Appendix B
Non-Homeland Security Missions

Non-Homeland Security Missions Performance Goals and Results

Mission Measure Perfor- | 5901 | 2002 | 2003 | 2004 | 2005
mance
Days of waterway Goal 8 2 8 2 2

Ice closures

. 7 7
Operations | 8 for severe winter | Acta | 7 7 0
2 for average winter | Result

Annual Review of Coast Guard Mission Performance

Page 17


Appendix B

Non-Homeland Security Missions

Non-Homeland Security Missions
Individual Mission Resource Hours
350,000 wee —-
@ 300,000
3 250,000
© 200,000 Se 2
§ 150,000
8 100,000 ist a
© 50,000
0
Baseline 2001 2002 2003 2004 2005
Fiscal Year |g SAR MATON Olce BLMR

For the three major non-homeland security missions ~ SAR, ATON, and
LMR — the resource hours have steadily increased after the initial post-9/11
drop. The weather-dependant Ice Operations is less than 4% of the total non-
homeland security resource hour total. These major missions have shown
significant and steady increases in the past 2 years, suggesting that the Coast
Guard has rebounded from the post-9/11 decreases, and is sustaining these
levels of effort.

Performance Goals and Results. The Coast Guard has been much more
successful in meeting its goals for its traditional non-homeland security
missions, meeting 22 of 28 goals (79%) where measurable goals and results
existed. Two non-homeland security mission areas, Aids to Navigation and
Marine Environmental Protection, met their goals for every year during the
period of FY 2001 through FY 2005. Goals for Marine Safety were met in the
3 years for which goals were established.

Of the remaining non-homeland security missions, Living Marine Resources,
Search and Rescue, and Ice Operations met their goals for 3 of the 5 years.
During FY 2005, five missions (Search and Rescue, Aids to Navigation, Ice
Operations, Marine Environmental Protection, and Marine Safety) met their
goals; only Living Marine Resources did not meet its goal. However, for the
safety and environmental missions that comprise the non-homeland security
missions, meeting 79% of established goals leaves much room for improved
performance by the Coast Guard. Specific performance goals and results for
each of the non-homeland security missions from FY 2001 through FY 2005
are summarized in the table below and detailed in the following pages.

Annual Review of Coast Guard Mission Performance

Page 11


Appendix C

Homeland Security Missions

Homeland Security Resource Hours. Overall total resource hours for
homeland security missions increased through FY 2004, and then slightly
decreased in FY 2005. However, the FY 2005 level is still significantly
(142%) above baseline levels, as depicted in the chart below.

Homeland Security Missions
Resource Hours
500,000

400,000 4

300,000

200,000

100,000 fl
0

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Resource hours for some individual homeland security missions increased
while others decreased. Ports, Waterways, and Costal Security (PWCS);
Defense Readiness; and Undocumented Migrant Interdiction showed
significant increases while Illegal Drug Interdiction and Other Law
Enforcement showed decreases. Specifically, through FY 2005, PWCS;
Defense Readiness; and Undocumented Migrant Interdiction increased a total
of 1,234%; 568% and 142% respectively, while Illegal Drug Interdiction and
Other Law Enforcement showed decreases of 39% and 27% respectively. The
significant growth of the PWCS mission, compared to all other Homeland
Security missions, is depicted in the following chart. Individual homeland
security missions are discussed in the following pages.

Homeland Security Missions

Growth in PWCS Resource Hours
500,000

400,000
300,000
200,000
100,000

0

Resource Hours

Pre-9/11 2001 2002 2003 2004 2005

Fiscal Year @PWCS BOther HLS

Annual Review of Coast Guard Mission Performance

Page 21


Background

Coast Guard Missions. Section 888 of the Homeland Security Act of 2002
defines the Coast Guard’s missions as either non-homeland security missions
or homeland security missions as follows:

Non-Homeland Security Missions
Search and Rescue

Aids to Navigation

Ice Operations

Living Marine Resources

Marine Safety

Marine Environmental Protection

Homeland Security Missions

e Illegal Drug Interdiction
Undocumented Migrant Interdiction
Other Law Enforcement
Defense Readiness
Ports, Waterways, and Coastal Security

In addition, Section 888 of the Homeland Security Act of 2002 prohibits the
Secretary from substantially or significantly reducing the missions of the
Coast Guard or the Coast Guard’s capability to perform those missions.

Resource Hours. The Coast Guard uses resource hours — generally the
number of flight hours (for aircraft) and underway hours (for boats and
cutters) dedicated to a specific mission — to determine the amount of time that
is utilized in each of its non-homeland security and homeland security mission
areas. During our review, we analyzed the total number of resource hours
reported by the Coast Guard prior to September 11, 2001 (“baseline”) through
FY 2005. We did not, however, verify the resource hour data reported by the
Coast Guard, nor did we validate that the Coast Guard had accurately
classified resource hour use for each mission. Our analysis did not include
resource hour data for the marine safety and marine environmental protection
missions because these missions are personnel intensive and are largely
carried out without using Coast Guard aircraft, cutter, and boat assets. We
assessed total resource hours for the nine individual missions in order to
identify the changes in each.

Annual Review of Coast Guard Mission Performance

Page 2


Appendix F
Report Distribution

Department of Homeland Security

Secretary

Deputy Secretary

Chief of Staff

Deputy Chief of Staff

General Counsel

Executive Secretary

Assistant Secretary, Policy
Assistant Secretary, Public Affairs
Assistant Secretary, Legislative and Intergovernmental Affairs
DHS GAO/OIG Audit Liaison
USCG Audit Liaison

Office of Management and Budget

Chief, Homeland Security Branch
DHS OIG Budget Examiner

Congress

Congressional Oversight and Appropriations Committees, as appropriate

Annual Review of Coast Guard Mission Performance

Page 32


Appendix B
Non-Homeland Security Missions

Non-Homeland Security Mission: Living Marine Resources

The Living Marine Resources mission is responsible for federal living marine
resources regulations and enforcing domestic fisheries laws.

Resource Hours. After the events of September 11, resource hour levels for
Living Marine Resources showed a significant decrease in FY 2002. In

FY 2003, the levels began to increase but were still 26% below baseline
levels. The resource hours then increased again in FYs 2004 and 2005,
resulting in levels within 3% of baseline levels, after a low of almost 38%
below baseline levels during FY 2002, as illustrated in the chart below.

