Assessment of the Explanation That Immigration and Customs Enforcement Provided for Its Subsequent Transfer from the Spectrum Relocation Fund
Gao ID: GAO-08-846R September 9, 2008Congress has taken a number of steps to facilitate the deployment of innovative, new commercial wireless services to consumers, including authorizing the Federal Communications Commission (FCC) to assign licenses through auctions and requiring more spectrum to be transferred from federal government use to commercial use. In addition, in 2004, Congress passed the Commercial Spectrum Enhancement Act (CSEA), which established a Spectrum Relocation Fund (the Fund) to cover the costs incurred by federal entities within certain spectrum bands as they relocate to new frequency assignments or transition to alternative technologies. The Fund is administered by the Office of Management and Budget (OMB) in consultation with the National Telecommunications and Information Administration (NTIA) of the Department of Commerce. In September 2006, FCC concluded an auction of licenses for Advanced Wireless Services on radio spectrum in the 1710 megahertz (MHz) to 1755 MHz band that is currently used by federal agencies. The auction raised almost $6.9 billion in net winning bids from the sale of these frequencies, which was deposited into the Fund to be available to the federal entities for their eligible relocation expenses. Any auction proceeds remaining in the Fund after payment of relocation costs are to revert to the General Fund of the U.S. Treasury not later than 8 years after the date of their deposit.
Our assessment of the explanation that ICE provided is that the need for a substantial subsequent transfer was caused by DHS and ICE failing to identify a significant number of relocation expenses in the original transfer request, including costs associated with additional equipment, offices, and systems, and with a fifth frequency assignment. DHS submitted and OMB, in consultation with NTIA, reviewed and approved this original transfer request. The CSEA provided some guidance to agencies concerning the categories of expenses that are eligible for relocation monies from the Fund. In addition, NTIA provided guidance to agencies about how to submit information for their initial estimates of their relocation costs, including how to break out expenses and how to format their submissions. OMB also provided some guidance to the federal entities to use in developing their original requests for transfers from the Fund. However, in submitting both its initial estimate to NTIA and its original transfer request to OMB, ICE did not detail its estimated costs by equipment, location, system, or frequency--as suggested by NTIA's guidance--and did not include costs for one of its frequency assignments. Instead, ICE provided a lump sum estimate of $3,559,281 for its spectrum relocation costs. ICE staff told us that the initial estimate had not been well coordinated among ICE offices and was simply a poorly crafted estimate. According to OMB staff, ICE's initial estimate and original transfer request were based on an inadequate inventory of deployed systems. OMB and NTIA accepted ICE's estimate and did not require ICE to provide the details suggested in the CSEA or requested in NTIA's guidance in either its original or subsequent transfer request. As a result, OMB and NTIA had limited assurance that DHS or ICE had conducted a thorough assessment of ICE's spectrum relocation needs. With respect to subsequent requests for transfer, OMB staff stated that they work with agencies on what information is needed to support a request. However, OMB has not established any written guidance or criteria for agencies in submitting subsequent requests for transfer, which could result in limited assurance going forward that the subsequent requests reflect thorough and properly vetted estimates.
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: Mark L. Goldstein Team: Government Accountability Office: Physical Infrastructure Phone: No phone on recordGAO-08-846R, Assessment of the Explanation That Immigration and Customs Enforcement Provided for Its Subsequent Transfer from the Spectrum Relocation Fund
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GAO-08-846R:
September 9, 2008:
Congressional Committees:
Subject: Assessment of the Explanation That Immigration and Customs
Enforcement Provided for Its Subsequent Transfer from the Spectrum
Relocation Fund:
Congress has taken a number of steps to facilitate the deployment of
innovative, new commercial wireless services to consumers, including
authorizing the Federal Communications Commission (FCC) to assign
licenses through auctions and requiring more spectrum to be transferred
from federal government use to commercial use. In addition, in 2004,
Congress passed the Commercial Spectrum Enhancement Act (CSEA),
[Footnote 1] which established a Spectrum Relocation Fund (the Fund) to
cover the costs incurred by federal entities within certain spectrum
bands as they relocate to new frequency assignments or transition to
alternative technologies.[Footnote 2] The Fund is administered by the
Office of Management and Budget (OMB) in consultation with the National
Telecommunications and Information Administration (NTIA) of the
Department of Commerce.[Footnote 3] In September 2006, FCC concluded an
auction of licenses for Advanced Wireless Services on radio spectrum in
the 1710 megahertz (MHz) to 1755 MHz band that is currently used by
federal agencies. The auction raised almost $6.9 billion in net winning
bids from the sale of these frequencies, which was deposited into the
Fund to be available to the federal entities for their eligible
relocation expenses.[Footnote 4] Any auction proceeds remaining in the
Fund after payment of relocation costs are to revert to the General
Fund of the U.S. Treasury not later than 8 years after the date of
their deposit.[Footnote 5]
In February 2007, OMB, in consultation with NTIA, submitted a Report to
Congress outlining the agencies' original transfer amounts from the
Fund. These amounts represented OMB's determination of the appropriate
costs and timelines for relocating the federal communications systems
in the 1710-1755 MHz band. OMB noted that these original transfer
amounts represented the best estimate of each agency at that time and
that the possibility of subsequent transfers existed.[Footnote 6]
However, OMB staff with whom we spoke also pointed out that the Fund
was not intended to be an ongoing source of revenue for the affected
agencies. OMB staff said that initial estimates from the agencies in
2005 had formed the reserve price for the auction, and that agencies
are expected to try to hold to their initial estimates.
