Coast Guard
Challenges during the Transition to the Department of Homeland Security Gao ID: GAO-03-594T April 1, 2003The Coast Guard is one of 22 agencies being placed in the new Department of Homeland Security (DHS). With its key roles in the nation's ports, waterways, and coastlines, the Coast Guard is an important part of enhanced homeland security efforts. But it also has important nonsecurity missions, such as search and rescue, fisheries and environmental protection, and drug and migrant interdiction. GAO has conducted a number of reviews of the Coast Guard's missions and was asked to testify about the Coast Guard's most recent level of effort for its various missions and the major operational and organizational challenges facing the agency during its transition into the newly created DHS.
Data on the most recent levels of effort for the Coast Guard's various missions show clearly the dramatic shifts that have occurred among its missions since the September 11, 2001, attacks. Predictably, levels of effort related to homeland security remain at much higher levels than before September 11th. Other missions, such as search and rescue, have remained at essentially the same levels. In contrast, several other missions--most notably fisheries enforcement and drug interdiction--dropped sharply after September 11th and remain substantially below historical levels. Continued homeland security and military demands make it unlikely that the agency, in the short run, can increase efforts in the missions that have declined. Further, the fiscal year 2004 budget request contains little that would substantially alter the existing levels of effort among missions. The Coast Guard faces fundamental and daunting challenges during its transition to the new department. Delays in the planned modernization of cutters and other equipment, responsibility for new security-related tasks as directed under the Maritime Transportation Security Act (MTSA), and mandatory responses to unexpected events, such as terrorist attacks or extended terror alerts, will have an impact on the Coast Guard's ability to meet its new security-related responsibilities while rebuilding its capacity in other missions. Also, as one of the agencies being merged into the new department, the Coast Guard must deal with a myriad of organizational, human capital, acquisition, and technology issues. The enormity of these challenges requires the development of a comprehensive blueprint or strategy that addresses how the Coast Guard should balance and monitor resource use among its various missions in light of its new operating reality.
GAO-03-594T, Coast Guard: Challenges during the Transition to the Department of Homeland Security
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Testimony:
Before the Subcommittee on Coast Guard and Maritime Transportation,
Committee on Transportation and Infrastructure, House of
Representatives:
United States General Accounting Office:
GAO:
For Release on Delivery Expected at 10:00 a.m. EST:
Tuesday, April 1, 2003:
Coast Guard:
Challenges during the Transition to the Department of Homeland
Security:
Statement of JayEtta Z. Hecker, Director Physical Infrastructure:
GAO-03-594T:
GAO Highlights:
Highlights of GAO-03-594T, a testimony before the Subcommittee on Coast
Guard and Maritime Transportation, Committee on Transportation and
Infrastructure, House of Representatives
Why GAO Did This Study:
The Coast Guard is one of 22 agencies being placed in the new
Department of Homeland Security (DHS). With its key roles in the
nation‘s ports, waterways, and coastlines, the Coast Guard is an
important part of enhanced homeland security efforts. But it also has
important nonsecurity missions, such as search and rescue, fisheries
and environmental protection, and drug and migrant interdiction. GAO
has conducted a number of reviews of the Coast Guard‘s missions and was
asked to testify about the Coast Guard‘s most recent level of effort
for its various missions and the major operational and organizational
challenges facing the agency during its transition into the newly
created DHS.
What GAO Found:
Data on the most recent levels of effort for the Coast Guard‘s various
missions show clearly the dramatic shifts that have occurred among its
missions since the September 11, 2001, attacks. Predictably, levels of
effort related to homeland security remain at much higher levels than
before September 11th. Other missions, such as search and rescue, have
remained at essentially the same levels. In contrast, several other
missions”most notably fisheries enforcement and drug interdiction”
dropped sharply after September 11th and remain substantially below
historical levels. Continued homeland security and military demands
make it unlikely that the agency, in the short run, can increase
efforts in the missions that have declined. Further, the fiscal year
2004 budget request contains little that would substantially alter the
existing levels of effort among missions.
The Coast Guard faces fundamental and daunting challenges during its
transition to the new department. Delays in the planned modernization
of cutters and other equipment, responsibility for new security-related
tasks as directed under the Maritime Transportation Security Act
(MTSA), and mandatory responses to unexpected events, such as terrorist
attacks or extended terror alerts, will have an impact on the Coast
Guard‘s ability to meet its new security-related responsibilities while
rebuilding its capacity in other missions. Also, as one of the agencies
being merged into the new department, the Coast Guard must deal with a
myriad of organizational, human capital, acquisition, and technology
issues. The enormity of these challenges requires the development of a
comprehensive blueprint or strategy that addresses how the Coast Guard
should balance and monitor resource use among its various missions in
light of its new operating reality
What GAO Recommends:
In order to monitor resource use and measure performance, GAO
recommended in November 2002 that the Coast Guard develop a long-term
blueprint or strategy outlining how resources will be distributed
across missions, a time frame for achieving this desired balance, and a
useful format for reporting progress to the Congress. The Coast Guard
agreed with the need for such a strategy and has started to develop
one.
www.gao.gov/cgi-bin/getrpt?GAO-03-594T.
To view the full testimony, including the scope and methodology, click
on the link above. For more information, contact JayEtta Hecker at
(206) 512-2834 or heckerj@gao.gov.
[End of section]
GAO-03-594T:
Mr. Chairman and Members of the Subcommittee:
I am pleased to be here today to discuss major operational and
organizational challenges facing the Coast Guard during this period of
transition into the newly created Department of Homeland Security
(DHS). The creation of DHS represents one of the largest
reorganizations and consolidations of government agencies, personnel,
programs, and operations in recent history. Creating this new
department means merging 22 agencies--with their disparate
organizational structures, cultures, and systems--into a cohesive
working unit. For these and other reasons, we have designated the
implementation and transformation of DHS as a high-risk area.[Footnote
1]
As one of the agencies being merged into the new department, the Coast
Guard must deal with a myriad of organizational, human capital,
process, and technology challenges and, at the same time, carry out its
expanding mission responsibilities. But the Coast Guard, even as a
separate entity, was rapidly reinventing itself in many respects in the
wake of the September 11, 2001, terrorist attacks. After the attacks,
the Coast Guard‘s priorities and focus had to shift suddenly and
dramatically toward protecting the nation‘s vast and sprawling network
of ports and waterways. Cutters, aircraft, boats, and personnel
normally used for traditional missions--such as drug and migrant
interdiction, fisheries enforcement, and marine environmental
protection--were shifted to homeland security functions, which
previously consumed only a small part of the agency‘s operating
resources. As we have recently reported,[Footnote 2] the Coast Guard
has begun restoring activity levels for many of its traditional
missions, but doing so is a work in process.
