Management Letter
Recommendations for Improvements to USDA's Internal Controls and Policies on Premium Class Air Travel Gao ID: GAO-08-85R November 19, 2007At the request of the Permanent Subcommittee on Investigations, Senate Committee on Homeland Security and Governmental Affairs, in September 2007 we reported on the governmentwide use of premium class travel. As part of the audit and related investigations, we tested premium class transactions at the Department of Agriculture (USDA). The purpose of this letter is to provide the Acting Secretary of Agriculture with information on specific matters identified during our work that relate to weaknesses in internal controls at USDA. Further, this letter details the results of investigative work we performed related to allegations forwarded to us by USDA's Office of Inspector General of premium class travel abuses by executives at the Foreign Agricultural Service (FAS). This letter contains six recommendations that warrant your attention.
We found that USDA spent over $110 million in air travel from July 1, 2005, through September 30, 2006, of which about $3.9 million included at least one leg of a premium class flight. Overall, the percentage of USDA flights in premium class was less than the overall governmentwide average of 7 percent. However, we found that FAS used premium class travel nearly 30 percent of the time and accounted for the majority of USDA's premium class travel, due in part to policies and procedures that were more permissive than USDA departmentwide policies. Other issues of significance included the following: USDA, and its component organizations, did not track premium class travel other than first class. Consequently, USDA and its component organizations were not aware of the magnitude of premium class travel by department or by component organization. Further, we found that FAS accounted for $2.0 million of the $3.9 million USDA spent on premium class travel. Of the 145 USDA premium class trips we examined, 140 trips did not have documentation to justify premium class travel. Without this documentation, FAS and USDA cannot confirm that employees are using premium class in accordance with the Federal Travel Regulation (FTR) or department and agency policies. Lacking such documentation, USDA has little assurance that these trips are in accordance with federal regulations and exposes the government to excess travel costs. FAS officials accounted for 112 of the 145 USDA trips we audited and investigated. These trips were taken mostly by senior executives, and included 79 FAS premium class trips that were authorized by USDA staff subordinate to the traveler or by an employee not permitted to authorize premium class travel. These transactions did not follow USDA's policy for proper authorization. Premium class transactions approved by subordinates, while not expressly prohibited by the FTR, reduce the scrutiny of premium class travel and amount to self-approval. We found 25 instances in which FAS executives used "exceptional circumstances" or the 14-hour rule to justify the need for premium class travel, at the same time that other FAS staff traveling on the same flights for the same purpose traveled in coach. For example, in December 2005, a FAS executive traveled in business class from Washington, D.C., to Hong Kong and back at a cost of nearly $7,000. In contrast, 11 other FAS employees did not travel in premium class, even though they were eligible for premium class travel according to General Services Administration policy if their supervisor approved the expenditure of additional funds. Instead, the 11 employees traveled on the same plane in coach at the cost of less than $1,400 per ticket. We found an additional 47 instances in which executives violated FAS policy by claiming "exceptional circumstances" to justify flights less than 14 hours to Western Europe. FAS policy specifically prohibits the use of this criterion for flights from the United States to Western Europe. Further, no explanation was given on the travel vouchers related to the exceptional circumstance criterion that warranted the additional cost for premium class travel. At the end of our discussion of these issues, we offer recommendations for strengthening USDA's internal controls and travel policies. We are also referring to the Acting Secretary of Agriculture three individuals who violated FAS's premium class policy, potentially abused executive travel, or both for further review and appropriate action, including, if warranted, repayment of the difference between the price of coach and premium class and administrative actions.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-08-85R, Management Letter: Recommendations for Improvements to USDA's Internal Controls and Policies on Premium Class Air Travel
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GAO-08-85R:
U.S. Government Accountability Office: GAO:
November 19, 2007:
The Honorable Charles Conner:
Acting Secretary of Agriculture:
Subject: Management Letter: Recommendations for Improvements to USDA's
Internal Controls and Policies on Premium Class Air Travel:
Dear Mr. Conner:
At the request of the Permanent Subcommittee on Investigations, Senate
Committee on Homeland Security and Governmental Affairs, in September
2007 we reported on the governmentwide use of premium class
travel[Footnote 1]. As part of the audit and related investigations, we
tested premium class transactions at the Department of Agriculture
(USDA). The purpose of this letter is to provide you with information
on specific matters identified during our work that relate to
weaknesses in internal controls at USDA. Further, this letter details
the results of investigative work we performed related to allegations
forwarded to us by USDA's Office of Inspector General of premium class
travel abuses by executives at the Foreign Agricultural Service (FAS).