In OMB's February 2007 report, Immigration and Customs Enforcement
(ICE) of the Department of Homeland Security (DHS) requested
approximately $3.6 million from the Fund to relocate electronic
surveillance operations consisting of four systems on four frequency
assignments. Later that year, in November 2007, OMB notified Congress
that it had approved a request from ICE for a subsequent transfer of
monies from the Fund. ICE received a subsequent transfer of more than
$35 million--approximately 10 times the amount that it had originally
received.[Footnote 7] This subsequent transfer to ICE was the first
subsequent transfer that OMB approved. OMB has since approved
subsequent transfers to three other affected federal entities. Other
requests for subsequent transfers are currently in the review process.
In accordance with the provisions of the CSEA, whenever a subsequent
transfer exceeds 10 percent of the original transfer, GAO is required
to submit to Congress, within 30 days after receiving the plan, an
assessment of the explanation for the subsequent transfer.[Footnote 8]
Our assessment of the explanation for ICE's subsequent transfer was to
be provided to Congress by December 26, 2007, but due to the scope of
the work involved, we were unable to provide our assessment within that
statutory time frame. The cognizant committees were amenable to our
providing this report at a later date. Our assessment is based on work
that we conducted between December 2007 and September 2008, including
our review of documentation provided by ICE, OMB, and NTIA and
discussions with staffs from these entities. We conducted this audit in
accordance with generally accepted government auditing standards. Those
standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
Results in Brief:
Our assessment of the explanation that ICE provided is that the need
for a substantial subsequent transfer was caused by DHS and ICE failing
to identify a significant number of relocation expenses in the original
transfer request, including costs associated with additional equipment,
offices, and systems, and with a fifth frequency assignment. DHS
submitted and OMB, in consultation with NTIA, reviewed and approved
this original transfer request. The CSEA provided some guidance to
agencies concerning the categories of expenses that are eligible for
relocation monies from the Fund. In addition, NTIA provided guidance to
agencies about how to submit information for their initial estimates of
their relocation costs, including how to break out expenses and how to
format their submissions. OMB also provided some guidance to the
federal entities to use in developing their original requests for
transfers from the Fund. However, in submitting both its initial
estimate to NTIA and its original transfer request to OMB, ICE did not
detail its estimated costs by equipment, location, system, or
frequency--as suggested by NTIA's guidance--and did not include costs
for one of its frequency assignments. Instead, ICE provided a lump sum
estimate of $3,559,281 for its spectrum relocation costs. ICE staff
told us that the initial estimate had not been well coordinated among
ICE offices and was simply a poorly crafted estimate. According to OMB
staff, ICE's initial estimate and original transfer request were based
on an inadequate inventory of deployed systems. OMB and NTIA accepted
ICE's estimate and did not require ICE to provide the details suggested
in the CSEA or requested in NTIA's guidance in either its original or
subsequent transfer request. As a result, OMB and NTIA had limited
assurance that DHS or ICE had conducted a thorough assessment of ICE's
spectrum relocation needs. With respect to subsequent requests for
transfer, OMB staff stated that they work with agencies on what
information is needed to support a request. However, OMB has not
established any written guidance or criteria for agencies in submitting
subsequent requests for transfer, which could result in limited
assurance going forward that the subsequent requests reflect thorough
and properly vetted estimates.
To address the issues we have identified, we are recommending that OMB,
in consultation with NTIA, establish written criteria for federal
entities to follow when submitting subsequent requests for spectrum
relocation funding, communicate these criteria to each of the affected
federal entities, and require the federal entities submitting
subsequent requests to meet these criteria. These criteria should be
designed to better assure OMB (and NTIA in its consultative role) that
the requesting federal entity has conducted a thorough assessment of
its spectrum relocation needs, and that the estimate has been vetted
throughout the agency or department involved.
We provided a draft of this report to OMB, DHS, and the Department of
Commerce for comment. OMB staff provided oral comments and said that
they are considering our recommendation. OMB's comments were technical,
and we incorporated them into the report as appropriate. DHS provided
written comments which appear in enclosure I. DHS states in its letter
that it believes our recommendation would be beneficial if adopted. DHS
states that our report does not sufficiently reflect action taken by
DHS and ICE with regard to ICE's subsequent transfer request. DHS
states that ICE's subsequent transfer request submission included a
tactical plan, complete inventory of current equipment, office
locations, and pricing information on the analog replacement equipment.
We acknowledge in our report that they submitted more thorough
information in support of that request, although we maintain that even
more information would have been helpful to ICE, DHS, OMB, and NTIA in
validating that request. NTIA, in oral and e-mail comments, disagreed
with our emphasis on ICE not having provided information for any of its
estimates broken out by location, system, or frequency. NTIA says this
type of detail was not necessary for the type of surveillance system
that ICE was operating. We maintain that ICE's costs could have and
should have been broken out in multiple ways to assure and validate
that all necessary relocation expenses were being identified. The fact
that ICE came back and asked for 10 times more funding than its
original request is evidence that ICE did not construct and present to
NTIA and OMB an initial estimate that was close to accurate.
