These estimates totaled nearly $7 billion for unclassified programs and activities for fiscal year 1997, and should be considered a minimum estimate of federal spending for unclassified terrorism-related programs and activities. The amounts for governmentwide terrorism-related funding and spending are uncertain because (1) definitions of antiterrorism and counterterrorism vary from agency to agency; (2) in most cases agencies do not have separate budget line items for terrorism-related activities; (3) some agency functions serve more than one purpose, and it is difficult to allocate costs applicable to terrorism alone (e.g., U.S. embassy security measures protect not only against terrorism but also against theft, compromise of classified documents, and violent demonstrations); (4) some agencies, such as the Departments of Energy and Transportation, have decentralized budgeting and accounting functions and do not aggregate terrorism-related funding agencywide; (5) programs and activities may receive funding from more than one appropriation within a given agency, which makes it difficult to track collective totals; and (6) appropriations legislation often is not clear regarding which amounts are designated to combat terrorism. Key Interagency Management Functions Are Not Clearly Required or Performed

There is no interagency mechanism to centrally manage funding requirements and requests to ensure an efficient, focused governmentwide application of federal funds to numerous agencies’ programs designed to combat terrorism. Further, because terrorism-related funding requirements and proposals have not been prioritized across agencies, OMB could not have fully considered tradeoffs among competing demands. The principles underlying the Results Act provide guidance that the many federal agencies responsible for combating terrorism can use to develop coordinated goals, objectives, and performance measures and to improve the management of individual agency and overall federal efforts to combat terrorism. Otherwise, the Economy Act would have required the FBI to reimburse DOD for the transportation costs. Conclusions

Billions of dollars are being spent by numerous agencies with roles or potential roles in combating terrorism, but because no federal entity has been tasked to collect such information across the government, the specific amount is unknown. Recommendations

We recommend that consistent with the responsibility for coordinating efforts to combat terrorism, the Assistant to the President for National Security Affairs, NSC, in consultation with the Director, OMB, and the heads of other executive branch agencies, take steps to ensure that (1) governmentwide priorities to implement the national counterterrorism policy and strategy are established; (2) agencies’ programs, projects, activities, and requirements for combating terrorism are analyzed in relation to established governmentwide priorities; and (3) resources are allocated based on the established priorities and assessments of the threat and risk of terrorist attack. To ensure that federal expenditures for terrorism-related activities are well-coordinated and focused on efficiently meeting the goals of U.S. policy under PDD 39, we recommend that the Director, OMB, use data on funds budgeted and spent by executive departments and agencies to evaluate and coordinate projects and recommend resource allocation annually on a crosscutting basis to ensure that governmentwide priorities for combating terrorism are met and programs are based on analytically sound threat and risk assessments and avoid unnecessary duplication. DOD commented that although PDD 39 states that support provided by a federal agency to the lead federal agency in support of counterterrorist operations is borne by the providing agency, PDD 39 is not a statute, and does not provide authority to waive reimbursement that is required by the Economy Act. 3. 4. The report acknowledges that OMB reviews agencies’ individual budget requests, and suggests that this process would be enhanced if federal funding proposals were reviewed on a crosscutting, governmentwide basis.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed interagency processes intended to ensure the efficient allocation of funding and resources for the federal government's efforts to combat terrorism, focusing on: (1) federal funding for unclassified programs and activities to combat terrorism; (2) whether any agency or entity has been designated to coordinate budget proposals, establish priorities, manage funding requirements, and help ensure the efficient allocation of federal resources for combating terrorism across federal agencies; (3) opportunities for agencies to expand coordination of terrorism-related programs and activities under the Government Performance and Results Act (GPRA) principles and framework; and (4) issues concerning the reimbursement of support provided to agencies with lead counterterrorism responsibilities.

What GAO Found

GAO noted that: (1) the amount of federal funds being spent on combating terrorism is unknown and difficult to determine; (2) identifying and tracking terrorism-related governmentwide spending with precision is difficult for several reasons; (3) information from key agencies involved in combating terrorism shows that nearly $7 billion was spent for unclassified terrorism-related programs and activities during fiscal year (FY) 1997; (4) the Department of Defense budgeted about $3.7 billion in FY 1997, or about 55 percent of the estimated spending; (5) although the National Security Council (NSC) is to coordinate counterterrorism policy issues and the Office of Management and Budget (OMB) is to assess competing funding demands, neither agency is required to regularly collect, aggregate, and review funding and spending data relative to combating terrorism on a crosscutting, governmentwide basis; (6) neither agency establishes funding priorities for terrorism-related programs across agencies' budgets or ensures that individual agencies' stated requirements have been validated against threat and risk criteria before budget requests are submitted to Congress; (7) because governmentwide priorities for combating terrorism have not been established and funding requirements have not necessarily been validated based on an analytically sound assessment of the threat and risk of a terrorist attack, there is no basis to have reasonable assurance that: (a) agencies' requests are funded through a coordinated and focused approach to implement national policy and strategy; (b) the highest priority requirements are being met; (c) terrorism-related activities and capabilities are not unnecessarily duplicative or redundant; and (d) funding gaps or misallocations have not occurred; (8) GPRA principles and framework can provide guidance and opportunities for the many federal agencies involved in the crosscutting program to combat terrorism to develop coordinated goals, objectives and performance measures, and to enhance the management of individual agency and overall federal efforts; (9) Presidential Decision Directive (PDD) 39 directs that agencies will provide support for terrorism-related activities at their own expense unless the President directs otherwise; (10) the Economy Act generally requires reimbursement for goods and services provided to another agency; and (11) the difference between PDD 39 and the Economy Act concerning reimbursement has caused disagreements between agencies in some cases.