Transfer of Budgetary Resources to the Department of Homeland Security (DHS)
Gao ID: GAO-04-329R April 30, 2004The enactment of the Homeland Security Act of 2002 led to the most substantial reorganization of the federal government since the 1940s by creating the Department of Homeland Security (DHS). Established in January 2003, DHS combined 29 program functions that were transferred from 10 agencies, referred to as the legacy agencies. In addition, legacy agencies transferred resources for support functions, such as offices of inspectors general and management and support. According to the President's proposal to create DHS, the reorganization was also designed to, among other things, achieve future savings through the elimination of redundancies among the transferred programs. Given the breadth and magnitude of the reorganization, questions have been raised among members of Congress and in the media about whether the creation of DHS would prompt increases in the size of the workforces at the agencies affected by the reorganization. This report responds to a request by the Chairman, House Committee on Transportation and Infrastructure, that we examine how the transfer of full-time equivalent (FTE) positions to DHS was conducted at the agencies involved in the transfer. Specifically, in this report, we (1) identify the budgetary resources and number of FTEs transferred from the legacy agencies to DHS, (2) compare the number of FTEs at DHS with the number of FTEs transferred from functions at legacy agencies, (3) identify differences between legacy agency fiscal year 2003 FTE balances after the transition and their fiscal year 2004 FTE requests, and (4) discuss any DHS efforts to identify opportunities to achieve personnel cost savings related to the reorganization.
The Office of Management and Budget (OMB) estimated that of the $38.28 billion transferred from 10 legacy agencies to DHS, $24.76 billion would support DHS's fiscal year 2003 needs, including funding for the 181,875 FTEs transferred from legacy agencies. Ninety-seven percent of the FTEs transferred were associated with seven program functions whose budget accounts were transferred to DHS in their entirety, including the functions of a former standalone agency, the Federal Emergency Management Agency. The nine remaining legacy agencies reported FTE decreases in their fiscal year 2003 budgets that generally matched OMB estimates of FTEs transferred to DHS. Only limited information was available to identify differences between legacy agency FTE balances after the transfer and their fiscal year 2004 requests. For the 24 budget accounts that were the source of the remaining 3 percent of FTEs transferred to DHS, the nine legacy agencies reported that, for their fiscal year 2004 requests: (1) 17 of 24 budget accounts included requests for FTEs less than or equal to the number of FTEs remaining after the transfer, and (2) 7 of 24 budget accounts included requests for FTEs greater than the number of FTEs remaining after the transfer. All legacy agencies reported that requested increases in FTEs were unrelated to the transfer of FTEs to DHS. DHS officials told us that while it was too early to identify personnel savings from the consolidation of legacy agency program functions in DHS, the department is beginning to examine some opportunities that may lead to such savings. They also said that these savings opportunities will have to be balanced with new departmental mission needs as yet to be determined.
GAO-04-329R, Transfer of Budgetary Resources to the Department of Homeland Security (DHS)
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April 30, 2004:
The Honorable Don Young:
Chairman:
Committee on Transportation and Infrastructure:
United States House of Representatives:
Subject: Transfer of budgetary resources to the Department of Homeland
Security (DHS):
Dear Mr. Chairman:
The enactment of the Homeland Security Act of 2002[Footnote 1] led to
the most substantial reorganization of the federal government since the
1940s by creating the Department of Homeland Security (DHS).
Established in January 2003, DHS combined 29 program functions that
were transferred from 10 agencies, referred to as the legacy agencies
(appendix I lists the functions, by agency, identified for
transfer).[Footnote 2] In addition, legacy agencies transferred
resources for support functions, such as offices of inspectors general
and management and support. DHS was created to improve the government's
coordination of efforts to protect against threats to the homeland.
According to the President's proposal to create DHS, the reorganization
was also designed to, among other things, achieve future savings
through the elimination of redundancies among the transferred programs.
Given the breadth and magnitude of the reorganization, questions have
been raised among members of Congress and in the media about whether
the creation of DHS would prompt increases in the size of the
workforces at the agencies affected by the reorganization.
This report responds to your request that we examine how the transfer
of full-time equivalent (FTE) positions--a workforce measure equal to
one work year or 2,080 nonovertime hours--to DHS was conducted at the
agencies involved in the:
transfer. Specifically, in this report, we (1) identify the budgetary
resources and number of FTEs transferred from the legacy agencies to
DHS, (2) compare the number of FTEs at DHS with the number of FTEs
transferred from functions at legacy agencies, (3) identify differences
between legacy agency fiscal year 2003 FTE balances after the
transition and their fiscal year 2004 FTE requests, and (4) discuss any
DHS efforts to identify opportunities to achieve personnel cost savings
related to the reorganization.
As agreed with your office, we are not reporting on changes to the
contractor workforce because reliable data on the total number of
contractor employees are not available. Except for cases involving
certain cost reimbursement contracts, the government generally does not
require its contractors to report on the number of employees involved
in performing government contracts. We are not aware of any source from
which complete and reliable data on this matter would be readily
available. Similarly, we are also not providing information on the
dollar value of contracts transferred by legacy agencies to DHS
because, according to DHS officials, such information is not readily
available for the inventory of contracts that DHS inherited from legacy
agencies.[Footnote 3] DHS officials report that they have created a
contract transfer list based on on-going contract obligations, which at
the time of the DHS transfer was the government-wide standard for
reporting procurement actions to the Federal Procurement Data System
(FPDS), the federal government's central source of statistical
information on federal contracting.[Footnote 4] DHS officials said that
to obtain total contract value information for contracts transferred
into the Department, DHS would have to compile these data from a
variety of sources, most of which are manual, and they would not have a
high degree of confidence in the data.
According to DHS officials, FPDS does not provide data on total
contract value for legacy agency contracts transferred to DHS in fiscal
year 2003. Consistent with expected changes to FPDS, DHS officials
stated that they are now tracking contract dollar value data for DHS's
new contracts executed in fiscal year 2004 and future years.[Footnote
5]
The transfer of programs, funding, and personnel resources from legacy
agencies to DHS began on March 1, 2003.[Footnote 6] OMB had and
continues to have responsibility for overseeing the transfer of FTEs,
positions, and budget authority from legacy agencies to the new
department.[Footnote 7] OMB staff said that they worked with legacy
agencies to determine the functions, number of corresponding FTEs and
positions, and budget dollars to be transferred to DHS.[Footnote 8]
Given that the transfer occurred midway through fiscal year 2003, OMB
estimated DHS's "gross discretionary budget authority," which,
according to OMB, represented a projection of what DHS's budget
authority would have been if DHS had been operating for the entire
fiscal year 2003. OMB also estimated the corresponding number of fiscal
year 2003 FTEs DHS would have needed to operate for the entire fiscal
year. Once OMB developed these estimates, it directed the legacy
agencies to reduce their fiscal year 2003 budget authority and FTEs by
amounts equal to the amounts transferred from them to DHS. For example,
according to OMB staff, OMB directed the Department of the Treasury to
reduce its budget authority and FTEs from its Office of Inspector
General budget account for fiscal year 2003, and these resources were
then transferred to DHS's Office of Inspector General budget
account[Footnote 9]. OMB also used the estimates it prepared for DHS's
transition in fiscal year 2003 as the basis for developing DHS's 2004
budget request.[Footnote 10]:
To meet our objectives, we reviewed available data and documentation
and interviewed officials from DHS, OMB, the nine legacy agencies still
in existence, and the Office of Personnel Management (OPM) in
Washington, D.C.[Footnote 11] To identify information on the number of
FTEs and budgetary resources transferred from the legacy agencies to
DHS, we obtained OMB estimates of fiscal year 2003 FTEs and
"gross discretionary budget authority" transferred to DHS. To compare
the number of FTEs at DHS after the transfer with decreases in FTEs at
legacy agencies, we identified legacy agency functions and related
budget accounts affected by the transfer, obtained and compiled by
function and budget account FTE data from each legacy agency before and
after the transfer, compared the results of our compilation with OMB
estimates, and asked OMB and legacy agencies to confirm whether our
compilations were correct.[Footnote 12] To identify differences between
legacy agency fiscal year 2003 FTE balances after the transition and
their fiscal year 2004 FTE requests, we obtained available legacy
agency FTE data for functions and budget accounts affected by the
transfer and compared these data with the fiscal year 2004 FTE requests
developed by legacy agencies for the President's budget. Finally, to
discuss:
DHS efforts to identify opportunities to achieve personnel cost savings
related to the reorganization, we interviewed DHS officials from the
Office of the Undersecretary for Management and reviewed available DHS
documents on cost savings opportunities. We also asked OMB to review
our comparisons of OMB and legacy agency-provided data on FTEs to
explain any differences between the OMB-provided numbers and those from
the legacy agencies. In comments on this report, OMB staff explained
that FTE estimates are made as point-in-time estimates and can change,
but did not specifically comment on the differences between legacy
agency and OMB data.
In addition to analyzing FTE data on the transfer, during our review,
we sought to analyze whether there were increases in positions, budget
authority, and personnel at legacy agencies after the transition.