ICE's Initial Estimate and Original Transfer Request Did Not
Sufficiently Detail Its Costs and Did Not Include Relocation Expenses
for All of Its Systems and Frequency Assignments:
The CSEA required that NTIA notify FCC (the agency conducting the
auctions) on behalf of the affected federal entities regarding their
estimated relocation costs and timelines at least 6 months prior to the
commencement of an auction.[Footnote 9] In February 2005, shortly after
the CSEA became law, NTIA sent each of the affected federal entities a
letter that provided an overview of the CSEA. NTIA also provided an
enclosure containing the language of the CSEA and recommended to the
federal entities that they review carefully the listing of eligible
frequencies and definition of "relocation costs" in section 202 of the
act as they prepared their relocation cost estimates. Section 202 of
the act provides guidance on eligible expenses by listing several
categories and examples of relocation costs, such as equipment
replacement costs, site acquisition and construction costs, and the
costs of engineering studies or economic analyses.
To compile the necessary information as required by the CSEA, NTIA
requested in its letter that agencies provide their information to NTIA
by September 2005 in a certain format. Specifically, the NTIA guidance
in enclosure 2 of its letter provided a list of information required
for each agency's frequency assignments, including the serial number,
frequency, system name, geographic location information, and initial
cost estimate (see figure 1).
Figure 1: Enclosure 2 of NTIA's February 2005 Letter to the Affected
Federal Entities Regarding Relocation Cost Estimates for the 1710-1755
MHz Frequency Band:
[See PDF for image]
Enclosure 2:
1710-1755 MHz Information Format:
The following list contains the information required for each agencies
frequency assignment. Note that included are frequency assignments that
may be located in the 1755-1850 MHz band due to band pairing with 1710-
1755 MHz operations.
Serial Number:
Frequency (MHz):
Bureau Code:
Original Service Type:
Original System Name:
Transmitter Location, State:
Transmitter Geographic Location:
Transmitter Latitude (ddmmss):
Transmitter Longitude (ddmmss):
Receiver Location, State:
Receiver Geographic Location:
Receiver Latitude (ddmmss):
Receiver Longitude (ddmmss):
Relocation Timeline (in months):
Cost Estimate ($K):
Source: NTIA.
[End of figure]
NTIA guidance also included a separate template for an executive
summary of relocation costs and timelines for the affected 1710-1755
MHz frequencies for each department or agency (see figure 2). This
executive summary was to include a number and description of systems
and the number of frequency assignments supporting each system, as well
as per-unit costs for each system. In addition, NTIA staff with whom we
spoke noted that, for surveillance systems such as ICE was operating,
the most important information for the agency to provide would be
detailed equipment information and costs. NTIA advised agencies to
retain all documents supporting their cost estimates.
Figure 2: Enclosure 3 of NTIA's February 2005 Letter to the Affected
Federal Entities Regarding Relocation Cost Estimates for the 1710-1755
MHz Frequency Band:
[See PDF for image]
Enclosure 3:
Executive Summary Of 1710-1755 MHz Costs And Relocation Timeline For
[Insert Name Of Department Or Agency]:
The total estimated relocation or modification costs for the [insert
name of Department or Agency]'s radio communications systems in the
1710-1755 MHz band is $ [insert amount].[Footnote] This total
represents estimated costs to relocate [insert number and description
of the agency's systems and the number of frequency assignments
supporting such systems for each system being relocated, e.g., 4 fixed
microwave systems supported with 62 frequency assignments and I land
mobile system supported with 4 frequency assignments]. The per unit
estimated cost for the [insert description of system, e.g. fixed
microwave system] is $ [insert amount] [The per unit cost must be
provided for each system covered by the cost estimate.]
The [insert the name of the Department or Agency] estimates that the
timeline for relocating its [description of system] is [insert number
of months/years] from the date of the agency's receipt of relocation
funds. [Please provide this information for each system covered by the
cost estimate.]
[Any other additional information to be supplied by the agencies should
appear in this paragraph (e.g., unique system requirements), including
whether the agency intends to utilize alternative technologies or
commercial systems to replace its existing systems. To the extent
alternative technologies will be used, the agency should indicate for
which systems (or parts of systems) and how the alternative technology
affected the cost estimate and timeline for relocation.]
If you have any further questions regarding our department's relocation
costs, the point of contact is (insert name, telephone number, and
email address).
Footnote: The total relocation costs include all the eligible costs as
defined in Title II of the Commercial Spectrum Enhancement Act, Pub. L.
No. 108-494.
Source: NTIA.
[End of figure]
In response to NTIA's requests, DHS obtained the estimated relocation
costs from its affected entities[Footnote 10]--including ICE--and
reviewed, approved, and submitted these estimated costs to NTIA in
September 2005. The initial cost estimate that DHS provided for ICE in
September 2005 did not include a breakout of costs by equipment,
location, system, or frequency. For example, DHS provided an initial
breakdown of costs by location and frequency for its Customs and Border
Protection component, but did not do so for ICE. Instead, it provided a
lump sum estimate of $3,559,281, representing the combined costs for
four systems using four frequency assignments.
In September 2006, OMB provided some guidance to the affected federal
entities for submission of the entities' original transfer requests.
OMB delivered to the agencies, via NTIA, a document that outlined the
process involved in relocating the agencies to new spectrum under the
CSEA. OMB noted that agencies should ensure that the information they
provided reflected the most up to date relocation plans. OMB also
provided the agencies with a template for submitting information.
