Most recently, in May 2011, the  President directed each federal agency to determine its optimal fleet  inventory—including the number and types of vehicles needed—and to  set targets for achieving this inventory by December 31, 2015. VA and the Army Corps, lease most of  the vehicles in their fleets. Selected Agencies Follow Leading Practices for Fleet Management to Varying Degrees

We identified three leading practices for fleet management: 1) maintaining  a well-designed fleet management information system (FMIS), 2)  analyzing life-cycle costs to inform investment decisions, and 3)  optimizing fleet size and composition and found that the selected  agencies in our review follow these practices to varying degrees. None of these agencies  are fully analyzing lifecycle costs to make vehicle investment decisions. All of the agencies we examined have carried out an internal process for  determining their optimal fleet size and composition and have set targets  for achieving these optimal inventories, but most have not provided GSA,  which reviews these targets, with clear information on the methods they  used for producing them. We identified  these leading practices based on views provided by fleet management  experts in the private sector, local government, and fleet management  associations. We also compared these practices with legal requirements  and GSA and OMB guidance related to federal fleet management. Overall, according to the experts  and GSA officials we interviewed, these practices provide a foundation for  agencies to manage fleet costs while meeting their missions. Based on information provided by the selected agencies, most of their  FMISs capture the majority of the types of fleet data recommended by  GSA but none include all of these types of data. While GSA identifies in its guidance the types of  indirect costs that agencies should capture in their FMISs, it has not  provided agencies with guidance on how to estimate those costs. Some  agencies have not yet developed an approach for estimating these costs. Officials anticipate that the new fleet card  In 2012, GSA recommended that DHS, USDA, Interior, and VA obtain  centralized, department-wide FMISs. Selected Agencies Have Adopted Strategies to Mitigate Such Challenges as Competing Requirements, Funding Allocation, and Lack of Expertise

As previously discussed, data availability and integration of data systems  are key challenges that affect many aspects of fleet management;  however, agency officials also identified three additional, broad  challenges: multiple and competing energy requirements, the allocation of  funding to fleet management activities, and ensuring that fleet managers  have adequate expertise in a decentralized environment. Agencies have pursued or are pursuing a variety of strategies  to address these challenges, which include the fleet optimization process,  leveraging Department of Energy (DOE) tools, using a working capital  fund, and providing online training, among other things. A key goal of the fleet optimization process is to  determine what fleet size and composition would best meet the agency’s  mission while also adhering to requirements for alternative fuel and fuel- efficient vehicles. The steps  these agencies are taking to improve data collection and system  integration have the potential to improve their ability to access and  analyze data related to fleet management, including their ability to capture  and analyze life cycle costs. By not fully tracking and analyzing total  fleet costs, including such indirect costs, some agencies may not have full  cost information with which to analyze life-cycle costs and make cost- effective investment decisions, such as decisions about whether to lease  or purchase vehicles, and may not be able to fully monitor and report on  fleet costs. 1. Develop and publish guidance for agencies on estimating indirect  costs attributable to fleet management to help ensure that agencies  have complete and accurate cost data. 2. Appendix I: Scope and Methodology

We assessed the extent to which the following agencies use leading  practices to manage their fleets, including the size and costs of these  fleets: the Departments of Agriculture (USDA), Interior (Interior),  Homeland Security (DHS), and Veterans Affairs (VA), and the United  States Air Force (Air Force) and the United States Army Corps of  Engineers (Army Corps) within the Department of Defense. Collectively,  these agencies account for about 46 percent of the roughly 450,000  civilian and non-tactical military vehicles maintained by the federal  government (excluding the U.S. Postal Service). We looked for variation in fleet characteristics,  including: age of passenger vehicles, change in fleet size from 2005- 2011, and change in fleet composition (owned versus leased) from 2005- 2011, to ensure that we selected agencies with a range of fleet  characteristics. To determine the extent to which the selected federal agencies use  leading practices to manage their fleets, including the size and cost of  these fleets, we reviewed agency fleet management policies, procedures,  plans, and other documentation on their fleet management practices and  conducted interviews with fleet management officials at these agencies. To identify challenges these agencies face in managing their fleets and  strategies they use to address these challenges, we interviewed agency  fleet managers from our selected agencies.
Why GAO Did This Study

