Page 1 GAO-04-309R Immigration Application Fees

United States General Accounting Office

Washington, D.C. 20548

A

January 5, 2004

The Honorable Orrin G. Hatch

Chairman

The Honorable Patrick J. Leahy

Ranking Minority Member

Committee on the Judiciary

United States Senate

The Honorable F. James Sensenbrenner, Jr.

Chairman

The Honorable John Conyers, Jr.

Ranking Minority Member

Committee on the Judiciary

House of Representatives

Subject: Immigration Application Fees: Current Fees Are Not Sufficient 

to Fund U.S. Citizenship and Immigration Services’ Operations

The Homeland Security Act of 2002 (HSA)1 established the Bureau of 

Citizenship and Immigration Services (CIS)2 within the Department of 

Homeland Security (DHS). CIS is responsible for several functions 

transferred from the former Immigration Services Division of the 

Immigration and Naturalization Service (INS) under the Department of 

Justice. CIS’s functions include adjudicating and processing applications 

for U.S. citizenship and naturalization, administering work authorizations 

and other petitions, and providing services for new residents and citizens. 

CIS collects fees from applicants to process the various immigrationrelated applications and petitions. CIS also receives appropriated funds to 

pay for administrative and overhead costs such as records management 

and backlog reduction.3

 HSA requires that we report on whether CIS is 

likely to derive sufficient funds from fees to carry out its functions in the 

absence of appropriated funds.4

1

Pub. L. No. 107-296, § 451, 116 Stat. 2195.

2

The bureau is now referred to as the United States Citizenship and Immigration Services 

(CIS).

3

A backlog exists when the processing time for a newly filed application exceeds the 

processing target time, which is 6 months or less for every application.

4

Pub. L. No. 107-296, § 477(d)(3), 116 Stat. 2210.
Page 2 GAO-04-309R Immigration Application Fees

This report summarizes the information provided during our November 24, 

2003, briefing to your staff on this topic. The enclosed briefing slides 

highlight the results of our work and the information provided. 

Specifically, we determined application fees collected and projected for 

funding CIS operations for fiscal years 2001 through 2003 and compared 

those totals with identifiable operating costs for those 3 fiscal years as a 

basis for determining whether fees collected would likely be sufficient to 

fund CIS’s operating costs.

Results in Brief We determined that fees were not sufficient to fully fund CIS’s operations. 

In part, this has resulted because (1) the current fee schedule is based on 

an outdated fee study that did not include all costs of CIS’s operations and 

(2) costs have increased since that study was completed due to an 

additional processing requirement and other actions.

While it is clear fees are insufficient to fully fund CIS’s operations, there is 

insufficient cost data to determine the full extent of the shortfall. A 

fundamental problem is that CIS does not have a system to track the status 

of each application as it moves through the process.5

 Accordingly, CIS does 

not have information on the extent to which work on applications in 

process remains to be finished. In addition, CIS does not know the current 

cost of each step to process each application. The effect is that CIS knows 

neither the cost to process new applications nor the cost to complete 

pending applications. Further, because DHS is still determining how 

administrative and overhead functions will be carried out and the related 

costs allocated, CIS does not know what future administrative and 

overhead costs will be.

For the 3-year period from fiscal year 2001 through 2003, CIS’s reported 

operating costs exceeded available fees by almost $460 million, thus 

creating the need for appropriated funds. CIS projects that this situation 

will remain in fiscal year 2004. Since the beginning of fiscal year 2001, the 

number of pending applications increased by more than 2.3 million (about 

59 percent) to about 6.2 million at the end of fiscal year 2003. This increase 

occurred despite additional appropriations beginning in fiscal year 2002 of 

$80 million annually to address the backlog. In addition, CIS has not 

performed an analysis of the steps needed to reduce processing times to 

5

According to CIS officials, the deployment of a new system that will track the status of each 

application is expected in 2006.
Page 3 GAO-04-309R Immigration Application Fees

the 6-month average goal established in the President’s backlog initiative. 

These times increased significantly in fiscal year 2003 to levels well above 

the 6-month target established in CIS’s March 2002 Backlog Elimination 

Plan. 