However, this template was the high-level presentation of information
that has been included in OMB's reports to Congress, which identify the
agency, bureau, account, amount, timeline, number of frequency
assignments, and number of systems. Descriptive information was also
requested about the agency's relocation activities. OMB's guidance did
not request any further detail from the agencies in support of the
amount of their original transfer requests.
Roughly 1˝ years passed between the affected federal entities providing
their initial cost estimates to NTIA and their providing estimates to
OMB for the actual transfer of funds. During that time, about half of
the agencies provided OMB and NTIA with updated cost estimates.
However, ICE again submitted the roughly $3.6 million cost estimate for
four frequencies and four systems. ICE's 2007 original transfer request
still did not detail expenses by equipment, system, location, or
frequency. OMB staff told us that they questioned ICE's $3.6 million
estimate as seeming too low, but ICE assured them that the amount was
an accurate estimate. In February 2007, OMB made its determination of
the costs and timelines for relocation for all of the affected federal
entities and sent a Report to Congress[Footnote 11] outlining the
amounts that would be transferred from the Fund to 28 accounts within
12 federal departments and agencies (see figure 3). ICE was approved
for $3,559,281 for four systems using four frequency assignments.
Figure 3: Spectrum Relocation Fund Original Transfer Amounts and
Project Timelines, February 2007:
[See PDF for image]
Table 1: Spectrum relocation Transfer Amounts and Project Timelines:
Agency: Agriculture;
Bureau: Forest Service;
Amount[A]: $21,578,486;
Timeline[B]: 36.
Agency: DOD;
Bureau: Air Force;
Amount[A]: $106,753,481;
Timeline[B]: 48.
Agency: DOD;
Bureau: Army;
Amount[A]: $15,933,043;
Timeline[B]: 36.
Agency: DOD;
Bureau: Navy;
Amount[A]: $134,465,000;
Timeline[B]: 36.
Agency: DOD;
Bureau: RDT&E/O&M (Defense-wide support);
Amount[A]: $98,200,000;
Timeline[B]: 72.
Agency: DOD; Subtotal;
Amount[A]: $355,351,524.
Agency: DOE;
Bureau: Bonneville Power Administration;
Amount[A]: $48,627,399;
Timeline[B]: 72.
Agency: DOE;
Bureau: Southwestern Power Administration;
Amount[A]: $8,091,360;
Timeline[B]: 24.
Agency: DOE;
Bureau: Western Area Power Administration;
Amount[A]: $108,202,200;
Timeline[B]: 36.
Agency: DOE;
Bureau: National Nuclear Security Administration;
Amount[A]: $10,900,000;
Timeline[B]: 24.
Agency: DOE;
Bureau: Departmental Administration (DOE-wide support);
Amount[A]: $1,000,000;
Timeline[B]: 72.
Agency: DOE; Subtotal;
Amount[A]: $176,820,959.
Agency: DHS;
Bureau: Customs and Border Protection;
Amount[A]: $74,349,990;
Timeline[B]: 12.
Agency: DHS;
Bureau: Immigration and Customs Enforcement;
Amount[A]: $3,559,281;
Timeline[B]: 12.
Agency: DHS;
Bureau: Secret Service;
Amount[A]: $105,800;
Timeline[B]: 12.
Agency: DHS;
Bureau: Chief Information Officer (DHS-wide support);
Amount[A]: $11,979,761;
Timeline[B]: 12.
Agency: DHS; Subtotal;
$89,994,832.
Agency: HUD;
Bureau: Inspector General;
Amount[A]: $21,115;
Timeline[B]: 24.
Agency: DOI;
Bureau: Bureau of Reclamation;
Amount[A]: $4,550,000;
Timeline[B]: 36.
Agency: DOI;
Bureau: Geological Survey;
Amount[A]: $6,158,949;
Timeline[B]: 36.
Agency: DOI;
Bureau: National Park Service;
Amount[A]: $14,703,000;
Timeline[B]: 36.
Agency: DOI; Subtotal;
Amount[A]: $25,411,949.
Agency: DOJ;
Bureau: Alcohol, Tobacco, and Firearms;
Amount[A]: $48,024,000;
Timeline[B]: 36.
Agency: DOJ;
Bureau: Drug Enforcement Agency;
Amount[A]: $74,772,000;
Timeline[B]: 36.
Agency: DOJ;
Bureau: Federal Bureau of Investigation;
Amount[A]: $139,225,000;
Timeline[B]: 36.
Agency: DOJ;
Bureau: Chief Information Officer (DOJ-wide support);
Amount[A]: $800,000;
Timeline[B]: 36.
Agency: DOJ; Subtotal;
Amount[A]: $262,821,000.
Agency: DOT;
Bureau: Federal Aviation Administration;
Amount[A]: $58,062,020;
Timeline[B]: 48.
Agency: Treasury;
Bureau: Internal Revenue Service;
Amount[A]: $4,409,000;
Timeline[B]: 28.
Agency: Treasury;
Bureau: Inspector General for Tax Administration;
Amount[A]: $892,000;
Timeline[B]: 28.
Agency: Treasury; Subtotal;
Amount[A]: $5,301,000.
Agency: NASA;
Bureau: NASA;
Amount[A]: $740,000;
Timeline[B]: 24.