This letter contains six recommendations that warrant your attention.
Results in Brief:
We found that USDA spent over $110 million in air travel from July 1,
2005, through September 30, 2006, of which about $3.9 million included
at least one leg of a premium class flight. Overall, the percentage of
USDA flights in premium class was less than the overall governmentwide
average of 7 percent. However, we found that FAS used premium class
travel nearly 30 percent of the time and accounted for the majority of
USDA's premium class travel, due in part to policies and procedures
that were more permissive than USDA departmentwide policies. Other
issues of significance included the following:
* USDA, and its component organizations, did not track premium class
travel other than first class. Consequently, USDA and its component
organizations were not aware of the magnitude of premium class travel
by department or by component organization. Further, we found that FAS
accounted for $2.0 million of the $3.9 million USDA spent on premium
class travel.[Footnote 2]
* Of the 145 USDA premium class trips we examined, 140 trips did not
have documentation to justify premium class travel. Without this
documentation, FAS and USDA cannot confirm that employees are using
premium class in accordance with the Federal Travel Regulation (FTR) or
department and agency policies.[Footnote 3] Lacking such documentation,
USDA has little assurance that these trips are in accordance with
federal regulations and exposes the government to excess travel costs.
* FAS officials accounted for 112 of the 145 USDA trips we audited and
investigated. These trips were taken mostly by senior executives, and
included 79 FAS premium class trips that were authorized by USDA staff
subordinate to the traveler or by an employee not permitted to
authorize premium class travel. These transactions did not follow
USDA's policy for proper authorization. Premium class transactions
approved by subordinates, while not expressly prohibited by the FTR,
reduce the scrutiny of premium class travel and amount to self-
approval.
* We found 25 instances in which FAS executives used "exceptional
circumstances" or the 14-hour rule to justify the need for premium
class travel, at the same time that other FAS staff traveling on the
same flights for the same purpose traveled in coach. For example, in
December 2005, a FAS executive traveled in business class from
Washington, D.C., to Hong Kong and back at a cost of nearly $7,000. In
contrast, 11 other FAS employees did not travel in premium class, even
though they were eligible for premium class travel according to General
Services Administration (GSA) policy if their supervisor approved the
expenditure of additional funds. Instead, the 11 employees traveled on
the same plane in coach at the cost of less than $1,400 per ticket. We
found an additional 47 instances in which executives violated FAS
policy by claiming "exceptional circumstances" to justify flights less
than 14 hours to Western Europe. FAS policy specifically prohibits the
use of this criterion for flights from the United States to Western
Europe. Further, no explanation was given on the travel vouchers
related to the exceptional circumstance criterion that warranted the
additional cost for premium class travel.
At the end of our discussion of these issues, we offer recommendations
for strengthening USDA's internal controls and travel policies. We also
referred to you on October 18, 2007, individuals who violated USDA's
premium class policy, potentially abused executive travel, or both, for
further review and appropriate action. Actions could include, if
warranted, repayment of the difference between the price of coach and
premium class and administrative actions.