Absent actions to increase fees, reduce processing costs and times, or both, 

as well as to improve the timeliness and completeness of fee schedule 

updates, CIS will continue to need appropriated funds to avoid even greater 

increases in the backlog of pending applications. The full costs of CIS’s 

operations cannot be determined until analyses of the costs to process 

incoming and pending applications and administrative and overhead costs 

are completed.

Recommendations for 

Executive Action

In order to achieve the goals of the President’s backlog initiative, we 

recommend that the Secretary of Homeland Security direct the Director of 

CIS to perform an analysis of current processing functions to determine 

steps needed to reduce the processing time to an average of 6 months or 

less.

In order to determine the cost to process new and pending applications, we 

recommend that the Secretary of Homeland Security direct the Director of 

CIS to

• perform a comprehensive fee study to determine the costs to process 

new immigration applications and

• determine the costs to eliminate the backlog of pending applications.

In order for CIS to know the full cost of its operations, we recommend that 

the Secretary of Homeland Security direct the Deputy Secretary to identify 

which support services and functions, such as shared services, 

modernizing and supporting shared databases, shared infrastructure, and 

other forms of support, and the cost of those functions should be 

transferred or allocated to CIS.

Regarding the timing of fee schedule updates, we recommend that the 

Secretary of Homeland Security direct the Director of CIS to identify 

options to improve the timeliness for implementing fee updates to help 

ensure that all costs are captured.
Page 4 GAO-04-309R Immigration Application Fees

Agency Comments and 

Our Evaluation

We obtained oral comments on a draft of our briefing slides from DHS and 

CIS officials. They generally agreed with our conclusions and 

recommendations. However, they stated that our recommendations did 

not address the fact that fee schedules do not go into effect promptly, thus 

delaying implementation of fee levels that would help ensure that the full 

costs of adjudications are covered. The timing of fee schedule updates is a 

key issue, and we have added a recommendation to address this issue. DHS 

and CIS officials also provided technical comments, which we 

incorporated as appropriate.

Scope and 

Methodology

We analyzed actual and estimated/projected application fees and 

appropriations that fund CIS operations and the related costs for fiscal 

years 2001 through 2003. To determine if fees collected were sufficient to 

fund CIS’s operations, we (1) interviewed CIS staff and officials and 

external auditors, (2) reviewed biennial fee review reports, (3) reviewed 

audit reports, (4) reviewed financial records and budget-related 

documents, (5) analyzed various other documents provided by CIS 

containing information on numbers of applications and application fees, 

and (6) analyzed data on fee collections and appropriated funds and 

compared these to our analysis of the related costs.

We assessed the reliability and completeness of the CIS-provided data for 

fiscal years 2001 and 2002 by reconciling the funds received and costs 

incurred to the audited financial statements. For fiscal year 2003 data, the 

audit was not yet complete. We did not otherwise verify the data. We did 

not assess the effectiveness of CIS’s application processing functions or 

verify the accuracy of application totals.

We requested comments on a draft of the enclosed briefing slides from DHS 

and CIS officials. We received oral comments from DHS and CIS that were 

incorporated into the briefing slides and this report as appropriate. We 

conducted our work from March through November 2003 in accordance 

with generally accepted government auditing standards.

We are sending copies of this report to congressional committees and 

subcommittees responsible for issues related to immigration services and 

the Department of Homeland Security, the Secretary of Homeland Security, 

the Deputy Secretary of the Department of Homeland Security, and the 

Director of CIS. This report is also available at no charge on GAO’s home 
Page 5 GAO-04-309R Immigration Application Fees

page at http://www.gao.gov. If you have any questions about this report, 

please contact me at (202) 512-9508 or Steven Haughton, Assistant 

Director, at (202) 512-5999. You may also reach us by e-mail at 

calboml@gao.gov or haughtons@gao.gov. Additional contributors to this 

assignment were Diane N. Morris and Estelle M. Tsay.

