December 3, 2021

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COVID-19: Additional Actions Needed to Improve Accountability and Program Effectiveness of Federal Response

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<div>What GAO Found As the nation continues to respond to, and recover from, the COVID-19 pandemic, increases in COVID-19 cases in July, August, and September 2021, primarily due to the Delta variant of the virus, have hampered these efforts. From the end of July 2021 to September 23, 2021, the number of new cases reported each day generally exceeded 100,000, according to Centers for Disease Control and Prevention (CDC) data. This was a daily case count not seen since February 2021 (see figure). Reported COVID-19 Cases per Day in the U.S., Mar. 1, 2020–Sept. 23, 2021 Meanwhile, COVID-19 vaccination efforts continue. As of September 23, 2021, about 64 percent of the U.S. population eligible for vaccination (those 12 years and older), or almost 183 million individuals, had been fully vaccinated, according to CDC. The government must remain vigilant and agile to address the evolving COVID-19 pandemic and its cascading impacts. Furthermore, as the administration implements the provisions in the COVID-19 relief laws, the size and scope of these efforts—from distributing funding to implementing new programs—demand strong accountability and oversight. In that vein, GAO has made 209 recommendations across its body of COVID-19 reports issued since June 2020. As of September 30, 2021, agencies had addressed 33 of these recommendations, resulting in improvements including increased oversight of relief payments to individuals and improved transparency of decision-making for emergency use authorizations for vaccines and therapeutics. Agencies partially addressed another 48 recommendations. GAO also raised four matters for congressional consideration, three of which remain open. In this report, GAO is making 16 new recommendations, including recommendations related to fiscal relief funds for health care providers, recovery funds for states and localities, worker safety and health, and assessing fraud risks to unemployment insurance programs. GAO’s recommendations, if swiftly and effectively implemented, can help improve the government’s ongoing response and recovery efforts as well as help it to prepare for future public health emergencies. GAO’s new findings and recommendations, where applicable, are discussed below. Relief for Health Care Providers A total of $178 billion has been appropriated to the Provider Relief Fund (PRF) to reimburse eligible providers for health care–related expenses or lost revenues attributable to COVID-19. As of August 31, 2021, the Department of Health and Human Services (HHS) had allocated and disbursed about $132.5 billion of this amount and had allocated but not yet disbursed about $21.5 billion; the remaining $24.1 billion was unallocated and undisbursed. On September 10, 2021, HHS announced that $17 billion of the previously unallocated $24.1 billion would be allocated for a general distribution to a broad range of providers who could document COVID-related revenue loss and expenses. HHS expected to begin disbursing the funds in December 2021. As of September 2021, HHS’s Health Resources and Services Administration (HRSA) had not established time frames for implementing and completing post payment reviews for all PRF payments. In addition, the agency had not finalized procedures for recovery of overpayments or recovered the bulk of the overpayments that it had already identified. Without post-payment oversight to help ensure that relief payments are made only to eligible providers in correct amounts and to identify unused payments or payments not properly used, HHS cannot fully address stated payment integrity risks for the PRF and seek to recover overpayments, unused payments, or payments not properly used. GAO recommends that HRSA take steps to finalize and implement post-payment oversight. Specifically, HRSA should establish time frames for completing post-payment reviews to promptly address identified risks and identify overpayments made from the PRF, such as payments made in incorrect amounts or payments to ineligible providers; and it should finalize procedures and implement post-payment recovery of any PRF overpayments, unused payments, or payments not properly used. HHS—which includes HRSA—partially agreed with these recommendations. Coronavirus State and Local Fiscal Recovery Funds In March 2021, the American Rescue Plan Act of 2021 (ARPA) appropriated $350 billion to the Department of the Treasury (Treasury) to provide payments from the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF). The CSLFRF allocates funds to states, the District of Columbia, localities, tribal governments, and U.S. territories to cover a broad range of costs stemming from the COVID-19 pandemic’s fiscal effects. According to Treasury data, it had distributed approximately $240 billion from the CSLFRF to recipients as of August 31, 2021 (see figure). Coronavirus State and Local Fiscal Recovery Funds Allocations and Treasury Distributions as of Aug. 31, 2021, by Recipient Type Note: For more details, see the Coronavirus State and Local Fiscal Recovery Funds enclosure in appendix I.aNon-entitlement units of local government are local governments typically serving populations of less than 50,000.As of July 2021, some of the 48 states that responded to GAO’s survey reported that they had somewhat less than or much less than sufficient capacity to report on their use of CSLFRF allocation consistent with federal requirements (17 of 48 states), capacity to disburse the funds (13 of 48 states), and apply appropriate internal controls and respond to inquiries about requirements (10 of 48 states). In addition, most states (44 of 48) reported that they had taken or planned to take additional steps—such as hiring new staff or reassigning existing staff—to help them manage their CSLFRF allocations. As of August 2021, Treasury was developing—but had not finalized or documented—key internal processes and control activities to monitor recipients’ use of their CSLFRF allocations for allowable purposes and to respond to internal control and compliance findings. According to officials, these internal processes and control activities were in the development stage, partly because of the short time frame since ARPA’s enactment and because Treasury’s Office of Recovery Programs, established in April 2021, continues to work to recruit and onboard key team members. Until Treasury properly designs and documents policies and procedures to guide CSLFRF program officials and other responsible oversight parties in the Office of Recovery Programs, there is a risk that key control activities needed to help ensure program management fulfills its recipient monitoring and oversight responsibilities may not be established or applied effectively and consistently. This risk may be particularly acute with respect to monitoring state and local recipients that face capacity challenges in managing their CSLFRF allocations in accordance with federal requirements, as some survey respondents noted. GAO recommends that Treasury design and document timely and sufficient policies and procedures for monitoring CSLFRF recipients to provide assurance that recipients are managing their allocations in compliance with laws, regulations, agency guidance, and award terms and conditions. Treasury agreed with the recommendation. Unemployment Insurance Fraud Risk Management GAO continues to have concerns about potential fraud in the unemployment insurance (UI) program, including concerns about Department of Labor (DOL) efforts to assess and manage program fraud risks. During the pandemic, fraudulent and potentially fraudulent activity has increased substantially and new types of fraud have emerged, according to DOL officials. For example, in June 2021, DOL’s Office of Inspector General reported that it had identified nearly $8 billion in potentially fraudulent UI benefits paid from March 2020 through October 2020. Improper payments have also been a long-standing concern in the regular unemployment insurance program, suggesting that the program may be vulnerable to fraud. While DOL continues to identify and implement strategies to address potential fraud and has some ongoing program integrity activities, it has not comprehensively assessed fraud risks in alignment with leading practices identified in GAO’s Fraud Risk Framework, which by law must be incorporated in guidelines established by the Office of Management and Budget for agencies. DOL has not clearly assigned defined responsibilities to a dedicated entity for designing and overseeing fraud risk management activities. Without a dedicated entity with defined responsibilities to lead antifraud initiatives, including the process of assessing fraud risks to UI programs, DOL may not be strategically managing UI fraud risks. GAO recommends that DOL designate a dedicated entity and document its responsibilities for managing the process of assessing fraud risks to the unemployment insurance program, consistent with leading practices as provided in GAO’s Fraud Risk Framework. This entity should have, among other things, clearly defined and documented responsibilities and authority for managing fraud risk assessments and for facilitating communication among stakeholders regarding fraud-related issues. DOL neither agreed nor disagreed with this recommendation. DOL also has not comprehensively assessed UI fraud risks in alignment with leading practices identified in GAO’s Fraud Risk Framework. These leading practices call for federal managers to plan regular fraud risk assessments and determine their fraud risk profile, among other things. Such assessments would provide reasonable assurance that DOL has identified the most significant fraud risks for the regular UI program that will exist after the pandemic. For example, some fraud risks identified in the CARES Act UI programs may continue to exist in the regular UI program after the temporary UI programs expire. GAO recommends that DOL (1) identify inherent fraud risks facing the unemployment insurance program, (2) assess the likelihood and impact of inherent fraud risks facing the program, (3) determine fraud risk tolerance for the program, (4) examine the suitability of existing fraud controls in the program and prioritize residual fraud risks, and (5) document the fraud risk profile for the program. DOL neither agreed nor disagreed with these recommendations. FEMA’s Disaster Relief Fund and Assistance to State, Local, Tribal, and Territorial Governments The Federal Emergency Management Agency (FEMA) has used the Disaster Relief Fund to respond to the COVID-19 pandemic—the first time the fund has been used during a nationwide public health emergency. For example, from September 1, 2020 to August 31, 2021, FEMA obligated a total of approximately $26.8 billion through one type of disaster assistance, Public Assistance, for emergency protective measures, such as eligible medical care, the purchase and distribution of food, and