However, we did not report on increases in these other data because
some of the information obtained was either incomplete or we were
unable to reconcile differences in data provided by OMB, OPM, and the
legacy agencies. According to OMB staff, differences could occur
because (1) estimates on positions were in flux at the time the
transfer occurred and (2) budget authority estimates could have been
collected at different points in time and were subject to change. OPM
officials said that OPM's data on personnel could differ from legacy
agency personnel data because (1) OPM's personnel data included both
those personnel who were part of the formal DHS transfer as well as
those personnel who voluntarily left their positions at legacy agencies
and were hired by DHS during the time of the DHS transition and (2)
data on personnel could have been collected at different points in
time.
Because of generally corresponding FTE data from OMB and legacy
agencies and basic confirmation during interviews with knowledgeable
officials, we determined the FTE data used to develop this report to be
sufficiently reliable to meet our objectives for this report. We did
our work from May 2003 to April 2004 in accordance with generally
accepted government auditing standards. Appendix II discusses our scope
and methodology in greater detail.
Results in Brief:
OMB estimated that of the $38.28 billion transferred from 10 legacy
agencies to DHS, $24.76 billion would support DHS's fiscal year 2003
needs, including funding for the 181,875 FTEs transferred from legacy
agencies. Ninety-seven percent of the FTEs transferred were associated
with seven program functions whose budget accounts were transferred to
DHS in their entirety, including the functions of a former stand-alone
agency, the Federal Emergency Management Agency. The nine remaining
legacy agencies reported FTE decreases in their fiscal year 2003
budgets that generally matched OMB estimates of FTEs transferred to
DHS. Only limited information was available to identify differences
between legacy agency FTE balances after the transfer and their fiscal
year 2004 requests. For the 24 budget accounts that were the source of
the remaining 3 percent of FTEs transferred to DHS, the nine legacy
agencies reported that, for their fiscal year 2004 requests:
* 17 of 24 budget accounts included requests for FTEs less than or
equal to the number of FTEs remaining after the transfer,[Footnote 13]
and:
* 7 of 24 budget accounts included requests for FTEs greater than the
number of FTEs remaining after the transfer.
All legacy agencies reported that requested increases in FTEs were
unrelated to the transfer of FTEs to DHS.
Figure 1 shows the FTEs transferred to DHS, by budget accounts, for
accounts that were transferred in their entirety, and for accounts with
remaining balances at legacy agencies.
Figure 1: Percentage of FTEs Transferred to DHS Associated with Budget
Accounts Transferred in their Entirety and Those That Remain at Legacy
Agencies:
[See PDF for image]
[End of figure]
DHS officials told us that while it was too early to identify personnel
savings from the consolidation of legacy agency program functions in
DHS, the department is beginning to examine some opportunities that may
lead to such savings. They also said that these savings opportunities
will have to be balanced with new departmental mission needs as yet to
be determined.
Resource Transfer to DHS:
According to OMB, a total of $38.28 billion in unobligated funding--
including fiscal year 2003 funding and funds from prior budget years--
was transferred from the 10 legacy agencies to DHS. Given that DHS was
established midway through fiscal year 2003, OMB estimated a transfer
of $24.76 billion from legacy agencies to DHS in fiscal year 2003
"gross discretionary budget authority"--which represented current year
funding DHS would have needed during fiscal year 2003. This included
funds for an estimated 181,875 FTEs transferred from legacy agencies.
OMB data also showed that the transfer included 209,105 full-and part-
time positions.[Footnote 14] Table 1 shows OMB's March 2003 estimates
of the legacy agency resources that would have been needed to operate
DHS during all of fiscal year 2003.
Table 1: Estimated Legacy Agency Resources Needed to Operate the
Department of Homeland Security during Fiscal Year 2003:
Legacy agency: Agriculture;
Fiscal year 2003 estimated FTEs transferred[A]: 2,690;
Estimated positions[B]: 2,655[D];
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: $56.0.
Legacy agency: Commerce;
Fiscal year 2003 estimated FTEs transferred[A]: 35[E];
Estimated positions[B]: 50;
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 8.0.
Legacy agency: Defense;
Fiscal year 2003 estimated FTEs transferred[A]: 92;
Estimated positions[B]: 105;
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 500.0.
Legacy agency: Energy;
Fiscal year 2003 estimated FTEs transferred[A]: 101;
Estimated positions[B]: 101;
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 148.0.
Legacy agency: Federal Emergency Management Agency[F];
Fiscal year 2003 estimated FTEs transferred[A]: 5,330;
Estimated positions[B]: 8,542;
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 2,830.0.
Legacy agency: General Services Administration;
Fiscal year 2003 estimated FTEs transferred[A]: 1,497;
Estimated positions[B]: 1,713;
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 450.0.
Legacy agency: Health and Human Services;
Fiscal year 2003 estimated FTEs transferred[A]: 110;
Estimated positions[B]: 91[D];
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 500.0.
Legacy agency: Justice;
Fiscal year 2003 estimated FTEs transferred[A]: 40,053;
Estimated positions[B]: 37,154[D];
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 5,500.0.
Legacy agency: Transportation;
Fiscal year 2003 estimated FTEs transferred[A]: 103,073;
Estimated positions[B]: 129,302;
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 10,348.0.
Legacy agency: Treasury;
Fiscal year 2003 estimated FTEs transferred[A]: 28,894;
Estimated positions[B]: 29,392;
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: 4,417.0.
Total;
Fiscal year 2003 estimated FTEs transferred[A]: 181,875[G];
Estimated positions[B]: 209,105;
Fiscal year 2003 "gross discretionary budget authority" transferred
(in millions of dollars)[C]: $24,757.0.
Source: GAO analysis of OMB data as of March 2003. ABased on estimates
provided by OMB on August 7, 2003. Although the transfer of legacy
agency resources began on March 1, 2003, OMB estimates of FTEs are
projected for the entire fiscal year 2003. This allows comparisons with
other fiscal years that cover a 12-month period. For civilian employees
in the executive branch, one FTE is equal to one work year or 2,080
nonovertime hours.
[B] Based on data compiled by OMB as of February 28, 2003. Positions
are the specific duties and responsibilities assignable to an employee
and can be full-time, part-time, or vacant. Positions do not represent
actual full-time equivalent employment.
[C] Based on estimates provided by OMB as of August 7, 2003. Given that
the transfer occurred midway through fiscal year 2003, OMB estimated
DHS's "gross discretionary budget authority," which, according to OMB,
represented a projection of what DHS's budget authority would have been
if DHS had been operating for the entire fiscal year 2003. According to
OMB data, a total of $38.28 billion in unobligated funding was
transferred to DHS's budget.
[D] According to OMB staff, the number of positions could be lower than
the number of FTEs for these agencies because OMB position data were
not necessarily complete at the time the OMB estimates of FTEs were
compiled.
[E] Although OMB FTE estimates show that 35 FTEs were transferred from
the Department of Commerce to DHS for the Critical Infrastructure
Assurance Office (CIAO), according to Department of Commerce officials,
Commerce reduced the number of FTEs associated with this budget account
by 50 FTEs because of the transfer. Commerce officials said that 50
FTEs have been associated with CIAO since its inception in Commerce.
[F] FEMA became a part of DHS on March 1, 2003, and no longer exists as
a freestanding agency. gAn additional 100 new FTEs were allocated to
DHS to establish a budget for departmental operations in fiscal year
2003.
[G] An additional 100 new FTEs were allocated to DHS to establish a
budget for departmental operations in fiscal year 2003.
[End of table]
Ninety-seven percent of the estimated FTEs (176,466 FTEs) transferred
were associated with seven program functions whose budget accounts were
transferred to DHS in their entirety, and budget accounts for these
functions no longer exist at the legacy agencies.[Footnote 15] For
example, the Coast Guard was transferred from the Department of
Transportation (DOT), and the Immigration and Naturalization Service
(INS) was abolished and its functions were transferred from the
Department of Justice (DOJ).[Footnote 16] In addition, FEMA, formerly a
stand-alone agency, was merged into DHS in its entirety. The remaining
3 percent of the estimated FTEs (5,409 FTEs) were associated with
transfers from 24 budget accounts that remain at the legacy agencies.
For example, FTEs for the Federal Protective Service were formerly
included in the General Services Administration's (GSA) Real Property
Activities--Federal buildings fund--budget account and are now with
DHS. In another instance, some FTEs were transferred from offices of
inspectors general budget accounts at DOT, Treasury, DOJ, GSA, and USDA
for a new office of inspector general budget account at DHS. Appendix
III provides information on OMB estimates of fiscal year 2003 FTE
transfers, by function, for each legacy agency.
In addition to the resources transferred, for DHS's fiscal year 2003
budget, OMB allocated DHS an additional 100 FTEs for management staff.
In fiscal year 2003, DHS also received $6.61 billion in budget
authority through supplemental appropriations for a total of $31.37
billion in budget authority.
The Homeland Security Act of 2002 requires the legacy agencies to
transfer identified programs, personnel, and funding resources to DHS
within one year of the department's creation.[Footnote 17] According to
DHS and legacy agency officials, the transfer of funding, FTEs, and
positions is not complete; legacy agencies are still providing support
services to DHS through memorandums of agreement. According to DHS and
legacy agency officials, these agreements--of which there are at least
50--cover a variety of services such as mail and messenger services,
payroll processing, computer network services, building security, and
shuttle bus services. DHS and legacy agency officials told us that some
of the agreements may have extended beyond the one-year period, and
additional personnel could be transferred when these agreements end.