Scope and Methodology:
This letter is based on the work performed during our audit of the
federal government's use of premium class air travel and investigative
work on allegations of abuse of premium class travel at USDA. To
determine the magnitude of premium class travel at USDA, we extracted
premium class transactions from July 1, 2005 through June 30, 2006,
from the databases provided by Bank of America. Premium class
transactions were defined as debit air travel transactions that
included at least one leg of first or business class travel. Our review
included charges made to both the individually billed accounts, which
are travel cards assigned to individual travelers for transportation
expenses, lodging, and miscellaneous expenses, and the centrally billed
accounts, which are travel cards assigned to the agencies and used
primarily to procure transportation for travelers. We selected and
tested a statistical sample of governmentwide premium class travel
transactions, which included trips taken by USDA employees, and
conducted other audit work to determine the extent to which this travel
was improper.[Footnote 4] To determine whether USDA tracked premium
class travel other than first class, we interviewed USDA and FAS
officials. Because first class travel at USDA was immaterial--
accounting for only 4 percent of total premium class travel--we did not
review the completeness of USDA's reporting of first class travel to
GSA. To identify specific cases of improper or abusive use of premium
class travel, we used data mining to identify instances in which
individuals flew many premium class flights during the period or groups
of individuals flew together in premium class.[Footnote 5] Because we
included additional data provided by the bank subsequent to our
selection of the statistical sample, our data-mining work was performed
on data from July 1, 2005, through September 30, 2006. In addition, as
part of our investigative work, we reviewed premium class transactions
from executives as part of an allegation we received in May 2006
related specifically to improper use of premium class travel by FAS
executives.[Footnote 6] To identify underlying causes contributing to
improper premium class travel, we reviewed federal laws and regulations
and USDA's and FAS's implementing guidance for premium class travel,
and interviewed USDA and FAS officials on the processes and procedures
in place to authorize and justify premium class travel. Enclosure I
contains a summary of when federal regulations allow premium class
travel to be authorized. We also interviewed GSA and Office of
Management and Budget (OMB) officials on their oversight of premium
class travel.
We conducted our audit from July 2006 through August 2007 in accordance
with U.S. generally accepted government auditing standards, and we
performed our investigative work during the same period in accordance
with standards prescribed by the President's Council on Integrity and
Efficiency.
Premium Class Travel Not Tracked:
We found that USDA spent over $110 million in air travel from July 1,
2005, through September 30, 2006, of which about $3.9 million included
at least one leg of a premium class flight. Overall, the percentage of
USDA flights in premium class is less than the overall governmentwide
average of 7 percent. Further, we found that FAS, was the most
extensive user of premium class travel within USDA and spent nearly 30
percent of its air travel dollars on premium class flights.
Specifically, we found that FAS accounted for $2.0 million of the $3.9
million USDA spent on premium class airfare.[Footnote 7] According to
officials we interviewed, neither USDA nor FAS tracked premium class
travel other than first class, even though premium class travel other
than first class accounted for 96 percent of all premium class travel.
Without collecting this information, USDA and FAS were unaware of the
magnitude of premium class travel.
The FTR requires all executive branch agencies to provide GSA annual
reports, which are forwarded to OMB, listing all instances when the
agency approved the use of first class transportation accommodations.
However, neither OMB nor GSA requires reporting on business class
travel, which accounts for the vast majority of all premium class
travel in the government. Tracking all premium class travel, including
business class travel, is crucial to USDA's ability to manage its
budget and ensure that all travelers adhere to the FTR's standard of
care requirement. Without knowing how much is spent on premium class
travel and without internal controls sufficient to prevent improper
premium class travel, USDA is unable to systematically determine
whether such travel is necessary to the performance of its mission, or
whether it is unnecessary and thus should be reduced to provide funds
for other higher-priority services.
Premium Class Travel Not Properly Authorized, Justified, or Both:
Of the 145 USDA premium class trips we audited and investigated, 140
trips did not have adequate documentation to support that the trip was
authorized and justified for the use of premium class travel. The FTR
states that in order to be valid, premium class travel has to be
specifically authorized and justified, that is, meet one of a number of
criteria specified in the regulations. Nearly 97 percent of the USDA
transactions we audited were not properly authorized, justified, or
both.
We found that FAS accounts for the majority of the improper USDA
premium class travel. Specifically, of the 145 instances of premium
class travel we tested, 112 were premium class travel undertaken by FAS
employees, of which 110 were improperly authorized, improperly
justified, or both. FAS implementing policy specifies that individuals
who use "mission-critical (or exceptional circumstances)" as a
justification for premium class travel must provide additional
documentation that further justifies the need for "mission-critical"
travel. However, FAS was unable to provide documentation for any of the
57 trips that were taken in premium class using this criterion, as
required by its policy. These mission-critical trips included travelers
claiming to be attending meetings and accompanying senior officials.