distribution of personal protective equipment. GAO found that FEMA inconsistently interpreted and applied its policies for expenses eligible for COVID-19 Public Assistance within and across its 10 regions. For example, officials in one state said that FEMA at one point had deemed the provision of personal protective equipment at correctional facilities as ineligible for reimbursement in their region but that states in other regions had received reimbursement for the same expense. These inconsistencies were due to, among other things, changes in policies as FEMA used the Public Assistance program for the first time to respond to a nationwide emergency. FEMA officials stated that it was difficult to ensure consistency in policies as different states and regions are not experiencing the same things at the same time. FEMA is likely to receive applications for reimbursement for a larger number of projects than it estimated earlier in 2021, given the surge in COVID-19 cases this summer. To improve the consistency of the agency’s interpretation and application of the COVID-19 Public Assistance policy, GAO recommends that FEMA further clarify and communicate eligibility requirements nationwide. GAO also recommends that FEMA require the agency’s Public Assistance employees in the regions and at its Consolidated Resource Centers to attend training on changes to COVID-19 Public Assistance policy. The Department of Homeland Security—which includes FEMA— agreed with both of these recommendations. Loans for Aviation and Other Eligible Businesses Treasury has executed 35 loan agreements with certain aviation businesses and other businesses deemed critical to maintaining national security. These loans have totaled about $22 billion of the $46 billion authorized by the CARES Act for loans and loan guarantees to such businesses. As directed by the CARES Act, Treasury required certain loan recipients to provide financial assets, such as warrants that give the federal government an option to buy shares of stock at a predetermined price before a specified date, to protect taxpayer interests. According to Treasury officials, it is likely that, if the airline industry continues to recover and borrowers do not default, the warrants could have higher values than the predetermined price Treasury would have to pay to act on them. Treasury has not exercised any of the warrants for stock it received from nine businesses, nor has it developed policies and procedures for determining when to act on the warrants to benefit the taxpayer. GAO recommends that Treasury develop policies and procedures to determine when to act on warrants obtained as part of the loan program for aviation and other eligible businesses to benefit the taxpayers. Treasury agreed with this recommendation. Payroll Support Assistance to Aviation Businesses As of September 2021, Treasury had made payments totaling $59 billion of $63 billion provided for the Payroll Support Programs to support aviation business. These payments were to be used exclusively for the continuation of wages, salaries, and benefits. Similar to Treasury’s requirement for loans for aviation and other eligible businesses, Treasury required certain Payroll Support Program recipients to provide warrants, as allowed by the CARES Act. As of September 2021, 14 recipients had provided a total of 58 million warrants. As Treasury continues to hold these warrants for stock purchases, the warrants may increase in value as the airline industry recovers. Treasury has not exercised any of the warrants for stock it holds in the 14 businesses, nor has it documented policies and procedures to guide when to act on the warrants to fulfill the statutory purpose to provide appropriate compensation to the federal government. GAO recommends that Treasury develop policies and procedures to determine when to act on warrants obtained as part of the Payroll Support Program to provide appropriate compensation to the federal government. Treasury agreed with this recommendation. COVID-19 Testing Use is increasing for antigen tests, one of two types of COVID-19 diagnostic and screening tests for which HHS’s Food and Drug Administration has issued emergency use authorizations. These “rapid” antigen tests typically have a turnaround time of about 30 minutes or less for results, compared with 1 to 3 days for molecular tests, the second type of test HHS authorized. Antigen tests can be conducted at doctors’ offices or in homes or other settings; some antigen tests can be conducted without a prescription. Since June 2020, HHS has worked to encourage and improve the reporting of antigen testing data to local, state, and federal health officials. However, HHS officials told GAO reporting of antigen test results is incomplete, which prevents HHS from using antigen testing data for COVID-19 surveillance. HHS is taking additional steps aimed at improving reporting of antigen test data. For example, officials told GAO that HHS will continue to make enhancements to data reporting by building reporting methods into the testing process, such as for testing in schools and workplaces. HHS is also considering surveillance approaches to supplement or enhance current surveillance efforts. For example, HHS is exploring wastewater surveillance approaches, which provide data that can complement and confirm other forms of surveillance for COVID-19 and an efficient pooled community sample that is particularly useful in areas where timely COVID-19 clinical testing is underutilized or unavailable, according to HHS officials. Worker Safety and Health The Occupational Safety and Health Administration (OSHA) faced challenges in enforcing workplace safety and health standards during the COVID-19 pandemic, but the agency has not assessed lessons learned or promising practices. According to inspectors from area offices, they faced challenges related to resources and to communication and guidance, such as a lack of timely guidance from OSHA headquarters. GAO recommends that OSHA assess—as soon as feasible and, as appropriate, periodically thereafter—various challenges related to resources and to communication and guidance that the agency has faced in its response to the COVID-19 pandemic and take related actions as warranted. The Department of Labor—which includes OSHA—partially agreed with this recommendation. Advance Child Tax Credit Payments ARPA temporarily expanded eligibility for the child tax credit (CTC) to additional qualified individuals by eliminating a requirement that individuals must earn a minimum amount annually to be eligible. ARPA also temporarily increased the maximum amount of the CTC from $2,000 per qualifying child to $3,000 or $3,600, depending on the child’s age. As required by ARPA, the Internal Revenue Service (IRS) and Treasury are responsible for issuing half of the CTC through periodic advance payments, known as advance CTC payments. IRS reported disbursing more than 106 million advance payments totaling over $45.5 billion as of September 25, 2021 (see figure). Dollar Amount and Count of Advance Child Tax Credit Payments, by Month, as of Sept. 25, 2021 IRS is conducting and planning several outreach efforts to increase the public’s awareness of advance CTC payments. However, IRS and Treasury have not developed a comprehensive estimate of individuals who are potentially eligible for advance CTC payments and the agencies have not set a participation goal. Such an estimate would enable Treasury and IRS to measure the tax credit’s participation rate, providing greater clarity regarding populations at risk of not receiving the payments. GAO recommends that Treasury, in coordination with IRS, estimate the number of individuals, includingnonfilers, who are eligible for advance CTC payments, measure the 2021 participation rate based on that estimate, and use that estimate to develop targeted outreach and communications efforts for the 2022 filing season; the participation rate could include individuals who opt in and out of the advance payments. Treasury neither agreed nor disagreed with this recommendation. Child Nutrition Child nutrition programs administered by the Department of Agriculture’s Food and Nutrition Service (FNS) supply cash reimbursements to schools or other programs for meals and snacks provided to eligible children nationwide. In fiscal year 2019, before the pandemic, the four largest programs—the National School Lunch Program, School Breakfast Program, Summer Food Service Program, and Child and Adult Care Food Program—along with other child nutrition programs, received $23.1 billion in federal funds. During a typical year, two of these programs—the National School Lunch Program and the School Breakfast Program—subsidize meals for nearly 30 million children in approximately 95,000 elementary and secondary schools nationwide. As of July 2021, FNS officials were unable to provide a plan showing how FNS intends to comprehensively analyze lessons learned during the pandemic, such as from operational and financial challenges. Further, according to FNS officials, while the School Meals Operations study—launched in spring 2021—is surveying school districts and state agencies that administer the federal child nutrition programs, the study is not gathering local perspectives directly from child care centers and day care homes or other local program sponsors that are not school districts. As a result, FNS may miss opportunities to identify lessons learned and will lack comprehensive information to aid its future planning. GAO recommends that the Department of Agriculture document its plan to analyze lessons learned from operating child nutrition programs during the COVID-19 pandemic. This plan should include a description of how the department will gather perspectives of key stakeholders, such as Child and Adult Care Food Program institutions and nonschool Summer Food Service Program sponsors. The Department of Agriculture—which includes FNS—agreed with this recommendation. Why GAO Did This Study As of September 23, 2021, the U.S. had about 43 million reported cases of COVID-19 and about 699,000 reported deaths, according to CDC. The country also continues to experience economic repercussions from the pandemic. Six relief laws, including the CARES Act, had been enacted as of August 31, 2021, to address the public health and economic threats posed by COVID-19. As of that same date (the most recent for which government-wide data was available), the federal government had obligated a total of $3.9 trillion and expended $3.4 trillion of the $4.8 trillion in COVID-19 relief funds that had been appropriated by these six laws, as reported by federal agencies. The CARES Act includes a provision for GAO to report on its ongoing monitoring and oversight efforts related to the COVID-19 pandemic. This report examines the federal government’s continued efforts to respond to, and recover from, the COVID-19 pandemic. GAO reviewed data, documents, and guidance from federal agencies about their activities. GAO also interviewed federal and state officials, stakeholders from organizations for localities, and other stakeholders.</div>