Linda M. Calbom

Director

Financial Management and Assurance

Enclosure
Page 6 GAO-04-309R Immigration Application Fees

Enclosure

1

Current Fees Are Not Sufficient to Fund U.S. Citizenship 

and Immigration Services’ Operations

Briefing to Staff of the Senate and House Committees on the 

Judiciary

November 24, 2003

IMMIGRATION APPLICATION FEES
Enclosure

Page 7 GAO-04-309R Immigration Application Fees

2

Contents

• Introduction and Objectives

• Results in Brief

• Background

• Sufficiency of Fees

• Conclusions

• Recommendations

• Agency Comments and Our Evaluation

• Scope and Methodology
Enclosure

Page 8 GAO-04-309R Immigration Application Fees

3

Introduction and Objectives

• The Homeland Security Act of 2002 (HSA)1 established the 

Bureau of Citizenship and Immigration Services (BCIS) 

within the Department of Homeland Security (DHS) to carry 

out several functions transferred to BCIS from the former 

Immigration Services Division of the Immigration and 

Naturalization Service (INS) under the Department of 

Justice (DOJ). The transfer became effective March 1, 

2003.

• BCIS is now referred to as the United States Citizenship and 

Immigration Services (CIS).

(Note: Throughout these slides, we use “CIS” to refer to both the new U.S. CIS 

and the former Immigration Services Division of INS.)

1Pub. L. No. 107-296, § 451, 116 Stat. 2195.
Enclosure

Page 9 GAO-04-309R Immigration Application Fees

4

Introduction and Objectives (cont.)

• CIS’s functions include adjudicating and processing 

applications for U.S. citizenship and naturalization, 

administering work authorizations and other petitions, and 

providing services for new residents and citizens.

• CIS collects fees from applicants to process the various 

immigration-related applications and petitions.

• CIS also receives appropriated funds that are used for 

administrative and overhead costs (including records 

management) and backlog reduction.2

2A backlog exists when the processing time for a newly filed application exceeds the processing target

time, which is 6 months or less for every application.
Enclosure

Page 10 GAO-04-309R Immigration Application Fees

5

Introduction and Objectives (cont.)

• HSA requires that we report on whether CIS is likely to 

derive sufficient funds from fees to carry out its functions in 

the absence of appropriated funds.3

• Consequently, the objective of our review was to determine 

whether fees collected are sufficient to fund CIS’s operating 

costs.

• To do this, we

• determined amounts of application fees projected and collected for funding CIS operations for fiscal years 2001 

through 2003, and

• identified CIS’s operating costs for fiscal years 2001 through 2003.

3Pub. L. No. 107-296, § 477(d)(3), 116 Stat. 2210.
Enclosure

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6

Results in Brief

• Although all costs of CIS’s operations were not identifiable, 

on the basis of our review of the current fees, we 

determined that fees were not sufficient to fully fund CIS’s 

operations. In part, this has resulted because

• the current fee schedule is based on an outdated fee 

study that did not include all costs of CIS’s operations 

and

• costs have increased due to an additional processing requirement and other actions that are not covered by 

the current fees.
Enclosure

Page 12 GAO-04-309R Immigration Application Fees

7

Results in Brief (cont.)

• Costs are not identifiable in part because

• CIS cannot accurately track the status of each 

application as it moves through the process,4 and

• remaining steps needed to complete the processing of 

pending applications and the related costs are not 

known.

• As shown in table 1, for the 3-year period from fiscal year 

2001 to 2003, CIS’s operating costs exceeded available 

fees, thus creating the need for appropriated funds. CIS 

projects that this situation will remain in fiscal year 2004.

4According to CIS officials, a new system that will track application status is expected to be

deployed in 2006.
Enclosure

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8

Results in Brief (cont.)

Source: GAO analysis of CIS data.

aCarryforward fees represent fees collected but not used in the current year. These unused fees are

carried forward to the next year to continue processing incomplete applications.

Table 1: Funds and Reported Costs for Fiscal Years 2001-2003

(Dollars in thousands)

Carryforward feesa available - beginning FY 2001 107,673 $ 

Fees collected 3,432,871 

Fees available for CIS operations 3,540,544 

Processing costs 3,557,702 $ 

Administrative and overhead costs 440,900 

Total operating costs 3,998,602 

Costs not covered by fees (458,058) 

S&E appropriation - backlog 160,000 $ 

S&E appropriation - admin & overhead 440,900 

Total S&E appropriation 600,900 

Carryforward fees available - end FY 2003 142,842 $ 

3-year totals
Enclosure

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9

Results in Brief (cont.)

