Some  agencies have begun to recognize the need to pay more attention to fleet  management and are taking steps to review their guidelines in an effort to  provide better criteria to determine vehicle needs and to manage their  fleets more efficiently. Decisions about whether to acquire and retain vehicles are made at  the local level with little or no headquarters oversight. The Navy and the Forest Service conduct periodic assessments of fleet  size, but the results of the assessments are either not enforced or not  conducted in a systematic manner. Opportunities Exist to Dispose of Underutilized Vehicles and Realize Potential Savings

Our work and reviews by inspectors general identified numerous instances  where agencies had an excessive number of vehicles in their fleets. If  these vehicles were disposed of, agencies could realize savings ranging  from thousands to millions of dollars, as illustrated in the following  examples:  In February 2004, the Department of the Interior’s Inspector General  reported that a significant portion of the department’s fleet of  approximately 36,000 vehicles is underutilized and estimated savings of  $34 million. However, because these reductions were not based on the application of  utilization criteria to identify vehicle needs, there is no guarantee that the  fleets are the right size to meet the agencies’ missions. Governmentwide Initiatives to Improve Fleet Management Practices

As a result of a review of governmentwide fleet practices, GSA’s Office of  Governmentwide Policy (OGP) and OMB are taking actions to require  agencies to better manage and improve the cost-efficiency of their fleets. Based  on the survey results, OGP is currently revising the Federal Management  Regulation to require agencies to improve fleet management practices by,  among other things, (1) appointing a central fleet manager, (2) periodically  reviewing fleet size, and (3) funding a fleet management information  system. However, we anticipate strong opposition to this requirement,  based on our discussions with agency officials outside of GSA. In 2002, OMB began requiring agencies, as  part of their budget submission, to report the size, composition, and  cost of their fleets for the current year and to project costs for the next  3 fiscal years. Recommendations for Executive Action

To help agencies determine the appropriate size and composition of their  fleets, we recommend that the Administrator of GSA direct the Office of  Governmentwide Policy to include in the revised Federal Management  Regulation the following two requirements for agencies    develop utilization criteria related to the missions of the vehicles and     conduct periodic assessments of the number and type of vehicles in their  fleets using these criteria. To ensure that agency fleets are the right size and composition to meet  their missions, we recommend that the Secretaries of the Departments of  Agriculture, Defense, Homeland Security, and Veterans Affairs take the  following three actions    establish guidance and policies that include clearly defined utilization  criteria to be used in validating the need for vehicles based on their  missions;  require fleet managers to use these criteria in determining the need for  vehicles and in conducting periodic fleet assessments; and    establish effective oversight mechanisms to ensure that the utilization  criteria are defined and fleet assessments are carried out. We focused our review on the key revisions directly related to  the justification for acquiring and retaining vehicles. The Department of Defense agreed with our recommendations. $1.7 million annually. The state office did not complete its  required annual review and was not  managing its vehicle fleet efficiently.
Why GAO Did This Study

Federal agencies spend about $1.7 billion annually to operate a fleet of about 387,000 vehicles. During the last decade, concerns have been raised about whether agencies have more vehicles than they need. In an April 2002 letter to federal agencies, the Office of Management and Budget stated that the size of the federal fleet seemed excessive. GAO was asked to determine (1) the extent to which agencies ensure that their fleets are the right size to meet agency missions, (2) whether potential savings could result from the disposal of unneeded vehicles, and (3) what actions are being taken on a governmentwide basis to improve fleet management practices. GAO focused its review on the justification for acquiring and retaining vehicles at the Departments of Agriculture, Army, Homeland Security, Navy, and Veterans Affairs.

What GAO Found

Because of a lack of attention to key vehicle fleet management practices, the agencies GAO reviewed cannot ensure their fleets are the right size or composition to meet their missions. Industry practices for cost-efficient fleets include the development of utilization criteria related to the mission of a vehicle and periodic fleet assessments using these criteria to determine the appropriate fleet size and composition. If unneeded vehicles are identified, they are disposed of. However, the agencies GAO reviewed have not established policies that contain clearly defined utilization criteria that would allow them to determine the number and type of vehicles they need. Further, agencies are not routinely conducting periodic fleet assessments. Two agencies, the Navy and the Forest Service within the Department of Agriculture, conduct assessments; however, these assessments are either inconsistently applied or the results are not enforced. Some agencies have begun to recognize the need to revise their guidelines to provide better criteria for determining their vehicle needs. GAO's work and reviews by inspectors general identified numerous instances where agencies were retaining vehicles they did not need, with potential savings ranging from thousands to millions of dollars if these vehicles were eliminated. For example, the Department of the Interior's Inspector General reported that a significant portion of the department's 36,000 vehicles were underutilized and estimated savings of $34 million annually if these vehicles were disposed of. GSA's Office of Governmentwide Policy and the Office of Management and Budget have recently taken a number of actions to require agencies to better manage and improve the cost-efficiency of their fleets. The Office of Governmentwide Policy is currently revising the Federal Management Regulation to require agencies to (1) appoint a central fleet manager with control over all aspects of fleet management, including fleet budgets, which are now generally controlled at the local level; (2) establish utilization criteria and periodically review fleet size; and (3) fund a fleet management information system. The Office of Governmentwide Policy plans to work in a cooperative effort with agencies to implement the revised regulation. However, based on discussions with officials from the agencies GAO reviewed, GAO anticipates that GSA will face opposition to its requirement for centralized budget control over the fleets. In 2002, the Office of Management and Budget began requiring agencies to report, as part of their budget submissions, the size, composition, and cost of their fleets for the current year and to project costs for the next 3 fiscal years.