What GAO Found

As the nation continues to respond to, and recover from, the COVID-19 pandemic, increases in COVID-19 cases in July, August, and September 2021, primarily due to the Delta variant of the virus, have hampered these efforts. From the end of July 2021 to September 23, 2021, the number of new cases reported each day generally exceeded 100,000, according to Centers for Disease Control and Prevention (CDC) data. This was a daily case count not seen since February 2021 (see figure).

Reported COVID-19 Cases per Day in the U.S., Mar. 1, 2020–Sept. 23, 2021

Meanwhile, COVID-19 vaccination efforts continue. As of September 23, 2021, about 64 percent of the U.S. population eligible for vaccination (those 12 years and older), or almost 183 million individuals, had been fully vaccinated, according to CDC.

The government must remain vigilant and agile to address the evolving COVID-19 pandemic and its cascading impacts. Furthermore, as the administration implements the provisions in the COVID-19 relief laws, the size and scope of these efforts—from distributing funding to implementing new programs—demand strong accountability and oversight. In that vein, GAO has made 209 recommendations across its body of COVID-19 reports issued since June 2020. As of September 30, 2021, agencies had addressed 33 of these recommendations, resulting in improvements including increased oversight of relief payments to individuals and improved transparency of decision-making for emergency use authorizations for vaccines and therapeutics. Agencies partially addressed another 48 recommendations. GAO also raised four matters for congressional consideration, three of which remain open.

In this report, GAO is making 16 new recommendations, including recommendations related to fiscal relief funds for health care providers, recovery funds for states and localities, worker safety and health, and assessing fraud risks to unemployment insurance programs. GAO’s recommendations, if swiftly and effectively implemented, can help improve the government’s ongoing response and recovery efforts as well as help it to prepare for future public health emergencies. GAO’s new findings and recommendations, where applicable, are discussed below.

Relief for Health Care Providers

A total of $178 billion has been appropriated to the Provider Relief Fund (PRF) to reimburse eligible providers for health care–related expenses or lost revenues attributable to COVID-19. As of August 31, 2021, the Department of Health and Human Services (HHS) had allocated and disbursed about $132.5 billion of this amount and had allocated but not yet disbursed about $21.5 billion; the remaining $24.1 billion was unallocated and undisbursed. On September 10, 2021, HHS announced that $17 billion of the previously unallocated $24.1 billion would be allocated for a general distribution to a broad range of providers who could document COVID-related revenue loss and expenses. HHS expected to begin disbursing the funds in December 2021.

As of September 2021, HHS’s Health Resources and Services Administration (HRSA) had not established time frames for implementing and completing post payment reviews for all PRF payments. In addition, the agency had not finalized procedures for recovery of overpayments or recovered the bulk of the overpayments that it had already identified.

Without post-payment oversight to help ensure that relief payments are made only to eligible providers in correct amounts and to identify unused payments or payments not properly used, HHS cannot fully address stated payment integrity risks for the PRF and seek to recover overpayments, unused payments, or payments not properly used. GAO recommends that HRSA take steps to finalize and implement post-payment oversight. Specifically, HRSA should establish time frames for completing post-payment reviews to promptly address identified risks and identify overpayments made from the PRF, such as payments made in incorrect amounts or payments to ineligible providers; and it should finalize procedures and implement post-payment recovery of any PRF overpayments, unused payments, or payments not properly used. HHS—which includes HRSA—partially agreed with these recommendations.

Coronavirus State and Local Fiscal Recovery Funds

In March 2021, the American Rescue Plan Act of 2021 (ARPA) appropriated $350 billion to the Department of the Treasury (Treasury) to provide payments from the Coronavirus State and Local Fiscal Recovery Funds (CSLFRF). The CSLFRF allocates funds to states, the District of Columbia, localities, tribal governments, and U.S. territories to cover a broad range of costs stemming from the COVID-19 pandemic’s fiscal effects. According to Treasury data, it had distributed approximately $240 billion from the CSLFRF to recipients as of August 31, 2021 (see figure).

Coronavirus State and Local Fiscal Recovery Funds Allocations and Treasury Distributions as of Aug. 31, 2021, by Recipient Type

Figure described in preceding paragraph. For additional information about this figure, refer to contacts listed at http://www.gao.gov/products/GAO-22-105051
Note: For more details, see the Coronavirus State and Local Fiscal Recovery Funds enclosure in appendix I.
aNon-entitlement units of local government are local governments typically serving populations of less than 50,000.

