticipated in automation fees and contributing to an unobligated balance of $284 million at the end of fiscal year 2013. CJIS officials stated that they are aware of growing unobligated balances but have not evaluated what an appropriate amount should be. As a result, CJIS does not know if it is carrying over a suitable amount to meet future needs.
In addition, unobligated balances in the CVF grew to nearly $9 billion by the end of fiscal year 2013. Statutory provisions annually limit DOJ's ability to obligate collections in the fund. For example, during fiscal year 2013, DOJ received about $1.5 billion in deposits to the fund, from sources such as criminal fines, and had statutory authority to obligate $730 million from the fund for crime victim assistance programs. Consistent with scorekeeping guidelines used during the congressional budget process, DOJ reported funds not available for obligation as a credit or offset to its annual discretionary budget authority. From fiscal years 2009 through 2013, DOJ reported $32 billion in offsets provided primarily by the CVF. As a result, DOJ's reported net discretionary budgetary authority decreased about 36 percent from 2009 to 2013, while DOJ's actual total discretionary budget authority remained relatively constant during these years.
Why GAO Did This Study
Recommendations
GAO recommends that DOJ develop a policy to analyze unobligated carryover balances of the Three Percent Fund. GAO also recommends that the FBI publish cost recovery and automation portions of fingerprint checks fees and develop a policy to analyze and determine an appropriate range for unobligated balances from automation fees. DOJ generally concurred with our recommendations, but noted concerns with developing revenue estimates for the Three Percent Fund and establishing a range of carryover balances for FBI fingerprint check fees.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Justice | To help ensure the efficient use of resources for the Three Percent Fund, the Attorney General should develop a policy and implement procedures to regularly analyze unobligated balances and develop collection estimates in order to determine an appropriate reserve amount and inform estimates of future funding needs. |
In February 2015, we found that the Department of Justice (DOJ) Collection Resource Allocation Board (CRAB) had taken steps to manage the Three Percent Fund, but it had not conducted analyses that would help DOJ better manage the fund, such as developing reserve estimates aligned with DOJ priorities or projecting future collections. GAO has identified leading practices among federal agencies when evaluating balances in federal accounts. Such practices emphasize the importance of regularly analyzing balances by, for example, estimating collections and determining reserve needs. Doing so helps agencies more effectively anticipate program needs and ensure the most efficient use of resources. As a result, we recommended that DOJ develop a policy and implement procedures to regularly analyze unobligated balances collection estimates in the Three Percent Fund. DOJ partially concurred with this recommendation. In response, DOJ provided us with a policy it began implementing in January 2016 to help them analyze the Three Percent Fund's unobligated balance and develop an appropriate reserve amount. For example, DOJ's policy for developing the reserve estimate now relies on more robust requests for information of DOJ debt collection activities, including government personnel, contract support, and automated litigation service requirements. By developing and implementing this policy, DOJ is better positioned to ensure the continuity of operations funded through the Three Percent Fund and to make future resource allocations. While we recommended that DOJ's policy include estimating future-year collections, DOJ did not believe it was appropriate to make such estimations. Specifically, DOJ believed it would be perceived as inappropriately encouraging larger government civil collections. We are closing the recommendation as implemented based on DOJ's actions to analyze the Fund's unobligated balance and develop a reserve amount. These actions should help DOJ better manage balances to ensure efficient and effective use of resources to support program activities.
|
| Federal Bureau of Investigation | To improve transparency and ensure the effective use of automation fees for the CJIS fingerprint checks fees, the Director of the Federal Bureau of Investigation should publish in the Federal Register, or other documents such as annual reports, how much is assessed for automation and cost recovery in each transaction to better communicate the cost of the service to customers and stakeholders. |
The FBI concurred with this recommendation. In 2016, the FBI began providing transparency on the breakout of the fingerprint checks fees to its stakeholders through the CJIS Information Letter, and to its customers in 2018 through the Federal Register. Specifically, the FBI included a break out of the fee to include the cost recovery portion of the fee and the automation portion. Based on these actions, this recommendation is closed as implemented.
|
| Federal Bureau of Investigation | To improve transparency and ensure the effective use of automation fees for the CJIS fingerprint checks fees, the Director of the Federal Bureau of Investigation should develop a policy to analyze the unobligated balances coming from the automation portion of the fee to inform program needs, including improving methods for anticipating automation collections, and establishing a range of appropriate carryover amounts to support program needs. |
In fiscal year 2015, we found that the Federal Bureau of Investigation (FBI) had a growing unobligated balance from the automation portion of its Criminal Justice Information Services (CJIS) fingerprint checks fees but did not evaluate the appropriate range of its carryover amounts, nor had it developed a policy to do so. As a result, we recommended that FBI develop a policy to analyze the unobligated balances coming from the automation portion of the fee to inform program needs, including improving methods for anticipating automation collections, and establishing a range of appropriate carryover amounts to support program needs. FBI concurred with this recommendation. In August 2019, FBI reported that it had improved its methods for anticipating collections by incorporating an analysis that better accounted for transaction volume. Additionally, in January 2019 FBI established a minimum and maximum carryover balance. The carryover minimum balance ensures that FBI has an appropriate reserve of funds in case of emergency requirements to keep mission critical systems operational. Likewise, according to the FBI, the carryover maximum provides for enough funding to be available to cover needs during major IT development projects. The carryover maximum also takes into account annual carryover balance rescissions. By improving its methods for anticipating automation collections and establishing a range of carryover amounts, FBI is helping to ensure that it is using its resources more efficiently. Based on these actions, this recommendation is closed as implemented.
|