U.S. ARMY CORPS OF 

ENGINEERS

Building Overhead 

Costs into Projects 

and Customers' Views 

on Information 

Provided

Report to the Ranking Member, 

Committee on Environment and Public 

Works, U.S. Senate

June 2013

GAO-13-528

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-13-528, a report to the 

Ranking Member, Committee on Environment 

and Public Works, U.S. Senate

June 2013

U.S. ARMY CORPS OF ENGINEERS 

Building Overhead Costs into Projects and 

Customers' Views on Information Provided

Why GAO Did This Study

The Corps spends billions of dollars 

annually on projects in its Civil Works 

program. Part of the cost of doing 

business with the Corps involves 

paying for overhead—costs that do not 

directly relate to a specific project or 

activity but more generally support 

agency operations. Overhead costs 

are included in the amount that 

Congress appropriates for specific 

Corps projects and the amount that 

customers pay for Corps’ services. The 

Corps provides services to customers 

including other Department of Defense 

units, federal agencies, state and local 

governments, Indian tribes, and foreign 

governments. The Corps’ Civil Works 

program is organized around its 

headquarters, 8 divisions, and 38 

districts nationwide. Only district 

overhead is charged to projects; 

overhead for headquarters and 

divisions is not. 

You asked GAO to review the Corps’ 

process for building overhead costs 

into projects. This report examines 

(1) how the Corps builds overhead 

costs into its projects and 

(2) customers’ views on overhead 

information. To accomplish this, GAO 

reviewed Corps’ documentation of its 

overhead and billing processes, 

interviewed officials at Corps 

headquarters, 2 divisions, and 

4 districts based on geographic 

location, and interviewed 16 of the 

highest paying federal and nonfederal 

Corps’ customers in fiscal year 2012. 

The results of these interviews cannot 

be generalized to all customers but 

provided insights.

GAO is not making recommendations 

in this report. The Department of 

Defense did not provide comments.

What GAO Found

The U.S. Army Corps of Engineers (Corps) uses a multistep process to build 

overhead costs into projects. At the foundation of this process, Corps policy 

establishes two categories of costs to calculate overhead—general and 

administrative overhead expenses associated with district administrative offices, 

such as resource management, and technical overhead expenses associated 

with district technical offices, such as engineering. Using these two categories as 

a starting point, the Corps next calculates overhead rates as part of its annual 

budget process. Specifically, each district administrative and technical office 

develops operating budgets with overhead estimates, which are then 

consolidated and routed through district and division management, resulting in a 

final division-wide operating budget and overhead rates. The Corps then bills 

projects for overhead costs based on the number of hours its staff charge to 

projects. Overhead charges are not applied to hours worked by contracted labor, 

which represent a substantial amount of work. The Corps reports that it contracts 

out most of its design work and all of its construction work to private sector 

entities, such as architectural and engineering firms and construction companies. 

Finally, the Corps periodically monitors overhead costs and makes any 

necessary adjustments such as changing overhead rates, reducing expenditures, 

or providing rebates to customers. The Corps is able to monitor overhead 

because it tracks overhead costs separately from other project costs in its 

financial management system through specific overhead accounting codes. 

Corps customers’ views varied on whether overhead information is accessible 

and understandable. Half of the 16 highest paying customers GAO interviewed 

said overhead information is generally accessible and understandable. For 

example, one federal customer said that the Corps provides overhead 

information in monthly bills, and the information is understandable. One of the 16 

highest paying customers said overhead information is not accessible and 

understandable. For example, this nonfederal customer and the Corps could not 

agree on whether overhead information requested by the customer had been 

provided, leaving the customer unable to understand Corps costs, including 

overhead information. The remaining 7 highest paying customers had no opinion 

on accessibility and/or understandability. While offering no opinion on one aspect 

of overhead information, such as accessibility, they generally offered a positive 

opinion on the other aspect, understandability. For example, one federal 

customer had no opinion on whether the information was accessible but said that 

the information was understandable because the Corps explains how it builds 

overhead into its projects during project meetings. Conversely, a nonfederal 

customer told GAO that he has requested and received overhead information 

from the Corps—stating that overhead information is accessible, but he offered 

no opinion on understanding it. Among customers GAO interviewed, there were 

common views about overhead information. Specifically, some customers 

indicated that overhead information is important, but that overall project costs are 

more important than overhead costs. They also said that good communication is 

important to understanding overhead information.

View GAO-13-528. For more information, 

contact Anne-Marie Fennell at (202) 512-3841 

or fennella@gao.gov.
Page i GAO-13-528 Army Corps Overhead Process

Letter 1 

Background 3

The Corps Uses a MultiStep Process to Build Overhead Costs into 

Its Projects 7

Customers’ Views on Overhead Information 15

Agency Comments and Our Evaluation 19

Appendix I Objectives, Scope, and Methodology 20

Appendix II Structured Interview Administered to U.S. Army Corps of 

Engineers’ Customers 23

Appendix III GAO Contact and Staff Acknowledgments 31

Tables

Table 1: Information on the U.S. Army Corps of Engineers’ Federal 

and Nonfederal Customers 7

Table 2: List of Highest Paying Customers Interviewed 22

Figures

Figure 1: Locations of the U.S. Army Corps of Engineers’ Civil 

Works Divisions and Districts 4

Figure 2: Overview of U.S. Army Corps of Engineers’ Process for 

Building Overhead Costs into Projects 9

Figure 3: Components of the Hourly Rate Charged to U.S. Army 

Corps of Engineers’ Customers 13

Contents 
Page ii GAO-13-528 Army Corps Overhead Process

Abbreviations

Corps U.S. Army Corps of Engineers

G&A general and administrative overhead

This is a work of the U.S. government and is not subject to copyright protection in the 