As of July 2021, some of the 48 states that responded to GAO’s survey reported that they had somewhat less than or much less than sufficient capacity to report on their use of CSLFRF allocation consistent with federal requirements (17 of 48 states), capacity to disburse the funds (13 of 48 states), and apply appropriate internal controls and respond to inquiries about requirements (10 of 48 states). In addition, most states (44 of 48) reported that they had taken or planned to take additional steps—such as hiring new staff or reassigning existing staff—to help them manage their CSLFRF allocations.

As of August 2021, Treasury was developing—but had not finalized or documented—key internal processes and control activities to monitor recipients’ use of their CSLFRF allocations for allowable purposes and to respond to internal control and compliance findings. According to officials, these internal processes and control activities were in the development stage, partly because of the short time frame since ARPA’s enactment and because Treasury’s Office of Recovery Programs, established in April 2021, continues to work to recruit and onboard key team members.

Until Treasury properly designs and documents policies and procedures to guide CSLFRF program officials and other responsible oversight parties in the Office of Recovery Programs, there is a risk that key control activities needed to help ensure program management fulfills its recipient monitoring and oversight responsibilities may not be established or applied effectively and consistently. This risk may be particularly acute with respect to monitoring state and local recipients that face capacity challenges in managing their CSLFRF allocations in accordance with federal requirements, as some survey respondents noted. GAO recommends that Treasury design and document timely and sufficient policies and procedures for monitoring CSLFRF recipients to provide assurance that recipients are managing their allocations in compliance with laws, regulations, agency guidance, and award terms and conditions. Treasury agreed with the recommendation.

Unemployment Insurance Fraud Risk Management

GAO continues to have concerns about potential fraud in the unemployment insurance (UI) program, including concerns about Department of Labor (DOL) efforts to assess and manage program fraud risks. During the pandemic, fraudulent and potentially fraudulent activity has increased substantially and new types of fraud have emerged, according to DOL officials. For example, in June 2021, DOL’s Office of Inspector General reported that it had identified nearly $8 billion in potentially fraudulent UI benefits paid from March 2020 through October 2020. Improper payments have also been a long-standing concern in the regular unemployment insurance program, suggesting that the program may be vulnerable to fraud. While DOL continues to identify and implement strategies to address potential fraud and has some ongoing program integrity activities, it has not comprehensively assessed fraud risks in alignment with leading practices identified in GAO’s Fraud Risk Framework, which by law must be incorporated in guidelines established by the Office of Management and Budget for agencies.

DOL has not clearly assigned defined responsibilities to a dedicated entity for designing and overseeing fraud risk management activities. Without a dedicated entity with defined responsibilities to lead antifraud initiatives, including the process of assessing fraud risks to UI programs, DOL may not be strategically managing UI fraud risks. GAO recommends that DOL designate a dedicated entity and document its responsibilities for managing the process of assessing fraud risks to the unemployment insurance program, consistent with leading practices as provided in GAO’s Fraud Risk Framework. This entity should have, among other things, clearly defined and documented responsibilities and authority for managing fraud risk assessments and for facilitating communication among stakeholders regarding fraud-related issues. DOL neither agreed nor disagreed with this recommendation.

DOL also has not comprehensively assessed UI fraud risks in alignment with leading practices identified in GAO’s Fraud Risk Framework. These leading practices call for federal managers to plan regular fraud risk assessments and determine their fraud risk profile, among other things. Such assessments would provide reasonable assurance that DOL has identified the most significant fraud risks for the regular UI program that will exist after the pandemic. For example, some fraud risks identified in the CARES Act UI programs may continue to exist in the regular UI program after the temporary UI programs expire. GAO recommends that DOL (1) identify inherent fraud risks facing the unemployment insurance program, (2) assess the likelihood and impact of inherent fraud risks facing the program, (3) determine fraud risk tolerance for the program, (4) examine the suitability of existing fraud controls in the program and prioritize residual fraud risks, and (5) document the fraud risk profile for the program. DOL neither agreed nor disagreed with these recommendations.

FEMA’s Disaster Relief Fund and Assistance to State, Local, Tribal, and Territorial Governments

The Federal Emergency Management Agency (FEMA) has used the Disaster Relief Fund to respond to the COVID-19 pandemic—the first time the fund has been used during a nationwide public health emergency. For example, from September 1, 2020 to August 31, 2021, FEMA obligated a total of approximately $26.8 billion through one type of disaster assistance, Public Assistance, for emergency protective measures, such as eligible medical care, the purchase and distribution of food, and distribution of personal protective equipment.

GAO found that FEMA inconsistently interpreted and applied its policies for expenses eligible for COVID-19 Public Assistance within and across its 10 regions. For example, officials in one state said that FEMA at one point had deemed the provision of personal protective equipment at correctional facilities as ineligible for reimbursement in their region but that states in other regions had received reimbursement for the same expense. These inconsistencies were due to, among other things, changes in policies as FEMA used the Public Assistance program for the first time to respond to a nationwide emergency. FEMA officials stated that it was difficult to ensure consistency in policies as different states and regions are not experiencing the same things at the same time.

FEMA is likely to receive applications for reimbursement for a larger number of projects than it estimated earlier in 2021, given the surge in COVID-19 cases this summer. To improve the consistency of the agency’s interpretation and application of the COVID-19 Public Assistance policy, GAO recommends that FEMA further clarify and communicate eligibility requirements nationwide. GAO also recommends that FEMA require the agency’s Public Assistance employees in the regions and at its Consolidated Resource Centers to attend training on changes to COVID-19 Public Assistance policy. The Department of Homeland Security—which includes FEMA— agreed with both of these recommendations.

Loans for Aviation and Other Eligible Businesses

Treasury has executed 35 loan agreements with certain aviation businesses and other businesses deemed critical to maintaining national security. These loans have totaled about $22 billion of the $46 billion authorized by the CARES Act for loans and loan guarantees to such businesses. As directed by the CARES Act, Treasury required certain loan recipients to provide financial assets, such as warrants that give the federal government an option to buy shares of stock at a predetermined price before a specified date, to protect taxpayer interests.

According to Treasury officials, it is likely that, if the airline industry continues to recover and borrowers do not default, the warrants could have higher values than the predetermined price Treasury would have to pay to act on them. Treasury has not exercised any of the warrants for stock it received from nine businesses, nor has it developed policies and procedures for determining when to act on the warrants to benefit the taxpayer. GAO recommends that Treasury develop policies and procedures to determine when to act on warrants obtained as part of the loan program for aviation and other eligible businesses to benefit the taxpayers. Treasury agreed with this recommendation.

Payroll Support Assistance to Aviation Businesses

As of September 2021, Treasury had made payments totaling $59 billion of $63 billion provided for the Payroll Support Programs to support aviation business. These payments were to be used exclusively for the continuation of wages, salaries, and benefits.

Similar to Treasury’s requirement for loans for aviation and other eligible businesses, Treasury required certain Payroll Support Program recipients to provide warrants, as allowed by the CARES Act. As of September 2021, 14 recipients had provided a total of 58 million warrants.

As Treasury continues to hold these warrants for stock purchases, the warrants may increase in value as the airline industry recovers. Treasury has not exercised any of the warrants for stock it holds in the 14 businesses, nor has it documented policies and procedures to guide when to act on the warrants to fulfill the statutory purpose to provide appropriate compensation to the federal government. GAO recommends that Treasury develop policies and procedures to determine when to act on warrants obtained as part of the Payroll Support Program to provide appropriate compensation to the federal government. Treasury agreed with this recommendation.

