Page 1 GAO-13-395R, Food Assistance

United States Government Accountability Office

Washington, DC 20548 

March 7, 2013 

The Honorable Debbie Stabenow 

Chairwoman 

Committee on Agriculture, Nutrition, and Forestry 

United States Senate 

Dear Chairwoman Stabenow: 

Subject: Food Assistance: Briefing on U.S. Department of Agriculture’s Food Assistance 

Procurement Process 

This letter formally transmits the enclosed briefing that we presented to your staff on 

February 5, 2013. You asked us to study the U.S. Department of Agriculture’s (USDA) food 

assistance procurement process. This report (1) describes USDA’s organization and 

management structure for food assistance procurement, and (2) assesses whether there is 

overlap and duplication in USDA’s organization and management structure for food 

assistance procurement.1

To conduct this work, we reviewed the activities of USDA’s Agricultural Marketing Service 

(AMS); USDA’s Farm Service Agency (FSA), including the Kansas City Commodity Office; 

USDA’s Foreign Agriculture Service; USDA’s Food and Nutrition Service; and the U.S. 

Agency for International Development. We interviewed agency officials and commodity 

vendors; obtained and reviewed documents from USDA and other relevant U.S. agencies; 

and conducted fieldwork in Kansas City, Missouri. We interviewed agency officials about the 

data they provided. In addition, for the staffing data, we compared the staffing data to prior 

period data; for the contracts, we obtained information from agency officials about the 

systems from which the data were reported. We determined that the data we used were 

sufficiently reliable for our purposes. 

We conducted this review from October 2012 to March 2013, in accordance with generally 

accepted government auditing standards. Those standards require that we plan and perform 

the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that the evidence 

obtained provides a reasonable basis for our findings and conclusions based on our audit 

objectives. 

In summary, while USDA’s organization and management structure for its food assistance 

procurement might suggest overlap, we found no duplication of AMS and FSA efforts. For 

example, AMS and FSA follow similar contracting rules and regulations; however, AMS and 

 

1

Program overlap occurs when programs have similar goals, similar activities or strategies to achieve them, or 

similar target recipients. Duplication occurs when two or more agencies or programs are engaged in the same 

activities or provide the same services to the same beneficiaries. See GAO, 2012 Annual Report: Opportunities 

to Reduce Duplication, Overlap and Fragmentation, Achieve Savings, and Enhance Revenue, GAO-12-342SP 

(Washington, D.C.: Feb. 28, 2012). 
Page 2 GAO-13-395R, Food Assistance 

FSA have different procurement processes and funding authorities and purchase different 

commodities. 

In addition, AMS and FSA have taken steps to streamline their procurement processes 

through reorganization and the implementation of their Web-Based Supply Chain 

Management System. Finally, while AMS and FSA have made several changes to 

reorganize and streamline the food assistance procurement process, the agencies have not 

evaluated their efforts. 

We provided a draft of the briefing slides to USDA. The agency did not provide any 

comments. 

We are sending copies of this report to the Secretary of Agriculture and appropriate 

congressional committees. This report will also be available at no charge on our website at 

http://www.gao.gov. 

If you or your staff have any questions about this report, please contact me at 

(202) 512-9601 or melitot@gao.gov. Contact points for our Offices of Congressional 

Relations and Public Affairs may be found on the last page of this report. Key contributors to 

this report were Kathryn A. Larin, Assistant Director; Valérie Nowak, Assistant Director; 

Rhonda M Horried; Daniel Meyer; Mark Needham; and Jose M. Pena, III. Karen Deans 

provided technical support. 

Sincerely yours, 

Thomas Melito, Director 

International Affairs and Trade 

Kay Brown, Director 

Education, Workforce, and Income Security 

Enclosure 1 
Page 3 GAO-13-395R, Food Assistance

Enclosure 1 

Briefing to Staff of the Senate 

Agriculture, Nutrition, and Forestry 

Committee

Observations on U.S. Department of

Agriculture’s Food Assistance 

Procurement Process 

February 5, 2013

Page 1

 
Page 4 GAO-13-395R, Food Assistance 

Objectives

(1) Describe the U.S. Department of Agriculture's (USDA) 

organization and management structure for food 

assistance procurement. 

(2) Assess whether there is overlap and duplication in 

USDA’s organization and management structure for 

food assistance procurement.

Page 2

 
Page 5 GAO-13-395R, Food Assistance 

Scope and Methodology

• We reviewed the activities of 

o USDA’s Agricultural Marketing Service (AMS)

o USDA’s Farm Service Agency (FSA)—including the 

Kansas City Commodity Office (KCCO)

o USDA’s Foreign Agriculture Service (FAS) 

o USDA’s Food and Nutrition Service (FNS) 

o U.S. Agency for International Development (USAID)

• We interviewed agency officials and commodity vendors; 

obtained and reviewed documents from USDA and other 

relevant U.S. agencies; and conducted fieldwork in Kansas 

City, Missouri.

Page 3

 
Page 6 GAO-13-395R, Food Assistance 

Scope and Methodology (cont.)

GAO’s definition of overlap: 

• Programs that have similar goals, devise similar 

strategies and activities to achieve those goals, or 

target similar beneficiaries.

GAO’s definition of duplication:

• When two or more agencies or programs are 

engaged in the same activities or provide the 

same services to the same beneficiaries.

Page 4

These definitions are based on prior GAO work, GAO, 2012 Annual Report: Opportunities to Reduce Duplication, Overlap and 

Fragmentation, Achieve Savings, and Enhance Revenue, GAO-12-342SP (Washington, D.C.: Feb. 28, 2012).