However, DHS officials said that, so far, as agreements have ended, DHS
has absorbed the additional workload without increasing FTEs or
personnel because of DHS's consolidation of support services.
Our discussions with legacy agency officials indicated that it would be
difficult to estimate (1) the number of FTEs associated with existing
agreements at legacy agencies and (2) how FTEs might be affected once
memorandums of agreement end. Officials said that some of the
agreements were shared service arrangements where DHS agreed to pay a
proportionate share of the total cost of services rendered; the
agreements did not include a dedicated number of personnel providing
services to DHS. Officials stated other agreements included staff hour
cost estimates that could not be readily converted to FTEs.
Legacy agency officials also indicated that legacy agencies vary in
their plans for reassigning personnel after the agreements end. For
example, officials at the Department of Commerce, the Department of
Defense (DOD), DOJ, and GSA said that they do not plan to reassign
staff after the agreements end because dedicated staff are not
providing these services or the amount of support provided is small.
Treasury officials said that they might need to reduce staff if DHS
decided to discontinue receiving working capital fund services, such as
those for telephone operator services, and no other client required
additional support.
Legacy Agencies Fiscal Year 2003 FTE Decreases Generally Matched FTEs
Transferred to DHS:
All legacy agencies reported FTE decreases in their fiscal year 2003
budgets, and these decreases generally matched OMB's data on the number
of FTEs transferred to DHS.[Footnote 18] Specifically, data provided to
us by the legacy agencies for those budget accounts still existing at
the agencies showed that all nine legacy agencies decreased their
budgeted FTEs by amounts that generally corresponded to OMB data on the
FTEs transferred to DHS. Three of the nine agencies--USDA, DOT, and
GSA--provided data that showed that their FTE decreases were the same
as OMB data on the transfer. Four of the nine agencies--Commerce,
Department of Energy (DOE), Department of Health and Human Services
(HHS), and Treasury--said that their FTE decreases were slightly
greater than OMB's data on FTEs transferred.[Footnote 19] The number of
FTEs over and above the amounts transferred by OMB ranged from 1 FTE at
DOE to 45 FTEs at Treasury. DOD said that it decreased its FTE budget
by 1 FTE less than the number of FTEs in OMB's data.[Footnote 20]
Finally, the ninth legacy agency, DOJ, provided data showing FTE
decreases that differed from OMB estimates associated with three budget
accounts:
General Administration--Office of Inspector General (OIG) budget
account:
DOJ said that it transferred 15 FTEs to DHS, rather than 55 FTEs as
shown in OMB's data. DOJ said that originally, the Treasury OIG was to
transfer 155 FTEs to DHS and 40 FTEs to the DOJ OIG for the transfer of
the Bureau of Alcohol, Tobacco, and Firearms to DOJ.
However, under a second plan agreed to by DOJ, Treasury, DHS, OMB, and
OPM, the Treasury OIG transferred 195 FTEs directly to DHS's OIG,
reducing to 15 the number of FTEs that DOJ's OIG transferred to DHS's
OIG.[Footnote 21]
General Administration--Salaries and expenses budget account:
DOJ said that it transferred 10 FTEs in fiscal year 2003, rather than
93 as shown in OMB's data. DOJ said that only 10 of the 93 FTEs for the
General Administration--Salaries and expenses budget account were
planned for transfer in 2003 and the remaining 83 FTEs were transferred
in the fiscal year 2004 budget submission.
* Office of Justice Programs--Justice assistance budget account:
DOJ said that it transferred 55 FTEs, rather than no FTEs as shown in
OMB's data.
OMB staff explained that, as discussed earlier, FTE estimates are made
as point in time estimates and can change.
Limited Information Available to Identify Differences between Legacy
Agency FTE Balances after the Transfer and Requested FTEs:
As mentioned earlier, 97 percent of the estimated FTEs (176,466 FTEs)
transferred were associated with seven program functions that were
transferred to DHS in their entirety, and their budget accounts no
longer exist at the legacy agencies. For the 24 budget accounts that
were the source of the remaining 3 percent of FTEs transferred to DHS,
the nine legacy agencies reported that, for their fiscal year 2004
requests,
* 17 of 24 budget accounts included requests for FTEs less than or
equal to the number of FTEs remaining after the transfer,[Footnote
22]and:
* 7 of 24 budget accounts included requests for FTEs greater than the
number of FTEs remaining after the transfer.
Figure 2 shows a breakdown of FTEs transferred by agency and budget
account.
Figure 2: Breakdown of FTEs Transferred to DHS, by Agencies and Budget
Account:
[See PDF for image]
Legend: N/A = Not applicable.
Notes:
[A] USDA officials provided fiscal year 2003 FTE data for the Animal
and Plant Health Inspection Service--Plant Protection and Quarantine
Program.
[B] According to the Department of Commerce, Commerce reduced FTEs by
50 because of the transfer.
[C] According to DOD, 91 FTEs, representing all FTEs for the National
Communication System, were transferred to DHS.
[D] According to DOD, the fiscal year 2003 FTE balance for the DOD--
Operations and Maintenance--Operation and maintenance, Defense-wide
budget account after the transfer included a larger decrease (-4,153
FTEs) than the 91 FTEs transferred to DHS because it reflects FY 2003
actual data submitted in the FY 2005 budget cycle and decreases
occurred for other management and budgetary reasons.
[E] In addition to transferring the amounts identified by OMB, DOE
transferred 1 additional FTE for DHS support activities.
[F] According to GSA, 1 FTE was transferred to DHS immediately and 15
FTEs are being retained at GSA to provide support services for DHS
while the GSA/DHS support services are in effect. GSA's total reduction
to the working capital fund account as a result of the transfer is 16
FTEs.
[G] HHS transferred an additional 7 FTEs from the Office of Inspector
General, Centers for Disease Control and Prevention, Food and Drug
Administration, and National Institutes of Health.
[H] According to DOJ officials, FTEs were transferred from the Office
of Justice Programs to DHS in 2002. According to DOJ, 55 FTEs were
transferred from the Office of Justice Programs to DHS.
[I] DOJ officials stated that only 10 of the 93 FTEs for the General
Administration--Salaries and expenses budget account were planned for
transfer in 2003. According to DOJ, the remaining 83 FTEs were
transferred in the fiscal year 2004 budget submission.
[J] According to DOJ officials, as part of the formation of DHS, the
Office of Management and Budget (OMB), directed the Treasury Office of
Inspector General (OIG) to transfer 155 FTEs to DHS's OIG and directed
the DOJ OIG to transfer 55 FTEs to DHS's OIG. At the same time, OMB
directed the Treasury OIG to transfer 40 FTEs to the DOJ OIG to
compensate for the transfer of the Bureau of Alcohol, Tobacco, and
Firearms from the Department of the Treasury to DOJ. According to DOJ,
this would have resulted in the DOJ OIG receiving 40 individuals from
the Treasury OIG while at the same time transferring 55 of its
personnel to DHS's OIG. DOJ said that the inspectors general for DOJ,
the Department of the Treasury, and DHS agreed that the series of
transfers originally directed by OMB was inefficient and would cause
undue personal and mission-related disruptions, particularly to the
personnel and field offices affected by the proposed transfers.
According to DOJ, the three inspectors general conferred and agreed to
a proposal that would avoid such disruptions but still accomplish the
same overall number of transfers. Under this plan, DOJ said that the
Treasury OIG transferred 195 FTEs directly to DHS's OIG (the 155 FTEs
it was required to transfer to DHS's OIG as well as the 40 it was
required to transfer to DOJ's OIG). This reduced to 15 (55 minus 40)
the number of FTEs that DOJ's OIG had to directly transfer to DHS's
OIG.
[K] According to the Department of the Treasury, Treasury transferred
226 FTEs from the Departmental Offices--Salaries and expenses budget
account to DHS.
[L] FEMA became a part of DHS on March 1, 2003, and no longer exists as
a freestanding agency with its own budget accounts.
[M] Under the Homeland Security Act of 2002, P.L. 107-296 (Nov. 25,
2002), the Immigration and Naturalization Service was abolished and its
functions were transferred from the Department of Justice. In its
technical comments, DOJ noted that functions delegated to INS
transferred to DHS, but that the Attorney General did not delegate to
INS every function under the Immigration and Naturalization Act.
Specifically, according to DOJ, the Attorney General continues to
manage those functions that he did not delegate to INS, e.g., the
management of certain law enforcement responsibilities related to visas
that were delegated to DOJ's Criminal Division.
[N] U.S. Coast Guard, Transportation Security Administration, U.S.
Customs, U.S. Secret Service, and Federal Law Enforcement Training
Center budget accounts were transferred to DHS in their entirety, and
budget accounts for these functions no longer exist at the legacy
agencies.