Agency: TVA;
Bureau: Tennessee Valley Authority;
Amount[A]: $10,687,857;
Timeline[B]: 48.
Agency: USPS;
Bureau: Inspection Service;
Amount[A]: $1,761,760;
Timeline[B]: 12.
Agency: Total;
Amount[A]: $1,008,552,502.
[A] Amount specified will be transferred to the agency following the
notification period. If actual project costs differ from the
transferred amount, such discrepancies will be disposed of in
accordance with the CSEA. Due to rounding, amounts may differ from
figures included in the President's Budget.
[B] Timeline indicated represents the estimated time to completion of
spectrum relocation activities, in months, beginning from the date of
the transfer of funds to the agency.
Source: OMB.
[End of figure]
ICE's subsequent transfer request of November 2007 was for an
additional $35.6 million to cover relocation expenses for an additional
547 systems and 1 frequency assignment[Footnote 12] that had not been
accounted for in ICE's initial estimate of September 2005 or its
original transfer request of February 2007. ICE also noted that many of
its offices had not been included in its original transfer request. ICE
staff told us that the initial estimate was completed when DHS was
being set up and confusion existed from the combining of agencies and
offices.[Footnote 13] ICE staff said that the original estimate had not
been well coordinated among ICE offices and was simply a poorly crafted
estimate. Nonetheless, ICE and DHS officials approved the initial
estimate and original transfer request and submitted them to NTIA and
OMB. According to an OMB staffer, ICE's initial estimate was based on
an inadequate inventory of ICE's deployed systems, leading to the need
for additional funding to cover relocation of these systems.
OMB and NTIA Did Not Require Sufficient Detail from ICE, Resulting in
Limited Assurance That the Estimate Reflected a Thorough Assessment of
ICE's Spectrum Relocation Needs:
NTIA staff told us that while they provided guidance and a format for
ICE to submit spectrum relocation information for its initial estimate,
they did not require ICE to provide the detail requested, including
costs by equipment, location, system, or frequency. With regard to the
original transfer requests, OMB provided the affected federal entities
with some guidance and a template for submitting information. But this
template asked for information at a high level, and the guidance did
not seek specifics to support the amounts requested. With regard to
subsequent transfer requests, OMB staff told us that they provided no
written guidance or criteria for the federal entities to use in
developing their requests. OMB staff noted that they do expect to
receive certain information from the agencies, including reasons for
the subsequent request, information on costs, information on options
the agency considered, and information to show that the agency will
only use the funding to achieve comparable capability and not enhanced
capability.
In conducting their reviews of ICE's initial estimate, original
transfer request, and subsequent transfer request, OMB and NTIA
accepted ICE's estimate and did not require ICE to provide the details
suggested in the CSEA or requested in NTIA's correspondence, resulting
in limited assurance that DHS or ICE had conducted a thorough
assessment of ICE's spectrum relocation needs. According to ICE staff,
the agency's subsequent request for almost $35.6 million from the Fund
covers all of its frequencies and is a thorough assessment of ICE's
spectrum relocation needs for its analog systems. While ICE's
subsequent request does provide much more thorough detail in relation
to the new equipment it will need to purchase, ICE still has not
provided a complete breakout of costs by location, systems, or
frequency. Such information would have allowed ICE, DHS, OMB, and NTIA
to cross check information and better validate the equipment inventory
provided.
Although OMB is currently reviewing additional subsequent transfer
requests, and could receive more, the agency has not established any
written guidance for preparing subsequent transfer requests. Yet
preparation of thorough and properly vetted requests is essential
because NTIA staff told us they do not have the staff resources to
validate the information on a large number of systems and OMB staff
stated that they do not have the technical capability to always do an
in-depth technical analysis of an agency's submissions regarding
relocation costs. For example, in its subsequent transfer request for
almost $35.6 million, ICE submitted a list of equipment that it would
need to purchase in moving to its new frequency assignments, such as
video recording and receiver kits, transmitters, and antennas. ICE
included the estimated costs and quantities for each piece of
equipment. OMB and NTIA told us that the validation of those costs must
come in large part from the agency or department itself. They said that
they rely on the agencies and departments to have the most thorough
understanding of their inventories and equipment needs. However, they
said they would question a specific piece of equipment or a quantity if
something looked unusual. OMB staff told us they review agency
submissions for reasonableness, consistency with the CSEA, and cost-
effectiveness, and that they compare the equipment requested with the
agencies' needs and missions.
Conclusions:
A large proportion of the responsibility for accurately assessing
spectrum relocation funding needs falls to the individual agencies that
must relocate. Although guidance for estimating spectrum relocation
funding needs was provided in the CSEA and by NTIA and OMB, ICE did not
ensure that it was covering all of its equipment inventory, the needs
of all its offices, and including all of its frequency assignments in
its initial estimate or its original transfer request. By not
undertaking a comprehensive assessment of its needs, ICE underestimated
those needs by 10-fold. Although we were told that additional
subsequent transfer requests are expected, OMB has not established
written criteria regarding information to be provided in support of the
requests. Going forward, OMB, in consultation with NTIA, should require
from the agencies enough detail and information to be confident that
the agencies have conducted a thorough and properly vetted assessment
of spectrum relocation needs when submitting subsequent requests for
funding. It is important to make sure that subsequent transfer requests
truly represent the best cost estimates of the agencies.