Living Marine Resources
Resource Hours

100,000
80,000
60,000
40,000 +
20,000
0 r

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Performance Goals and Results. The Living Marine Resources mission
measures its successes by determining the percentage of fishermen complying
with domestic federal fisheries regulations. The goals set for this mission
were met in FYs 2001, 2002, and 2003, but were not achieved in FY 2004 and
FY 2005, as depicted in the table below. There has been an overall decline in
actual compliance since FY 2001.

Non-Homeland Security Missions Performance Goals and Results

Mission | Measure Perfor) 001 | 2002 | 2003 | 2004 | 200s
ne
7 Percentage of — | Goat | 97.0% | 97.0% ] 97.0% | 97.0% | 97.0%
Living fishermen
Marine | complying with | Actuat | 98.6% | 973% | 97.1% | 96.3% | 96.4%

Resources | Federal
regulations Result

Annual Review of Coast Guard Mission Performance

Page 18


Appendix C
Homeland Security Missions

Homeland Security Missions Performance Goals and Results

Perfor-
mance

Goal 15.0% | 18.7% | 20.7% | 15.0% | 19.0%

Mission Measure 2001 2002 2003 2004 2005

2001-2003:
Cocaine Seizure

Illegal Drug
Interdiction | 2004-2005:
Cocaine Removal
Rate

Actual | 11.7% | 10.6% | 16.3%

Result

Annual Review of Coast Guard Mission Performance

Page 24


Appendix B

Non-Homeland Security Missions

Non-Homeland Security sion: ine Safety

The Marine Safety mission is responsible for providing safe, efficient, and
environmentally sound waterways for the myriad of commercial and
recreational users.

Resource Hours. We did not analyze the resource hour data for the marine
safety mission because this mission is personnel intensive and is largely
carried out without using Coast Guard aircraft, cutter, and boat assets.

Performance Goals and Results. The Coast Guard measures the success of
the Marine Safety mission by comparing 5-year average annual fatalities and
injuries. The Marine Safety mission accomplished its goals in FY 2003
through FY 2005, as shown in the table below. Because the goal was revised
to become a 5-year average, goals for FY 2001 and FY 2002 were not
available.

Non-Homeland Security Missions Performance Goals and Results

Mission —_| Measure Perfor-! 3001 | 2002 | 2003 | 2004 | 2005
mance
Goal N/A N/A 1,543 1,513 1,317
Morine S-year average
Safety annual fatalities Actual 1,651 1,332 1,307 1,293 £301

and injuries*

* For FYs 2003 through 2005, the measure included the 5-year average for mariner deaths and
injuries, passenger deaths and injuries, and boating deaths. Beginning in FY 2006, the
measure will also include the 5-year average for boating injuries.

Annual Review of Coast Guard Mission Performance

Page 20


Additional Information and Copies

To obtain additional copies of this report, call the Office of Inspector General (OIG)
at (202) 254-4100, fax your request to (202) 254-4285, or visit the OIG web site at
www.dhs.gov/oig.

OIG Hotline

To report alleged fraud, waste, abuse or mismanagement, or any other kind of
criminal misconduct relative to department programs or operations, call the OIG
Hotline at 1-800-323-8603; write to DHS Office of Inspector General/MAIL STOP
2600, Attention: Office of Investigations — Hotline, 245 Murray Drive, SW,
Building 410, Washington, DC 20528; fax the complaint to (202) 254-4292; or
email DHSOIGHOTLINE@dhs.gov. The OIG seeks to protect the identity of each
writer and caller.



Appendix B

Non-Homeland Security Missions

on-Homeland Security Mission: s to Navigation

The ATON mission is a means for the Coast Guard to mark the waters of the
United States and its territories to assist boaters in navigation and alert them
of obstructions and hazards.

Resource Hours. Resource hour levels for ATON tracked similar to the
Search and Rescue mission: increased in FY 2001, showed a decrease during
FY 2002 and FY 2003, and then again slightly increased in FYs 2004 and
2005. This resulted in levels slightly above baseline levels, as illustrated in
the chart below.

Aids to Navigation
Resource Hours

150,000

125,000 +
100,000
75,000
50,000
25,000
of

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Performance Goals and Results. The Coast Guard has shown progress in
the ATON mission for the last 5 years. This mission, which is measured
based on a 5-year average of collisions, allisions, and groundings, has been
successful in accomplishing its established goals for each of the past 5 years,
as depicted below.

Non-Homeland Security Missions Performance Goals and Results

Mission | Measure Perfor-) 5901 | 2002 | 2003 | 2004 | 2005
meme

5-year average Goal | 2,261 2,098 | 2,010 1,923 1,831

Aids To collisions,
Navigation | allisions, and Actual | 2,215 | 2,098 | 2,000 1,876 1,825

Annual Review of Coast Guard Mission Performance

Page 15


fleet. The Coast Guard’s Short-range Aids-to-Navigation (ATON) program is
a case in point.

The Coast Guard’s ATON program utilizes a fleet of seagoing and coastal
buoy tenders, ice-breaking tugs, inland construction tenders, river tenders,
harbor tugs, self-propelled barges, and small boats to maintain a system of
about 50,000 federal signal stations with buoys, lights, and daybeacons. The
fleet is also utilized to perform a number of non-ATON-related missions such
as search and rescue; ports, waterways, and coastal security; marine
environmental protection; defense readiness; and law enforcement. We are
concerned that the non-ATON-related workload demands and an aged ATON
fleet may be undermining ATON program performance. For example,
between FYs 2002 and 2005, the ATON fleet logged 510,000 resource hours
for all Coast Guard missions, of which 103,000 hours (20%) were devoted to
non-ATON-related missions (6% non-homeland security missions and 14%
homeland security missions). During the same period, the ATON availability
rate’ dropped from 98.3% to 97.6%, well below the target rate of 99.7%.

Further, over 20% of the buoy inventory and the bulk of the ATON fleet are
aged and in need of replacement or rehabilitation. Of particular concern are
reports that the ATON fleet has significant safety, supportability,
environmental compliance, and habitability concerns that have existed for
decades. The Coast Guard estimates the cost of rehabilitating and replacing
these ATON assets could exceed $500 million; however, to date, the Coast
Guard has done little to mitigate or eliminate these concerns. The Coast
Guard will have to address these ATON issues to avoid further deterioration
of the navigation availability rate and to maintain the ability of the ATON
fleet to perform its non-ATON-related missions.

