The Bureau has estimated that, with the  redesign option, the total life cycle cost estimate for the 2010 Census will  be from $13.7 billion to $14.5 billion. 2). With the redesign, this plan will need  to be updated. The Census Bureau’s 2010 Census Life Cycle Cost Estimate Is Not Reliable

		The 2010 Census Life Cycle Cost Estimate Is Not Adequately Documented

The Bureau’s life cycle cost estimate for the 2010 Census is not adequately  documented. The Bureau did  not provide detailed documentation for data sources and significant  assumptions used in estimating the cost of the short form 2010 Census. The 2010 Census Life Cycle Cost Estimate Is Not Comprehensive

The 2010 Census life cycle cost estimate is not comprehensive because the  Bureau did not include all potential costs or clearly define some of the  cost elements in the model for the short form Census. In addition, the  Bureau provided documentation that the life cycle cost estimate did not  include the cost to fingerprint temporary workers. Updating this productivity  assumption resulted in a significant increase of approximately $270 million  to the cost of the address canvassing operation. Further, the Bureau cannot readily demonstrate the accuracy of its cost  estimates because it does not maintain historical data, which include  previous versions of the estimate, in a centralized, standard format that is  readily available. An  independent cost estimate is considered to be one of the most reliable  validation methods. Performing uncertainty analysis would enable the Bureau to quantify the  risk and uncertainty associated with the cost model; provide a level of  confidence for its cost estimate; and give decision makers perspective on  the potential variability of the cost estimate should facts, circumstances,  and assumptions change. Unreliable 2010 Census Cost Estimate Does Not Fully Inform Annual Budgets

The Bureau uses the life cycle cost estimate as the starting point for  annual budget formulation. In addition, while the Bureau revises the  life cycle cost estimate based on appropriations received and updated  budget information, the Bureau does not update the cost estimate to  reflect actual costs. However, because the life cycle  cost estimate is not valid and reliable, as described above, budget requests  based on that estimate are not fully informed. The Bureau Has Insufficient Policies and Inadequately Trained Staff for Conducting High- Quality Cost Estimation; However, a New System May Help Improve the Bureau’s Cost Estimation Practices

The Bureau has insufficient policies and inadequately trained staff for  conducting high-quality cost estimation. The Bureau does not have formal  cost estimation policies and procedures. Conclusions

On April 3, 2008, the Secretary of Commerce presented a redesigned 2010  Census plan with significant cost increases. However, until the Bureau  makes fundamental changes to how it estimates and updates cost  information, uncertainties about the ultimate cost of the 2010 Census will  remain. The Bureau’s ability to produce well-documented, comprehensive,  accurate, and credible cost estimates for the 2010 and future decennial  censuses and its ability to effectively manage operations and contain costs  will continue to be hampered unless improvements are made to its cost  estimation processes and systems. 2. 3. Appendix I: Objectives, Scope, and Methodology

The objectives of this report were to (1) assess the extent to which the  U.S. Census Bureau’s (Bureau) 2010 Census life cycle cost estimate  adheres to characteristics defined for high-quality cost estimation,   (2) report on the relationship between the life cycle cost estimate and the  Bureau’s budget, and (3) assess whether the Bureau’s existing policies and  resources are sufficient to conduct high-quality cost estimation.
Why GAO Did This Study

The 2010 Census will be the most expensive census in our nation's history, even after adjusting for inflation. The Census Bureau (Bureau) estimates that the life cycle cost of the 2010 Census will be from $13.7 billion to $14.5 billion. GAO was asked to (1) assess the extent to which the Bureau's 2010 Census life cycle cost estimate adheres to characteristics defined for high-quality cost estimation, (2) report on the relationship between the estimate and the Bureau's budget, and (3) assess whether the Bureau's existing policies and resources are sufficient to conduct cost estimation. To assess the reliability of the Bureau's cost estimate, GAO analyzed the Bureau's methods and approaches to determine if the estimate is well-documented, comprehensive, accurate, and credible.

What GAO Found

The Bureau's 2010 Census life cycle cost estimate is not reliable because it lacks adequate documentation and is not comprehensive, accurate, or credible. The Bureau could not provide detailed documentation on data sources, significant assumptions, or changes in assumptions for the cost estimate. The cost estimate is not comprehensive because the Bureau did not include the potential cost to fingerprint temporary workers or clearly define some of the cost elements in the model. The cost estimate is not accurate because it does not reflect updated information on address canvassing productivity that was identified during the dress rehearsal and that should result in a significant cost increase. Further, the Bureau does not maintain historical data in a centralized way that is easily accessible for analysis. The cost estimate is not credible because the Bureau did not perform sensitivity or uncertainty analyses, which would have helped quantify the risk and uncertainty associated with the cost model and provided a level of confidence for the estimate. The Bureau also did not validate the estimate with an independent cost estimate. The Bureau uses the life cycle cost estimate as the starting point for annual budget formulation and revises the life cycle cost estimate based on appropriations received and updated budget information. However, the Bureau does not update the cost estimate to reflect actual costs. Further, because the life cycle cost estimate is not reliable, annual budget requests based on that estimate are not fully informed. The Bureau has insufficient policies and procedures and inadequately trained staff for conducting high-quality cost estimation for the decennial census. The Bureau does not have established cost estimation guidance and procedures in place or staff certified in cost estimation techniques. While the Bureau is developing a new budget management tool called the Decennial Budget Integration Tool, which will support the cost estimation process, the Bureau will need to establish rigorous cost estimation policies and procedures and use skilled estimators to ensure that future cost estimates are reliable and of high quality. On April 3, 2008, the Secretary of Commerce announced a redesign of the 2010 Census plan that included significant cost increases of $2.2 billion to $3 billion. The details of this cost increase were not available at the time of this review; however, until the Bureau makes fundamental changes to its cost estimation process, uncertainties about the ultimate cost of the 2010 Census will remain. Without improvements to the cost estimation process, the Bureau's ability to effectively manage operations will be hampered and Congress's ability to oversee the 2010 Census will be constrained.