[End of figure]
We asked the five agencies that provided data showing that they
requested increased FTEs associated with seven budget accounts to
explain why they requested these increases. For all seven budget
accounts, agency officials said that requested increases in FTEs were
for programmatic or mission changes in the programs. Specifically, for
those budget accounts:
* GSA requested 10 additional FTEs for its working capital fund. A GSA
official explained that the additional FTEs were requested to staff
GSA's Human Capital Strategy and Competitive Sourcing Initiatives
related to the President's Management Agenda and for other programmatic
changes unrelated to the transfer.[Footnote 23]
* GSA requested 60 additional FTEs for its General Activities--
Operating expenses budget account. A GSA official said that the
requested increase was a result of the restructuring of the GSA budget
internally, which would have occurred regardless of the transfer of
FTEs to DHS and is unrelated to the transfer.[Footnote 24]
* DOT requested 22 additional FTEs for its Office of the Secretary--
Salaries and expenses budget account. A DOT official said that the
requested increase included FTEs for the Office of Intelligence and
Security, which, among other things, coordinates DOT transportation
security issues with DHS. The official said that the requested increase
was not related to the transfer.
* Commerce requested 16 additional FTEs for its Bureau of Industry and
Security--Operations and administration budget account. A Commerce
official said that the requested FTEs were for the bureau's core export
enforcement and export regulation missions and not related to the
missions that were transferred.
* DOD requested 2,889 additional FTEs for its Operations and
Maintenance--Operation and maintenance, Defense-wide budget account. A
DOD official said that the requested increase is related to changes in
the composition of the budget account and the conversion of military
positions to civilian positions and is unrelated to the
transfer.[Footnote 25]
* DOJ requested 1,868 additional FTEs for its Federal Bureau of
Investigation--Salaries and expenses budget account. A DOJ official
said that the requested increase is associated with Counterterrorism
and Operations Support, Counterintelligence, Cybercrime
Investigations, Security, Technology Investments, and Criminal
Investigations and is unrelated to the transfer.
* DOJ requested 59 additional FTEs for its General Administration--
Salaries and expenses account. A DOJ official said that the requested
increase is associated with transfers from the Department of Treasury
and increases in the Office of Intelligence Policy and Review and is
unrelated to the DHS transfer.
DHS Officials Identified a Preliminary Plan They Hope Will Achieve
Personnel Cost Savings:
In November 2003, officials with DHS's Office of the Undersecretary for
Management said that they had developed a plan that could lead to
potential personnel cost savings through the consolidation of DHS-wide
support services. According to these officials, DHS had begun to
implement a tri-bureau initiative, which is a plan to identify and
reorganize support services to achieve management efficiencies in the
Bureaus of Immigration and Customs Enforcement, Citizenship and
Immigration Services, and Customs and Border Protection. As part of
this initiative, DHS said it was evaluating (1) how and where support
services were currently being provided within the department; (2) what
the optimal service level should be, based on quality and cost
considerations; and (3) what was the best approach for realigning and
reorganizing support services. For example, officials said they had
begun to examine how motor vehicle fleet management in particular
locations was currently being provided and how it could be reorganized
at these locations so that customers could share services.
Officials from the Office of the Undersecretary for Management said the
reorganization and consolidation of these services through the tri-
bureau initiative should yield efficiencies and cost savings, including
possible personnel savings. However, these officials said that they
were still in the early stages of identifying and assessing the
agency's support service needs and how they should be provided. Thus,
DHS was not at the point of realizing savings in the support service
area. In addition, they said that although there may be opportunities
to realize personnel cost savings, DHS would have to consider personnel
needs as new missions arise.
In the meantime, for fiscal year 2004, DHS requested a total of 179,241
FTEs--2,634 FTEs less than the number of FTEs transferred in fiscal
year 2003. According to DHS officials, DHS's fiscal year 2004 enacted
appropriation will support 179,917 FTEs.
Agency Comments and Our Evaluation:
On January 14, 2004 and April 14, 2004, we requested comments on this
report from the Attorney General, Secretary of Agriculture, Secretary
of Commerce, Secretary of Defense, Secretary of Energy, Secretary of
Health and Human Services, Secretary of Homeland Security, Secretary of
Transportation, Secretary of the Treasury, Director of the Office of
Management and Budget, Director of the Office of Personnel Management,
and the Administrator of the General Services Administration. The
Department of Defense, in a letter, which is included in appendix IV,
stated that it concurred with our report. The Department of Justice
provided comments that are discussed below and included in appendix V.
The Departments of Agriculture, Energy, Treasury; the Office of
Personnel Management; and the General Services Administration stated
that they had no comments on our draft report. The Departments of
Commerce, Justice, Health and Human Services, Transportation, and
Homeland Security and Office of Management and Budget also provided
technical comments that we have incorporated where appropriate.
In written comments dated February 6, 2004, DOJ stated that it was
concerned that the draft report, as written, could be misconstrued when
trying to discern what resources DOJ provided to DHS. DOJ provided data
showing that FTEs transferred to DHS differed from OMB estimates for
transfers associated with three DOJ budget accounts. We included
additional language in the report to reflect the information provided
by DOJ. DOJ also stated that while the draft report referred to the
transfer of INS to DHS, the functions of INS were transferred to DHS
and INS was abolished. We included additional language in the report to
clarify how INS functions were transferred. Regarding differences in
OMB and DOJ provided data on FTEs transferred to DHS, in comments
provided during an interview with us on March 12, 2004, OMB staff said
that there could be differences between these data because OMB gave
agencies flexibility and discretion to determine "what made sense" for
the transfer of functions.
DHS officials commented that DHS has made "significant progress" in
consolidating services under fewer service providers within the
department. Specifically, these officials said that DHS had reduced the
number of financial management service providers from 19 to 10,
separate contracting offices from 13 to 8, human resource offices from
22 to 7, and property management systems from 22 to 3. In addition,
they also indicated that DHS had reduced its payroll systems from 8 to
3, and it expects to pay all of its employees using one system by the
end of the year. DHS officials said that they believe that their
continued focus on consolidation and integration of services and
service providers will aid DHS in realizing further savings and
efficiencies in support of its overall mission. Because DHS provided
this information after the completion of our review, we were not able
to assess these DHS efforts.
As agreed with your office, unless you publicly announce the contents
of this report earlier, we plan no further distribution until 15 days
from the report date. At that time, we will send copies of this report
to other interested congressional committees and to the agencies
included in our review. We will also make copies available to others
upon request. In addition, the report will be available at no charge on
the GAO Web site at http://www.gao.gov.
If you have any questions about this report, please contact my
Assistant Director, John F. Mortin, or me at (202) 512-8777. Key
contributors to this report were Vickie:
Miller, Barbara Stolz, Chelsa Kenney, Julian King, Christine Davis,
Katherine Davis, Jenna Aurand, Denise Fantone, Bill Woods, Michele
Mackin, and Gregory Wilmoth.
Sincerely yours,
Signed by:
Paul L. Jones, Director:
Homeland Security and Justice Issues:
Appendix I:
Program Functions Transferred to the Department of Homeland Security:
List of program functions transferred to the Department of Homeland
Security (DHS) under the Homeland Security Act of 2002, P.L. 107-296
(Nov. 25, 2002). For program functions in italics, budget accounts no
longer exist at legacy agencies because these functions were
transferred in their entirety to DHS.
Department of Agriculture
1. Specified agricultural import and entry inspection activities from
the Animal and Plant Health Inspection Service[A]:
2. Plum Island Animal Disease Center[B]:
Department of Commerce:
3. Critical Infrastructure Assurance Office[C]:
4. Integrated Hazard Information System (to be renamed "FIRESAT")[D]:
Department of Defense:
5. National Communications System[C]:
6. National Bio-Weapons Defense Analysis Center[E]:
Department of Energy:
7. Chemical and biological national security program and supporting
programs and activities of the nonproliferation and verification
research and development program[E]:
8. Nuclear smuggling programs and activities within the proliferation
detection program of the nonproliferation and verification research and
development program[E],[M].
9. Nuclear assessment program and activities of the assessment,
detection, and cooperation program of the international materials
protection and cooperation program[E]:
10. Such life sciences activities of the biological and environmental
research program related to microbial pathogens as the President may
designate for transfer to DHS[E].
11. Advanced scientific computing research and program activities at
Lawrence Livermore National Laboratory [E]:
12. Environmental Measurements Laboratory[E]:
13. National Infrastructure Simulation and Analysis Center and the
energy security and assurance program[C]:
14. Nuclear Incident Response Team[F]:
15. Federal Emergency Management Agency[D]:
General Services Administration:
16. Federal Protective Service[G]:
17. Federal Computer Incident Response Center[C]:
Department of Health and Human Services:
18. Office of Emergency Preparedness, the National Disaster Medical
System, and the Metropolitan Medical Response System[D]:
19. Strategic National Stockpile[D,N]:
Department of Justice:
20. Immigration and Naturalization Service[I]:
21. National Infrastructure Protection Center (other than the Computer
Investigations and Operations Section)[C]:
22. National Domestic Preparedness Office[D]:
23. Domestic Emergency Support Teams[D, J]:
24. Office for Domestic Preparedness[G]:
Department of Transportation
25. Coast Guard[K]:
26. Transportation Security Administration[G]:
Department of the Treasury:
27. U.S. Customs Service[G,H]:
28. U.S. Secret Service[L]:
29. Federal Law Enforcement Training Center[G]:
Source: GAO analysis of the Homeland Security Act of 2002, P.L. 107-296
(Nov. 25, 2002).