• During the same period, the number of pending applications 

increased by more than 2.3 million (about 59 percent) since 

the beginning of fiscal year 2001 to a total of about 6.2 

million at the end of fiscal year 2003 despite additional 

annual appropriations beginning in fiscal year 2002 of $80 

million to address the backlog. 

• In addition, CIS has not performed an analysis of the steps 

needed to reduce processing times down to the 6-month 

average goal established in the President’s backlog 

initiative. These times have increased significantly in fiscal 

year 2003.
Enclosure

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10

Results in Brief (cont.)

• Because DHS is still in the process of determining how 

administrative and overhead functions will be carried out 

and the related costs allocated, CIS does not know what 

future administrative and overhead costs will be.

• We are making recommendations for CIS to determine (1) 

the steps needed and related costs to process current and 

pending applications, (2) the administrative and overhead 

functions and related costs that need to be funded, and (3) a 

plan to improve timeliness of fee schedule updates.

• DHS officials generally agreed with our conclusions and 

recommendations, but stated that our recommendations did 

not address the fact that because fee schedules are not 

updated promptly, full costs are not captured. We added a 

recommendation to address this issue.
Enclosure

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11

Background

• In October 1988, Congress authorized INS to collect fees to 

recover the cost of providing immigration adjudication and 

naturalization services and authorized and established in 

the Treasury the Immigration Examinations Fee Account 

(IEFA).5

• CIS collects such fees from applicants for over 50 different 

application types and deposits the fees into the IEFA. The 

fees range from $15 to $580.

• Unused fees are carried forward to the next year and are 

available to continue processing incomplete applications.

5Pub. L. No. 100-459, § 209(a), 102 Stat. 2203.
Enclosure

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12

Background (cont.)

• CIS also collected and deposited fees into the H-1B NonImmigrant Petitioner Fee Account (H-1B account).

• The H-1B account was established in October 19986 to fund 

a number of activities administered by the Department of 

Labor, National Science Foundation, and DOJ. 

• Employers were also required to pay a fee of $500 for each 

H-1B worker sponsored,7 and the fee was applied to filings 

made before October 1, 2001.

6Pub. L. No. 105-277, Div. C, Tit. IV, § 414(b), 112 Stat. 2681-652.

7Pub. L. No. 105-277, Div. C, Tit. IV, § 414(a), 112 Stat. 2681-651. CIS received 1.5 percent of the $500 

which was in addition to the base filing fee of $130 that was deposited to the IEFA.
Enclosure

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13

Background (cont.)

• In October 2000, the additional fee was increased to $1,000 

and extended for filings made before October 1, 2003.8

• Therefore, the additional fee was no longer collected. Any 

unused additional H-1B fees will also be carried forward and 

used to process backlogged applications.

• In 1990,9 INS was authorized to set fees at a level to fund 

the cost of asylum processing and other services provided 

to immigrants at no charge. As a result, INS added a 

surcharge to the immigration application fees to recover 

these additional costs.

8Pub. L. No. 106-311, § 1, 114 Stat. 1247. CIS received 4 percent of the $1,000 fee.

9Pub. L. No. 101-515, § 210(d), 104 Stat. 2121.
Enclosure

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14

Background (cont.)

• In November 2002, HSA repealed the authority to include 

the cost of asylum processing and other services provided 

to immigrants at no charge, referred to as the surcharge.10

• As a result, in January 2003, the fees were adjusted by 

discontinuing the surcharge for asylum and refugee 

services. 

• In February 2003,11 CIS was reauthorized to collect such 

fees and the surcharge was reinstated.

• According to a CIS official, prior to the establishment of 

DHS, INS received an appropriation in each fiscal year that 

it used for administrative and overhead costs. 

10Pub. L. No. 107-296, § 457, 116 Stat. 2201.

11Pub. L. No. 108-7, § 107, Div. L. § 107, 117 Stat. 532.
Enclosure

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15

Background (cont.)

• A portion of the fiscal year 2003 appropriation was allocated 

by INS to its former Immigration Services Division (now 

CIS). For fiscal year 2004, CIS received a separate 

appropriation.

• INS/CIS used $80 million in appropriated funds annually in 

fiscal years 2002 and 2003 for the President’s backlog 

initiative, a 5-year effort with a goal to achieve a 6-month 

average processing time per application. CIS will continue 

to use $80 million of its appropriations through fiscal year 

2006 for the President’s backlog initiative.