Similarly, FAS policies require a traveler to submit a statement
regarding his/her first duty day if the traveler uses premium class for
a flight longer than 14 hours. However, we found that for 27 trips in
premium class travel, travelers did not report times of arrival at a
work duty station after flying over 14 hours in premium class.
Premium Class Travel Not Authorized at the Proper Level:
We found 79 of 112 FAS premium class transactions we tested were
authorized by an employee subordinate to the traveler or by an employee
not permitted to authorize premium class travel.[Footnote 8] The FAS
trips we reviewed were taken by nine different senior executives and
one other FAS employee.[Footnote 9] One senior executive took 23 trips
authorized by a subordinate.
Our internal control standards provide that "Transactions and other
significant events should be authorized and executed only by persons
acting within the scope of their authority. This is the principal means
of assuring that only valid transactions to exchange, transfer, use, or
commit resources and other events are initiated or entered
into."[Footnote 10] As we have reported previously,[Footnote 11]
allowing subordinates to approve their supervisors' premium class
travel is, in effect, self-approval that eliminates an important
oversight control. This is especially problematic because executive
travel is listed in our Sensitive Payments Guide as a high-risk area
susceptible to abuse or noncompliance with laws and
regulations.[Footnote 12]
Furthermore, USDA policy states that only general officers of the
department may approve premium class travel; the general officer for
FAS is the Undersecretary for Farm and Foreign Agricultural
Services.[Footnote 13] According to FAS travel policy, business class
travel is required to be approved by a deputy administrator or above,
who is to consider a cost comparison between business class and coach
class. Approved trips must then be forwarded to the Administrator who
makes the final authorization. Since FAS policy has delegated premium
class authorizing authority below the level required by USDA policy,
FAS policy appears to not be following USDA policies for premium class
travel.
Improper and Abusive Executive Travel:
We also found instances in which premium class travel by FAS executives
was not supported by proper justification or appeared abusive.
Specifically, executives misused the "exceptional circumstances"
criterion, and used the 14-hour rule to justify premium class travel
when other employees traveling on the same flight sat in coach.
Specifically, of the 112 trips taken by FAS executives that we tested,
47[Footnote 14] improperly used the "exceptional circumstances"
criterion as justification of premium class travel. In these cases,
executives used "exceptional circumstances" to justify flights to
Western Europe, even though FAS policy specifically prohibited the use
of this criterion for these flights. Further, no explanation was given
on the travel vouchers related to the exceptional circumstance
criterion that warranted the additional cost for premium class travel.
For example, in December 2005, a FAS executive traveled from
Washington, D.C., to Geneva and back in business class, a trip lasting
10 hours that cost the government about $7,500. In contrast, a coach
ticket for the same itinerary would have cost the government about
$1,000.
We also found indications that executives traveled in premium class
simply because of their rank, and in many cases these trips were
authorized by their subordinates. In 25 instances, we found that
executives used the 14-hour rule or the "exceptional circumstances"
criterion to justify the need for premium class travel when their staff
traveling on the same flights for the same purpose traveled in coach.
For example, in December 2005, a FAS executive traveled in business
class from Washington, D.C., to Hong Kong and back at a cost of nearly
$7,000. In contrast, 11 other FAS employees did not travel in premium
class, even though they were eligible to do so under GSA regulations if
their supervisor approved the expenditure of additional funds. Instead,
the 11 employees traveled on the same plane in coach at the cost of
less than $1,400 per ticket.
Recommendations for Executive Action:
To improve USDA's ability to detect and prevent improper premium class
travel, we recommend that the Secretary of Agriculture strengthen
existing internal controls over the use of premium class travel by
taking the following six actions:
* Develop and implement procedures to:
- identify the extent of premium class travel, including business class
travel, and;
- monitor for trends and frequency of premium class travel use,
including potential misuse by executives.