[A] P.L. 107-296, § 421. bP.L. 107-296, § 310. This section authorizes
the Department of Agriculture to continue research, diagnostic, and
other activities at the Plum Island Animal Disease Center after its
transfer to DHS.
[C] P.L. 107-296, § 201(g).
[D] P.L. 107-296, § 503. eP.L. 107-296, § 303.
[F] P.L. 107-296, § 504. This section provides that at the direction of
the Secretary of Homeland Security (in connection with an actual or
threatened terrorist attack, major disaster, or other emergency in the
United States), the Nuclear Incident Response Team of the Department of
Energy shall operate as an organizational unit of DHS. The Secretary of
Energy and the Administrator of the Environmental Protection Agency
shall exercise direction, authority, and control over the team when it
is not operating as a unit of DHS.
[G] P.L. 107-296, § 403.
[H] Certain customs revenue functions did not transfer to DHS under the
Homeland Security Act, although Section 412 authorizes the Secretary of
the Treasury to delegate such functions to DHS.
[I] P.L. 107-296, §§ 441, 451(b). Certain federal immigration functions
relating to the care of unaccompanied alien children transferred to the
Department of Health and Human Services under the Act rather than DHS.
P.L. 107-296, § 462. j Interagency group mobilized in response to major
incidents.
[K] P.L. 107-296, § 888(b).
[L] P.L. 107-296, § 821.
[M] Section 303(1)(B) of the Homeland Security Act of 2002 authorizes
the President to designate the nuclear smuggling programs and
activities either for transfer to the Department of Homeland Security
or for joint operation by the Homeland Security and Energy Departments.
[N] In its technical comments, HHS noted that Section 1705 of the
Homeland Security Act divides responsibilities for the Strategic
National Stockpile between DHS and HHS, with HHS retaining management
authority over the stockpile. DHS, on the other hand, is to "maintain"
the stockpile under Section 1705 and direct its response in the event
of a terrorist attack or major disaster under Section 502(3)(B).
Because of the agencies' respective spheres of authority under the
Homeland Security Act, the agencies have entered a memorandum of
agreement interpreting the Act's stockpile transfer provision, Section
503(6), to require the transfer of stockpile assets, except for
personnel, who are to remain with HHS to carry out the agency's
statutory management responsibilities.
[End of table]
Appendix II: Scope and Methodology:
Our objectives were to determine the number of full-time
equivalent[Footnote 26] (FTE) positions and amount of funding
transferred from the legacy agencies to the Department of Homeland
Security (DHS), compare the number of FTEs at DHS after the transfer
with decreases in FTEs from affected programs at the legacy agencies,
identify differences between legacy agency fiscal year 2003 FTE
balances after the transition and their fiscal year 2004 FTE requests,
and describe any DHS efforts to identify opportunities to achieve
personnel cost savings related to the reorganization.
To meet our objectives, we conducted our work in Washington, D.C., at
DHS, the Office of Management and Budget (OMB), the Office of Personnel
Management (OPM), and the nine agencies that were required to transfer
program functions to DHS under the Homeland Security Act of 2002.
Referred to as legacy agencies and remaining after the transition, the
nine agencies were the Department of Agriculture, Department of
Defense, Department of Energy, Department of Commerce, Department of
Justice, Department of Health and Human Services, Department of the
Treasury, Department of Transportation, and the General Services
Administration. A tenth agency, the Federal Emergency Management Agency
(FEMA) was transferred in its entirety and became part of DHS on March
1, 2003. At each agency, we interviewed budget and program officials
and obtained and reviewed documentation related to the transfer. In
addition, we obtained and reviewed applicable laws and documents
related to the reorganization.
To determine the number of FTEs and amount of funding transferred from
the legacy agencies to DHS, we met with officials at DHS, OMB, and the
nine legacy agencies to discuss the approach OMB and DHS used to carry
out the transfer.[Footnote 27] For each of the nine legacy agencies and
FEMA, OMB provided estimates of the number of fiscal year 2003
FTEs[Footnote 28] and fiscal year 2003 "gross discretionary budget
authority"[Footnote 29] transferred to DHS. OMB also provided data on
the number of positions that were transferred to DHS from the legacy
agencies.[Footnote 30] We also met with OPM officials to discuss their
role in the transfer.
To compare the number of FTEs at DHS with decreases in FTEs from
programs at the legacy agencies remaining after the transfer, we
obtained OMB estimates of DHS and legacy agency budgeted FTEs and
available data from each legacy agency on fiscal year 2003 FTE
balances, before and after the transfer. We compiled OMB data by agency
and asked each legacy agency to confirm whether our compilations were
correct. In order to provide the most accurate data on these transfers,
we compared OMB estimates with legacy agency data to determine whether
any differences existed between them. We also asked OMB to review this
information and to explain any differences between the OMB-provided
numbers and those from the legacy agencies. OMB staff explained that
FTE estimates are made as point-in-time estimates and can change, but
did not specifically comment on differences between legacy agency and
OMB data. In addition to analyzing FTE data, during our review, we also
sought to analyze whether there were increases in positions, budget
authority, and personnel after the transition. Some of the position,
budget authority, and personnel information obtained were incomplete,
and we also were unable to reconcile all the differences in data
provided by OMB, OPM, and the legacy agencies. According to OMB staff,
differences in position and budget authority data could occur because
estimates on positions were in flux at the time the transfer occurred,
and budget authority estimates could have been collected at different
points in time and were subject to change. OPM officials said that OPM
and legacy agency personnel data could differ because of what the data
include and the point in time the data were collected.
To identify differences between legacy agency fiscal year 2003 FTE
balances after the transition and their fiscal year 2004 budget
requests, we obtained available data from the legacy agencies
associated with their fiscal year 2003 FTE budget balances after the
transfer and fiscal year 2004 FTE requests when budget accounts
remained at the legacy agency. We then compared agencies' fiscal year
2003 balances after the transition with their fiscal year 2004 requests
to determine any differences. Once we did our comparison, we focused on
those cases where legacy agencies' fiscal year 2004 requested FTEs were
greater than their fiscal year 2003 balances after the transition and
asked agency officials to provide explanations for the increases.
To describe any DHS efforts to identify opportunities to achieve
personnel cost savings related to the reorganization, we interviewed
DHS officials from the Office of the Undersecretary for Management
about their efforts to identify such opportunities and barriers in the
support services area. We obtained and reviewed the plans that they had
developed to consolidate support services and that may result in cost
savings. DHS did not, however, respond to our request to meet with
those agency officials who could discuss with us the steps DHS is
taking to identify opportunities and barriers to personnel cost savings
in program offices.
Because of generally corresponding FTE data from OMB and legacy
agencies and basic confirmation during interviews with knowledgeable
officials, we determined the FTE data used to develop this report to be
sufficiently reliable to meet our objectives for this report. We
conducted our work from May 2003 to April 2004 in accordance with
generally accepted government auditing standards.
Appendix III:
Fiscal Year 2003 Estimated FTEs Transferred to the Department of
Homeland Security by Legacy Agency Function and Budget Account:
The full-time equivalent (FTE) data included in tables III.1 to III.10
below are based on estimates provided by the Office of Management and
Budget (OMB) on August 7, 2003. Although the transfer of legacy agency
resources to the Department of Homeland Security (DHS) began on March
1, 2003, OMB estimates are projected for the entire fiscal year of
2003. For civilian employees in the executive branch, one FTE is equal
to one work year, or 2,080 nonovertime hours.
Table III.1: Fiscal Year (FY) 2003 Estimated FTEs Transferred from the Department of Agriculture (USDA) to DHS by Legacy Agency Function and Budget Account:
Legacy agency function and budget account: Agriculture[A];
Total FY 2003 FTE transfer: 2,690.
Legacy agency function and budget account: Animal Plant and Health
Inspection Service;
[USDA--Animal and Plant Health Inspection Service- -Salaries and
expenses budget account];
Total FY 2003 FTE transfer: 2,684.
Legacy agency function and budget account: Departmental Administration;
[USDA--Departmental administration budget account];
Total FY 2003 FTE transfer: 2.
Legacy agency function and budget account: Executive Operations--Office
of Chief Information Officer;
[USDA--Executive Operations--Office of Chief Information Officer budget
account];
Total FY 2003 FTE transfer: 2.
Legacy agency function and budget account: Office of the Inspector
General [USDA--Office of the Inspector General budget account];
Total FY 2003 FTE transfer: 2.
Source: GAO analysis of OMB estimates.
[A] According to a USDA official, on March 17, 2004, 17 FTEs and
personnel were transferred from the USDA's Agricultural Research
Service to DHS as part of the transfer of the Plum Island Animal
Disease Center. Although the Plum Island Animal Disease Center facility
was transferred to DHS on June 1, 2003, under the Homeland Security Act
of 2002, USDA and DHS agreed that the transfer of personnel resources
to operate the center should be delayed to a later date. USDA entered
into a reimbursable agreement with DHS to provide operating personnel
for the center until March 17, 2004.