To help meet its increased homeland security responsibilities and
restore activity levels for its traditional missions, the Coast Guard
has received substantial budget increases over the last 2 years. This
trend continued with the President‘s fiscal year 2004 budget request
for the Coast Guard of $6.8 billion--a 9.6 percent increase over the
previous year. Still, despite the large budget increases for the Coast
Guard since September 11th, there is much congressional concern about
how--and whether--the Coast Guard can continue to meet its
responsibilities for all of its missions, given the increased emphasis
on and additional resources required for homeland security.
My testimony today, which is based on recently completed work,
addresses two topics: (1) the most recent levels of effort for the
Coast Guard‘s various missions, and how these levels compare to those
in the past; (2) the challenges the Coast Guard faces in balancing its
resources among its missions and ensuring and maximizing its
effectiveness in each of its missions. The scope and methodology of our
review is described in the appendix.
In summary:
* The most recent levels of effort for the Coast Guard‘s various
missions--as measured by the use of multiple-mission resources such as
cutters, patrol boats, and aircraft--show clearly the dramatic increase
in the amount of time spent on homeland security following the
September 11th attacks. In the months after the attacks, as the initial
surge in homeland security activities was abating, activity in many
other missions began returning to pre-September 11th levels, but some
have not yet recovered. For example, the amount of resource hours
currently being spent on search and rescue and maintaining aids to
navigation are fairly consistent with traditional levels over the last
5 years. However, there have been substantial declines from traditional
levels of time spent on two law enforcement missions--fisheries
enforcement and drug interdiction. The fiscal year 2004 budget request
for the Coast Guard, which includes a $592 million increase over the
2003 budget, does not include initiatives that would substantially
reverse these declines. The majority of this increase would cover pay
increases for current or retired employees or continue certain programs
already under way, such as upgrades to information technology. About
$168.5 million of the increase would fund new initiatives, most of
which relate either to homeland security or to search and rescue. As
such, these initiatives do not represent substantial shifts in current
levels of effort among missions. This situation is further exacerbated
by the diversion of Coast Guard resources to respond to heightened
terror alerts at home and military operations in the Middle East.
:
* The Coast Guard faces fundamental challenges in being able to
accomplish all of its new homeland security responsibilities, while
rebuilding capacity in other missions to pre-September 11th levels. For
example, the Coast Guard‘s Deepwater Project, a modernization effort
for cutters, patrol boats, and aircraft, has already experienced delays
in the delivery of key assets, jeopardizing the agency‘s future ability
to carry out a number of missions at optimum levels. This situation
could worsen because the Coast Guard has tied successful completion of
the project to levels of funding that are beyond what has been
available. Another challenge involves the implementation of the
Maritime Transportation Security Act of 2002 (MTSA), which requires the
Coast Guard to undertake a variety of new homeland security tasks.
Since an implementation strategy has not yet been fully developed for
MTSA, and funding to accomplish implementation is not provided in the
fiscal year 2004 budget request, for the foreseeable future, the Coast
Guard will need to absorb the costs related to these tasks within its
operating budget. Similarly, any unexpected events--such as terrorist
attacks or extended terror alerts--could also result in using resources
for homeland security purposes that would normally be used for other
missions. Further, the Coast Guard‘s expanded role in homeland security
and its relocation in the newly created DHS have changed many of its
priorities and working parameters; its adjustment to this new
environment is a work in progress. Altogether, these factors raise
serious concerns about the Coast Guard‘s ability to meet traditional
expectations across the broad range of all of its missions.[Footnote 3]
In recent reports, [Footnote 4] we have pointed to several steps that
are needed in such an environment. One is to continue finding ways to
operate more efficiently to maximize the existing resources available.
Another is to develop a comprehensive blueprint or strategy for
accomplishing mission responsibilities. This blueprint needs to
recognize the new operating reality created by the Coast Guard‘s
increasing homeland security role and translate that reality into (1)
realistic level-of-effort targets for all of its missions, (2) a plan
for achieving these targets with appropriate performance measurements,
and (3) a framework for monitoring and reporting on levels of effort
and performance in achieving mission goals so that the agency and the
Congress can better decide how limited dollars can be spent.
Background:
The Coast Guard, which became a part of DHS on March 1, 2003, has a
wide variety of both security and nonsecurity missions. (See table 1.)
The Coast Guard‘s equipment includes 141 cutters, approximately 1,400
small patrol and rescue boats, and about 200 aircraft. Coast Guard
services are provided in a variety of locations, including ports,
coastal areas, the open sea, and in other waterways like the Great
Lakes and the Mississippi River. The Coast Guard‘s installations range
from small boat stations providing search and rescue and other services
to marine safety offices that coordinate security and other activities
in the nation‘s largest ports.
Table 1: Security and Nonsecurity Missions of the Coast Guard:
Mission area[a]: Security missions.
Mission area[a]: Ports, waterways, and coastal security; Activities and
functions within each mission area: Conducting harbor patrols,
vulnerability assessments, intelligence gathering and analysis, and
other activities to prevent terrorist attacks and minimize the damage
from attacks that occur.
Mission area[a]: Drug interdiction; Activities and functions within
each
mission area: Deploying cutters and aircraft in high drug trafficking
areas and gathering intelligence to reduce the flow of illegal drugs
across maritime boundaries.
Mission area[a]: Migrant interdiction; Activities and functions within
each mission area: Deploying cutters and aircraft to reduce the flow of
undocumented migrants entering the United States by maritime routes.
Mission area[a]: Defense readiness; Activities and functions within
each
mission area: Participating with the Department of Defense (DOD) in
global military operations; deploying cutters and other boats in and
around harbors to protect DOD force mobilization operations.