• The President’s backlog initiative calls for using $500 million 

over 5 years. Each $100 million installment is comprised of 

$80 million in appropriated funds and $20 million in fee 

collections.
Enclosure

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16

Background (cont.)

• In response to the President’s initiative, CIS established a 

Backlog Elimination Plan that was issued in March 2002. 

The plan is currently being revised.

• The Chief Financial Officers Act of 1990 requires that DOJ 

perform biennial fee reviews. As a result, INS conducted 

reviews of its examination fees to determine the full cost of 

providing immigration adjudication and naturalization 

services. 

• INS’s last biennial fee review was completed in fiscal year 

1999. Because of the lengthy process to publish a notice of 

proposed fee increases, receive and review comments, and 

publish a final rule, the fees did not go into effect until 

February 2002, as shown in figure 1.
Enclosure

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17

Background (cont.)

• CIS attempted to increase application fees in fiscal year 

2003 to cover certain additional costs related to expanded 

security checks.

• The request was submitted to DOJ management in 

November 2002. According to a CIS official, the request 

was not acted upon because of the upcoming transition of 

CIS from DOJ to DHS and was returned to CIS in March 

2003.

• CIS officials told us they recently revised this fee increase 

proposal, which was approved by DHS and submitted to the 

Office of Management and Budget (OMB) in October 2003.
Enclosure

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18

Background (cont.)

•Figure 1 shows the timing of the events that have affected fees.

Figure 1: Fee History Timeline

12Except for the fee for the Application for Naturalization, which became effective in January 1999.
Enclosure

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19

Sufficiency of Fees

• Although all costs of CIS’s operations were not identifiable, 

on the basis of our review of the current fees, we 

determined that fees were not sufficient to fully fund CIS’s 

operations. In part, this has resulted because

• the current fee schedule is based on an outdated fee 

study that did not include all costs of CIS’s operations 

and

• costs have increased due to an additional processing requirement and other actions that are not covered by 

the current fees.

• Costs are not identifiable in part because of CIS’s inability to

accurately track applications and the remaining steps 

needed to complete processing the backlog of pending 

applications. The related costs are not known.
Enclosure

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20

Sufficiency of Fees (cont.)

• These issues are discussed in more detail later in these 

slides.

• Although reported processing costs exceeded available fees 

for the 3-year period ending in fiscal year 2003, CIS had 

sufficient funds to cover these costs because it

• received $80 million each year in appropriated funds to 

assist with the backlog (see table 2) and

• reduced planned spending in fiscal year 2003.
Enclosure

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21

Sufficiency of Fees (cont.)

• For the 3-year period, CIS received more than $4 billion to 

complete the processing of 20.1 million applications, but the 

number of pending applications still increased by 2.3 million. 

However, the remaining costs necessary to complete the 

backlog of pending applications is not known and therefore 

has not been included in the reported costs.

• In addition, as shown in table 2, CIS was provided $441 

million in appropriated funds during fiscal years 2001 

through 2003 that it used to cover administrative and 

overhead costs. 
Enclosure

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22

Sufficiency of Fees (cont.)

Source: GAO analysis of CIS data.

Note: CIS officials told us appropriated funds are assumed to be fully obligated in the year received.

Therefore, the carryforward amount consists of unused fee collections only. For purposes of demonstrating

whether fees would be sufficient to cover both processing and total operating costs, we presented the

information in the above format before including appropriated funds.

(Dollars in thousands) 3-year

FY 2001 FY 2002 FY 2003 totals

Carryforward fees-beginning 107,673 $ 188,374 $ 128,926 $ 107,673 $ 

Fees collected 1,083,718 1,177,634 1,171,519 3,432,871

Fees available 1,191,391 $ 1,366,008 $ 1,300,445 $ 3,540,544 $ 

Processing costs (1,003,017) (1,317,082) (1,237,603) (3,557,702)

Administrative & overhead costs (160,403) (136,756) (143,741) (440,900)

Total operating costs (1,163,420) $ (1,453,838) $ (1,381,344) $ (3,998,602) $ 

Excess fees (costs not covered by fees) 27,971 $ (87,830) $ (80,899) $ (458,058) $ 

S&E appropriation - backlog - 80,000 80,000 160,000

S&E appropriation - admin & overhead 160,403 136,756 143,741 440,900

Total S&E appropriations 160,403 $ 216,756 $ 223,741 $ 600,900 $ 

Carryforward fees-end 188,374 $ 128,926 $ 142,842 $ 142,842 $ 

Table 2: Schedule of Available Funds and Reported Costs
Enclosure

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23

Sufficiency of Fees (cont.)