Federal agencies (excluding the U.S. Postal Service) spend about $3 billion annually to acquire, operate, and maintain about 450,000 civilian and non-tactical military vehicles. Agencies may lease or buy vehicles from GSA, which also issues requirements and guidance on fleet management. In recent years, Congress and the President have raised concerns about the size and cost of federal agencies' fleets. In 2011, the President directed agencies to determine their optimal fleet inventories and set targets for achieving these inventories by 2015 with the goal of a more cost-effective fleet.
GAO was asked to review agency efforts to reduce fleet costs. This report addresses (1) the extent to which selected federal agencies use leading practices to manage their fleets, including their sizes and costs, and (2) any challenges these agencies face in managing their fleets and strategies they use to address these challenges. GAO selected USDA, DHS, Interior, VA, Air Force, and the Army Corps for review based on factors such as fleet size, fleet composition, and changes in fleet size from 2005 to 2011. To identify leading practices, GAO interviewed recognized private sector and government fleet management experts and GSA officials.

What GAO Found

GAO identified three leading practices for fleet management and found that selected federal agencies--the Departments of Agriculture (USDA), Homeland Security (DHS), the Interior (Interior), and Veterans Affairs (VA); the U.S. Air Force (Air Force); and the Army Corps of Engineers (Army Corps)--follow these practices to varying degrees. These practices are 1) maintaining a well-designed fleet-management information system (FMIS), 2) analyzing life-cycle costs to inform investment decisions, and 3) optimizing fleet size and composition. GAO identified these practices based on views provided by recognized fleet experts and determined that the practices align with legal requirements and General Services Administration (GSA) recommendations.
None of the agencies GAO reviewed capture in their FMISs all of the data elements recommended by GSA. The types of data missing most frequently are data on fleet costs, including indirect costs, such as salaries of personnel with fleet-related duties. Also, some of these systems are not integrated with other key agency systems. As a result, fleet managers face challenges in performing analyses that can guide fleet decisions. All of these agencies are making efforts to improve their data and FMISs, but some lack an approach for estimating indirect fleet costs. GSA's guidance does not discuss how to estimate these costs.
Most of the selected agencies are not fully analyzing life-cycle costs to make decisions about when to replace vehicles. In addition, although most of the selected agencies use life-cycle cost analyses to decide whether to lease or purchase vehicles, some agencies' analyses do not consider a full set of costs. As a result, agencies may not have full information with which to make vehicle replacement and procurement decisions. Officials mainly cited problems with their cost data and FMISs as contributing factors, and efforts to improve in these areas have the potential to enhance agencies' ability to conduct these types of analyses.
In response to the President's 2011 directive and related GSA guidance, the selected agencies have set targets for achieving optimal fleet size and composition. Planned changes in fleet sizes from 2011 to 2015 range from DHS's 15 percent fleet reduction to VA's 8 percent increase. GSA reviewed agencies' initial targets in 2012 and recommended some changes, but lacked supporting documentation to explain how most agencies produced their targets. GSA's lack of information on these methods limits its ability to oversee agencies' fleet optimization efforts and help agencies ensure that their fleets are the right size and composition to meet their missions cost-effectively.
In addition to data-related challenges, agency officials identified three broad fleet management challenges: meeting energy requirements, such as requirements for acquiring alternative fuel vehicles; uncertainty regarding the allocation of funding to fleet management activities; and ensuring that fleet managers have adequate expertise. Agencies have pursued or are pursuing a variety of strategies to address these challenges. These include the fleet optimization process, which calls for agencies to determine how best to fulfill requirements for alternative fuel vehicles; using a working capital fund, which provides a steady stream of funding; and providing online training for fleet managers.

What GAO Recommends

GAO recommends that the Administrator of GSA 1) develop and publish guidance for agencies on estimating indirect fleet costs and 2) request that agencies provide supporting documentation on their methods for determining their optimal fleet inventories. GSA agreed with the recommendations.