 
Page 7 GAO-13-395R, Food Assistance 

Background on U.S. Commodity Procurement

• AMS and FSA procure commodities for several FNS domestic 

programs, such as (1) National School Lunch Program, (2) Food 

Distribution Program on Indian Reservations, (3) the Emergency 

Food Assistance Program, (4) Food Assistance for Disaster 

Relief, and (5) Child and Adult Care Food Program.

• FSA procures commodities for several FAS and USAID 

international programs such as (1) Food for Peace Act, Title II; 

(2) Food for Progress; and (3) McGovern-Dole International 

Food for Education and Child Nutrition. 

Page 5

 
Page 8 GAO-13-395R, Food Assistance 

6

AMS Procures Commodities for Domestic Programs Only; FSA 

Procures Commodities for Domestic and International Programs

USDA 

Commodity

Procurement 

Agency

Staffing* Contracts FY 2012

Commodity 

Procurement

Customers

Domestic International

AMS 18 1,429 $1.4 billion FNS

FSA 

Domestic

FSA 

International

24

21

1,121

536

$.5 billion

$.8 billion

FNS

FAS and 

USAID

Totals 63 3,086 $2.7 billion

*Staffing does not include support branches or the Office of the Director, except for contracting officers and specialists.

 
Page 9 GAO-13-395R, Food Assistance 

USDA’s Procurement of Commodities Shows 

Signs of Organizational Overlap

• Both AMS and FSA follow similar contracting process.*

• Both FSA domestic and FSA international purchase 

four of the same commodities.

• Both AMS and FSA domestic have FNS as a customer.

Page 7

*The USDA contracting process is based on the Federal Acquisition Regulation, Agricultural 

Acquisition Regulations, and USDA Procurement Advisories.

 
Page 10 GAO-13-395R, Food Assistance 

Differences in AMS and FSA Domestic Commodities and Key 

Aspects of Procurements Do Not Indicate Duplication of Effort

AMS FSA

Commodities Perishable: such as red meat, fish, 

poultry, egg products, fruits, 

vegetables

Non-perishable: such as grain products, 

peanut products, dairy products (e.g. 

evaporated milk), oils 

Specifications Non-commercial Commercial

Inspections AMS Contractor quality assurance

Market support 

mechanism

Market surplus removal Non-recourse commodity loans

Funding authority Act of Aug. 24, 1935, ch. 615 

(amending the Agriculture Adjustment 

Act), Sec. 32 (codified at 7 USC 

612c)

Commodity Credit Corporation authority 

derived from section 416 of the Agricultural 

Act of 1949 (codified at 7 USC 1431)

Page 8

 
Page 11 GAO-13-395R, Food Assistance 

FSA’s Domestic and International Branches Procure Commodities 

Separately Due to Differences in Customers, Packaging, Solicitations, 

and Contract Awards

Page 9

Differences FSA Domestic FSA International

Customers FNS USAID and FAS

Packaging Commercial Non-commercial

Grouping of 

Solicitations and 

Contract Awards

Quarterly, by 

commodity group

Twice monthly for packaged,

ad hoc for bulk

Evaluation of 

Solicitations and 

Contract Awards

Lowest-priced 

commodity vendor

Lowest landed cost for 

commodity and ocean 

transportation vendors

Delivered to U.S. warehouses U.S. ports or intermediate 

locations

Source: USDA.

 
Page 12 GAO-13-395R, Food Assistance 

FSA International and Domestic Bulk Commodities* 

Are Procured Separately Due to Differences in Packaging and Delivery

International bulk commodities such as loose 

grains and vegetable oil are procured with 

international food assistance program funds 

and loaded directly into the hold of tanker 

vessel from a grain elevator to be delivered 

overseas.

Domestic bulk commodities include 

(1) whole corn purchased in 2200-pound totes 

that are delivered to Minnesota, and (2) nonfortified flour loaded into tanker trucks for 

delivery in the U.S. or lined 20-foot containers 

for the Army Air Force Exchange Service in 

Germany with funds from the National School 

Lunch Program.

Page 10

*The bulk commodity comparisons on this slide are intended to provide examples of the differences 

between domestic and international purchases but are not intended to be representative of, or 

generalizeable to, all commodities.

Source of photos: USDA.

 
Page 13 GAO-13-395R, Food Assistance 

USDA Has Made Efforts to Reorganize and 

Improve Its Procurement Process

Organizational Procurement Consolidation

• In 2011, AMS consolidated three program commodity procurement 

units into one commodity procurement division. 

• In 2010, FSA temporarily reorganized KCCO’s international and 

domestic procurement divisions under one procurement division, 

although the procurement processes are still separate.

Contract Administration 

• In 2011, AMS assumed administration of its contracts from FSA.

Page 11

 
Page 14 GAO-13-395R, Food Assistance 

USDA’s Web-Based Supply Chain Management 

(WBSCM) System Attempts to Streamline the 

Procurement Process

• USDA’s February 2011 assessment of WBSCM indicates that most 

procurement processes have been streamlined into one integrated 

system.

• USDA’s assessment of WBSCM reports that it provides a single, 

authoritative, and easy-to-access source of data, which gives users 

automated, useful standard and non-standard reports. 

• USDA’s assessment of WBSCM identified additional areas of 

improvement for international programs. According to AMS officials, 

a July 2013 enhancement of the system is planned in part to help 

improve the applicability of WBSCM for international programs.

Page 12

 
Page 15 GAO-13-395R, Food Assistance 

Concluding Observations

• USDA’s organization and management structure for its food 

assistance procurement might suggest overlap; however, 

we found no duplication of AMS and FSA efforts.

• AMS and FSA have taken steps to streamline their 

procurement processes through reorganization and the 

implementation of WBSCM. 

• While AMS and FSA have made several changes to 

reorganize and streamline the food assistance procurement 

process, the agencies have not evaluated their efforts.

Page 13
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