Recommendation for Executive Action:
Because it is important that federal agencies present accurate
estimates when determining their spectrum relocation needs so that
additional subsequent transfer requests--and, thus, further depletion
of the Spectrum Relocation Fund--can be avoided, we are recommending
that the Director of OMB take the following action:
* In consultation with NTIA, establish written criteria for agencies to
follow when submitting supplemental requests for spectrum relocation
funding, communicate these criteria to each of the affected federal
entities, and require that these criteria be followed before OMB
approves subsequent requests. These criteria should be designed to
better assure OMB (and NTIA in its consultative role) that the
requesting agency has conducted a thorough assessment of its spectrum
relocation needs, and that the estimate has been properly vetted
throughout the agency or department involved. For example, these
criteria could include, but not be limited to, requiring agencies to
provide replacement costs by equipment, location, system, or frequency
and requiring agencies to break out expenses into standard categories.
Until such criteria can be developed, OMB might consider using, as an
interim requirement, the guidance set forth in NTIA's February 2005
letter to the agencies, including NTIA's template and executive
summary.
Agency Comments and Our Evaluation:
We provided a draft of this report to OMB, DHS, and the Department of
Commerce for their review and comment. OMB provided oral comments. OMB
staff said that they were considering our recommendation. They also
provided technical comments, which we incorporated into the report, as
appropriate. They further provided additional documentation and we made
changes to our report based on this documentation.
DHS provided oral comments, comments via e-mail, and written comments.
DHS's written comments, reprinted in enclosure I of our report, note
that DHS believes our recommendation would be beneficial if adopted.
However, DHS's letter states that the agency does not believe that our
report sufficiently reflects action taken by DHS and ICE, noting
submissions from ICE to OMB in relation to ICE's subsequent transfer
request. DHS states that its subsequent transfer request submission
included a tactical plan, complete inventory of current equipment,
office locations, and pricing information on the analog replacement
equipment. Most of our report deals with the insufficiency of ICE's
original request for $3.6 million. With regard to ICE's subsequent
request, we acknowledge in our report that ICE submitted more thorough
information in support of that request, although we maintain that a
complete breakout of costs by location, system, or frequency would have
been helpful to ICE, DHS, OMB, and NTIA in validating that request.
With regard to DHS's oral and e-mail comments, we incorporated the
department's technical comments into the report, as appropriate. Most
of DHS's comments related to ICE's need to transition from analog to
digital surveillance systems in the future. We referred to this issue
in footnote 7 of our report. As we stated there, our report deals only
with ICE's original and approved subsequent transfer request, which
involved conversion from analog to analog equipment. However, DHS notes
that any criteria established for future subsequent transfer requests
(per our recommendation) should also be oriented toward the unique
characteristics of surveillance systems and the missions of federal law
enforcement agencies. We agree. If OMB should decide to implement our
recommendation, we urge DHS and the other affected federal entities to
work with OMB and NTIA to ensure that the criteria developed meet the
spectrum relocation needs of the various federal entities. DHS also
noted that some of its subsequent request was related to acquiring new
analog equipment because many of the devices currently deployed in the
field cannot be modified or repaired. We believe these types of costs
should have been identified by ICE as part of its original transfer
request and are thus included in the missed relocation costs identified
in our report. Finally, ICE noted that it provided an itemized listing
of equipment needs for its subsequent transfer request that was broken
down by offices. While ICE provided a thorough listing of equipment, we
maintain that providing information broken out by locations, systems,
and frequencies--to the greatest extent possible--would have allowed
ICE, DHS, OMB, and NTIA to cross-check information and better assure
that all funding needs have been identified.
NTIA provided oral and e-mail comments. Overall, NTIA disagrees with
the emphasis that we placed on ICE not having provided information for
any of its estimates broken out by system, location, or frequency. NTIA
said that, due to the nature of ICE's surveillance system, NTIA
considers it to be one system, operating in one location (the United
States and its possessions), and that all of the equipment on this one
system was multi-frequency equipment that could have used any of ICE's
frequencies, making whether ICE had four or five frequencies irrelevant
to ICE's relocation costs. NTIA said that ICE gave the agency exactly
the type of information that NTIA expected to receive about ICE's type
of system. However, we maintain that had more information been
provided, it would have produced a better estimate, and ICE, DHS, OMB,
and NTIA would have been better able to validate the estimate. While we
do not take a position on what constitutes a "system," we believe that
any definition should provide the ability to track specific costs for
replacement. Lumping all of ICE's equipment into one system, as NTIA
suggests, does not provide sufficient detail for tracking costs. With
regard to breaking out relocation expenses by location, ICE
documentation lists offices as part of the costs missed. We do not
agree with NTIA that ICE's operating "location" should be "the United
States and its possessions," as that again lumps costs together and
does not allow sufficient detail for tracking costs. With regard to
breaking out relocation expenses by frequency, ICE noted on several
occasions that the missed frequency affected its costs, and OMB's
November 2007 Report to Congress that accompanied ICE's subsequent
transfer request states this as well.
We will send copies of this report to the appropriate congressional
committees, the Director of OMB, the Secretary of Commerce, and the
Secretary of Homeland Security. We will make copies available to others
upon request. In addition, this report will be available at no charge
on GAO's Web site at [hyperlink, http://www.gao.gov].