For all Coast Guard missions, the Coast Guard has been sustaining
performance through increases in resource hours. However, since the Coast
Guard is near its resource hour capacity, it cannot “squeeze out” any more
resource hours from its existing assets to ensure the capacity and readiness to
respond to future crises or major terrorist attacks. To improve performance,
the Coast Guard must ensure that a comprehensive and fully defined
performance management system is implemented and that experienced and
trained personnel are available to satisfy increased workload demands.

5 ATON availability is a measure of the maintenance of established aids to navigation. It measures program effort,
reliability of equipment, and personnel performance. While the ATON availability rate is not a trae outcome measure,
it was used by the Coast Guard as an interim performance measure until the current measure was developed.

Annual Review of Coast Guard Mission Performance

Page 7


Appendix D
Purpose, Scope, and Methodology

Section 888(f)(1) of the Homeland Security Act of 2002 directs the Inspector
General to conduct an annual review that assesses thoroughly the Coast
Guard’s performance of all its missions (both homeland security and non-
homeland security missions) with a particular emphasis on examining non-
homeland security missions.” The objective of this review is to determine the
extent that resource hours and performance results and targets for each Coast
Guard mission have changed from prior to September 11, 2001, through

FY 2005.

To make this determination, we obtained from the Coast Guard performance
data and updates to resource hours originally reported by GAO in its March
2004 report “Relationship between Resources Used and Results Achieved
Needs to Be Clearer,” GAO-04-432. We analyzed the total number of
resource hours reported by the Coast Guard prior to September 11, 2001,
(“baseline”) through FY 2005. We did not, however, verify the resource hour
data reported by the Coast Guard, nor did we validate that the Coast Guard
had accurately classified resource hour use for each mission. Our analysis did
not include resource hour data for the marine safety and marine environmental
protection missions because these missions are personnel intensive and are
largely carried out without using Coast Guard aircraft, cutter, and boat assets.
We assessed total resource hours for the nine individual missions in order to
identify the changes in each.

We analyzed the Coast Guard’s performance targets and goals to determine
whether the goals established for each of the Coast Guard’s missions had been
accomplished. Information on performance targets and goals were obtained
from the Coast Guard FY 2004 Performance Report, the Department of
Homeland Security Fiscal Year 2005 Performance and Accountability Report,
the FY 2007 Coast Guard Budget in Brief, the FY 2007 Coast Guard
Congressional Stage Budget Submission, and specific updates provided by the
Coast Guard.

We conducted our audit between October 2005 and April 2006 under the
authority of the Inspector General Act of 1978, as amended. We followed
generally accepted government auditing standards, except that we relied on
Coast Guard data and did not verify the data to original documents.

We would like to extend our appreciation for the cooperation and courtesies
extended by the Coast Guard to our staff during the review.

° PLL. 107-296, Homeland Security Act of 2002, November 25, 2002, Section 888 “Preserving Coast Guard Mission
Performance.”

Annual Review of Coast Guard Mission Performance

Page 30


Appendix C
Homeland Security Missions

Homeland Security Mission: Defense Readiness

The Defense Readiness mission provides essential capabilities to support
national security and national military strategies. Resource hours primarily
depict the execution of these defense missions, while the performance goals
and results measure the Coast Guard’s readiness to perform the mission.

Resource Hours. Resource hours for Defense Readiness have increased
through FY 2005. Resource hour levels have increased by 516% through
FY 2003, slightly decreased by 6% from FY 2003 to FY 2004, and then
increased again by 15% in FY 2005 to the highest level ever for Defense
Readiness. This level is 568% over baseline levels, or 6.67 times as many
hours. These changes in resource hours are shown in the chart below.

Defense Readiness
Resource Hours

50,000

40,000

30,000

20,000

10,000 at
04 r

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Performance Goals and Results. The success of the Defense Readiness
mission is measured by the percentage of units meeting C-2 combat readiness
level, as determined by the Department of Defense. This mission failed to
meet any of the established goals for FY 2001 through FY 2005.

Homeland Security Missions Performance Goals and Results
Mission _| Measure Perfor) 5001 | 2002 | 2003 | 2004 | 2005
mance
Percentage of | Goal | 100% | 100% | 100% | 100% | 100%
Defense | units meeting C-2 1 iuai | 67.0% | 70.0% | 78.0% | 76.0% | 67.0%
Readiness | combat readiness | At¥# 8% |, 70.0% | 18.0% |) 10.0%, | 0108
level Result

Annual Review of Coast Guard Mission Performance

Page 27


Prior to FY 2001, the non-homeland security missions represented the largest
percentage of resource hours within the Coast Guard. Following

September 11, 2001, the Coast Guard dedicated a larger percentage of
resource hours to homeland security missions than for non-homeland security
missions, as depicted in the chart above. While total resource hours grew
each year, the percentage of resource hours dedicated to homeland security
also grew until FY 2005, when the percentage of resource hours dedicated to
non-homeland security missions increased for the first time. This shift in
resource hours may be attributed to the Coast Guard’s response to Hurricane
Katrina, when over one-third of all Coast Guard aviation assets were deployed
to the Gulf Coast.

In addition, total non-homeland security resource hours have returned to
baseline levels. After an initial drop in non-homeland security resource hours
in FY 2002, the non-homeland resource hours have increased every year, and
in FY 2005 were within 3% of baseline levels. Not only are the total
non-homeland security mission resource hours approaching baseline levels,
but individual missions that comprise the non-homeland security category are
also approaching the pre-9/11 levels in the post-9/11 environment.

Assessments of resource hours for all Coast Guard missions, and individual
non-homeland security missions and homeland security missions, are included
in Appendices A, B, and C.