[End of table]
Table III.2: FY 2003 Estimated FTEs Transferred from the Department of
Commerce (Commerce) to DHS by Legacy Agency Function and Budget
Account:
Legacy agency function and budget account: Commerce;
Total FY 2003 FTE transfer: 35.
Legacy agency function and budget account: Critical Infrastructure
Assurance Office (CIAO);
[Commerce--Bureau of Industry and Security-- Operations and
administration budget account][A];
Total FY 2003 FTE transfer: 35[B].
Source: GAO analysis of OMB estimates.
[A] According to OMB data, 15 FTEs were transferred from Commerce's
Bureau of Industry and Security--Operations and administration budget
account to DHS's Department-wide Technology Investments budget account.
[B] According to the Department of Commerce, 50 FTEs have been
associated with CIAO since its inception in Commerce.
[End of table]
Table III.3: FY 2003 Estimated FTEs Transferred from the Department of
Defense (DOD) to DHS by Legacy Agency Function and Budget Account:
Legacy agency function and budget account: Defense;
Total FY 2003 FTE transfer: 92.
Legacy agency function and budget account: National Communications
System;
[DOD--Operations and Maintenance--Operation and maintenance, Defense-
wide budget account];
Total FY 2003 FTE transfer: 92.
Source: GAO analysis of OMB estimates.
[End of table]
Table III.4: FY 2003 Estimated FTEs Transferred from the Department of
Energy (DOE) to DHS by Legacy Agency Function and Budget Account:
Legacy agency function and budget account: Energy;
Total FY 2003 FTE transfer: 101.
Legacy agency function and budget account: Environmental Measurements
Laboratory [portion of Environmental Management Program Direction];
[DOE--Environmental and Other Defense Activities--Defense environmental
restoration and waste management budget account];
Total FY 2003 FTE transfer: 57.
Legacy agency function and budget account: Energy Security and
Assurance and National Infrastructure Simulation Center;
[DOE-- Environmental and Other Defense Activities--Other defense
activities budget account];
Total FY 2003 FTE transfer: 22.
Legacy agency function and budget account: Program Direction, Defense
Nuclear Nonproliferation, Office of the Administrator, National Nuclear
Security Administration;
[DOE--National Nuclear Security Administration--Office of the
Administrator budget account];
Total FY 2003 FTE transfer: 22.
Source: GAO analysis of OMB estimates.
[End of table]
Table III.5: FY 2003 Estimated FTEs Transferred from the Federal
Emergency Management Agency (FEMA) to DHS:
Legacy agency function and budget account: Federal Emergency Management
Agency;
[FEMA budget accounts][A];
Total FY 2003 FTE transfer: 5,330.
Source: GAO analysis of OMB estimates.
[A] According to OMB data, 42 FTEs were transferred from the FEMA--
Salaries and expenses budget account to DHS's Departmental Operations
budget account; 206 FTEs were transferred from the FEMA--Working capital fund to DHS's
Working capital fund; and 200 FTEs were transferred from the FEMA--
Office of the Inspector General budget account to DHS's Office of the
Inspector General budget account.
[End of table]
Table III.6: FY 2003 Estimated FTEs Transferred from the General
Services Administration (GSA) to DHS by Legacy Agency Function and
Budget Account:
Legacy agency function and budget account: General Services
Administration;
Total FY 2003 FTE transfer: 1,497.
Legacy agency function and budget account: Federal Protective Service;
[GSA--Real Property Activities--Federal buildings fund budget
account][A];
Total FY 2003 FTE transfer: 1,452.
Legacy agency function and budget account: Federal Computer Incident
Response Center;
[GSA--General Activities--Operating expenses budget account];
Total FY 2003 FTE transfer: 25.
Legacy agency function and budget account: Working Capital Fund;
[GSA- -General Activities--Working capital fund account];
Total FY 2003 FTE transfer: 16[B].
Legacy agency function and budget account: Office of the Inspector
General;
[GSA--General Activities--Office of the Inspector General budget
account];
Total FY 2003 FTE transfer: 4.
Source: GAO analysis of OMB estimates.
[A] According to OMB data, 29 FTEs were transferred from the GSA--Real
Property Activities--Federal buildings fund budget account to DHS's
Departmental Operations budget account.
[B] According to GSA, 1 FTE was transferred to DHS immediately and 15
FTEs are being retained at GSA to provide support services for DHS
while the GSA/DHS support services are in effect. GSA's total reduction
to the working capital fund account as a result of the transfer is 16
FTEs.
[End of table]
Table III.7: FY 2003 Estimated FTEs Transferred from the Department of
Health and Human Services (HHS) to DHS by Legacy Agency Function and
Budget Account:
Legacy agency function and budget account: Heath and Human Services;
Total FY 2003 FTE transfer: 110.
Legacy agency function and budget account: Office of Emergency
Preparedness;
--National Disaster Medical System;
--Metropolitan Medical Response System;
[HHS--Departmental Management--General departmental management budget
account];
Total FY 2003 FTE transfer: 107.
Legacy agency function and budget account: Departmental Management;
[HHS--Departmental Management--General departmental management budget
account][A];
Total FY 2003 FTE transfer: 3.
Source: GAO analysis of OMB estimates.
[A] According to OMB data, 3 FTEs were transferred from the HHS
Departmental Management--General departmental management budget account
to DHS's Departmental Operations budget account.
[End of table]
Table III.8: FY 2003 Estimated FTEs Transferred from the Department of
Justice (DOJ) to DHS by Legacy Agency Function and Budget Account:
Legacy agency function and budget account: Justice;
Total FY 2003 FTE transfer: 40,053.
Legacy agency function and budget account: Immigration and
Naturalization Service;
[DOJ--INS budget accounts][A];
Total FY 2003 FTE transfer: 39,598.
Legacy agency function and budget account: National Infrastructure
Protection Office;
[DOJ--Federal Bureau of Investigation--Salaries and expenses budget
account];
Total FY 2003 FTE transfer: 307.
Legacy agency function and budget account: Office for Domestic
Preparedness (from DOJ Office of Justice Programs);
[DOJ--Office of Justice Programs--Justice assistance budget account];
Total FY 2003 FTE transfer: --[B].
Legacy agency function and budget account: General Administration--
Salaries and expenses;
[DOJ--General Administration--Salaries and expenses budget account];
Total FY 2003 FTE transfer: 93[C].
Legacy agency function and budget account: Office of the Inspector
General;
[DOJ--General Administration--Office of the Inspector General budget
account];
Total FY 2003 FTE transfer: 55[D].
Source: GAO analysis of OMB estimates.
[A] According to OMB data, 87 FTEs were transferred from the
Immigration and Naturalization Service--Immigration Enforcement budget
account to DHS's Departmental Operations budget account.
[B] According to DOJ officials, FTEs were transferred from the Office
of Justice Programs to DHS in 2002. According to DOJ, 55 FTEs were
transferred from the Office of Justice Programs to DHS.
[C] DOJ officials stated that only 10 of the 93 FTEs for the General
Administration--Salaries and expenses budget account were planned for
transfer in 2003. According to DOJ, the remaining 83 FTEs were
transferred in the fiscal year 2004 budget submission.
[D] According to DOJ officials, as part of the formation of DHS, OMB
directed the Treasury Office of Inspector General (OIG) to transfer 155
FTEs to DHS's OIG and directed the DOJ OIG to transfer 55 FTEs to DHS's
OIG. At the same time, OMB directed the Treasury OIG to transfer 40
FTEs to the DOJ OIG to compensate for the transfer of the Bureau of
Alcohol, Tobacco, and Firearms from the Department of the Treasury to
DOJ. According to DOJ, this would have resulted in the DOJ OIG
receiving 40 individuals from the Treasury OIG while at the same time
transferring 55 of its personnel to DHS's OIG. DOJ said that the
inspectors general for DOJ, the Department of the Treasury, and DHS
agreed that the series of transfers originally directed by OMB was
inefficient and would cause undue personal and mission-related
disruptions, particularly to the personnel and field offices affected
by the proposed transfers. According to DOJ, the three inspectors
general conferred and agreed to a proposal that would avoid such
disruptions but still accomplish the same overall number of transfers.
Under this plan, DOJ said that the Treasury OIG transferred 195 FTEs
directly to DHS's OIG (the 155 FTEs it was required to transfer to
DHS's OIG as well as the 40 it was required to transfer to DOJ's OIG).
This reduced to 15 (55 minus 40) the number of FTEs that DOJ's OIG had
to directly transfer to DHS's OIG.
[End of table]
Table III.9: FY 2003 Estimated FTEs Transferred from the Department of
Transportation (DOT) to DHS by Legacy Agency Function and Budget
Account:
Legacy agency function and budget account: Transportation;
Total FY 2003 FTE transfer: 103,073[A].
Legacy agency function and budget account: U.S. Coast Guard (USCG);
[USCG budget accounts][B];
Total FY 2003 FTE transfer: 43,508[A].