If you or your staffs have any questions about this report, please
contact me at (202) 512-2843 or goldsteinm@gao.gov. Contact points for
our Offices of Congressional Relations and Public Affairs may be found
on the last page of this report. Key contributors to this report were
Faye Morrison (Assistant Director), Eli Albagli (Senior Analyst), Colin
Fallon, David Hooper, Madhav Panwar, and Mindi Weisenbloom.
Signed by:
Mark L. Goldstein:
Director, Physical Infrastructure Issues:
List of Committees:
The Honorable Robert C. Byrd:
Chairman:
The Honorable Thad Cochran:
Ranking Member:
Committee on Appropriations:
United States Senate:
The Honorable Daniel K. Inouye:
Chairman:
The Honorable Kay Bailey Hutchison:
Ranking Member:
Committee on Commerce, Science, and Transportation:
United States Senate:
The Honorable Barbara A. Mikulski:
Chairman:
The Honorable Richard C. Shelby:
Ranking Member:
Subcommittee on Commerce, Justice, Science, and Related Agencies:
Committee on Appropriations:
United States Senate:
The Honorable Richard Durbin:
Chairman:
The Honorable Sam Brownback:
Ranking Member:
Subcommittee on Financial Services and General Government:
Committee on Appropriations:
United States Senate:
The Honorable Robert C. Byrd:
Chairman:
The Honorable Thad Cochran:
Ranking Member:
Subcommittee on Homeland Security:
Committee on Appropriations:
United States Senate:
The Honorable David R. Obey:
Chairman:
The Honorable Jerry Lewis:
Ranking Member:
Committee on Appropriations:
House of Representatives:
The Honorable John D. Dingell:
Chairman:
The Honorable Joe Barton:
Ranking Member:
Committee on Energy and Commerce:
House of Representatives:
The Honorable Alan Mollohan:
Chairman:
The Honorable Rodney Frelinghuysen:
Ranking Member:
Subcommittee on Commerce, Justice, Science, and Related Agencies:
Committee on Appropriations:
House of Representatives:
The Honorable José E. Serrano:
Chairman:
The Honorable Ralph Regula:
Ranking Member:
Subcommittee on Financial Services and General Government:
Committee on Appropriations:
House of Representatives:
The Honorable David E. Price:
Chairman:
The Honorable Harold Rogers:
Ranking Member:
Subcommittee on Homeland Security:
Committee on Appropriations:
House of Representatives:
The Honorable Edward J. Markey:
Chairman:
The Honorable Cliff Stearns:
Ranking Member:
Subcommittee on Telecommunications and the Internet:
Committee on Energy and Commerce:
House of Representatives:
[End of section]
Enclosure I:
Comments from the Department of Homeland Security:
U.S. Department of Homeland Security:
Washington, DC 20528:
[hyperlink, http://www.dhs.gov]
September 5, 2008:
Mr. Mark L. Goldstein:
Director, Physical Infrastructure Issues:
U.S. Government Accountability Office:
441 G Street, NW:
Washington, DC 20548:
Dear Mr. Goldstein:
RE: Draft Report GAO-08-846R, Spectrum Relocation Fund Subsequent
Transfer-Assessment of the Explanation that Immigration and Customs
Enforcement Provided for Its Subsequent Transfer from the Spectrum
Relocation Fund (GAO Job Code 543199):
The Department of Homeland Security (DHS) appreciates the opportunity
to review and comment on the Government Accountability Office's (GAO)
draft report. The report is an assessment of the explanation for the
subsequent transfer of funds from the Spectrum Relocation Fund as the
transfer exceeded ten percent of the original transfer.
GAO makes no recommendations to the Department of Homeland Security.
The draft report recommends that the Director of the Office of
Management and Budget (OMB) establish clear criteria, in consultation
with the Department of Commerce's National Telecommunications and
Information Administration (NTIA), for agencies to follow when
submitting supplemental requests for spectrum relocation funding,
communicate these criteria to each of the affected federal entities,
and require that these criteria be followed before OMB approves
subsequent requests. The recommendation would be beneficial if adopted.
We believe that the draft does not sufficiently reflect action taken by
DHS and its component, Immigration and Customs Enforcement (ICE),
regarding aspects of the transfer. Specifically, in May 2007, with the
full support of the DHS Office of the Chief Information Officer (OCIO),
ICE submitted to OMB and NTIA a revised $72.3 million funding request
above the initially provided $3.5 million for the purchase of digital
video equipment to transition ICE operations from the Advanced Wireless
Services (AWS) band. The submission included a tactical plan, complete
inventory of current equipment, office locations, and pricing of
replacement (analog) equipment in support of the funding request. OMB's
review of the ICE submission, along with subsequent estimates resulted
in ICE being granted an additional $35.57 million for the purchase of
analog replacement equipment. This additional funding was provided to
meet the DHS OCIO established aggressive twelve month timeline to
release the encumbered Advanced Wireless Services (AWS) frequencies to
the FCC license winners. OMB further directed ICE to coordinate with
other affected law enforcement agencies to develop a common digital
solution. OMB agreed to consider providing additional AWS Spectrum Fund
funds once a common digital solution has been adopted.