Mission area[a]: Nonsecurity missions; Activities and functions within
each mission area: [Empty].
Mission area[a]: Maritime safety; Activities and functions within each
mission area: Setting standards and conducting vessel inspections to
better ensure the safety of passengers and crew aboard cruise ships,
ferries, and other passenger vessels and commercial and fishing
vessels; partnering with states and boating safety organizations to
reduce recreational boating deaths.
Mission area[a]: Search and rescue; Activities and functions within
each
mission area: Operating small boat stations and national distress and
response communication system; conducting search and rescue operations
for mariners in distress.
Mission area[a]: Living marine resources; Activities and functions
within
each mission area: Protecting our nation‘s fishing grounds from foreign
encroachment; enforcing domestic fishing laws and regulations through
inspections and fishery patrols.
Mission area[a]: Environmental protection; Activities and functions
within each mission area: Preventing and responding to marine oil
spills; preventing the illegal dumping of plastics and garbage into our
nation‘s waters.
Mission area[a]: Aids to navigation; Activities and functions within
each
mission area: Maintaining the extensive system of navigation aids in
our waterways; monitoring marine traffic through traffic service
centers.
Mission area[a]: Ice operations; Activities and functions within each
mission area: Conducting polar operations to facilitate the movement of
critical goods and personnel in support of scientific and national
security activity; conducting domestic icebreaking operations to
facilitate year-round commerce.
Source: U.S. Coast Guard.
[A] The Coast Guard‘s security and nonsecurity missions are delineated
in the Homeland Security Act of 2002 (P. L. 107-296, Nov. 25, 2002).
[End of table]:
As an organization that is also part of the armed services, the Coast
Guard has both military and civilian positions. At the end of fiscal
year 2002, the agency had over 42,000 full-time positions--about 36,000
military and about 6,600 civilians. The Coast Guard also has about
7,200 reservists who support the national military strategy and provide
additional operational support and surge capacity[Footnote 5] during
emergencies, such as natural disasters. In addition, about 36,000
volunteer auxiliary personnel assist in a wide range of activities from
search and rescue to boating safety education.
The events of September 11th caused the Coast Guard to direct its
efforts increasingly into maritime homeland security activities,
highlighted by the Coast Guard‘s establishing a new program area:
Ports, Waterways, and Coastal Security (coastal security). Prior to
September 11th, activities related to this area represented less than
10 percent of the Coast Guard‘s operating budget, according to Coast
Guard officials. In the fiscal year 2004 budget request, coastal
security represents about one-quarter of the Coast Guard‘s planned
operating budget. Other mission areas, most notably drug interdiction,
have declined substantially as a percentage of the operating budget.
The Coast Guard‘s Emphasis on Security Continues to Affect Its Levels
of Effort in Some Missions:
The emphasis the Coast Guard placed on security after September 11th
has had varying effects on its level of effort among all of its
missions, as measured by the extent to which multiple-mission resources
(cutters, other boats, and aircraft) are used for a particular
mission.[Footnote 6] The most current available data show that some
security-related missions, such as migrant interdiction and coastal
security, have grown significantly since September 11th. Other
missions, such as search and rescue and aids to navigation remained at
essentially the same levels as they were before September 11th.
However, the level of effort for other missions, most notably the
interdiction of illegal drugs and fisheries enforcement, is
substantially below pre-September 11th levels.
Missions with Increased Levels of Resources:
Missions such as coastal security, and migrant interdiction have
experienced increased levels of effort. Coastal security has seen the
most dramatic increase from pre-September 11th levels. (See fig. 1.)
For example, it went from 2,400 resource hours[Footnote 7] during the
first quarter of 1999, peaked at 91,000 hours during the first quarter
of fiscal year 2002 (immediately after September 11, 2001), and most
recently stood at nearly 37,000 hours for the first quarter of fiscal
year 2003. In figure 1, as well as the other resource figures that
follow, we have added a line developed by using linear
regression[Footnote 8] techniques to show the general trend for the
period. It is important to note that while such lines depict the trend
in resource hours to date, they should not be taken as a prediction of
future values. Other activity indicators, such as sea marshal[Footnote
9] boardings, also demonstrate an increased level of emphasis. Before
September 11th, such boardings were not done; but there were over 550
boardings during the first quarter of 2003. Similarly, vessel
operational control actions[Footnote 10] have risen by 85 percent since
the fourth quarter of fiscal year 2001.
Figure 1: Number of Resource Hours Spent on Ports, Waterways, and
Coastal Security, by Quarter, October 1998 - December 2002:
[See PDF for image]
Note: GAO analysis of data from the Coast Guard‘s Abstract of
Operations includes resource hours for cutters, boats, and aircraft.
Figures shown are for the first quarter of fiscal year 1999 and 2003,
respectively. The dotted line shows actual quarter-by-quarter totals;
the thicker line is a regression line showing the general trend.
[End of figure]:
Given the emphasis on homeland security, it is not surprising that
efforts to interdict illegal immigrants have also increased. For
example, during the first quarter of 2003, the level of effort in this
area was 28 percent higher than it was for the comparable period in
1998.
Missions with a Steady State of Resources:
Some of the Coast Guard‘s traditional missions, such as providing aids
to navigation and search and rescue, have been the least affected by
the increased emphasis on security. (See fig. 2.) While resource hours
for both of these missions have declined somewhat since the first
quarter of fiscal year 1998, the overall pattern of resource use over
the past 5 years has remained consistent. Although search and rescue
boats and buoy tenders were used to perform homeland security functions
immediately after September 11th, these activities did not materially
affect the Coast Guard‘s ability to carry out its search and rescue or
aids to navigation missions. Search and rescue boats were initially
redeployed for harbor patrols after the September 11th terrorist
attacks; but the impact on the mission was minimal because the
deployments occurred during the off-season, with respect to
recreational boating.[Footnote 11] Similarly, some boats that normally
serve as buoy tenders--an aids to navigation function--were used for
security purposes instead; but they were among the first to be returned
to their former missions. For the first quarter of fiscal year 2003,
the number of resource hours spent on these missions was very close to
the number spent during the comparable quarter of fiscal year 1998.