Legacy agency function and budget account: Transportation Security
Administration (TSA);
[TSA budget accounts][C];
Total FY 2003 FTE transfer: 59,512.
Legacy agency function and budget account: Office of the Inspector
General;
[DOT--Office of the Inspector General--Salaries and expenses budget
account];
Total FY 2003 FTE transfer: 40.
Legacy agency function and budget account: Office of the Secretary;
[DOT--Office of the Secretary--Salaries and expenses budget account];
Total FY 2003 FTE transfer: 9.
Legacy agency function and budget account: Office of the Secretary;
[DOT--Office of the Secretary--Office of Civil Rights budget account];
Total FY 2003 FTE transfer: 3.
Legacy agency function and budget account: Office of the Secretary;
[DOT--Office of the Secretary--Transportation planning, research, and
development budget account];
Total FY 2003 FTE transfer: 1.
Source: GAO analysis of OMB estimates.
[A] Includes 37,074 military FTEs. bAccording to OMB data, 44 FTEs were
transferred from the USCG--Operating expenses budget account to DHS's
Departmental Operations budget account. cAccording to OMB data, 18 FTEs
were transferred from TSA budget accounts to DHS's Departmental
Operations budget account.
[End of table]
Table III.10: FY 2003 Estimated FTEs Transferred from the Department of
the Treasury (Treasury) to DHS by Legacy Agency Function and Budget
Account:
Legacy agency function and budget account: Treasury;
Total FY 2003 FTE transfer: 28,894.
Legacy agency function and budget account: U.S. Customs;
[U.S. Customs budget accounts][A];
Total FY 2003 FTE transfer: 21,570.
Legacy agency function and budget account: U.S. Secret Service;
[U.S. Secret Service budget accounts][B];
Total FY 2003 FTE transfer: 6,111.
Legacy agency function and budget account: Federal Law Enforcement
Training Center (FLETC);
[FLETC budget accounts][C];
Total FY 2003 FTE transfer: 837.
Legacy agency function and budget account: Departmental Offices--
Salaries and expenses;
[Departmental Offices--Salaries and expenses budget account];
Total FY 2003 FTE transfer: 221.
Legacy agency function and budget account: Office of the Inspector
General;
[Departmental Offices--Office of the Inspector General budget account];
Total FY 2003 FTE transfer: 155[D].
Source: GAO analysis of OMB estimates.
[A] According to OMB data, 97 FTEs were transferred from the U.S.
Customs Service--Salaries and expenses budget account to DHS's
Departmental Operations budget account. bAccording to OMB data, 45 FTEs
were transferred from the U.S. Secret Service--Salaries and expenses
budget account to DHS's Departmental Operations budget account.
cAccording to OMB data, 4 FTEs were transferred from the Federal Law
Enforcement Training Center--Salaries and expenses budget account to
DHS's Departmental Operations budget account.
[D] According to DOJ officials, as part of the formation of DHS, OMB
directed the Treasury Office of Inspector General (OIG) to transfer 155
FTEs to DHS's OIG and directed the DOJ OIG to transfer 55 FTEs to DHS's
OIG. At the same time, OMB directed the Treasury OIG to transfer 40
FTEs to the DOJ OIG to compensate for the transfer of the Bureau of
Alcohol, Tobacco, and Firearms from the Department of the Treasury to
DOJ. According to DOJ, this would have resulted in the DOJ OIG
receiving 40 individuals from the Treasury OIG while at the same time
transferring 55 of its personnel to DHS's OIG. DOJ said that the
inspectors general for DOJ, the Department of the Treasury, and DHS
agreed that the series of transfers originally directed by OMB was
inefficient and would cause undue personal and mission-related
disruptions, particularly to the personnel and field offices affected
by the proposed transfers. According to DOJ, the three inspectors
general conferred and agreed to a proposal that would avoid such
disruptions but still accomplish the same overall number of transfers.
Under this plan, DOJ said that the Treasury OIG transferred 195 FTEs
directly to DHS's OIG (the 155 FTEs it was required to transfer to
DHS's OIG as well as the 40 it was required to transfer to DOJ's OIG).
This reduced to 15 (55 minus 40) the number of FTEs that DOJ's OIG had
to directly transfer to DHS's OIG.
[End of table]
Appendix IV: Comments from the Department of Defense:
DEFENSE INFORMATION SYSTEMS AGENCY:
701 S. COURTHOUSE ROAD
ARLINGTON, VIRGINIA 22204-2199:
IN REPLY:
REFER M. Comptroller (CFE):
APR 20 2004:
Mr. Paul Jones:
U.S. General Accounting Office
441 G. Street NW:
Washington, DC 20548:
Dear Mr. Jones;
This is the Department of Defense response to the GAO draft report,
"Transfer of Budgetary Resources to the Department of Homeland
Security," dated April 14, 2004 (Code 440212/ GAO-04-329R).
The Department concurs with the report's recommendations. If you have
any questions concerning this matter please contact Mrs. Darlene B.
Ramseur at 703-681-0321 or via e-mail at ramseurd@ncr.disa.mil.
Sincerely,
Signed for:
EDWARD B. CODY:
Comptroller:
[End of section]
Appendix V: Comments from the Department of Justice:
U.S. Department of Justice:
Washington DC 20530:
FEB 06 2004:
Paul Jones:
Director, Homeland Security and Justice
General Accounting Office:
441 G Street, NW Washington, DC 20548:
Dear Mr. Jones:
On January 14, 2004, the General Accounting Office (GAO) provided the
Department of Justice (DOJ) with a copy of its draft report entitled
"Transfer of Budgetary Resources to the Department of Homeland
Security" (GAO-04-329R/440212) with a request for comments by
February 6, 2004. We appreciate the opportunity to review the draft
report and are providing formal comment for incorporation into the
final report. We are concerned that the report, as written, could be
misconstrued when trying to discern what resources the DOJ provided to
the Department of Homeland Security (DRS). We believe further details
concerning the various full time equivalent (FTE) transfers will
enhance the readers' comprehension of the actual changes that took
place. We are providing the following information for this purpose.
The draft report contains Office of Management Budget (OMB) data on the
transfers of budgetary resources to the DHS that is inconsistent with
our data. Specifically, regarding the paragraph found on page 8 of the
draft report that begins "Finally, the ninth legacy agency, DOJ,
provided data that showed it transferred 40 fewer FTEs. . .":
As part of the formation of the DHS, the OMB directed the Department of
Treasury's Office of the Inspector General (OIG) and DOJ OIG to
transfer personnel to the DHS to help form the DES OIG. The OMB
directed Treasury OIG to transfer 155 FTE to DHS OIG and directed the
DOJ OIG to transfer 55 FTE to DHS OIG. At the same time, the OMB
directed the Treasury OIG to transfer 40 FTE to the DOJ OIG to
compensate for transfer of the Bureau of Alcohol, Tobacco and Firearms
(ATF) from the Department of Treasury to the DOJ. In effect, this would
have resulted in the DOJ OIG receiving 40 individuals from the Treasury
OIG while at the sarric time transferring 55 of its personnel to the
DHS OIG. The Inspectors General for the DOJ, Department of the
Treasury, and DHS agreed that the series of transfers originally
directed by the OMB was inefficient and would cause undue personal and
mission-related disruptions, particularly to the personnel and field
offices affected by the proposed transfers. Therefore, the three
Inspectors General concerned and agreed to a proposal that would avoid
such disruptions
but still accomplish the same overall number of transfers. Under this
plan, the Treasury 010 transferred 195 FTE directly to the DHS OIG (the
155 FTE it was required to transfer to DHS OJG as well as the 40 it was
required to transfer to DOJ OIG). This reduced to 15 (55 minus 40) the
number of FTE the DOS OIG had to directly transfer to DHS OIG. However,
in total the DOS OIG contributed 55 FTE to DHS OIG.
This simple and efficient plan was approved by the OMB and Office of
Personnel Management and subsequently implemented Therefore, contrary
to the information in the GAO report, the DOJ 01G did contribute 55 FTE
to the DHS OIG.
Further in that paragraph the report notes, "DOS data showed the DOJ
transferred 83 fewer FTE. . .", the report should note that only ten of
the 93 FTE for General Administration were planned for transfer in 2003
the remaining 83 FTE were transferred in the FY2004 budget submission.
The data on FTE transfers presented in this report, the report in
Appendix III, Table III.8 does not reflect the Department's transfer of
55 FTE from the Office of Justice Programs to the DHS.
Finally, the draft report refers to the transfer of the Immigration and
Naturalization Service (TNS) to the DHS. While this may appear to be
what happened, in actuality the functions of the TNS were transferred
to the DHS and the INS was abolished. This wording reflects a critical
legal difference because the functions assigned to the Attorney General
by the Immigration and Nationality Act that he did not delegate to the
INS were not transferred, e.g. the management of certain law
enforcement responsibilities related to visas that were delegated to
the Criminal Division and not the INS continue to be managed by the
Attorney General.
We hope these comments will be beneficial in preparing your final
report. If you have any questions concerning the Department's comments
in this matter, please feel free to contact Vickie L. Sloan, Director,
Audit Liaison Office, Justice Management Division on
(202) 514-0469.