Despite Increases in Mission Hours, Performance Still Leaves Room for
Improvement

The Coast Guard is not meeting all of its performance goals, despite steady
increases in mission hours. The Coast Guard has been much more successful
in meeting its goals for its traditional non-homeland security missions,
meeting 22 of 28 goals (79%) where measurable goals and results existed,
compared to 5 of 19 (26%) for homeland security missions. However, for the
safety and environmental missions that comprise the non-homeland security
missions, meeting 79% of established goals leaves much room for improved
performance by the Coast Guard. For the homeland security missions, the
Coast Guard achieved only 26% of its goals. This does not include the Ports,
Waterways, and Coastal Security mission, by far the largest user of resource
hours of any Coast Guard mission.

? Non-homeland security aircraft resource hours for the 4th Quarter of FY 2005 were more than 60% greater than the
4th Quarter FY 2004 level.

Annual Review of Coast Guard Mission Performance

Page 4


Performance Goals and Results. The Coast Guard uses outcome-oriented
performance goals and measures to assess results of each Coast Guard mission
in achieving current year goals, and to report past performance. Performance
results provides information that enables the President, Department, Congress,
and the public to assess the effectiveness of the Coast Guard’s mission
performance and stewardship of resources. Managers and executives use
performance results to help gauge performance against resources appropriated
by Congress for each Coast Guard mission, which are aligned with the
Department of Homeland Security’s strategic goals. Performance measures
are also used to monitor actions and enable executives to make decisions
regarding future priorities.

Results of Audit

Total Mission Hours Have Increased

The Coast Guard uses mission hours — generally the number of flight hours
(for aircraft) and underway hours (for boats and cutters) — as a form of
measurement to determine the amount of time dedicated to each of its
non-homeland security and homeland security mission areas. Increases in
resource hours have occurred in every period from FY 2001 through FY 2005,
as depicted in the following chart.

Resource Hours - All Coast Guard Missions
800,000

600,000

400,000

209,000 | oe thd 42% 38% 37% 30%
0

Baseline 2001 2002 2003 2004 2005

Fiscal Year
@Non-Homeland Security Missions @ Homeland Security Missions |

Resource Hours

* Coast Guard-calculated baseline (annual average based on eight fiscal year quarters
preceding September 11, 2001) from which changes in resource hours since the
September 11 attacks could be estimated.

Annual Review of Coast Guard Mission Performance

Page 3


Appendix B
Non-Homeland Security Missions

Non-Homeland Security Mission: Ice Operations

The Ice Operations mission is responsible for icebreaking activities in the
Great Lakes and Northeast.° This facilitates the movement of bulk cargoes
carried by regional commercial fleets during the winter months. Domestic
icebreaking is normally conducted for search and rescue and other emergency
situations, prevention of flooding caused by ice, and facilitation of navigation.

Resource Hours. Resource hours for Ice Operations steadily increased
through FY 2004, as shown in the chart below. Baseline levels were at
11,935, with FY 2004 levels at 17,552, representing an overall increase of
47%. However, in FY 2005 the mission had a major decline in resource
hours, ending in levels almost 5% below baseline levels. These are not
unusual fluctuations since this mission is dependent on ice accumulation,
which fluctuates on a yearly basis. The resource hours, however, still remain
very near baseline levels.

Ice Operations

Resource Hours
20,000 =
15,000
10,000
5,000
04

Resource Hours

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Performance Goals and Results. The success of the Ice Operations mission
is measured by days of waterway closures: no more than 8 days of closure for
winters considered severe and 2 days of closure for winters considered
average. The established goals were accomplished in FY 2001 and FY 2003
(both severe winters), and again in FY 2005 (average winter), as shown in the
table below. The goals were not attained in FY 2002 and FY 2004 (average
winters). Since the Coast Guard achieved its goal in both average and severe
winters, it appears that the type of winter is not the deciding factor in whether
the Coast Guard meets its goals.

© In addition to domestic ice operations, the Coast Guard operates the only U.S.-controlled icebreakers capable of
operations in the polar regions. The Coast Guard operates these cutters and is reimbursed for their operation and
maintenance by the National Science Foundation. Resource hours for polar operations are included in the chart;
however, only Coast Guard-directed domestic ice operations performance goals are measured.

Annual Review of Coast Guard Mission Performance

Page 16


resource hours normally dedicated to other missions to respond to crises and
to meet often drastically changing mission priorities.

For example, in the aftermath of Hurricane Katrina, the Coast Guard deployed
over one-third of its aviation assets from all over the country to the Gulf Coast
to aid in Search and Rescue operations. As a result, this had a significant
effect on resource hours—more than a 60% increase in hours used for non-
homeland security missions in the 4th Quarter of FY 2005 versus the 4th
Quarter FY 2004. During a November 2005 congressional hearing,’ the
Commandant noted that in moving these assets to the Gulf Coast, the Coast
Guard did incur additional risk throughout the rest of the country, such as
fewer counter-drug, fisheries enforcement, and migrant interdiction operations
conducted in the Caribbean and Florida Straits. The Commandant noted that
this is of particular concern due to the age and condition of the Coast Guard’s
assets.

The Coast Guard’s limited capacity is further exacerbated by extended crisis
operations, because the heavy use of these assets during the operations results
in significant maintenance and reconditioning of those assets during the
following months. This loss of resources following extended crisis operations
can affect readiness for other missions. Extended crisis operations also result
in deferred training, further depleting resource hour availability. During his
November 2005 testimony, the Commandant also noted that while the Coast
Guard is well positioned for immediate and effective first response, its limited
“bench strength,” i.e., reserve capability, makes it impossible to sustain these
operations for an extended period of time.

Lack of Comprehensive and Fully Defined Performance Management
System

In September 2004, we reported that the lack of a comprehensive and fully-
defined performance management system impedes the Coast Guard’s ability
to gauge its performance, allocate resources effectively, and target areas for
improved performance.’ In addition, we stated that the workload demands on
the Coast Guard would continue to increase and require experienced and
trained personnel, contradicting recent declining experience levels among its
personnel. We also stated that sustaining a high operating tempo due to
growing homeland security and national emergency demands would further
tax the Coast Guard’s infrastructure including its aging cutter and aircraft

> Joint hearing before the House Homeland Security Subcommittee on Science and Technology and the Armed Services
Subcommittee on Terrorism, Unconventional Threats and Capabilities regarding “Responding to Catastrophic Events:
‘The Role of the Military and National Guard in Disaster Response,” November 9, 2005.