Figure 2: Number of Resource Hours Spent on Search and Rescue and Aids
to Navigation, by Quarter, October 1997-December 2002:
[See PDF for image]
Note: GAO analysis of data from the Coast Guard‘s Abstract of
Operations includes resource hours for cutters, boats, and aircraft.
Figures shown are for the first quarter of fiscal year 1998 and 2003,
respectively. The dotted line shows actual quarter-by-quarter totals;
the thicker line is a regression line showing the general trend.
[End of figure]
Performance measurement data further demonstrates the relatively
minimal impact on these missions resulting from the Coast Guard‘s
emphasis on homeland security. For example, for search and rescue, the
Coast Guard was within about half a percentage point of meeting its
target for saving mariners in distress in 2002. Likewise, data show
that with respect to its aid to navigation mission, in 2002 the Coast
Guard was about 1 percent from its goal of navigational aid
availability. [Footnote 12]
Missions with a Decline in Resource Hours:
A number of missions have experienced declines in resource hours from
pre-September 11th levels, including drug interdiction, fisheries
enforcement (domestic and foreign), marine environmental protection,
and marine safety. In particular, drug enforcement and fisheries
enforcement have experienced significant declines. Compared with the
first quarter of 1998, resource hours for the first quarter of fiscal
year 2003 represent declines of 60 percent for drug interdiction and 38
percent for fisheries enforcement. (See fig. 3.) In fact, resource
hours for these areas were declining even before the events of
September 11th; and while they briefly rebounded in early 2002, they
have since continued to decline. A Coast Guard official said the recent
decline in both drug enforcement and fisheries can be attributed to the
heightened security around July 4, 2002, and the anniversary of the
September 11th terrorist attacks, as well as the deployment of
resources for military operations. They said the decline will likely
not be reversed during the second quarter of 2003 because of the
diversion of Coast Guard cutters to the Middle East and the heightened
security alert that occurred in February and March 2003.
Figure 3: Number of Resource Hours Spent on Drug Interdiction and
Fisheries Enforcement, by Quarter, October 1997-December 2002:
[See PDF for image]
Note: GAO analysis of data from the Coast Guard‘s Abstract of
Operations includes resource hours for cutters, boats, and aircraft.
Figures shown are for the first quarter of fiscal year 1998 and 2003,
respectively. The dotted line shows actual quarter-by-quarter totals;
the thicker line is a regression line showing the general trend.
[End of figure]:
The reduction in resource hours over the last several years in drug
enforcement is particularly telling. In the first quarter of 1998, the
Coast Guard was expending nearly 34,000 resource hours on drug
enforcement, and as of first quarter of 2003, the resource hours had
declined to almost 14,000 hours--a reduction of nearly two-thirds.
Also, both the number of boardings to identify illegal drugs and the
amount of illegal drugs seized declined from the first quarter of
fiscal year 2000. The Coast Guard‘s goal of reducing the flow of
illegal drugs based on the seizure rate for cocaine has not been met
since 1999. During our conversations with Coast Guard officials, they
explained that the Office of National Drug Control Policy set this
performance goal in 1997, and although they recognize that they are
obligated to meet these goals, they believe the goals should be
revised.
Our review of the Coast Guard‘s activity levels in domestic fishing
shows U.S. fishing vessel boardings and significant violations[Footnote
13] identified are both down since 2000. Similarly, the Coast Guard
interdicted only 19 percent as many foreign vessels as it did in
2000.[Footnote 14] The reduced level of effort dedicated to these two
missions is likely linked to the Coast Guard‘s inability to meet its
performance goals in these two areas. For instance, in 2002 the Coast
Guard did not meet its goal of detecting foreign fishing vessel
incursions,[Footnote 15] and while there is no target for domestic
fishing violations, there were fewer boardings and fewer violations
detected in 2002 than in 2000.[Footnote 16]
Recently, the Coast Guard Commandant stated that the Coast Guard
intends to return the level of resources directed to law enforcement
missions (drug interdiction, migrant interdiction, and fisheries
enforcement) to 93 percent of pre-September 11th levels (using a
baseline of the 8 quarters prior to September 11, 2001) by the end of
2003 and 95 percent by the end of 2004. However, in the environment of
heightened security and the continued deployment of resources to the
Middle East, these goals will likely not be achieved, especially for
drug interdiction and fisheries enforcement, which are currently far
below previous activity levels.
Fiscal Year 2004 Budget Request Will Not Substantially Alter Current
Levels of Effort:
The Coast Guard‘s budget request for fiscal year 2004 does not contain
initiatives or proposals that would substantially alter the current
levels of effort among missions. The request for $6.8 billion
represents an increase of about $592 million, or about 9.6 percent in
nominal dollars, over the enacted budget for fiscal year 2003.[Footnote
17] The majority of this increase covers pay increases for current or
retired employees or continues certain programs already under way, such
as upgrades to information technology. About $168.5 million of the
increase would fund new initiatives, most of which relate either to
homeland security or to search and rescue. As such, these initiatives
do not represent substantial shifts in current levels of effort among
missions.
However, the 2004 budget request does address a long-standing
congressional concern about the Coast Guard‘s search and rescue
mission. The search and rescue initiative is part of a multiyear effort
to address shortcomings in search and rescue stations and command
centers. In September 2001, the Department of Transportation Office of
the Inspector General reported that readiness at search and rescue
stations was deteriorating.[Footnote 18] For example, staff shortages
at most stations required crews to work an average of 84 hours per
week, well above the standard (68 hours) established to limit fatigue
and stress among personnel. The initiative seeks to provide appropriate
staffing and training to meet the standards of a 12-hour watch and a
68-hour work week. The Congress appropriated $14.5 million in fiscal
year 2002 and $21.7 million in fiscal year 2003 for this initiative.
The increased amount requested for fiscal year 2004 ($26.3 million) for
search and rescue would pay for an additional 390 full-time search and
rescue station personnel and for 28 additional instructors at the Coast
Guard‘s motor lifeboat and boatswain‘s mate schools.