Sincerely,
Signed by:
Paul R. Corts:
Assistant Attorney General for Administration:
Attachments:
[End of section]
(440212):
FOOTNOTES
[1] P.L. 107-296 (Nov. 25, 2002).
[2] As of March 1, 2003, the Federal Emergency Management Agency (FEMA)
transferred to DHS and no longer exists as a stand-alone federal
agency. Therefore, there are nine legacy agencies currently in
existence.
[3] According to DHS officials, total contract value represents the
total amount estimated to be spent under a contract, often over
multiple years.
[4] According to DHS officials, contract obligations are actions that
financially bind the federal government. DHS officials said that there
is no direct correlation between total contract value and contract
obligation amounts. DHS officials said that internal controls to ensure
contract obligations do not exceed total contract values are in place
and controlled at the local level by individual contracting officers.
[5] In March 2004, the Department of Homeland Security's Office of
Inspector General issued a report entitled "Review of the Status of
Department of Homeland Security Efforts to Address Its Major Management
Challenges," which stated that a major challenge for DHS is the
identification and management of its procurements. The report states
that DHS has struggled to prepare a sufficiently detailed and accurate
listing of its procurements and that data that DHS has received to date
come from 22 different sources and do not provide total contract award
information. In a report to the Director of the Office of Management
and Budget (OMB), we conveyed our serious and continuing concerns with
the reliability of data contained in FPDS and recommended steps to help
improve data reliability as the successor system, FPDS-Next Generation,
is implemented. See U.S. General Accounting Office, Reliability of
Federal Procurement Data, GAO-04-295R (Washington D.C.: Dec. 30, 2003).
[6] The Department of Homeland Security Reorganization Plan, required
under Section 1502 of the Homeland Security Act of 2002, specified that
transfers were to begin on March 1, 2003.
[7] Under 5 U.S.C. 5102(a)(3), position is defined as the work,
consisting of the duties and responsibilities, assignable to an
employee. Positions can represent full-time or part-time employees or
can be vacant and do not represent actual full-time equivalent
employment. Budget authority is the authority provided by law to enter
into financial obligations that will result in immediate or future
outlays involving federal government funds. Budget authority includes
the credit subsidy cost for direct loan and loan guarantee programs,
but does not include authority to ensure or guarantee the repayment of
indebtedness incurred by another person or government. The basic forms
of budget authority include (1) appropriations, (2) borrowing
authority, (3) contract authority, and (4) authority to obligate and
expend offsetting receipts and collections.
[8] On January 7, 2003, OMB issued a directive that asked heads of
selected departments and agencies to, among other things, identify
financial, logistical, and human resources that could be transferred to
DHS as part of the reorganization.
[9] For purposes of this report, we used the term budget account in the
same context as OMB, described in OMB Circular A-11, Section 20.11.
[10] The President's fiscal year 2004 budget request presented DHS as a
freestanding agency and constructed comparable estimates from legacy
agency budget accounts for fiscal years 2002 and 2003.
[11] Since FEMA became part of DHS on March 1, 2003, and no longer
exists as a stand-alone agency, we met with former FEMA officials in
DHS's Emergency Preparedness and Response Directorate who were
responsible for the FEMA transfer process.
[12] Our comparison focused only on functions with budget accounts in
the nine legacy agencies that existed after the transfer occurred.
[13] U.S. Department of Agriculture (USDA) officials provided fiscal
year 2003 FTE data for the Animal and Plant Health Inspection Service-
-Plant Protection and Quarantine Program.
[14] Positions can be part-time, full-time, or vacant and do not equate
to the number of FTEs, e.g., one FTE can include two or more part-time
positions. According to DHS and legacy agency officials, additional
positions were scheduled to transfer to DHS after the official transfer
date of March 1, 2003. They said position data are expected to be
adjusted based on continuing negotiations between DHS and legacy agency
offices. Some of the legacy agencies are still providing support
services to DHS via memorandums of agreement. As of March 31, 2003, DHS
had 160,201 full-and part-time civilian employees on board, according
to OPM's Central Personnel Data File.
[15] These seven program functions are the Federal Emergency Management
Agency, Secret Service, Federal Law Enforcement Training Center,
Customs Service, U.S. Coast Guard, Transportation Security
Administration, and Immigration and Naturalization Service.
[16] In comments on this report, DOJ noted that functions delegated to
INS transferred to DHS, but that the Attorney General did not delegate
to INS every function under the Immigration and Naturalization Act.
Specifically, according to DOJ, the Attorney General continues to
manage those functions that he did not delegate to INS, e.g., the
management of certain law enforcement responsibilities related to visas
that were delegated to DOJ's Criminal Division.
[17] Section 1502(d) of the Act states that the Department of Homeland
Security Reorganization Plan shall become effective for an agency by
the date specified in the plan or by the end of the transition period,
whichever is earlier. Pursuant to Section 1501(2), the end of the
"transition period" is January 24, 2004, 12 months following the
effective date of the Act as specified in Section 4. The Reorganization
Plan specified an earlier date for the transfers to begin, March 1,
2003.
[18] Our analysis did not include budget decreases that legacy agencies
made for FEMA, the Secret Service, Federal Law Enforcement Training
Center, Customs Service, U.S. Coast Guard, Transportation Security
Administration, and Immigration and Naturalization Service transfers to
DHS because budget accounts for these program functions no longer
existed at legacy agencies after the March 1, 2003, transfer. Our
analysis included other program function transfers, such as the
Critical Infrastructure Assurance Office and Federal Protective Service
because their former budget accounts still exist at the legacy
agencies.
[19] In addition to transferring the amounts identified by OMB, DOE
transferred one additional FTE for DHS support activities. Also, HHS
transferred an additional seven FTEs from the Office of Inspector
General, Centers for Disease Control and Prevention, Food and Drug
Administration, and National Institutes of Health.
[20] According to DOD, all FTEs for the National Communication System
function were transferred to DHS.
[21] According to DOJ, the original transfer plan would have resulted
in DOJ's OIG receiving 40 individuals from Treasury's OIG while at the
same time transferring 55 of its personnel to DHS's OIG. DOJ stated
that the inspectors general for DOJ, the Department of Treasury, and
DHS agreed that the transfers originally directed by OMB would have
been inefficient and would have caused undue personal and mission-
related disruptions, particularly to the personnel and field offices
affected by the transfers. DOJ said that the three inspectors general
conferred and agreed to a proposal that would avoid such disruptions
but still accomplish the same overall number of transfers.
[22] USDA officials provided fiscal year 2003 FTE data for the Animal
and Plant Health Inspection Service--Plant Protection and Quarantine
Program.
[23] The President's Management Agenda (PMA), announced in fiscal year
2002, is the President's strategy for improving management and
performance of the federal government. Under PMA, the President
identified five government-wide management initiatives--budget and
performance integration, strategic human capital management, improved
financial performance, expanded electronic government, and competitive
sourcing.
[24] For fiscal year 2004, the General Activities--Operating expenses
budget account FTE request included the transfer of funding for the
Office of Citizen Services and Communications (OCSC) from the Policy
and Citizen Services account. The GSA official told us that GSA
requested this reorganization because of inherent differences in the
Office of Government-wide Policy and the OCSC programs, and the diverse
budgetary and accounting requirements needed to properly manage them.
According to the official, GSA also transferred functions from the
Public Buildings Service to OCSC in the General Activities--Operating
expenses budget account and the management of the FirstGov Web site
function from the General activities--operating expenses budget account
to the Federal Citizen Information Center Fund.
[25] A DOD official said that the requested increase was related to (1)
the stand-up, or transfer in, of two defense agencies into the budget
account--the National Defense University and Counter-Intelligence
Field Activity; (2) transfers in of other subfunctions, such as
continuity of government functions, into the budget account; and (3)
the conversion of military positions to civilian positions as part of
the Secretary of Defense's plan to ensure military members serve
military purposes rather than fulfill functions that can be performed
by civilians.
[26] For civilian employees in the executive branch, one FTE is equal
to one work year or 2,080 nonovertime hours.
[27] Funding may include support for FTEs or program funds.
[28] Although the transfer of legacy agency resources began on March 1,
2003, OMB estimates of FTEs transferred from legacy agencies are
projected for the entire fiscal year 2003.
[29] Budget authority is the authority provided by law to enter into
financial obligations that will result in immediate or future outlays
involving federal government funds. Budget authority includes the
credit subsidy cost for direct loan and loan guarantee programs, but
does not include authority to ensure or guarantee the repayment of
indebtedness incurred by another person or government. The basic forms
of budget authority include (1) appropriations, (2) borrowing
authority, (3) contract authority, and (4) authority to obligate and
expend offsetting receipts and collections. Given that the transfer
occurred midway through fiscal year 2003, OMB estimated DHS's "gross
discretionary budget authority," which, according to OMB, represented a
projection of what DHS's budget authority would have been if DHS had
been operating for the entire fiscal year 2003.
[30] FTE and position data are not comparable. Under 5 U.S.C. 5102
(a)(3), position is defined as the work, consisting of the duties and
responsibilities, assignable to an employee. Positions can represent
full-time or part-time employees or can be vacant and do not represent
actual full-time equivalent employment.