• Carryforward fees to process pending applications 

increased by only $35 million (33 percent) to a total of 

almost $143 million at the same time the number of pending 

applications increased by more than 2.3 million (59 percent) 

to a total of 6.2 million.

• CIS does not know the remaining costs to complete the 

processing of pending applications because

• it does not know the current full cost to process a new 

application received or to complete the processing of a 

pending application, and
Enclosure

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24

Sufficiency of Fees (cont.)

• it does not have a real-time system to accurately track individual applications as they move through each stage 

of the process.13

• CIS officials told us they (1) plan to start a new fee study 

next year and (2) are working on a system to track where an 

individual application stands in the approval process.

• CIS officials told us that in August 2003, DHS approved 

CIS’s proposal for a system to track application status, 

which is expected to be deployed in 2006.

13INS’s financial statement auditors reported this issue as a material weakness in its Reports on Internal 

Control for fiscal years 2000 through 2002. 
Enclosure

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25

Sufficiency of Fees (cont.)

Fees Are Outdated

• The current fee schedule became effective in February 2002 

and is based on the fee review completed in fiscal year 

1997.

• The February 2002 fee increase adjusted the existing fees 

by

• increasing the fees for inflation (based on OMB 

inflationary factors) and

• adding a $5 charge to each application fee for 

information technology and quality assurance costs.
Enclosure

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26

Sufficiency of Fees (cont.)

• However, at a minimum, the fee increase did not include the 

following items, which were identified in the fee review 

completed in fiscal year 1999. CIS estimated the cost of 

these items to be about $101 million.

• New Integrated Card Production System

• New National Customer Service Center

• National Records Center

• Hiring of term/temporary employees

• Hiring of additional adjudication officers

• Expansion of Service Center operations
Enclosure

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27

Sufficiency of Fees (cont.)

• According to CIS officials, the above items were not 

included in the approved fee increase that became effective 

in fiscal year 2002 because it was determined that the 

resulting fee increases would have been excessive. For 

example, the Application for Naturalization fee would have 

increased by more than 50 percent from $225 to $345.

• As a result, the February 2002 fee increase did not fully 

cover processing costs at that time.
Enclosure

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28

Sufficiency of Fees (cont.)

New Requirements and Other Actions Increased Costs

• CIS officials told us costs were affected as a result of new 

departmental requirements to address problems arising 

from the September 11, 2001 terrorist attacks. The main 

requirement expanded Interagency Border Inspection 

System (IBIS) security checks, which are now mandatory for 

all new and pending applications.

• CIS officials told us costs were also affected as a result of 

other actions including:

• repeal of surcharge for asylum and refugee services 

($25 million in fiscal year 2003),
Enclosure

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29

Sufficiency of Fees (cont.)

• settlement of class action lawsuit relating to the Legalization Program of 1986 ($5.3 million in fiscal year 

2003 ),

• settlement of class action lawsuit relating to a union grievance concerning payment of overtime to 

adjudication officers ($2.2 million in fiscal year 2003 ),

• A-76 outsourcing study to determine which government services to contract out ($5 million budgeted for fiscal 

year 2004, $1 million for fiscal year 2005), and

• establishment of a new Office of Citizenship ($4.5 million budgeted for fiscal year 2004).

• CIS had estimated that the cost of 555 additional staff to 

perform the expanded IBIS checks for fiscal years 2003 and 

2004 would total about $69 million. 
Enclosure

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30

Sufficiency of Fees (cont.)

• CIS unsuccessfully attempted to increase application fees 

by $10 to cover the costs of these IBIS checks. CIS 

submitted a proposal to increase fees to DOJ management 

in November 2002. According to CIS officials, the request 

was not acted upon before the upcoming transition of CIS 

from DOJ to DHS. DOJ returned the request to CIS in 

March 2003.