Significant Challenges Raise Concerns about Coast Guard‘s Ability to
Accomplish Its Diverse Missions:
The Coast Guard faces fundamental challenges in balancing resource use
among its missions and accomplishing everything that has come to be
expected of it. We have already described how the Coast Guard has not
been able, in its current environment, to both assimilate its new
homeland security responsibilities and restore levels of effort for all
other missions. Several other challenges further threaten the Coast
Guard‘s ability to balance these diverse missions. For example, the
Coast Guard‘s Deepwater Project[Footnote 19] has already experienced
delays in delivery of key assets and could face additional delays if
future funding falls behind what the Coast Guard had planned. Such
delays could also seriously jeopardize the Coast Guard‘s ability to
carry out a number of security and nonsecurity missions. Similarly, for
the foreseeable future, the Coast Guard must absorb the cost of
implementing a variety of newly mandated homeland security tasks by
taking resources from ongoing activities. Funding for these tasks are
not provided in the fiscal year 2004 budget request. The Coast Guard
also faces the constant possibility that future terror alerts,
terrorist attacks, or military actions will likely require it to shift
additional resources to homeland security missions. Finally, the Coast
Guard‘s transition to DHS brings additional challenges, particularly
with respect to establishing effective communication links and building
partnerships both within DHS and with external agencies.
Such challenges raise serious concerns about the Coast Guard‘s ability
to accomplish all of its responsibilities and balance the level of
effort among all missions in an environment where it strives to be ’all
things to all people,“ and attempts to do so as one of many agencies in
a cabinet department whose primary mission is homeland security. In
past work, we have pointed to several steps that the Coast Guard needs
to take in such an environment. These include continuing to address
opportunities for operational efficiency, especially through more
partnering and developing a comprehensive blueprint or strategy for
balancing and monitoring resource use across all of its missions.
Continued Funding Shortfalls Could Delay the Deepwater Project and
Adversely Affect the Coast Guard‘s Mission Capabilities:
Under current funding plans, the Coast Guard faces significant
potential delays and cost increases in its $17 billion Integrated
Deepwater Project. This project is designed to modernize the Coast
Guard‘s entire fleet of cutters, patrol boats, and aircraft over a 20-
year period. Given the way the Coast Guard elected to carry out this
project, its success is heavily dependent on receiving full funding
every year. So far, that funding has not materialized as planned.
Delays in the project, which have already occurred, could jeopardize
the Coast Guard‘s future ability to effectively and efficiently carry
out its missions, and its law enforcement activities--that is, drug and
migrant interdiction and fisheries enforcement--would likely be
affected the most, since they involve extensive use of deepwater
cutters and aircraft.
Under the project‘s contracting approach, the responsibility for
Deepwater‘s success lies with a single systems integrator[Footnote 20]
and its contractors for a period of 20 years or more. Under this
approach, the Coast Guard has started on a course potentially expensive
to alter. It is based on having a steady, predictable, annual funding
stream of $500 million in 1998 dollars over the next 2 to 3 decades.
Already the funding provided for the project is less than the amount
the Coast Guard planned for. The fiscal year 2002 appropriation for the
project was about $28 million below the planned level, and the fiscal
year 2003 appropriated level was about $90 million below the planning
estimate. Further, the President‘s fiscal year 2004 budget request for
the Coast Guard is not consistent with the Coast Guard‘s deepwater
funding plan. If the requested amount of $500 million for fiscal year
2004 is appropriated, it would represent another shortfall of $83
million, making the cumulative shortfall about $202 million in the
project‘s first 3 years, according to Coast Guard data. If
appropriations hold steady at $500 million (in nominal dollars) through
fiscal year 2008, the Coast Guard estimates that the cumulative
shortfall will reach $626 million.[Footnote 21]
The shortfalls in the last 2 fiscal years (2002 and 2003) and their
potential persistence could have serious consequences. The main impact
is that it would take longer and cost more in the long run to fully
implement the deepwater system. For example, due to funding shortfalls
experienced to date, the Coast Guard has delayed the introduction of
the new maritime patrol aircraft by 19 months and slowed the conversion
and upgrade program for its 110-foot patrol boats. According to the
Coast Guard, if the agency continues to receive funding at levels less
than planned, new asset introductions--and the associated retirement of
costly, less capable Coast Guard resources--will continue to be
deferred.
The cost of these delays will be exacerbated by the accompanying need
to invest additional funds in maintaining current assets beyond their
planned retirement date because of the delayed introduction of
replacement capabilities and assets, according to the Coast Guard. For
example, delaying the maritime patrol aircraft will likely require some
level of incremental investment to continue safe operation of the
current HU-25 jet aircraft. Similarly, a significant delay in the
scheduled replacement for the existing 270-foot medium endurance cutter
fleet could require an unplanned and expensive renovation for this
fleet.
System performance--and the Coast Guard‘s capability to effectively
carry out its mission responsibilities--would also likely be impacted
if funding for the Deepwater Project does not keep pace with planning
estimates. For example, Coast Guard officials told us that conversions
and upgrades for its 110-foot patrol boats would extend its operating
hours from about 1,800 to 2,500 per year. Once accomplished, this would
extend the time these boats could devote to both security and
nonsecurity missions. As with the maritime patrol aircraft, reductions
in funding levels for the project have slowed the conversions and
upgrades for these vessels, which in turn, has prevented enhancements
in mission performance that newer vessels would bring. Coast Guard
officials also said that with significant, continuing funding
shortfalls delaying new asset introductions, at some point, the Coast
Guard would be forced to retire some cutters and aircraft--even as
demand for those assets continues to grow. For example, in 2002, two
major cutters and several aircraft were decommissioned ahead of
schedule due to their deteriorated condition and high maintenance
costs.
