DHS Components Define M&A Activities Differently and Can Identify M&A Spending, but Limitations Exist in Obtaining Data from Fiscal Years 1999 through 2013

The eight DHS components we reviewed define M&A spending  differently. According to component officials, the components can identify  M&A spending, but they do not do so because they are not required to by  the department. Because components define M&A differently, have  different methods for identifying spending, and limitations exist in  obtaining data, it is not possible to compare components’ M&A spending  data from fiscal years 1999 through 2013. Four of the eight components  in our review—FEMA, FLETC, ICE, and TSA—define their M&A activities  according to the activities funded through their appropriations accounts  and PPAs that are M&A in nature (i.e., activities of a support nature such  as planning and budgeting, legal support, and IT infrastructure), while the  other four—Coast Guard, DMO, CBP, and USSS—each define M&A  activities differently and their definitions are not tied to activities in specific  appropriation accounts or PPAs. For example, TSA officials stated that  TSA’s M&A activities are those found within its Transportation Security  Support appropriations account, specifically the following three  PPAs: Headquarters Administration, Human Capital Services, and  Information Technology. While FEMA officials stated that FEMA could provide data since fiscal  year 1999, officials from seven of the eight DHS components we  reviewed told us they would be able to provide M&A spending data for  some, but not all, fiscal years since 1999 because of changes in their  financial systems and data reliability issues, among other reasons. DHS Identifies Some M&A Spending and Is Taking Steps to Define and Collect Data on M&A Activities, but Could Improve Reliability of Data for Estimating Future Resource Requests

DHS has not identified the department’s total spending on M&A activities,  but through two efforts to achieve efficiencies and reduce spending, it  identifies spending on some M&A activities. However, on the basis of our  analysis of the activities entered into the FYHSP System PDM for fiscal  years 2012 and 2013, we determined that 1 component did not enter any  business support/M&A activities, and 5 components did not correctly  categorize their business support activities since they entered some  business support activities as mission support activities. According to DHS PA&E officials, the errors are a result of manual data  entry or components not adhering to the guidance in the PDM user  manual. DHS does not have a mechanism in place to work  with the components to correct data errors in the PDM. By implementing a mechanism to  assess whether components have entered the appropriate M&A activities  into the PDM, and working with the components to correct the data, as  needed, DHS would be better positioned to reliably estimate and report to  external stakeholders, such as Congress, what percentage of the  department’s resource allocations requests are identified as M&A. How have select DHS components defined and identified their M&A  activities and spending, and to what extent are M&A data available  from fiscal years 1999 through 2013? How has DHS identified M&A spending department-wide, and to what  extent has DHS defined M&A activities and taken steps to enhance  efforts to collect M&A data? To determine how selected DHS  components define their M&A activities and how they would go about  identifying spending associated with these activities, we interviewed  officials representing two of DHS’s eight support components— Departmental Management and Operations (DMO) and FLETC—and six  of DHS’s seven operational components—FEMA, CBP, the U.S. Coast  Guard, the Transportation Security Administration, ICE, and USSS.selected these eight components based on the amount of their budget  authority (totaling nearly 88 percent of DHS’s fiscal year 2013 budget  authority); their mission, for components with both operational and  support missions; and date established, for components established both  before and after the inception of DHS. To address the second objective, we examined DHS’s two efforts to  identify and manage its spending on specific M&A activities—DHS’s  Efficiency Review (ER)—an effort to identify opportunities to improve  efficiency and streamline decision making through a series of initiatives— and the Obama administration’s Campaign to Cut Waste—a government- wide effort to reduce administrative spending. We also analyzed fiscal year 2012 and 2013 data in the Future Years  Homeland Security Program (FYHSP) System Program Data Module  (PDM), which was developed by DHS, in part to model the percentage of  DHS’s resource allocation requests that are for activities identified as  M&A in future years.
Why GAO Did This Study

DHS is the third-largest federal department, with budget authority of approximately $60 billion. Since its inception in 2003, DHS has faced challenges strengthening its multiple management systems and processes. Some Members of Congress said that DHS's components' budget requests do not provide sufficient detail to allow them to distinguish between funding for mission and M&A activities. GAO was asked to provide information on what DHS spends on M&A activities, including spending by its components since fiscal year 1999.
This report addresses the following questions: (1) How have select DHS components defined and identified their M&A activities and spending, and to what extent are M&A data available from fiscal years 1999 through 2013? (2) How has DHS identified M&A spending department-wide, and to what extent has DHS defined M&A activities and taken steps to enhance efforts to collect M&A data? GAO analyzed documents, such as DHS's budget execution reports, and efforts to identify spending on M&A activities since fiscal year 1999. GAO interviewed officials from eight DHS components, selected on the basis of their budget authority, which in total accounts for nearly 88 percent of DHS's fiscal year 2013 budget authority. Though not generalizable, the interviews provided insights.

What GAO Found

Officials from all eight Department of Homeland Security (DHS) components in GAO's review define management and administration (M&A) activities--activities that help agencies achieve their mission and program goals--differently, and while component officials said they can identify M&A spending, limitations exist in obtaining spending data from fiscal years 1999 through 2013. Officials from four of the eight components define their M&A activities according to the activities funded through their appropriations accounts and programs, projects, or activities (PPA) that are M&A in nature. For example, officials from the Transportation Security Administration said its M&A activities are those found within three PPAs within its Transportation Security Support appropriations account. The remaining four components each define M&A activities differently, and those definitions are not tied to activities contained in specific appropriations accounts. For example, the Coast Guard's M&A activities are those associated with headquarters and its service centers (e.g., personnel support), according to officials. According to component officials, the eight components GAO reviewed can identify their M&A spending, but currently do not because they are not required to do so by the department. Officials from seven of the eight components said they could provide M&A spending data for some, but not all, fiscal years since 1999 because of changes in their financial systems, among other reasons. Federal Emergency Management Agency (FEMA) officials stated that FEMA could provide data since fiscal year 1999. Because components define M&A differently, have different methods for identifying spending, and limitations exist in obtaining data, it is not possible to compare components' M&A spending data from fiscal years 1999 through 2013.
DHS has not identified the department's total spending on M&A activities, but has identified some M&A spending through DHS's Efficiency Review--an effort to identify opportunities to improve efficiency--and the Campaign to Cut Waste--a government-wide effort to reduce administrative spending. DHS is also taking steps to define and collect data on M&A activities, but has encountered difficulties in implementing these steps. Specifically, in 2010, DHS developed a common definition of M&A in conjunction with the Future Years Homeland Security Program (FYHSP) System Program Data Module (PDM) for components to submit resource allocation requests for future years by activity type: mission/operational, mission support, and business support/M&A. However, DHS is unable to reliably estimate what percentage of its requests are identified as M&A because 4 out of 15 components did not enter all appropriate business support/M&A activities and 1 component did not enter any business support/M&A activities, among other errors, which DHS officials said are a result of manual data entry and components not adhering to the guidance in the user manual. DHS does not have a mechanism in place to work with the components to correct data errors in the FYHSP System PDM. By implementing a mechanism to assess whether components have entered the appropriate M&A activities into the PDM, and working with the components to correct the data, as needed, DHS would be better positioned to reliably estimate and report to external stakeholders what percentage of DHS's resource allocations requests are identified as M&A.

What GAO Recommends

GAO recommends that DHS implement a mechanism to assess and correct M&A data entered by components into the PDM. DHS concurred with GAO's recommendation.