COVID-19 Testing

Use is increasing for antigen tests, one of two types of COVID-19 diagnostic and screening tests for which HHS’s Food and Drug Administration has issued emergency use authorizations. These “rapid” antigen tests typically have a turnaround time of about 30 minutes or less for results, compared with 1 to 3 days for molecular tests, the second type of test HHS authorized. Antigen tests can be conducted at doctors’ offices or in homes or other settings; some antigen tests can be conducted without a prescription.

Since June 2020, HHS has worked to encourage and improve the reporting of antigen testing data to local, state, and federal health officials. However, HHS officials told GAO reporting of antigen test results is incomplete, which prevents HHS from using antigen testing data for COVID-19 surveillance. HHS is taking additional steps aimed at improving reporting of antigen test data. For example, officials told GAO that HHS will continue to make enhancements to data reporting by building reporting methods into the testing process, such as for testing in schools and workplaces.

HHS is also considering surveillance approaches to supplement or enhance current surveillance efforts. For example, HHS is exploring wastewater surveillance approaches, which provide data that can complement and confirm other forms of surveillance for COVID-19 and an efficient pooled community sample that is particularly useful in areas where timely COVID-19 clinical testing is underutilized or unavailable, according to HHS officials.

Worker Safety and Health

The Occupational Safety and Health Administration (OSHA) faced challenges in enforcing workplace safety and health standards during the COVID-19 pandemic, but the agency has not assessed lessons learned or promising practices. According to inspectors from area offices, they faced challenges related to resources and to communication and guidance, such as a lack of timely guidance from OSHA headquarters. GAO recommends that OSHA assess—as soon as feasible and, as appropriate, periodically thereafter—various challenges related to resources and to communication and guidance that the agency has faced in its response to the COVID-19 pandemic and take related actions as warranted. The Department of Labor—which includes OSHA—partially agreed with this recommendation.

Advance Child Tax Credit Payments

ARPA temporarily expanded eligibility for the child tax credit (CTC) to additional qualified individuals by eliminating a requirement that individuals must earn a minimum amount annually to be eligible. ARPA also temporarily increased the maximum amount of the CTC from $2,000 per qualifying child to $3,000 or $3,600, depending on the child’s age. As required by ARPA, the Internal Revenue Service (IRS) and Treasury are responsible for issuing half of the CTC through periodic advance payments, known as advance CTC payments.

IRS reported disbursing more than 106 million advance payments totaling over $45.5 billion as of September 25, 2021 (see figure).

Dollar Amount and Count of Advance Child Tax Credit Payments, by Month, as of Sept. 25, 2021

Figure described in preceding paragraph. For additional information about this figure, refer to contacts listed at http://www.gao.gov/products/GAO-22-105051

IRS is conducting and planning several outreach efforts to increase the public’s awareness of advance CTC payments. However, IRS and Treasury have not developed a comprehensive estimate of individuals who are potentially eligible for advance CTC payments and the agencies have not set a participation goal. Such an estimate would enable Treasury and IRS to measure the tax credit’s participation rate, providing greater clarity regarding populations at risk of not receiving the payments. GAO recommends that Treasury, in coordination with IRS, estimate the number of individuals, includingnonfilers, who are eligible for advance CTC payments, measure the 2021 participation rate based on that estimate, and use that estimate to develop targeted outreach and communications efforts for the 2022 filing season; the participation rate could include individuals who opt in and out of the advance payments. Treasury neither agreed nor disagreed with this recommendation.

Child Nutrition

Child nutrition programs administered by the Department of Agriculture’s Food and Nutrition Service (FNS) supply cash reimbursements to schools or other programs for meals and snacks provided to eligible children nationwide. In fiscal year 2019, before the pandemic, the four largest programs—the National School Lunch Program, School Breakfast Program, Summer Food Service Program, and Child and Adult Care Food Program—along with other child nutrition programs, received $23.1 billion in federal funds. During a typical year, two of these programs—the National School Lunch Program and the School Breakfast Program—subsidize meals for nearly 30 million children in approximately 95,000 elementary and secondary schools nationwide.

As of July 2021, FNS officials were unable to provide a plan showing how FNS intends to comprehensively analyze lessons learned during the pandemic, such as from operational and financial challenges. Further, according to FNS officials, while the School Meals Operations study—launched in spring 2021—is surveying school districts and state agencies that administer the federal child nutrition programs, the study is not gathering local perspectives directly from child care centers and day care homes or other local program sponsors that are not school districts. As a result, FNS may miss opportunities to identify lessons learned and will lack comprehensive information to aid its future planning. GAO recommends that the Department of Agriculture document its plan to analyze lessons learned from operating child nutrition programs during the COVID-19 pandemic. This plan should include a description of how the department will gather perspectives of key stakeholders, such as Child and Adult Care Food Program institutions and nonschool Summer Food Service Program sponsors. The Department of Agriculture—which includes FNS—agreed with this recommendation.