Some New Homeland Security Duties Are Not Fully Factored into the Coast
Guard‘s Distribution of Resources:
The Coast Guard has also been tasked with a myriad of new homeland
security requirements, but funding to implement them is not provided in
either the enacted fiscal year 2003 budget or the fiscal year 2004
budget request. As a result, the Coast Guard will have to meet many of
these requirements by pulling resources from other activities. Under
the Maritime Transportation Security Act (MTSA),[Footnote 22] signed
into law in November 2002, the Coast Guard must accomplish a number of
security-related tasks within a matter of months and sustain them over
the long term. For example, MTSA requires the Coast Guard to be the
lead agency in conducting security assessments, developing plans, and
enforcing specific security measures for ports, vessels, and
facilities. In the near term, the Coast Guard must prepare detailed
vulnerability assessments of vessels and facilities it identifies to be
at high risk of terrorist attack. It must also prepare a National
Maritime Transportation Security Plan that assigns duties among federal
departments and agencies and specifies coordination with state and
local officials--an activity that will require substantial work by
Coast Guard officials at the port level. The Coast Guard must also
establish plans for responding to security incidents, including
notifying and coordinating with local, state, and federal authorities.
Because the fiscal year 2004 budget request was prepared before MTSA
was enacted, it does not specifically devote funding to most of these
port security responsibilities. Coast Guard officials said that they
will have to absorb costs related to developing, reviewing, and
approving plans, including the costs of training staff to monitor
compliance, within their general budget.[Footnote 23] Coast Guard
officials expect that the fiscal year 2005 budget request will contain
funding to address all MTSA requirements. In the meantime, officials
said that the Coast Guard would have to perform most of its new port
security duties without additional appropriation, and that the funds
for these duties would come from its current operations budget. The
costs of these new responsibilities, as well as the extent to which
they will affect resources for other missions, are not known.
External Uncertainties Place Additional Strain on Resources:
Security alerts, as well as actions needed in the event of an actual
terrorist attack, can also affect the extent to which the Coast Guard
can devote resources to missions not directly related to homeland
security. For example, Coast Guard officials told us that in the days
around September 11, 2002, when the Office of Homeland Security raised
the national threat level from ’elevated“ to ’high risk,“ the Coast
Guard reassigned cutters and patrol boats in response. In February
2003, when the Office of Homeland Security again raised the national
threat level to high risk, the Coast Guard repositioned some of its
assets involved in offshore law enforcement missions, using aircraft
patrols in place of some cutters that were redeployed to respond to
security-related needs elsewhere. While these responses testify to the
tremendous flexibility of a multi-mission agency, they also highlight
what we found in our analysis of activity-level trends--when the Coast
Guard responds to immediate security needs, fewer resources are
available for other missions.
The Coast Guard‘s involvement in the military buildup for Operation
Enduring Freedom in the Middle East further illustrates how such
contingencies can affect the availability of resources for other
missions. As part of the buildup, the Coast Guard has deployed eight
110-foot boats, two high-endurance cutters, four port security units,
and one buoy tender to the Persian Gulf. These resources have come from
seven different Coast Guard districts. For example, officials from the
First District told us they sent four 110-foot patrol boats and three
crews to the Middle East. These boats are multi-mission assets used for
fisheries and law enforcement, search and rescue and homeland security
operations. In their absence, officials reported, the First District is
using other boats previously devoted to other tasks. For instance, buoy
tenders have taken on some search and rescue functions, and buoy
tenders and harbor tug/icebreakers are escorting high-interest vessels.
Officials told us that these assets do not have capabilities equivalent
to the patrol boats but have been able to perform the assigned mission
responsibilities to date.
Transition to Homeland Security Poses Additional Challenges:
The creation of DHS is one of the largest, most complex restructurings
ever undertaken, and the Coast Guard, as one of many agencies joining
the department, faces numerous challenges, including organizational,
human capital, acquisition, process and technology issues.[Footnote 24]
One particularly formidable challenge involves establishing effective
communication links and building partnerships both within DHS and with
external organizations. While most of the 22 agencies transferred to
DHS report to under secretaries for the department‘s various
directorates,[Footnote 25] the Coast Guard remains a separate entity
reporting directly to the Secretary of DHS. According to Coast Guard
officials, the Coast Guard has important functions that will require
coordination and communication with all of these directorates,
particularly the Border and Transportation Security Directorate. For
example, the Coast Guard plays a vital role with Customs, Immigration
and Naturalization Service, the Transportation Security
Administration, and other agencies that are organized in the
Directorate of Border and Transportation Security. Because the Coast
Guard‘s homeland security activities require interface with these and a
diverse set of other agencies organized within several DHS
directorates, communication, coordination, and collaboration with
these agencies is paramount to achieve department-wide results.
Effective communication and coordination with agencies outside the
department is also critical to achieving the homeland security
objectives, and the Coast Guard must maintain numerous relationships
with other public and private sector organizations outside DHS. For
example, according to Coast Guard officials, the Coast Guard will
remain an important participant in the Department of Transportation‘s
(DOT) strategic planning process, since the Coast Guard is a key agency
in helping to maintain the maritime transportation system. Also, the
Coast Guard maintains navigation systems used by DOT agencies such as
the Federal Aviation Administration. In the homeland security area,
coordination efforts will extend well beyond our borders to include
international agencies of various kinds. For example, the Coast Guard,
through its former parent agency, DOT, has been spearheading U.S
involvement in the International Maritime Organization. This is the
organization that, following the September 11th attacks, began
determining new international regulations needed to enhance ship and
port security. Also, our work assessing efforts to enhance our nation‘s
port security has underscored the formidable challenges that exist in
forging partnerships and coordination among the myriad of public and
private sector and international stakeholders.[Footnote 26]
Several Types of Actions Needed to Help Address Challenges:
In previous work, we have examined some of the implications of the
Coast Guard‘s new operating environment on the agency‘s ability to
fulfill its various missions.[Footnote 27] This work, like our
testimony today, has pointed to the difficulty the Coast Guard faces in
devoting additional resources to nonsecurity missions, despite the
additional funding and personnel the agency has received. In
particular, we have recommended that the following actions be taken as
a more candid acknowledgment of the difficulty involved:
* Opportunities for increased operational efficiency need to be
explored. Over the past decade, we and other outside organizations,
along with the Coast Guard, have studied Coast Guard operations to
determine where greater efficiencies might be found. These studies have
produced a number of recommendations, such as shifting some
responsibilities to other agencies. One particular area that has come
to the forefront since September 11th is the Coast Guard‘s potential
ability to partner with other port stakeholders to help accomplish
various security and nonsecurity activities involved in port
operations. Some effective partnerships have been established, but the
overall effort has been affected by variations in local stakeholder
networks and limited information-sharing among ports.