ICE successfully met the expeditious release of encumbered AWS
frequencies to the FCC license winners on March 26, 2008 by immediately
employing all of the initial $3.5 million AWS funds along with
additional DHS OCIO contingency funds (with OMB agreement) as phase one
of the tactical plan. Due to the significant funding shortfall and
tight time line, ICE was required to temporarily reduce surveillance
capability by over 50% in order to successfully meet the deadline. The
additional $35.5 million funding shall be applied to fully restore
analog operational capability in phase two of the tactical plan. This
will fully migrate all inventoried surveillance equipment to the new
spectrum obtained above 1755MHz. Phase three of the plan shall complete
the migration to digital services once a digital standard is adopted by
the federal law enforcement community and additional funding is
provided by OMB.
Technical comments have been provided under separate cover.
Sincerely,
Signed by:
Gerald E. Levine:
Director:
Departmental GAO/OIG Liaison Office:
[End of section]
Footnotes:
[1] Title II of Pub. L. No. 108-494, 118 Stat. 3986, 3991-3997 (Dec.
23, 2004).
[2] "Eligible relocation expenses" are those costs incurred by a
federal entity to achieve comparable capability of systems, regardless
of whether that capability is achieved by relocating to a new frequency
assignment or utilizing an alternative technology. 47 U.S.C. §
923(g)(3).
[3] NTIA's Office of Spectrum Management is responsible for managing
the federal government's use of radio frequency spectrum.
[4] The 1710-1755 MHz band of spectrum was paired with the 2110-2155
MHz band for the auction. Although the auction raised $13.7 billion,
the portion of the auction proceeds associated with the transferred
government spectrum amounted to almost $6.9 billion and was deposited
into the Fund.
[5] 47 U.S.C. § 928(d)(3).
[6] Under the CSEA, an eligible federal entity may receive more than
one transfer from the Fund, but if the sum of the subsequent transfer
or transfers exceeds 10 percent of the original transfer, certain
procedures apply. These procedures include prior approval by OMB and
notice to the cognizant congressional committees (i.e., the Committees
on Appropriations and Energy and Commerce of the House of
Representatives, and the Committees on Appropriations and Commerce,
Science, and Transportation of the Senate) and the Comptroller General
of the United States. 47 U.S.C. § 928(e)(1)(B).
[7] ICE has proposed using a two-phase relocation plan amounting to
$108 million. The first phase would cover analog-to-analog equipment
conversion, and the second phase would cover analog-to-digital
equipment conversion. ICE originally intended to ask for money for both
phases in its 2007 subsequent transfer request. However, according to
ICE staff, the agency received guidance from OMB to submit at a later
date its request for monies to cover digital equipment. Thus, it is
likely that, in the future, ICE will submit another request for a
subsequent transfer from the Fund for conversion to digital equipment.
This report deals only with ICE's original February 2007 transfer of
almost $3.6 million and its November 2007 subsequent transfer of more
than $35 million for analog equipment.
[8] 47 U.S.C. § 928(e)(1)(B).
[9] NTIA was to provide FCC with these estimates on behalf of the
federal entities and after review by OMB. 47 U.S.C. § 923(g)(4)(A).
NTIA also was to provide a copy of the estimates to the cognizant
congressional committees for approval and to GAO. 47 U.S.C. §
923(g)(5). The CSEA also provided that the conclusion of the auction by
FCC was contingent on minimum proceeds. Specifically, auction proceeds
must be equal to at least 110 percent of the total estimated relocation
costs for FCC to be able to conclude the auction. 47 U.S.C. §
309(j)(16)(B).
[10] DHS submitted relocation estimates for the following four
entities: Customs and Border Protection, ICE, the Secret Service, and
the Office of the Chief Information Officer.
[11] Under the CSEA, the plan--describing specifically how the sums
transferred from the Fund will be used to pay relocation costs and the
timelines for relocation--was to be submitted to the cognizant
committees for approval, and to the Comptroller General. 47 U.S.C. §
928(d)(2).
[12] Staff from NTIA told us that they discovered in September 2005
that ICE had five frequency assignments, not four as ICE had originally
reported. According to NTIA e-mail documentation, NTIA communicated
this information to ICE in September 2005. According to NTIA staff,
they asked ICE staff on several occasions following September 2005 if
systems and equipment on this fifth frequency would also require
relocation monies from the Fund. NTIA staff said that some agencies had
frequency assignments that they were not using, so it was possible that
ICE was not using the fifth frequency and, therefore, would require no
relocation funding for it. NTIA staff said that they would not change
the number of ICE's frequency assignments with relation to reporting
ICE's needs from the Fund until they were informed by DHS or ICE that
the agency was using that assignment and would need money from the Fund
for relocation costs. NTIA staff said that they did not receive
information from DHS or ICE about needing relocation monies for the
fifth frequency assignment until DHS made its subsequent request for
spectrum relocation funding to OMB in 2007. OMB staff said that they
did not receive information from DHS or NTIA about ICE's fifth
frequency assignment prior to submitting their February 2007 Report to
Congress, even though both ICE and NTIA had known since September 2005
about the existence of the fifth frequency assignment.
[13] Pursuant to Section 1502 of the Department of Homeland Security
Act of 2002 (Pub. L. No. 107-296, 116 Stat. 2135 (Nov. 25, 2002)),
multiple federal agencies were consolidated into the new Department of
Homeland Security in 2003, including the U.S. Customs Service, the
Immigration and Naturalization Service, and the Federal Protective
Service. Elements of these organizations became ICE. For a complete
listing of DHS agencies and offices, see [hyperlink,
http://www.dhs.gov/xabout/history/editorial_0133.shtm].
[End of section]
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