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  • Unmanned Aircraft Systems: DOD Needs to More Effectively Promote Interoperability and Improve Performance Assessments
    In U.S GAO News
    Unmanned aircraft systems (UAS) consist of an unmanned aircraft; sensor, communications, or weapons, carried on board the aircraft, collectively referred to as payloads; and ground controls. UAS have been used successfully in recent operations, and are in increasingly high demand by U.S. forces. To meet the demand, the Department of Defense (DOD) is increasing its investment in and reliance on UAS, and often deploying them while still in development. GAO has previously found that DOD's approach to developing and fielding UAS risked interoperability problems which could undermine joint operations. GAO was asked to review (1) UAS performance in recent joint operations and (2) the soundness of DOD's approach to evaluating joint UAS operational performance.DOD has achieved certain operational successes using UAS, including identifying time-critical targets in Iraq and Afghanistan, and striking enemy positions to defeat opposing forces. Some missions effectively supported joint operations, and in other cases, the missions were service-specific. DOD has encountered challenges which have hampered joint operations at times. First, some UAS cannot easily transmit and receive data with other communication systems because they are not interoperable. Although DOD guidance requires interoperability, detailed standards for interoperability have not been developed; DOD has relied on existing, more general standards; and the services developed differing systems. For now, U.S. forces have developed technical patches permitting transmission but slowing data flow, potentially hampering time-critical targeting. Second, some sensor payloads cannot be interchangeably used on different UAS because DOD has not adopted a payload commonality standard. Some UAS missions may have to be delayed if compatible unmanned aircraft and payloads are not available. Based on its experience with UAS in Persian Gulf operations, U.S. Central Command believes communications interoperability and payload commonality problems occur because the services' UAS development programs have been service-specific and insufficiently attentive to joint needs. Lastly, the electromagnetic spectrum needed to control the flight of certain unmanned aircraft and to transmit data is constrained and no standard requiring the capability to change frequencies had been adopted because the problem was not foreseen. Thus, some systems cannot change to avoid congestion and consequently some missions have been delayed, potentially undermining time-critical targeting. In addition to the joint operational challenges, inclement weather can also hamper UAS operations. Unmanned aircraft are more likely to be grounded in inclement weather than manned aircraft and DOD had not decided whether to require all-weather capability. While DOD has acknowledged the need to improve UAS interoperability and address bandwidth and weather constraints, little progress has been made. Until DOD adopts and enforces interoperability and other standards, these challenges will likely remain and become more widespread as new UAS are developed and fielded. DOD's approach to evaluating UAS joint operational performance has been unsound because it was not systematic or routine. DOD has deployed UAS before developing a joint operations performance measurement system, even though results-oriented performance measures can be used to monitor progress toward agency goals. DOD has generally relied on after-action and maintenance reports which have useful but not necessarily joint performance information. DOD has also relied on short-duration study teams for some performance information but had not established ongoing or routine reporting systems. Thus, while continuing to invest in UAS, DOD has incomplete performance information on joint operations on which to base acquisition or modification decisions. In May 2005, U.S. Strategic Command began developing joint performance measures.
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    In U.S GAO News
    What GAO Found The Federal Protective Service (FPS) provides security and protection at more than 9,000 federal facilities. FPS performs a variety of security activities in conjunction with the General Services Administration (GSA), which functions as the landlord at most of these facilities, and with the federal agencies, which occupy these facilities as tenants. These stakeholders can provide important perspectives on FPS's performance of its key activities (see figure). The Federal Protective Service's Three Key Security Activities Stakeholders expressed satisfaction with many aspects of FPS's performance of key activities but also identified aspects where they thought FPS could make improvements. For example, stakeholders expressed satisfaction with the professionalism of FPS personnel and commended FPS's coordination in responding to law enforcement incidents. However, some stakeholders said they would like to see FPS oversee contract guards more often. In addition, many stakeholders said that FPS could improve the cost estimates in its security assessment reports. GAO's review of FPS's Facility Security Assessment reports found that cost estimates for the recommended security measures lacked information that could help stakeholders make decisions to accept or reject FPS's recommendations. Specifically, recent reports for 27 selected buildings did not document (1) the assumptions FPS made to produce the cost estimates (e.g., the scope of work) and (2) the sources FPS used to create the estimate. In one report, for example, FPS recommended additional fencing and provided a cost estimate with an exact dollar amount. However, FPS did not document the assumptions it used to develop the estimate, such as the height and linear feet of fence or the fencing material. According to GAO's Cost Estimating and Assessment Guide , cost estimates should provide information about the assumptions and sources used to develop an estimate so that decision-makers can understand the level of uncertainty around the estimate. By providing detailed information about the cost estimates in Facility Security Assessment reports, FPS could better inform stakeholders and potentially increase implementation of recommended security measures, designed to increase the safety of people and property at these facilities. Why GAO Did This Study Over one million employees and a range of visitors seeking services at federal facilities depend on FPS to ensure the safety of both people and property at these locations. This report examines stakeholders' perspectives on FPS's performance of three key activities. GAO identified key activities from FPS data on work hours. GAO held discussion groups with stakeholders from 27 randomly selected facilities where FPS provided guard services and responded to incidents in fiscal year 2019 and analyzed stakeholder responses from 2017-2019 to GSA's and FPS's feedback instruments. These sources of stakeholder views are not representative but collectively provide insight into stakeholders' satisfaction with how FPS is performing key activities. GAO also reviewed agency documents; interviewed FPS officials about FPS's performance; and compared FPS's security assessment reports to criteria in GAO's Cost Estimating and Assessment Guide .
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  • GPS Modernization: DOD Continuing to Develop New Jam-Resistant Capability, But Widespread Use Remains Years Away
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    The Department of Defense (DOD) is closer to being able to use military code (M-code)—a stronger, more secure signal for the Global Positioning System (GPS) designed to meet military needs. However, due to the complexity of the technology, M-code remains years away from being widely fielded across DOD. M-code-capable receiver equipment includes different components, and the development and manufacture of each is key to the modernization effort. These include: special M-code application-specific integrated circuit chips, special M-code receiver cards, being developed under the Air Force Military GPS User Equipment (MGUE) programs, and the next generation of GPS receivers capable of using M-code signals from GPS satellites. DOD will need to integrate all of these components into different types of weapon systems (see figure for notional depiction of integration for one system). Integration across DOD will be a considerable effort involving hundreds of different weapon systems, including some with complex and unique integration needs or configurations. Global Positioning System User Equipment Integration The Air Force is almost finished—approximately one year behind schedule—developing and testing one M-code card for testing on the Marine Corps Joint Light Tactical Vehicle and the Army Stryker vehicle. However, one card intended for use in aircraft and ships is significantly delayed and missed key program deadlines. The Air Force is revising its schedule for testing this card. The M-code card development delays have had ripple effects on GPS receiver modernization efforts and the weapon systems that intend to use them. For example, an Air Force receiver modernization effort that depends on the new technology will likely breach its schedule and incur additional costs because of the delay. In turn, DOD planned to incorporate that receiver into its F/A-18 fighter aircraft, AV-8B strike aircraft, and the MH-53E helicopter, but it no longer plans to do so because of the delay. DOD has not yet determined the full extent of the development effort to widely integrate and field M-code receivers across the department. The amount of additional development and integration work is expected to vary for each weapon system and could range from a few weeks to several years. DOD is taking steps to enable fielding modernized receivers that use M-code cards by working to identify integration and production challenges. DOD has been developing the capability to use its more jam-resistant military-specific GPS signal for 2 decades. The Air Force launched the first GPS satellite capable of broadcasting the M-code signal in 2005, but is only now completing development of the software and other equipment needed to use it. The GPS modernization effort spans DOD and the military services, but an Air Force program office is developing M-code cards for eventual production and integration into weapon systems. The National Defense Authorization Act for Fiscal Year 2016 included a provision that the Air Force provide quarterly reports to GAO on next-generation GPS acquisition programs, and that GAO brief congressional defense committees. Since 2016, GAO has provided briefings and reported on various aspects of GPS. This report discusses DOD's progress and challenges (1) developing M-code receiver cards, and (2) developing receivers and taking other steps to make M-code-capable receivers available for fielding. GAO reviewed schedules and cost estimates for the Air Force's MGUE programs; military service and DOD M-code implementation data; and test and integration plans for aircraft, ships, and ground vehicles. GAO also reviewed strategies for continued access to microelectronics and interviewed officials from the MGUE programs, military services, and DOD, and representatives from microelectronics developers. For more information, contact Jon Ludwigson at (202) 512-4841 or ludwigsonj@gao.gov.