:
* A comprehensive blueprint or strategy is needed for setting and
assessing levels of effort and mission performance. One important
effort that has received relatively little attention, while the Coast
Guard has understandably put its homeland security responsibilities in
place, is the development of a plan that proactively addresses how the
Coast Guard should manage its various missions in light of its new
operating reality. The Coast Guard‘s adjustment to its new post-
September 11th environment is still largely in process, and sorting out
how traditional missions will be fully carried out alongside new
security responsibilities will likely take several years. But it is
important to complete this plan and address in it key elements and
issues so that it is both comprehensive and useful to decision makers
who must make difficult policy and budget choices. Without such a
blueprint, the Coast Guard also runs the risk of continuing to
communicate that it will try to be ’all things to all people“ when, in
fact, it has little chance of actually being able to do so.
The Coast Guard has acknowledged the need to pursue such a planning
effort, and the Congress has directed it to do so. Coast Guard
officials told us that as part of the agency‘s transition to DHS, they
are updating the agency‘s strategic plan, including plans to distribute
all resources in a way that can sustain a return to previous levels of
effort for traditional missions. In addition, the Congress placed a
requirement in MTSA for the Coast Guard to submit a report identifying
mission targets, and steps to achieve them, for all Coast Guard
missions for fiscal years 2003 to 2005. However, this mandate is not
specific about the elements that the Coast Guard should address in the
report.
To be meaningful, this mandate should be addressed with thoroughness
and rigor and in a manner consistent with our recent recommendations;
it requires a comprehensive blueprint that embodies the key steps and
critical practices of performance management. Specifically, in our
November 2002 report on the progress made by the Coast Guard in
restoring activity levels for its key missions, we recommended an
approach consisting of a long-term strategy outlining how the Coast
Guard sees its resources--cutters, boats, aircraft, and personnel--
being distributed across its various missions, a time frame for
achieving this desired balance, and reports with sufficient information
to keep the Congress apprised not only of how resources were being
used, but what was being accomplished. The Coast Guard agreed that a
comprehensive strategy was needed, and believes that it is beginning
the process of developing one. Table 2 provides a greater explanation
of what this approach or blueprint would entail.
Table 2: Elements of an Approach for Setting and Assessing Levels of
Effort and Mission Effectiveness:
Element: Setting realistic targets for levels of effort in
each mission area; Explanation: Targets need to take into account the
finite Deepwater and other resources available in the near to medium
term and the likely homeland security scenarios, based on resource
requirements needed to respond to various potential terrorist threats
and attacks.
Element: Developing an action plan for achieving
targets; Explanation: Action plan needs to include: * an analysis of
the mix of resources needed and timetables required to achieve level-
of-effort targets; * strategies for partnering with other public and
private sector organizations to accomplish mission activities; *
contingency plans for addressing responsibilities for all of its
missions during prolonged ’high alert“ periods; * new approaches and
techniques, including the use of new technology, for achieving mission
responsibilities; and; * identifying operational efficiencies that
would free up funds for more mission-enhancing needs, such as keeping
the Deepwater Project on schedule.
Element: Establishing realistic performance measures
for all missions; Explanation: Includes two steps: * completing
performance measures for homeland security, and; * evaluating and
revising, where necessary, performance measures, such as those for drug
interdiction, for all missions.
Element: Collecting sufficiently complete, accurate, and consistent
performance data to measure effectiveness in meeting performance
targets; Explanation: Includes data on: * resources being applied to
each mission (money, personnel, and capital assets),; * output measures
that describe what is being done with these resources (e.g., numbers of
patrols and inspections conducted), and; * outcome data on the extent
that program goals are being achieved.
[End of table]
Source: GAO.
The events of recent months heighten the need for such an approach.
During this time, the budgetary outlook has continued to worsen,
further emphasizing the need to look carefully at the results being
produced by the nation‘s large investment in homeland security. The
Coast Guard must be fully accountable for investments in its homeland
security missions and able to demonstrate what these security
expenditures are buying and their value to the nation. At the same
time, recent events also demonstrate the extent to which highly
unpredictable homeland security events, such as heightened security
alerts, continue to influence the amount of resources available for
performing other missions. The Coast Guard needs a plan that will help
the agency, the Congress, and the public understand and effectively
deal with trade-offs and their potential impacts in such circumstances.
Mr. Chairman, this concludes my testimony today. I would be pleased to
respond to any questions that you or Members of the Subcommittee may
have at this time.
Contacts and Acknowledgments:
For information about this testimony, please contact JayEtta Z. Hecker,
Director, Physical Infrastructure, at (202) 512-2834, or
heckerj@gao.gov, or Margaret T. Wrightson, at (415) 904-2200, or
wrightsonm@gao.gov. Individuals making key contributions to this
testimony include Steven Calvo, Christopher M. Jones, Sharon Silas,
Stan Stenersen, Eric Wenner, and Randall Williamson.
Scope and Methodology:
To determine the most recent levels of effort for the Coast Guard‘s
various missions and how these levels compare to those in the past, we
reviewed the data from the Coast Guard‘s Abstract of Operations. These
data, reported by crews of cutters, boats, and aircraft, represent the
hours that these resources spent in each of the Coast Guard‘s mission
areas. We reviewed these data to identify how resources were utilized
across missions both before and after September 11th, and to identify
any trends in resource utilization. In addition, we spoke with Coast
Guard officials at headquarters about the use of Coast Guard resources
both before and after September 11th.
To determine the implications of the proposed fiscal year 2004 budget
request for these various levels of effort, we reviewed the President‘s
fiscal year 2004 budget request for the Coast Guard, as well as the
enacted budget for the Coast Guard for fiscal year 2003. We used the
Department of Commerce‘s chain-weighted price index for gross domestic
product to adjust nominal dollar figures for the effect of inflation.
In addition, we spoke with Coast Guard officials within the Coast
Guard‘s Office of Programs and Operations Directorate, the Marine
Safety Directorate, and the Integrated Deepwater Systems Program
Office.
