Framework for Examining Agencies’ Efforts to Manage Declining Resources

The framework that we developed in 2012 for examining agencies’ efforts  to effectively manage in an environment of declining resources outlines  the following three key themes to guide agency officials in managing  declining resources:  1. Data analytics should guide decision making. For example, top management should take actions to ensure  the agency maintains the capacity—including the agency’s workforce and  physical capital such as infrastructure and IT—to achieve its mission. OMB has initiated a number of efforts to help agencies  cut and avoid costs. Opportunities Exist for Selected Agencies to Further Apply the Themes of the Framework to Manage Declining Resources

			Opportunities Exist at Selected Agencies for Top Management to Take Additional Actions to Ensure Agencies Maintain Capacity to Achieve Their Missions

While top management at the selected agencies have taken some steps  to manage declining resources consistent with our framework, additional  actions could address anticipated future challenges and help ensure that  agencies continue to have the capacity to achieve their missions. Some actions could help ensure that the agency avoids  longer-term costs and maintains capacity to achieve its mission. Finally, it is unclear based on the excerpts that FLETC  provided to what extent the revised strategic plan addresses the  anticipated surge in training needs. In addition, FLETC is in the process of developing an Online Campus  that can provide distance learning opportunities for federal law  enforcement officers and supplement the in-person training they  receive at FLETC campuses. EPA. As a result, we estimated, in  2010, that EPA had recovered or would recover $42.2 million. These efforts could help the agency identify opportunities to better  manage its existing resources through further efficiencies and cost  avoidance. For example:  ETA. The Timeliness and Level of Service to the Public for Some Programs at Selected Agencies Declined, According to Agency Officials and Stakeholders

		Agency Officials and Stakeholders Reported that Declining Resources Affected the Timeliness of Services for Some Programs at Selected Agencies

Despite agencies’ ongoing efforts to manage declining resources through  cost avoidance initiatives, improved efficiency, and other strategies, some  agency officials and some stakeholder organizations told us that declining  resources and the actions that agencies took to manage them, among  other factors, affected the timeliness of some services. In some  instances, stakeholder organizations commended the selected agencies  for their efforts to continue to meet their missions with fewer resources. However, they also noted that it took agencies longer to provide certain  services, which negatively affected individuals, businesses, state  operations, and other federal agencies. FLETC. ETA’s Office of Foreign Labor Certification. EPA’s Office of Pesticide Programs. For example, the Online  Campus represents a potential long-term cost avoidance strategy that  could help the agency maintain capacity to provide the necessary law  enforcement training, potentially at a reduced cost to both FLETC and its  partner organizations. However, FLETC has not yet finalized its plan for  the Online Campus with steps and timeframes needed to ensure it  successfully implements this priority action. To help ensure that ETA continues to have the capacity to achieve its  mission and manage changes in demand for services resulting from  changes in the broader economy, we recommend that the Secretary of  Labor direct the Administrator of ETA to systematically gather and  evaluate information on the challenges that states faced administering the  unemployment insurance program during the recession that began in  2007—such as rapidly ramping up staffing at the start of the recession  and ramping down as the economy recovered—and identify and build  upon any lessons learned from this experience that could be broadly  shared to help the program respond to any changes in workload during a  future economic downturn. In written comments, reproduced in appendix V, ETA did not state  whether it concurred or not with this recommendation. ETA stated that it  believed the recommendation does not fully recognize its work with states  to identify lessons learned from the most recent recession. Appendix I: Overview of Employment and Training Administration and Select Programs’ Budget and Performance Measures

New discretionary appropriations for the Employment and Training  Administration (ETA) declined by roughly 14 percent from fiscal year 2010  to fiscal year 2015.
Why GAO Did This Study

Federal discretionary appropriations declined by roughly 12 percent between FY 2010 and 2015. To better understand issues agencies face in an environment of declining resources and how agencies could address them, GAO developed a framework in 2012 for examining agencies' efforts to manage declining resources.
GAO was asked to examine the specific actions agencies are taking to manage declining resources and the effects on services to the public. This report examined (1) to what extent selected agencies' actions to manage in an environment of declining resources aligned with GAO's framework and (2) the effects, if any, declines in discretionary spending after 2009 had on services to the public at selected agencies.
GAO applied its framework to three agencies selected based on budget data from FY 2010 through 2014. For the larger agencies (EPA and ETA), GAO selected two programs within each agency for review. GAO reviewed agency documents; and interviewed agency officials, program partners, and external stakeholders.

What GAO Found

The three selected agencies GAO reviewed for this report—the Employment and Training Administration (ETA), Federal Law Enforcement Training Centers (FLETC), and the Environmental Protection Agency (EPA)—each took a number of different approaches to manage declining resources that aligned with the three key themes outlined in GAO's framework. For example:
Top Management Should Lead Efforts to Manage Declining Resources. ETA's Office of Foreign Labor Certification top management led efforts to ensure the agency maintains capacity to achieve its mission by taking steps to restructure its workforce to better use existing staff to address changes in workload. This includes cross-training its workforce to achieve greater interoperability of employees among its three processing centers.
Data Analytics Should Guide Decision Making. EPA used Lean Six Sigma, a data-driven process-improvement methodology, to evaluate agency processes and identify opportunities to make them more efficient. For example, EPA's Office of Pesticide Programs reported that it reduced the time it takes to post pesticide product labels, which provide critical information about proper use and handling of pesticides.
Agencies Should Develop Cost-Cutting and Cost-Avoidance Strategies. FLETC reported that in FY 2013 and 2014 the agency reviewed its service contracts to identity potential cost avoidance opportunities. As a result, FLETC reported avoiding roughly $8 million out of $81 million in service contracts by reducing or eliminating nonessential services, such as reducing hours for the information technology (IT) service desk support and consolidating security guard services.
However, opportunities exist for top management at selected agencies to take additional actions to ensure they maintain capacity to achieve their missions and avoid costs. For example, FLETC is working to develop an Online Campus initiative, which would provide distance-learning opportunities and represents a potential long-term cost avoidance strategy that could help the agency maintain capacity to provide necessary law enforcement training. However, FLETC has not yet finalized its plan for the Online Campus with steps and timeframes needed to ensure successful implementation. At ETA, the most recent recession tested the Unemployment Insurance (UI) program's capacity, but ETA has yet to systematically identify lessons learned to help ensure UI maintains capacity should workload increase again. Following through on these actions could help agencies better manage limited resources and maintain capacity to achieve their missions.
Some agency officials and stakeholders reported that actions taken by the selected agencies affected timeliness and service level for some programs. While some stakeholder organizations commended the agencies for their efforts to continue to achieve their missions with fewer resources, they also noted that some actions had negative effects on individuals, businesses, states, localities, and others. The effects they cited included delays in receiving unemployment benefits and disruptions to businesses resulting from delays in processing foreign labor applications and pesticide registration applications.

What GAO Recommends

GAO makes three recommendations, including that FLETC finalize its plan for the Online Campus and ETA systematically identify lessons learned by the UI program that could help it respond to future economic downturns. FLETC concurred. ETA did not state whether it concurred or not but stated it believed the recommendation does not fully recognize its existing efforts. GAO continues to believe the recommendation is valid as discussed in the report.