* Reiterate to USDA components existing USDA policy that premium class
travel can only be approved by general officers, unless specifically
exempted.
* Develop and implement policies and procedures to specifically
prohibit travelers or their subordinates from approving travelers'
requests for premium class travel.
* Require that premium class travel be approved by individuals who are
at least of the same rank/grade as the travelers.
* Develop and implement policies and procedures to specifically
prohibit the approval of premium class travel if all documentation
supporting premium class travel is not provided.
* Issue policies and procedures requiring that USDA and USDA components
monitor the frequency and cost of executive premium class travel.
Agency Comments and Our Evaluation:
In written comments on a draft of this report, USDA agreed with our
recommendations and stated that it had already made several changes to
its policies and procedures in response. In October 2007 USDA
implemented interim guidance requiring the Chief Financial Officer to
review and approve all premium class travel in advance of booking the
trip. All subcabinet officials at USDA were briefed on these interim
procedures. In addition, the office of the Chief Financial Officer has
completed a review of the department's travel policies and procedures,
and has begun an audit of premium class travel in the department. USDA
has also requested monthly premium class travel reports for review from
its travel service provider.
This report contains recommendations to you. The head of a federal
agency is required by 31 U.S.C. 720 to submit a written statement on
actions taken on these recommendations. You should submit your
statement to the Senate Committee on Homeland Security and Governmental
Affairs and the House Committee on Oversight and Government Reform
within 60 days of the date of this report. A written statement must
also be sent to the House and Senate Committees on Appropriations with
the agency's first request for appropriations made more than 60 days
after the date of the report.
This report is intended for use by the management of USDA. We are
sending copies to the Honorable Carl Levin and the Honorable Norm
Coleman, Chairman and Ranking Member, Permanent Subcommittee on
Investigations, Senate Committee on Homeland Security and Governmental
Affairs, and the Honorable Charles Grassley, Ranking Member, Senate
Committee on Finance. Copies will be made available to others upon
request. The report is also available at no charge on GAO's homepage at
[hyperlink, http://www.gao.gov]. If you or your staff have any
questions concerning this letter, please contact me at (202) 512-6722
or kutzg@gao.gov.
Sincerely yours,
Signed by:
Gregory Kutz:
Managing Director:
Forensic Audits and Special Investigations:
Enclosures - 2:
[End of section]
Enclosure I:
GSA Regulations Governing Premium Class Travel Use:
The Federal Travel Regulation (FTR), issued by the General Services
Administration (GSA), implements statutory and Office of Management and
Budget (OMB) requirements and policies for most federal civilian
employees and others authorized to travel at government expense. The
purpose of the FTR is to ensure that official travel is conducted
responsibly and at minimal administrative expense. Unless exempt by
specific legislation,[Footnote 15] executive agencies, fully owned
government corporations, and independent establishments are expected to
follow the FTR, including its promulgation related to premium class
travel. The Department of Defense's uniformed servicemembers and
Department of State employees exempt from the FTR are covered by their
agencies' travel regulations.