4 OIG Report Number OIG-04-43.

Annual Review of Coast Guard Mission Performance

Page 6


Appendix C

Homeland Security Missions

Homeland Security Performance Goals and Results. The Coast Guard was
not successful in meeting its goals for its homeland security missions, meeting
only 5 of 19 goals (26%) where measurable goals and results existed. The
Coast Guard did not meet its goals for one homeland-security mission,
Defense Readiness, in each of the periods reported between FY 2001 through
FY 2005. For Illegal Drug Interdiction, the Coast Guard was successful in
attaining its goal in only 1 of 4 years (results for FY 2005 are still pending).
For the Other Law Enforcement mission and the Undocumented Migrant
Interdiction mission, the Coast Guard met its goals in only 2 of the 5 years.
For the Ports, Waterways, and Coastal Security mission, by far the largest user
of resource hours of any Coast Guard mission, the Coast Guard only recently
developed a risk-based performance measure; and established its baseline
level in FY 2005. Performance goals and results for the five individual
homeland security missions, from FY 2001 through FY 2005, are summarized
in the table below and detailed on the following pages.

Homeland Security Missions Performance Goals and Results

Total

Mission Measure 2001 2002 2003 2004 2005 Met

2001-2003: Cocaine Seizure

Illegal Drug

Interdiction _| 2004-2005: Cocaine
Removal Rate

lof4

Undocumented | 5. sontage of migrants

Migrant interdicted or deterred 208s
Interdiction

Other Law | Foreign Vessel incursions

Enforcement | into U.S. EEZ 2of 5

Defense Percentage of units meeting Oofs
Readiness _| C-2 combat readiness level ol
Ports, Risk-based measure

Waterways, | developed; baseline for ‘e No No No | Measure

and Coastal | 2005 and future targets Measure | Measure | Measure | Baselined

Sesurity established.

SUBTOTAL oof4 | 1ot4 | 1of4 | 20f4 | 10f3 | sof19
Homeland Security

* FY 2005 actual results are pending publication of the non-commercial maritime flow in the
Interagency Assessment of Cocaine Movement.

** PWCS program was formally established after the events of September 11, 2001.

Annual Review of Coast Guard Mission Performance

Page 22


DEPARTMENT OF HOMELAND SECURITY

Office of Inspector General

Annual Review of Mission Performance
United States Coast Guard (FY 2005)

Office of Audits

OIG-06-50 July 2006


Appendix A
All Coast Guard Missions

Operations, Illegal Drug Interdiction, Undocumented Migrant Interdiction,
Other Law Enforcement, and Defense Readiness. Lastly, the Coast Guard
only recently developed a risk-based performance measure for the Ports,
Waterways, and Coastal Security mission. The Coast Guard has been much
more successful in meeting its goals for its traditional non-homeland security
missions, meeting 22 of 28 goals (79%) where measurable goals and results
existed, compared to 5 of 19 (26%) for homeland security missions (not
including the Ports, Waterways, and Coastal Security mission, by far the
largest user of resource hours of any Coast Guard mission).

Annual Review of Coast Guard Mission Performance

Page 9


Appendix A

All Coast Guard Missions

Total Resource Hours Have Increased. Total Coast Guard resource hours
have significantly increased since the baseline period, with increases in every
period through FY 2005, as depicted in the chart below. Note, however, that
the increase in total resource hours has leveled off, as the increase in total
resource hours from FY 2004 to FY 2005 was less than 1.5%. Based on the
data displayed in the chart below, and given the limited and finite level of
aircraft, cutters, and boats, the Coast Guard is within 4% of its statistically
projected maximum resource hours. Since resource hours are based on the
available assets, the Coast Guard will be unable to sustain an increase in total
resource hours without the acquisition of additional aircraft, cutters, and boats.

Resource Hours - All Coast Guard Missions
800,000

600,000

400,000 |

200,000 | | sox 5994 ea 38% 31% i
0

Baseline 2001 2002 2003 2004 2005

Fiscal Year
[Non-Homeland Security Missions ill Homeland Security Missions |

Resource Hours

Prior to FY 2001, the non-homeland security missions represented the largest
percentage of resource hours within the Coast Guard. Following

September 11, 2001, the Coast Guard dedicated a larger percentage of
resource hours to homeland security missions than for non-homeland security
missions, as depicted in the chart above. While total resource hours grew
each year, the percentage of resource hours dedicated to homeland security
also grew until FY 2005, when the percentage of resource hours dedicated to
non-homeland security missions increased for the first time. This shift in
resource hours may be attributed to the Coast Guard’s response to Hurricane
Katrina, when over one-third of all Coast Guard aviation assets were deployed
to the Gulf Coast.

Overall Coast Guard Performance Goals and Results. Of the 11 Coast
Guard missions (6 non-homeland security and 5 homeland security), only 2,
Aids to Navigation and Marine Environmental Protection, achieved the
established goals for the entire 5-year period. In addition, the Marine Safety
mission met its goals for the 3 years for which goals were established and
results were available. Seven of the remaining missions did not consistently
meet the goals, including Living Marine Resources, Search and Rescue, Ice

Annual Review of Coast Guard Mission Performance

Page 8


Appendix C

Homeland Security Missions

The resultant measure estimates the reduction in total risk affected by the
Coast Guard.

According to the Coast Guard, this baseline risk-reduction initiative was
largely an internal self-assessment that will be refined and improved upon in
the next several years as the modeling, simulation, and analysis of terror-
attack scenarios improves. Future iterations will seek to validate the process
and improve the accuracy of the conclusions by including external maritime
community stakeholders. External validation will be sought to refine the
process for estimating how much maritime security risk the Coast Guard itself
is responsible for mitigating.

A key concern regarding this newly established risk-based performance
measure is its subjectivity. The measure introduces many layers of
subjectivity involving the human scoring of scenarios, and the potential for
inconsistent or “uneven” evaluations based on different human input.
Therefore, the ability of this measure to accurately depict performance of the
PWCS missions — and remain consistent over time - has not been clearly
established. As such, the measure may not be representative of the PWCS
mission performance, and may restrict the measure’s usefulness for evaluative

purposes.