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  • Human Trafficking: Monitoring and Evaluation of International Projects Are Limited, but Experts Suggest Improvements
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    Human trafficking--a worldwide crime involving the exploitation of men, women, and children for others' financial gain--is a violation of human rights. Victims are often lured or abducted and forced to work in involuntary servitude. Since 2001, the U.S. government has provided about $447 million to combat global human trafficking. As GAO previously reported, estimates of the number of trafficking victims are questionable. In this report, GAO examines (1) collaboration among organizations involved in international antitrafficking efforts, (2) U.S. government monitoring of antitrafficking projects and difficulties in evaluating these projects, and (3) suggestions for strengthening monitoring and evaluation. GAO analyzed agency documents; convened an expert panel; interviewed officials; and conducted fieldwork in Indonesia, Thailand, and Mexico.While governments, international organizations, and nongovernmental organizations have recognized the importance of collaborating and have established some coordination mechanisms and practices, they will need to overcome challenges that have impeded collaboration in the past for their efforts to be successful. In two of the three countries GAO visited, it found that host governments--which bear ultimate responsibility for combating trafficking within their borders--have passed national antitrafficking laws and enacted national action plans. However, organizations continue to face numerous challenges when collaborating to combat human trafficking, including varying levels of government commitment and capacity. For example, some governments treat foreign trafficking victims as illegal immigrants and deport rather than protect them. In addition, according to officials in two of the three countries GAO visited, the ministries responsible for coordinating antitrafficking efforts have limited authority and capacity. U.S. government-funded antitrafficking projects often lack some important elements that allow projects to be monitored, and little is known about project impact due to difficulties in conducting evaluations. Project documents GAO reviewed generally include monitoring elements, such as an overarching goal and related activities, but often lack other monitoring elements, such as targets for measuring performance. To oversee projects, State officials supplement their efforts with assistance from U.S. embassy staff, but have not established written guidance for oversight. Officials said that they are working to improve performance measures and develop monitoring guidance. Conducting impact evaluations of antitrafficking projects is difficult due to several factors, including questionable project-level estimates of the number of trafficking victims. These estimates are needed for baselines by which to evaluate how effectively specific interventions are reducing trafficking. Elements in the design of certain projects, such as objectives that are too broad, further impede evaluation. Because of these difficulties, few impact evaluations have been completed, and little is known about the impact of antitrafficking interventions. A GAO-convened panel of experts identified and discussed ways to address the factors that make it difficult to monitor and evaluate antitrafficking projects. Panelists' suggested approaches included improving information on the nature and severity of trafficking and addressing monitoring and evaluation in project design. To improve information on trafficking, panelists suggested methods that have been used to sample other hard-to-reach populations, including domestic violence victims. One suggested method is sampling of "hot spots"--an intensive search for victims in areas known to have high concentrations of victims. To address weaknesses in project design that impede monitoring and evaluation, panelists suggested that officials design projects that clearly link activities to intended outcomes, identify measurable indicators, and establish procedures for setting and modifying targets.
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  • Vocational Rehabilitation: More VA and DOD Collaboration Needed to Expedite Services for Seriously Injured Servicemembers
    In U.S GAO News
    More than 10,000 U.S. military servicemembers, including National Guard and Reserve members, have been injured in the conflicts in Afghanistan and Iraq. Those with serious injuries are likely to be discharged from the military and return to civilian life with disabilities. The Department of Veterans Affairs (VA) offers vocational rehabilitation and employment (VR&E) services to help these injured servicemembers in their transition to civilian employment. GAO has noted that early intervention--the provision of rehabilitation services as soon as possible after the onset of a disability--is a practice that significantly facilitates the return to work. GAO examined how VA expedites VR&E services to seriously injured servicemembers and the challenges VA faces in its efforts to do so.VA has taken steps to expedite vocational rehabilitation and employment services for servicemembers returning from Afghanistan and Iraq with serious injuries. The agency has instructed its regional offices to make seriously injured servicemembers a high priority for all VA assistance, including VR&E services, and has asked DOD to provide data that would help VA identify and monitor this population. It has also deployed additional staff to five major Army military treatment facilities where the majority of the seriously injured are treated. Pending an agreement with DOD for sharing data, VA has relied on its regional offices to learn who the seriously injured are and where they are located. We found that the regional offices we reviewed had developed information that varied in completeness and reliability. We also found that VA does not have a policy for maintaining contact with those with serious injuries who may later be ready for VR&E services but did not initially apply for VR&E. Nevertheless, some regional offices did attempt to maintain contact while other regional offices did not. VA faces significant challenges in expediting VR&E services to seriously injured servicemembers. These include: the inherent challenge that individual differences and uncertainties in the recovery process make it difficult to determine when a servicemember will be ready to consider VR&E services; DOD's concerns that VA's outreach, including early intervention with VR&E, could work at cross purposes to military retention goals for servicemembers whose discharge from military service is not yet certain; and the lack of access to data from DOD that would allow VA to readily know which servicemembers are seriously injured and where they are located. VA and DOD generally concurred with our findings and recommendations.
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  • Priority Open Recommendations: Department of Justice
    In U.S GAO News
    What GAO Found In April 2020, GAO identified 18 priority recommendations for the Department of Justice (DOJ). Since then, DOJ has implemented nine of those recommendations by, among other things, improving the accuracy of the Federal Bureau of Investigation's (FBI) face recognition capabilities and the public's understanding of how the FBI uses and protects personal information, assessing its progress in its efforts to more efficiently handle FBI whistleblower retaliation complaints, developing better ways to assess its ability to combat illicit opioids, better addressing immigration judge staffing needs, and overseeing implementation of an electronic-filing system for immigration courts. In June 2021, GAO identified three additional priority recommendations for DOJ, bringing the total number to 12. The 12 recommendations fall into the following areas: Efforts to combat illicit opioid abuse. Federal prison system. FBI whistleblower retaliation complaints. Immigration courts. Cybersecurity. Improper payments. DOJ's continued attention to these issues could lead to significant improvements in government operations. Why GAO Did This Study Priority open recommendations are the GAO recommendations that warrant priority attention from heads of key departments or agencies because their implementation could save large amounts of money; improve congressional and/or executive branch decision-making on major issues; eliminate mismanagement, fraud, and abuse; or ensure that programs comply with laws and funds are legally spent, among other benefits. Since 2015, GAO has sent letters to selected agencies to highlight the importance of implementing such recommendations. For more information, contact Charles M. Johnson, Jr. at (202) 512-8777 or johnsoncm@gao.gov.
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  • DOD Systems Modernization: Maintaining Effective Communication Is Needed to Help Ensure the Army’s Successful Deployment of the Defense Integrated Military Human Resources System
    In U.S GAO News