• According to CIS officials, CIS revised this proposal to better 

capture efficiencies in the IBIS check process, actual costs 

incurred to date, and projected future costs. The revised 

proposal was approved by DHS and submitted to OMB in 

October 2003.
Enclosure

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31

Sufficiency of Fees (cont.)

Pending Applications Continue to Grow

• The number of pending applications at year end increased 

about 59 percent from about 3.9 million in fiscal year 2000 

to about 6.2 million in fiscal year 2003.

• During the same 3-year period, application processing times 

increased significantly (see table 3). As a result, the 

number of applications completed decreased from more 

than 7 million for both fiscal years 2001 and 2002 to 6.2 

million for fiscal year 2003.
Enclosure

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32

Sufficiency of Fees (cont.)

• The increases in pending applications occurred despite the 

backlog initiative efforts and the additional appropriated 

funds provided to carry out the efforts. As shown in table 2, 

about $143 million in carryforward fees remained to process 

applications as of September 30, 2003.

• The goal of the backlog initiative is to reduce processing 

time to an average of 6 months or less per application and 

eliminate the backlog.
Enclosure

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33

Sufficiency of Fees (cont.)

• In its March 2002 Backlog Elimination Plan, CIS estimated 

that it would need to hire over 1,500 additional staff to meet 

the backlog reduction milestones and achieve the 

processing time goals by the end of fiscal year 2003. 

According to CIS officials, the success of this plan was 

contingent upon, among other things, implementation of a 

new fee schedule that would fully recoup their processing 

costs, which did not occur.

• In addition, CIS’s plan did not include the staff needed to 

perform the expanded IBIS security checks.
Enclosure

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34

Sufficiency of Fees (cont.)

• Further, CIS has not established the time it should take to 

perform each step to complete the processing of 

applications, nor has it identified the remaining steps 

needed to complete processing the pending applications 

and the related costs. 

• Table 3 shows the average reported processing times for 

application types with the most volume and compares with 

the average goals set out in CIS’s March 2002 plan. The 

plan included goals to be achieved by the end of fiscal years 

2002 and 2003.
Enclosure

Page 40 GAO-04-309R Immigration Application Fees

35

Sufficiency of Fees (cont.)

FY 2002 FY 2003 Projected (as of 10/30/03)

I-485 10 6 14 13 33

I-130 10 6 31 25 51

I-140 4 3 7 5 10

I-129 2 1 2 2 3

I-539 5 1 9 4 7

I-90 3 1 4 9 19

I-131 2 1 3 3 7

I-765 2 1 2 3 3

I-751 9 6 17 9 45

I-821 7 6 63 20 10

N-400 8 6 9 10 14

N-600 9 6 10 6 8

N-643 9 6 5 10 5

FY 2001

Table 3: Average Reported Processing Time (Months)

FY 2002 FY 2003 Expected goals in backlog 

plan

Application 

number

Source: CIS.
Enclosure

Page 41 GAO-04-309R Immigration Application Fees

36

Sufficiency of Fees (cont.)

• As shown in table 3, average application processing times 

have significantly increased in fiscal year 2003, and are 

significantly higher than the goals set out in the March 2002 

plan.

• CIS told us it is revising its March 2002 Backlog Elimination 

Plan to include resources needed to eliminate the backlog 

and achieve an average processing time of 6 months per 

application. HSA requires this revised plan to be completed 

by November 26, 2003.
Enclosure

Page 42 GAO-04-309R Immigration Application Fees

37

Sufficiency of Fees (cont.)

Future Administrative and Overhead Costs Are Uncertain

• Because DHS is still in the process of determining how the 

administrative and overhead functions will be carried out 

and the related costs allocated, CIS does not know what its 

future administrative and overhead costs will be.

• CIS officials told us that since CIS was established as a 

separate bureau in March 2003, DHS has been in the 

process of determining which support services and 

functions, such as shared services, modernizing and 

supporting shared databases, shared infrastructure, and 

other forms of support, should be transferred or allocated to 

CIS.
Enclosure

Page 43 GAO-04-309R Immigration Application Fees

38

Sufficiency of Fees (cont.)