In addition, this mission is by far the largest user of Coast Guard resource
hours, and is almost equivalent to all non-homeland security missions
combined. However, it has taken the Coast Guard 3 years to develop a
performance measure, thereby not measuring performance for the largest
portion of Coast Guard resources since FY 2002. Given the critical nature of
this mission, and the large percentage of Coast Guard resources devoted to it,
the Coast Guard may want to consider dividing this measure into more finite
and objective elements.

Annual Review of Coast Guard Mission Performance

Page 29


Appendix C
Homeland Security Missions

Homeland Security Mission: Ports, Waterways, and Coastal Security

The Ports, Waterways, and Coastal Security (PWCS) mission is responsible
for preventing and protecting against maritime security threats, reducing
America’s vulnerability to those threats, and minimizing the adverse
consequences of maritime security incidents that do occur.

Resource Hours. Resource hours for PWCS rapidly increased in response to
the events of September 11, 2001, resulting in a 1,220% increase over
baseline levels by FY 2003 5 In FY 2004 the levels increased slightly by 4%
over FY 2003 levels, and decreased by 3% in FY 2005. Even with the
decrease, the mission still showed an increase in resources at a level 1,234%
over the baseline level. This is 13 times greater than the baseline level; the
chart below shows this rapid increase in resource hours. This mission is by
far the largest user of resource hours of any Coast Guard mission. The
resource hours used is almost equivalent to all resource hours used by non-
homeland security missions combined.

Ports, Waterways & Coastal Security
Resource Hours

300,000

250,000
200,000
150,000
100,000

50,000 i
0

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Performance Goals and Results. Prior to FY 2005, the Coast Guard had not
established performance goals for the Ports, Waterways, and Coastal Security
mission. In FY 2005, the Coast Guard established a new risk-reduction
performance measure to demonstrate PWCS performance. This risk-based
performance measure involves the scoring of high-consequence maritime
terrorist attack scenarios with respect to threat, vulnerability, and
consequence. Coast Guard operational and regulatory activities that have
taken place during the fiscal year are scored against the scenarios with regard
to their estimated percent decrease in threat, vulnerability, and consequence.

® Prior to FY 2001 and the subsequent formal establishment of the PWCS program, resource hours were collected under
a variety of categories that were used to establish the baseline.

Annual Review of Coast Guard Mission Performance

Page 28


Of the 11 Coast Guard missions (6 non-homeland security and 5 homeland
security), only 2, Aids to Navigation and Marine Environmental Protection,
achieved the established goals for the entire 5-year period. In addition, the
Marine Safety mission met its goals for the 3 years for which goals were
established and results were available. Seven of the remaining missions did
not consistently meet the goals, including Living Marine Resources, Search
and Rescue, Ice Operations, Illegal Drug Interdiction, Undocumented Migrant
Interdiction, Other Law Enforcement, and Defense Readiness. Lastly, the
Coast Guard only recently developed a risk-based performance measure for
the Ports, Waterways, and Coastal Security mission.

Assessments of performance goals and results for all Coast Guard missions,
and individual non-homeland security missions and homeland security
missions, are included in Appendices A, B, and C.

Barriers to Improving Performance Still Exist

The Coast Guard faces three major barriers to improving or sustaining its
mission performance:

1. Growth in resource hours has leveled off;

2. Limited and finite assets to respond to crises; and

3. Lack of comprehensive and fully defined performance management
system.

Growth In Resource Hours Has Leveled Off

Growth in total Coast Guard resource hours, which are significantly greater
than baseline levels, has leveled off. The increase in total resource hours from
FY 2004 to FY 2005 was less than 1.5%, and total resource hours for the
Coast Guard are reaching a maximum. Based on total resource hour data
(displayed in the previous chart), coupled with Coast Guard’s limited and
finite level of aircraft, cutters, and boats, the Coast Guard is within 4% of its
statistically projected maximum level of resource hours. Given that resource
hours are based on the limited and finite number of available assets, the Coast
Guard will be unable to increase its total resource hours without the
acquisition of additional aircraft, cutters, and boats.

Limited and Finite Assets To Respond To Crises

The Coast Guard has a limited and finite number of assets, and therefore
available resource hours, to respond to an extended crisis. With no additional
reserve assets for use in catastrophic situations, the Coast Guard must use

Annual Review of Coast Guard Mission Performance

Page 5


Appendix B
Non-Homeland Security Missions

Non-Homeland Security Mission: Marine Environmental Protection

The Marine Environmental Protection mission is responsible for preventing
the introduction of invasive species, stopping unauthorized ocean dumping,
and protecting against accidental oil and chemical spills.

Resource Hours. We did not analyze the resource hour data for the marine
environmental protection mission because this mission is personnel intensive
and are largely carried out without using Coast Guard aircraft, cutter, and boat
assets.

Performance Goals and Results. The Marine Environmental Response
mission’s successes are measured by the 5-year average annual oil spills and
chemical discharges. The Coast Guard has been very successful in reducing
the number of incidents year to year, thus accomplishing its goals for the
entire 5-year period. As depicted in the table below, the mission has been so
successful that the Coast Guard drastically changed its goal by over 50% in
FY 2005 (from 41% to 20%), which it still met.

Non-Homeland Security Missions Performance Goals and Results

Mission Measure Perfor-| 5901 | 2002 | 2003 | 2004 | 2005

mance

S-year avg. annual 1 Goa | 47.0 | 45.0 | 43.0 | 41.0 | 20.0
oil spills exceeding |

100 gallons and 35.1
chemical discharges ”
per 100M tons
shipped

Marine |
Environmental
Protection

Actual

Annual Review of Coast Guard Mission Performance

Page 19


Appendix C
Homeland Security Missions

Homeland Security Mission: Undocumented Migrant Interdiction

The Undocumented Migrant Interdiction mission responsibilities consist of
enforcing immigration laws at sea. To fulfill its responsibilities, the Coast
Guard conducts patrols and coordinates with other federal agencies and
foreign countries to interdict undocumented migrants at sea, denying them
entry via maritime routes to the United States, its territories, and possessions.

Resource Hours. There was a moderate decrease in Undocumented Migrant
Interdiction resource hours in FY 2001, but resource hours began’ to increase
in FY 2002. FY 2003 saw a significant 81% increase in resource hours, and a
significant increase from FY 2003 through FY 2004 by an additional 40%.
This resulted in an overall increase of 153% from the baseline. However,
resources were down slightly for FY 2005, but still above baseline levels by
142%. The chart below documents the changes through FY 2005.