OMB's general policy related to travel is that the taxpayers should pay
no more than necessary to transport government officials. Consistent
with this principle, the FTR states that with limited exceptions,
travelers must use coach class accommodations for both domestic and
international travel. Premium class travel can occur only when the
traveler's agency specifically authorizes the use of such
accommodations (authorization) and only under specific circumstances
(justification). Specifically, the FTR states that first class
accommodation is authorized only when at least one of the following
conditions exists[Footnote 16]:
* coach class airline accommodations or premium class other than first
class airline accommodations are not reasonably available;
* when use of first class is necessary to accommodate a disability or
other special need that is substantiated in writing by a competent
medical authority;
* exceptional security circumstances require first class travel, or;
* when required because of agency mission.[Footnote 17]
The FTR authorizes premium class accommodations other than first class
(business class) when at least one of the following conditions exists:
* regularly scheduled flights between origin/destination points provide
only premium class accommodations, and this is certified on the travel
voucher;
* coach class is not available in time to accomplish the mission, which
is urgent and cannot be postponed;
* premium class travel is necessary to accommodate the traveler's
disability or other physical impairment, and the condition is
substantiated in writing by competent medical authority;
* premium class travel is needed for security purposes or because
exceptional circumstances make its use essential to the successful
performance of the mission;
* coach class accommodations on authorized/approved foreign carriers do
not provide adequate sanitation or meet health standards;
* premium class accommodations would result in overall savings to the
government because of subsistence costs, overtime, or lost productive
time that would be incurred while awaiting coach class accommodations;
* transportation is paid in full by a nonfederal source;
* travel is to or from a destination outside the continental United
States, and the scheduled flight time (including stopovers) is in
excess of 14 hours (however, a rest stop en route or a rest period upon
arrival is prohibited when premium class accommodations are
authorized); or;
* when required because of agency mission.[Footnote 18]
As specified above, employees traveling in premium class have to meet
both authorization and justification to qualify, meaning that employees
who, for example, traveled premium class on a trip exceeding 14 hours
would violate the FTR if they traveled premium class without receiving
specific authorization to do so. Agencies subject to the FTR have
generally issued internal policies and procedures to clarify and
implement the premium class travel provisions of the FTR. When issuing
implementing policy, agencies have to follow executive branch policy,
which specifies that a subordinate organization seeking to establish
implementing regulations or guidance may make the regulations more
stringent but not relax the rules established by higher-level guidance.
For example, an agency's implementing policy related to premium class
travel because of disability can require that the traveler provides
medical certification that is updated annually, but cannot waive the
requirement that a certification by a competent medical authority be
provided.
[End of enclosure]
Comments from the United States Department of Agriculture:
United States Department of Agriculture:
Office of the Chief Financial Officer:
1400 Independence Avenue, SW:
Washington, DC 20250:
November 15, 2007:
Mr. Gregory D. Kutz:
Managing Director:
Forensic Audits and Special Investigations:
Government Accountability Office:
Washington, D.C. 20548:
Dear Mr. Kutz:
Thank you for providing a copy of your proposed report: Recommendations
for Improvements to the United States Department of Agriculture's
(USDA) Internal Controls and Policies on Premium Class Air Travel (GAO-
08-85R). Acting Secretary Conner has asked me to respond for the
Department. USDA concurs with your recommendations and has taken
several steps to improve oversight of premium class travel. The
Department has made the following changes in response to your
recommendations:
* On October 2, 2007, the Department implemented interim guidance
requiring the Chief Financial Officer (CFO) to review and approve all
first class and/or premium class travel in advance of booking the trip.
This guidance requires justification and documentation for General
Officer review and concurrence prior to consideration by the CFO. In
the event that the premium class travel is for the CFO, it will require
review and approval from the Department's Chief of Staff to the
Secretary. This approval process does not apply to upgrades using
frequent flyer miles or at the traveler's personal expense that are
allowed under the Federal Travel Regulations;
* Each Subcabinet Official was briefed on these interim procedures in
addition to briefings provided to management staff. We have also
instructed our Travel Management Centers to not make reservations for
premium class travel without verification of approval;
* The Office of the Chief Financial Officer (OCFO) just completed an
extensive review of the Agriculture Travel Regulation. The review
commenced prior to the GAO audit. The review team was instructed to
simplify the policy while providing the appropriate level of oversight
to authorizations in domestic travel, international travel, group
training expenses, and conference expenses. This regulation is
completed and in the department's clearance process;
* On November 2, 2007, the OCFO began an audit of premium class travel
in the Department. The purpose of the audit is to examine the use of
premium class travel and adherence to Federal and Departmental policy
and procedures. Audit results are due by the end of the calendar year;
and;
* USDA has also requested monthly premium class travel reports from our
eTravel Service providers. This will allow a monthly review process to
continually monitor premium class travel activity and to ensure
adherence to the new policy.