• Until this process is completed, CIS cannot determine the 

costs of the administrative and overhead functions that will 

need to be funded.
Enclosure

Page 44 GAO-04-309R Immigration Application Fees

39

Conclusions

• Absent actions to increase fees and/or reduce processing 

costs and times, as well as to improve the timeliness and 

completeness of fee schedule updates, CIS will continue to 

need appropriated funds to avoid even greater increases in 

the backlog of pending applications.

• However, the full costs of CIS’s operations that need to be 

funded cannot be determined until analyses of the costs to 

process incoming and pending applications and 

administrative and overhead costs are completed.
Enclosure

Page 45 GAO-04-309R Immigration Application Fees

40

Recommendations

• In order to achieve the goals of the President’s backlog 

initiative, we recommend that the Secretary of Homeland 

Security direct the Director of CIS to perform an analysis of 

current processing functions to determine steps needed to 

reduce the processing time to an average of 6 months or 

less.

• In order to determine the cost to process new and pending 

applications, we recommend that the Secretary of 

Homeland Security direct the Director of CIS to

• perform a comprehensive fee study to determine the 

costs to process new immigration applications and

• determine the costs to eliminate the backlog of pending 

applications.
Enclosure

Page 46 GAO-04-309R Immigration Application Fees

41

Recommendations (cont.)

• In order for CIS to know the full cost of its operations, we 

recommend that the Secretary of Homeland Security direct 

the Deputy Secretary to identify which support services and 

functions, such as shared services, modernizing and 

supporting shared databases, shared infrastructure, and 

other forms of support, and the cost of those functions 

should be transferred or allocated to CIS.

• Regarding the timing of fee schedule updates, we 

recommend that the Secretary of Homeland Security direct 

the Director of CIS to identify options to improve the 

timeliness for implementing fee updates to help ensure that 

all costs are captured. 
Enclosure

Page 47 GAO-04-309R Immigration Application Fees

42

Agency Comments and Our Evaluation

• DHS and CIS officials provided oral comments on a draft of 

this report. They generally agreed with our conclusions and 

recommendations.

• However, they stated that our recommendations do not 

address the fact that fee schedules are not updated 

promptly to capture the full costs of adjudications.

• The timing of fee schedule updates is a key issue, and we 

have added a recommendation to address this issue. 

• DHS and CIS officials also provided technical comments, 

which we incorporated as appropriate.
Enclosure

Page 48 GAO-04-309R Immigration Application Fees

43

Scope and Methodology

Scope

• We analyzed actual and estimated/projected application 

fees and appropriations that fund CIS operations and the 

related costs for fiscal years 2001 through 2003.

Methodology

• To determine if fees collected are sufficient to fund CIS’s 

operations, we

• interviewed CIS staff and officials and external auditors,

• reviewed biennial fee review reports,

• reviewed audit reports,

• reviewed financial records, including trial balances,
Enclosure

Page 49 GAO-04-309R Immigration Application Fees

44

Scope and Methodology (cont.)

• reviewed CIS budget-related documents, including the 

Reports on Budget Execution (SF-133),

• analyzed various other documents provided by CIS 

containing information on numbers of applications and 

application fees, and

• analyzed data on fee collections and appropriated funds, 

and compared these to our analysis of the related costs.

• We assessed the reliability and completeness of the CISprovided financial data for fiscal years 2001 and 2002 by 

reconciling the funds received and costs incurred to the 

audited financial statements for which clean opinions were 

issued for fiscal years 2001 and 2002.
Enclosure

Page 50 GAO-04-309R Immigration Application Fees

45

Scope and Methodology (cont.)

• For fiscal year 2003 data, the audit was not yet complete.

We did not otherwise verify the data.

• We reviewed the methodology, but did not verify CIS’s 

estimate of the costs of expanded IBIS security checks.

• We did not assess the effectiveness of CIS’s application 

processing functions nor verify the accuracy of application 

totals.
Enclosure

Page 51 GAO-04-309R Immigration Application Fees

46

Scope and Methodology (cont.)

• We requested comments on a draft of these briefing slides 

from DHS and CIS officials. We received oral comments 

from DHS and CIS that were incorporated into these briefing 

slides as appropriate.

• We conducted our work from March through November 

2003 in accordance with generally accepted government 

auditing standards.

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