Undocumented Migrant interdiction

Resource Hours
80,000 —

60,000

40,000

20,000 |
a |

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Performance Goals and Results. The Undocumented Migrant Interdiction
mission successes are measured by the percentage of migrants interdicted or
deterred. The mission accomplished its goals in FY 2002 and FY 2004 but
failed to do so in FY 2001, FY 2003, and again in FY 2005, as depicted in the
table below.

Homeland Security Missions Performance Goals and Results

Mission Measure Perfor-! 901 | 2002 | 2003 | 2004 | 2005
mance

Percentage of Goal 87.0% | 87.0% | 87.0% | 87.0% | 88.0%
Undocumented

rae migrants 0 y 9
eee on interdicted or Actual | 82.5% | 88.3% | 85.3% | 87.1% | 85.5%
deterred Result

Annual Review of Coast Guard Mission Performance

Page 25


OIG

Audit
Report

Department of Homeland Security
Office of Inspector General

Executive Summary

This report presents the annual review of the U.S. Coast Guard’s mission
performance as required by the Homeland Security Act of 2002.' To address
the Act’s requirements, we reviewed the Coast Guard resource hours used to
perform the various homeland security and non-homeland security missions,
as well as performance goals and results, from FY 2001 through FY 2005.

Total Mission Hours Have Increased. Coast Guard data shows that total
mission hours have increased in every period from FY 2001 through FY 2005.
Since FY 2001, more resource hours have been dedicated to homeland
security missions than for non-homeland security missions. However, after an
initial drop in FY 2002, non-homeland security resource hours have increased
every period, and have now returned to within 3% of baseline levels.

Despite Increases in Mission Hours, Performance Still Leaves Room for
Improvement. The Coast Guard has been more successful in meeting goals
for its traditional non-homeland security missions, meeting 22 of 28 goals
(79%) where measurable goals and results existed, but still leaving room for
improved performance. Not including the Ports, Waterways, and Coastal
Security mission, by far the largest user of resource hours of any Coast Guard
mission, the Coast Guard achieved only 26% of its homeland security goals
(5 of 19).

Barriers to Improving Performance Still Exist. Growth in total resource
hours has leveled off. Since resource hours are based on the limited and finite
number of available assets, the Coast Guard will be unable to increase total
resource hours without the acquisition of additional aircraft, cutters, and boats.
Consequently, the Coast Guard has a limited ability to respond to an extended
crisis, and therefore must divert resources normally dedicated to other
missions. To improve performance within their overall constraints, the Coast
Guard must ensure that a comprehensive and fully defined performance
management system is implemented, and that experienced and trained
personnel are available to satisfy increased workload demands.

1 Public Law 107-296, November 25, 2002. Section 888 directs the Inspector General to conduct an annual review that
assesses the performance of all Coast Guard missions, with a particular emphasis on non-homeland security missions.

Annual Review of Coast Guard Mission Performance

Page 1


Appendix B
Non-Homeland Security Missions

Non-Homeland Security Missions Performance Goals and Results

Mission Measure
Search and | Percentage of Mariners”
Rescue lives saved
Aids To 5-year average collisions,
Navigation allisions, and groundings

Days of waterway closures
Ice Operations | 8 for severe winter

2 for average winter
Percentage of fishermen
complying with Federal
regulations

5-year avg. annual oil spills
exceeding 100 gallons and
" chemical discharges per
Protection 100M tons shipped

Living Marine
Resources

Marine
Environmental

5-year average annual

Marine Safety | ftatities and injuries

SUBTOTAL
Non-Homeland Security

22 of 28

Annual Review of Coast Guard Mission Performance

Page 12


Appendix B

Non-Homeland Security Missions

Non-Homeland Security Missions Performance Goals and Results

Annual Review of Coast Guard Mission Performance

Page 14

Mission _| Measure Perfor-! 3901 | 2002 | 2003 | 2004 | 2005
mance
Goal | 85.0% | 85.0% | 85.0% 86.0%
Search and Percentage of
Roan Mariners’ lives | Actual | 84.2% % | 87.7% 6.1%
saved
Result



Table of Contents/Abbreviations

Executive SUMMALY ......cscessssseecseseseeseesecssesesesnessesssenssseeseaensesnesneesneersaeneenssseracssserssatenssenseseatensenes 1
Background
Results of Audit ......cceeeseseseeseeeeeteee

Total Mission Hours Have Increased.
Despite Increases in Mission Hours, Performance Sti
Barriers to Improving Performance Still Exist

eaves Room for Improvement

Appendices

Appendix A: All Coast Guard Missions
Appendix B: Non-Homeland Security Missions
Appendix C: Homeland Security Missions .......
Appendix D: Purpose, Scope, and Methodology ..
Appendix E: Major Contributors to this Report
Appendix F: Report Distribution

Abbreviations
ATON Aids to Navigation
CBP Customs and Border Protection
DHS Department of Homeland Security
EEZ Exclusive Economic Zone
FY Fiscal Year
LMR Living Marine Resources
OIG Office of Inspector General
P.L. Public. Law
PWCS Ports, Waterways, and Coastal Security
SAR Search and Rescue

Annual Review of Coast Guard Mission Performance


Appendix C

Homeland Security Missions

Homeland Security Mission: Illegal Drug Interdiction

The Coast Guard’s Illegal Drug Interdiction mission is a key player in
combating the flow of illegal drugs to the United States. The Coast Guard’s
mission is to reduce the supply of drugs from the source by denying
smugglers the use of air and maritime routes in the Transit Zone, a six million
square mile area, including the Caribbean, Gulf of Mexico, and Eastern
Pacific. The Coast Guard is the lead federal agency for maritime drug
interdiction and shares lead responsibility for air interdiction with the U.S.
Customs and Border Protection (CBP).

Resource Hours. The Illegal Drug Interdiction mission had a significant
reduction in resource hours through FY 2003, resulting in a 43% decrease
from baseline levels. However, the number of resource hours showed a
moderate increase of 11% from FY 2003 to FY 2004, and a slight 3%
decrease in FY 2005, resulting in a net decrease of 39% below baseline levels.
These changes are shown in the chart below.