To identify the challenges the Coast Guard faces in balancing its
resources among its missions and ensuring and maximizing its
effectiveness in each of its missions, we reviewed our previous reports
on performance management and developing performance measures. We also
reviewed Coast Guard strategic documents and discussed them with staff
in the Coast Guard‘s Program Management and Evaluation Division. In
addition, we met with officials from the Coast Guard‘s DHS Transition
team to discuss strategic planning and transition issues.
FOOTNOTES
[1] U.S. General Accounting Office, Major Management Challenges and
Program Risks: Department of Homeland Security, GAO-03-102 (Washington,
D.C.: January 2003).
[2] U.S. General Accounting Office, Coast Guard: Strategy Needed for
Setting and Monitoring Levels of Effort for All Missions, GAO-03-155
(Washington, D.C.: November 2002); U.S. General Accounting Office,
Coast Guard: Comprehensive Blueprint Needed to Balance and Monitor
Resource Use and Measure Performance for All Missions, GAO-03-544T
(Washington D.C.: March 2003).
[3] Some additional funding may be provided to address these challenges
through the proposed fiscal year 2003 supplemental budget. However, the
impact of this potential funding on these challenges is unknown.
[4] U.S. General Accounting Office, Coast Guard: Strategy Needed for
Setting and Monitoring Levels of Effort for All Missions, GAO-03-155
(Washington, D.C.: November 2002), and U.S. General Accounting Office,
Homeland Security: Challenges Facing the Coast Guard as it Transitions
to the New Department, GAO-03-467T (Washington, D.C.: February 2003).
[5] During emergencies, such as the events of September 11th, Coast
Guard reservists can be activated or full-time agency personnel
temporarily transferred to provide additional support at Coast Guard
field locations where such help is needed.
[6] A 5-year time frame was used to depict trend data for all missions
except coastal security. For that mission, a 4-year time frame was
used.
[7] The Coast Guard maintains information, on a mission-by-mission
basis, about how cutters, patrol boats, and aircraft are used. Each
hour that these resources are used in a mission is called a resource
hour. Resource hours do not include such things as the time that the
resource stands idle or the time that is spent maintaining it.
[8] Linear regression estimates the coefficients of the linear
equation, involving one or more independent variables, that best
predict the value of the dependent variable.
[9] Sea marshals are armed Coast Guard personnel who board selected
vessels operating in and around U.S. ports and harbors and take
position on the ship‘s bridge and other areas determined to be
necessary to vessel safety. These teams provide additional security to
ensure that only authorized personnel maintain control of the vessel at
all times.
[10] Vessel operational control actions are efforts to control vessels
and can include captain of the port orders, administration orders,
letters of deviation, and the designation of security zones.
[11] Search and rescue resources are subject to seasonal cycles, with
more resources being used during the summer months when boating is at
its peak.
[12] The Coast Guard had a goal to save at least 85 percent of all
mariners in imminent danger; they actually saved 84.4 percent.
Similarly, the Coast Guard had a goal to have 99.7 percent of
navigational aids available and their actual availability was 98.4
percent.
[13] The Coast Guard defines significant violations as any or all of
the following: (1) significant damage or impact to the resource or the
fisheries management plan, (2) significant monetary advantage to the
violator over the competition, or (3) a high regional interest of
emotional or political nature as determined by regional fisheries
councils.
[14] Activity data for foreign fishing vessels is a comparison of
fourth quarters in 2000 and 2002.
[15] In fiscal year 2002, the Coast Guard‘s goal was to detect 250
foreign fishing vessel incursions into U.S. fishing waters--only 202
were detected that year.
[16] According to Coast Guard officials, budget constraints that
occurred in fiscal years 2000 and 2001 resulted in a 15 percent
reduction in operating levels.
[17] The $592 million requested increase breaks down as follows: $440
million of the $592 million requested increase is for operating
expenses for the Coast Guard‘s mission areas, $20.8 million is for
capital projects, and $131 million is for pay for retired personnel.
[18] Audit of the Small Boat Station Search and Rescue Program. MH-
2001-94 (Washington, D.C.: Sept 14, 2001).
[19] Begun in 1996, the Integrated Deepwater Project is a program to
replace or modernize the Coast Guard‘s existing ships and aircraft, as
well as make use of innovative technology such as satellites and
improved detection capabilities to carry out its varied mission
responsibilities.
[20] The prime contractor, known as the ’systems integrator,“ is
responsible for ensuring that each ship, aircraft, or other equipment
is delivered on time and in accordance with agreed to prices and in
compliance with the Coast Guard‘s system performance specifications.
[21] The $28 million shortfall is expressed in 2002 dollars, the $90
million shortfall in 2003 dollars, and the $202 million shortfall in
2004 dollars. The $626 million dollar shortfall is expressed in 2008
dollars.
[22] P. L. 107-295, Nov. 25, 2002.
[23] The Coast Guard had already begun work on two aspects of the
legislation; these aspects are accounted for in the fiscal year 2004
budget request. These two items are requirements to (1) create marine
safety and security teams and (2) to dispatch armed officers as sea
marshals for some port security duties.
[24] U.S. General Accounting Office, Homeland Security: Challenges
Facing the Coast Guard as it Transitions to the New Department,
GAO-03-467T (Washington, D.C.: February 2003).
[25] Most agencies within DHS are organized within one of the four
directorates: Science and Technology, Information Analysis and
Infrastructure Protection, Border and Transportation Security, and
Emergency Preparedness and Response.
[26] U.S. General Accounting Office, Container Security: Current
Efforts to Detect Nuclear Materials, New Initiatives, and Challenges,
GAO-03-297T (Washington, D.C.: November 2002), and U.S. General
Accounting Office, Port Security: Nation faces Formidable Challenges in
Making New Initiatives Successful, GAO-02-993T (Washington, D.C.:
August 2002).
[27] U.S. General Accounting Office, Coast Guard: Budget and Management
Challenges for 2003 and Beyond, GAO-02-588T (Washington, D.C.: March
2001), and U.S. General Accounting Office, Coast Guard: Strategy Needed
for Setting and Monitoring Levels of Effort for All Missions,
GAO-03-155 (Washington, D.C.: November 2002).