    The Department of Defense (DOD) has had long-standing, serious problems with its numerous military component-unique personnel and pay systems, including accurately paying its military personnel on time and monitoring and tracking them to, from, and within their duty stations. For example, in the early 1990s, Army Reserve and National Guard troops received inaccurate or late pay and benefits after serving in Operations Desert Shield and Desert Storm. We previously reported that the lack of integration among DOD's multiple military personnel and pay systems, among other things, caused these and similar errors. To address these and other problems, in February 1998, DOD initiated a program to design and implement the Defense Integrated Military Human Resources System (DIMHRS). DIMHRS is intended to provide a joint, integrated, standardized personnel and pay system for all military components (including active and reserve components). In November 2004, DOD accepted the design of the first phase of DIMHRS for personnel and pay functions and then proceeded with development of the system. Meanwhile, as we reported in 2006, some Army Reserve and National Guard troops continued to receive inaccurate pay resulting in part from a lack of integration in Army personnel and pay systems. Furthermore, personnel and pay problems have been exacerbated by the hundreds of thousands of military personnel deployed to Iraq and Afghanistan, whose families depend on receiving accurate and timely pay, in addition to DOD's need to track military personnel in and out of theater. DOD is concurrently working with the Army, Air Force, and Navy, but the Army is to be the first to deploy DIMHRS. Therefore, we focused our review on DOD's plans to deliver the system to the Army for deployment. DOD has planned five DIMHRS deployment dates for the Army with the most recent one scheduled in March 2009. Four of the deployment dates were postponed--April 2006, April 2008, July 2008, and October 2008. As of April 2008, DOD moved the October date to March 2009. DIMHRS uses software referred to as a commercial-off-the-shelf product. According to DIMHRS program officials, including the Deputy Director of the Business Transformation Agency, the product will address all military component requirements. In February 2005, we reported that because DOD was not managing the DIMHRS program effectively, including its requirements, it was at increased risk of not delivering promised system capabilities and benefits on time. Since our 2005 report, we have monitored DOD's progress in managing the DIMHRS program under the authority of the Comptroller General to conduct evaluations on his own initiative. Specifically for this report, our objective was to determine to what extent DOD has effectively communicated the DIMHRS's capabilities to the Army in order for the Army to prepare for deployment of the system in March 2009.DOD has taken some recent steps to improve communications with the Army about DIMHRS's capabilities in an effort to better prepare the Army for deployment of the system in March 2009. However, Army officials still have some concerns about the extent to which Army requirements are being incorporated into DIMHRS. In addition, DOD has not established a clear, well-defined process for maintaining effective communications to better prepare the Army to deploy DIMHRS. Effective communication is a key federal internal control standard that calls for communications to constantly flow down, across, and up the organization to help it achieve all of its objectives. Such communication would improve the Army's understanding of what the system will deliver thus enabling the Army to better design and implement effective business processes to work with DIMHRS. The Army has had problems receiving assurance from DOD about the extent to which its requirements would be included in DIMHRS. For example, in September 2007, when the Army compared versions 3.0 and 3.1 of the system requirements document, it noted that DOD's DIMHRS program office had not effectively communicated with the Army the rationale or negotiated the acceptance of the Army's requirements that were dropped, changed, or both, which were agreed upon in version 3.0. During the Army's review of version 3.1, it identified and submitted 717 issues for DOD to resolve. Furthermore, when communicating changes for version 3.1, the format made it difficult for the Army to perform its comparative analysis. Army officials said that when the DIMHRS program office does not effectively communicate to them the differences between its requirements and the system, they have difficulty conducting a gap analysis between the system's planned capabilities and their own requirements. The gap analysis forms the basis upon which the Army can determine whether it needs to develop or adjust its business processes prior to deploying DIMHRS. DOD recently took steps to improve its communications with the Army about DIMHRS's capabilities and its impact on Army requirements. For example, in May 2008, the DIMHRS program office began to meet with Army officials to discuss the development of a formal process of delivering and adjudicating the documented updates to the design; this includes the differences between the Army's requirements--documented need of what a particular product or service should be or do--and the DIMHRS's requirements, which are documented in the system requirements document. According to Army officials, with respect to version 3.2, they identified 311 issues with 98 issues remaining in July 2008, which the DIMHRS program office is working to resolve. Additionally, in April 2008, the DIMHRS program office shared more detailed information about DIMHRS's capabilities through activities, such as demonstrations of the system capabilities. Moreover, the Deputy Director of the Business Transformation Agency stated that moving the deployment date to March 2009 allowed the DIMHRS program office and the Army the time to communicate about DIMHRS's capabilities. Although these steps have been taken, DOD has not developed and documented a clearly defined process for maintaining effective communications of the differences between DIMHRS's capabilities and Army requirements. 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    In U.S GAO News
    Following the terrorist attacks of September 11, 2001, increased security requirements and a significant number of active duty and reserve personnel sent overseas to support the war on terror left the Department of Defense (DOD) with fewer military personnel to rely on to protect domestic installations. To correct this shortage, Congress is temporarily allowing DOD to use contract security guards to fulfill roles previously performed by military employees. The U.S. Army has awarded contracts worth nearly $733 million to acquire contract guards at 57 Army installations, an investment far greater than those made by other DOD services so far. The requesters asked GAO to assess how the Army has been managing and overseeing its acquisition of security guard services, particularly with regard to the Army's (1) acquisition strategy, (2) employment screening, (3) training of contract guards, and (4) award fee process. This report also discusses DOD's mandated November 2005 report to Congress on the contract guard program.The Army's three-phased approach for acquiring contract security guards has relied heavily on sole-source contracts, despite the Army's recognition early on that it was paying considerably more for its sole-source contracts than for those awarded competitively. The Army has devoted twice as many contract dollars--nearly $495 million--to its sole-source contracts as to its competed contracts and has placed contract security guards at 46 out of 57 installations through sole-sourcing. These sole-source contracts were awarded to two Alaska Native corporation firms under the Small Business Administration's 8(a) Business Development Program. Congress has provided these firms with special advantages in the 8(a) program. During initial planning, the Army worked with a contractor who had not performed guard services before to refine the contract performance work statement. The Army's procedure for screening prospective contract guards is inadequate and puts the Army at risk of having ineligible guards protecting installation gates. The Army found that, at two separate installations, a total of 89 guards were put to work even though they had records relating to criminal offenses, including cases that involved assault and other felonies. Thorough background checks lag far behind the rate at which contract guards are put to work, and the initial screening process relies on prospective guards to be honest when filling out job application forms. In response to an earlier GAO report, DOD agreed to revise its antiterrorism standards to put into place a better mechanism for verifying the trustworthiness of contractors. The Army has given its contractors the responsibility to conduct most of the training of contract guards, and the Army cannot say with certainty whether training is actually taking place and whether it is being conducted according to approved criteria. GAO found that there is no requirement for the Army to certify that a contract guard has completed required training and that Army performance monitors do not conduct oversight of training as a matter of course. GAO also found missing or incomplete training records at several installations. At three installations, guards were certified by the contractor before training had been completed. An investigation discovered that at one installation, contractor personnel had falsified training records; the Army subsequently paid the contractor over $7,000 to re-qualify the guards. The Army has paid out more than $18 million in award fees, but the fees are based only on compliance with basic contractual requirements, not for above-and-beyond performance. Over the life of the contract guard program, the Army has paid out almost 98 percent of the available award fees. The practice of routinely paying contractors nearly the entire available award fee has created an environment in which the contractors expect to receive most of the available fee, regardless of acquisition outcomes. GAO found that many Army performance monitors were not conducting all of the required inspections of contractor activity in order to rate performance.
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    In U.S GAO News
    Since the September 11, 2001, terrorist attacks, the Department of Defense (DOD) has been engaged in domestic and overseas military operations in support of overseas contingency operations (OCO). These operations include Operation Iraqi Freedom, which focuses principally on Iraq, and Operation Enduring Freedom, which focuses principally on Afghanistan, but also include operations in the Horn of Africa, the Philippines, and elsewhere. Obtaining an accurate picture of OCO costs is of critical importance given the need to evaluate trade-offs and make more effective use of defense dollars in light of the nation's long-term fiscal challenges. In the past, the GAO has reported on the need for DOD to become more disciplined in its approach to developing plans and budgets, including building more OCO costs into the base defense budget. In February 2009, the Office of Management and Budget (OMB), in coordination with the Office of the Secretary of Defense (OSD), developed new guidance for use when constructing the initial fiscal year 2010 OCO funding request that more narrowly defined what should be considered an OCO funding need. The guidance remained in effect for building the fiscal year 2010 OCO supplemental request and the fiscal year 2011 OCO budget request.Under the Comptroller General's authority, GAO evaluated: 1. The fiscal year 2011 OCO budget request by comparing it to the fiscal year 2010 OCO appropriation and the fiscal year 2010 OCO supplemental request. 2. The assumptions DOD used to create the fiscal year 2010 OCO supplemental request and the fiscal year 2011 OCO budget request. 3. The extent to which the assumptions used for creating the fiscal year 2010 OCO supplemental request and the fiscal year 2011 OCO budget request are sensitive to operational changes. 4. The extent to which DOD moved certain costs of ongoing contingency operations from its OCO budget request into its base budget request.
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