Ilegal Drug Interdiction
Resource Hours
150,000

125,000
100,000
75,000
50,000
25,000
0

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Performance Goals and Results. From FY 2001 through FY 2003, the
Illegal Drug Interdiction mission’s success was measured by the percentage of
cocaine seizures. Starting in FY 2004, the goals will be measured by the
cocaine removal rate. The mission failed to accomplish its goal for any of the
FYs 2001 through 2003, but did accomplish its goal in FY 2004, as shown in
the table below. Results for FY 2005 are pending publication of the non-
commercial maritime flow in the Interagency Assessment of Cocaine
Movement.

Annual Review of Coast Guard Mission Performance

Page 23


Office of Inspector General

U.S. Department of Homeland Security
Washington, DC 20528

Homeland
Security

July 17, 2006
Preface

The Department of Homeland Security (DHS) Office of Inspector General (OIG) was established by
the Homeland Security Act of 2002 (Public Law 107-296) by amendment to the Inspector General
Act of 1978. This is one of a series of audit, inspection, and special reports prepared as part of our
oversight responsibilities to promote economy, efficiency, and effectiveness within the department.

This report presents the annual review of the U.S. Coast Guard’s mission performance and resource
hours, as required by the Homeland Security Act of 2002, Public Law 107-296, November 25, 2002.
It is based on interviews with employees and officials of relevant agencies and institutions, direct
observations, and a review of applicable documents.

It is our hope that this report will result in more effective, efficient, and economical operations. We
express our appreciation to all of those who contributed to the preparation of this report.

Richard L. Skinner
Inspector General


Appendix E
Major Contributors to this Report

Washington, DC Office

Richard T. Johnson,
Director, USCG and Maritime Security Operations Division

Michael Siviy, Audit Manager
James Bess, Senior Analyst
Jeffrey Wilson, Analyst
Douglas Thomas, Intern

Annual Review of Coast Guard Mission Performance

Page 31


Appendix C
Homeland Security Missions

Homeland Security Mission: Other Law Enforcement

The Fishery Conservation and Management Act of 1976’ established a
200-mile fishery conservation zone that would subsequently be designated as
the U.S. Exclusive Economic Zone (EEZ). The Other Law Enforcement
mission protects against foreign incursions into the U.S. EEZ.

Resource Hours. The resource hours for the Other Law Enforcement mission
have fluctuated widely through FY 2005. The mission showed a decrease
through FY 2002, increase in FY 2003, decrease in FY 2004, and increase in
FY 2005, resulting in a level 27% below the baseline levels. The chart below
depicts these fluctuations.

Other Law Enforcement

Resource Hours
10,000

8,000

6,000
4,000
2,000

0

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Performance Goals and Results. The Coast Guard measures the Other Law
Enforcement mission success by limiting the number of foreign vessel
incursions into the U.S. EEZ. In FYs 2001, 2002, and 2004, this mission
failed to accomplish its goal; its goal was reached only in FY 2003 and

FY 2005, as depicted below.

Homeland Security Missions Performance Goals and Results

Mission Measure Perfor-| 5901 | 2002 | 2003 | 2004 | 2005
mance
. Goal 202 202 202 202 200
Other Law | Foreign Vessel
incursions into | Actual 212 250 152 247 171

Enforcement | 1) ¢ Ep,
Result

T Public Law 94-265, April 13, 1976, later amended and renamed the Magnuson-Stevens Fishery Conservation and
Management Act.

Annual Review of Coast Guard Mission Performance

Page 26


Appendix B

Non-Homeland Security Missions

Non-Homeland Security Resource Hours Are At Baseline Levels. After an
initial drop in non-homeland security resource hours in FY 2002, the total
non-homeland resource hours have slowly increased in every year, nearly
reaching baseline levels during FY 2005. As seen in the chart below, non-
homeland security resource hours for FY 2005 were within 3% of baseline
levels.

Non Homeland Security Missions
Resource Hours

400,000

300,000

200,000 +

100,000 |
0 |

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

In addition, the percentage of resource hours dedicated to non-homeland
security missions had decreased through FY 2004, from 62% in the baseline
period to 37% in FY 2004. This trend was reversed in FY 2005, when 39% of
resource hours were dedicated to non-homeland security missions, an increase
of 2 percentage points. These figures are depicted in the chart on page 8.

Individual Missions Are Approaching Pre-9/11 Resource Hour Levels.
Individual non-homeland security missions are approaching the pre-9/11
levels in the post-9/11 environment. The individual missions that comprise
the non-homeland security missions — Search and Rescue (SAR), Aids to
Navigation (ATON), Ice Operations, and Living Marine Resources (LMR) —
are all within 10% of their baseline levels, as depicted in the following chart.

Annual Review of Coast Guard Mission Performance

Page 10


Appendix B

Non-Homeland Security Missions

Non-Homeland Security Mission: Search and Rescue

The Search and Rescue mission responsibilities include minimizing the loss of
life, personal injury, and property loss and damage in the maritime
environment by rendering aid to persons in distress and property associated
with maritime transportation, fishing, and recreational boating.

Resource Hours. Mission resource hour levels for SAR first increased in
FY 2001, decreased during FYs 2002 and 2003, and then slightly increased in
FY 2004 as illustrated in the chart below. The decrease during FY 2002 and
FY 2003 would be expected due to the responses to the September 11, 2001,
events and more resources being directed to homeland security missions such.
as Ports, Waterways, and Coastal Security. However, in FY 2005 Search and
Rescue showed a significant increase, attributable to the Coast Guard’s
response to Hurricane Katrina, approaching baseline levels. These current
levels are within 10% of baseline levels, which is a significant increase from
its FY 2003 low of 22% below baseline levels.

Search and Rescue
Resource Hours

100,000

80,000 _|
60,000
40,000
20,000
0

Baseline 2001 2002 2003 2004 2005
Fiscal Year

Resource Hours

Performance Goals and Results. The Search and Rescue mission measures
its performance by the percentage of mariners’ lives saved. In FY 2001 and
FY 2002 the goal of saving 85% of mariners in distress was not obtained, as
shown in the table below. However, since then, the goal has been attained in
FY 2003, FY 2004, and FY 2005. This occurred even with an increase in the
goal to 86% in FY 2005.

Annual Review of Coast Guard Mission Performance

Page 13