GAO's audit showed problems with unclear travel policies and weaknesses
in the approval process. USDA quickly addressed the problems identified
by the audit with interim and permanent solutions. A quick review of
the premium travel by the OCFO showed that the travel had limited
documentation, but in most cases would have been approved. Therefore,
notwithstanding approvals at subordinate levels or the absence of
properly executed forms, we believe that in many cases where travel was
performed in circumstances in which premium class accommodations were
utilized, premium class travel was in fact justified. To be prudent in
our responsibilities, the OCFO is conducting an audit of premium travel
including pre-authorization and post approvals.
Please be assured that we are working diligently to address the all of
audit issues identified in your letter. The new procedures that have
been put in place will allow premium class travel to occur when full
documentation showing it was properly authorized and justified is
provided. In addition, we will work with the Office of Inspector
General to ensure changes in their policies and procedures will prevent
future improper premium travel as noted in the management letter.
Sincerely,
Signed by:
Charles R. Christopherson, Jr.:
Chief Financial Officer:
[End of enclosure]
Footnotes:
[1] GAO, Premium Class Travel: Internal Control Weaknesses
Governmentwide Led to Improper and Abusive Use of Premium Class Travel,
GAO-07-1268 (Washington, D.C.: Sept. 28, 2007).
[2] As FAS's mission involves dealing with international entities, and
therefore international travel, it is expected that FAS would be a more
frequent user of premium class travel than other USDA components.
[3] For more information on federal regulations governing premium class
travel use, see enc. I.
[4] Our statistical sample included five transactions from USDA
travelers.
[5] We reviewed 3 individual transactions identified in our initial
data mining, and an additional 137 transactions from 12 USDA employees
who traveled during our audit period.
[6] We received allegations of abusive and improver travel at USDA,
including FAS and USDA's Office of Inspector General (OIG). Results of
the OIG travel investigation are not included in this report because,
in response to problems we identified, the OIG has agreed to changes in
policies and procedures that will help prevent future improper premium
travel. FAS transactions investigated as part of the investigation are
included in this report.
[7] Of the $2 million FAS spent on premium class travel, less than
$70,000 was for first class travel. Of the $3 million USDA as a whole
spent on premium class travel, $150,000 was for first class travel. We
did not audit whether USDA's reporting of first class travel to GSA was
complete because first class travel is a relatively small portion of
total premium class travel.
[8] An additional eight transactions had no signature at all.
[9] Senior executives are defined as members of the Senior Executive
Service (SES) and presidential appointees.
[10] GAO, Standards for Internal Control in the Federal Government,
GAO/AIMD-00-21-3.1 (Washington, D.C.: November 1999).
[11] GAO, Travel Cards: Internal Control Weaknesses at DOD Led to
Improper Use of First and Business Class Travel, GAO-04-88 (Washington,
D.C.: Oct. 24, 2003).
[12] GAO, Guide for Evaluating and Testing Controls Over Sensitive
Payments, GAO/AFMD-8.1.2 (Washington, D.C.: May 1993).
[13] A general officer is a USDA official as defined in 7 C.F.R. 2.4.
General officers report directly to the Secretary of Agriculture. If
travel is not first class and frequent traveler benefits are used to
offset additional cost of premium class, the head of an agency may
approve the tickets, according to USDA policy.
[14] Some of the 47 FAS premium class tickets justified using the
exceptional circumstances criterion were authorized by the traveler's
subordinate.
[15] A number of federal agencies are exempt from the FTR. For example,
the United States Postal Service (USPS) is exempt through 5 U.S.C. 104
and 5 U.S.C. 5701. The Federal Reserve Bank also claimed exemption from
the FTR under section 10 of the Federal Reserve Act, which provides
that "employment, compensation, leave, and expenses" of board employees
are "governed solely by the provisions of the Federal Reserve Act."
Both USPS and the Federal Reserve Bank use their respective exemptions
to promulgate their own travel policies.
[16] The FTR also allows for the traveler to upgrade to premium-class
accommodations, at the traveler's expense or by using frequent traveler
benefits.
[17] 41 C.F.R. 301-10.123.
[18] 41 C.F.R. 301-10.124.
[End of section]
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