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Page 1 GAO-13-528 Army Corps Overhead Process

441 G St. N.W.

Washington, DC 20548

June 19, 2013

The Honorable David Vitter

Ranking Member

Committee on Environment and Public Works

United States Senate

Dear Senator Vitter:

The U.S. Army Corps of Engineers (Corps) is responsible for 

investigating, developing, and maintaining water resource projects and 

spends billions of dollars annually on a variety of projects in its Civil 

Works program.1 As with private sector businesses, part of the cost of 

doing business with the Corps involves paying for overhead—costs that 

do not directly relate to a specific project or activity but more generally 

support agency operations. Examples of such costs include resource 

management, building security staff, rent, and information technology. 

Overhead costs are included in the amount that Congress appropriates 

for specific Corps projects and the amount customers pay for Corps’ 

services. The Corps provides services to an array of customers including 

other Department of Defense units, other federal agencies, state and 

local governments, Indian tribes, and foreign governments. These 

services include engineering and construction services, environmental 

restoration and management services, research and development 

assistance, management of water and land related natural resources, 

relief and recovery work, and other management and technical services.

You asked us to review the Corps’ process for building overhead costs 

into projects. This report examines (1) how the Corps builds overhead 

costs into its projects and (2) Corps customers’ views on overhead 

information.

To determine how the Corps builds overhead costs into its projects, we

reviewed Corps documentation regarding its overhead and billing 

processes including, among other things, overhead guidance for 

headquarters and the eight Corps divisions that conduct civil works 

 

1 In addition to the Civil Works program, the Corps has a Military program, which provides, 

among other things, engineering and construction services to other U.S. government 

agencies and foreign governments. This report only discusses the Civil Works program.

 
 

Page 2 GAO-13-528 Army Corps Overhead Process

activities. We interviewed officials at Corps headquarters and two division 

and four district offices—selected based on geographic location—about 

the overhead process and information used to estimate, allocate, and bill 

overhead to projects. We did not evaluate the accuracy or legal 

sufficiency of the Corps’ overhead formulas and calculations.2 We 

received an agency demonstration of how the Corps’ financial 

management system tracks overhead costs separately from other project 

costs, reviewed selected Corps customers’ bills provided by the Corps 

and some Corps customers, reviewed Corps overhead documentation, 

interviewed Corps officials knowledgeable about how the Corps tracks 

and bills overhead costs, and interviewed selected Corps customers. To 

assess Corps customers’ views on overhead, we interviewed the 16 

highest paying federal and nonfederal customers in fiscal year 2012 for 

each of the eight Corps divisions that conduct civil works activities. Our 

questions covered the importance the customers place on obtaining 

overhead information, availability of and access to such information, and 

how understandable the customers find the overhead information the 

Corps provides. The interview results are not generalizable to all Corps 

civil works customers but provide illustrative examples for the 16 

customers. In addition to these 16 customers, we interviewed 8 other 

Corps customers who represented geographic variation and different 

funding mechanisms to gather their views on the Corps’ overhead 

information.3 Appendix I contains more detailed information on our 

objectives, scope, and methodology and appendix II contains the 

questions from our interview with the 16 highest paying customers.

We conducted this performance audit from July 2012 to June 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.

 

2 This report is intended to provide a descriptive overview of the Corps’ practices. It does 

not attempt to evaluate the legal sufficiency or propriety of these practices.

3 Corps customers pay for Corps services through one of the following three funding 

mechanisms—on a reimbursable basis, on a cost share basis, and on a direct fund basis 

whereby the customer pays for Corps services in advance.
 

Page 3 GAO-13-528 Army Corps Overhead Process

The Corps is one of the world’s largest public engineering, design, and 

construction management agencies. The Civil Works program employs 

about 23,000 full-time equivalents,4 with staff in headquarters; 8 divisions, 

which were established generally according to watershed boundaries and 

are headed by a division commander, who is a military officer; and 38 

districts nationwide.5 The program covers hundreds of civil works projects 

nationwide and comprises water resource development activities, 

including flood risk management, navigation, recreation, and 

infrastructure and environmental stewardship. Headquarters and divisions 

generally establish policy and provide oversight, and districts implement 

projects. See fig. 1 for the locations of Corps civil works divisions and 

districts.

 

4 A full-time equivalent consists of one or more employed individuals who collectively 

complete 2,080 work hours in a given year. Therefore, one full-time employee or two halftime employees equal one full-time equivalent.

5 The Corps also has a number of centers that provide centralized services, such as 

financial services, and a number of Centers of Expertise that assist the Corps divisions 

and districts in the planning, design, and technical review of civil works projects. The 

Corps established the centers to consolidate expertise, improve consistency, reduce 

redundancy, and enhance institutional knowledge, among other things. For a full list of the 

Corps’ Centers of Expertise, see 

http://www.usace.army.mil/about/centersofexpertise.aspx. 

Background 
 

Page 4 GAO-13-528 Army Corps Overhead Process

Figure 1: Locations of the U.S. Army Corps of Engineers’ Civil Works Divisions and Districts
 

Page 5 GAO-13-528 Army Corps Overhead Process

More than 85 percent of Corps civil works staff work in the districts, which 

have a planning and executing role for Corps’ projects. Each district office 

is headed by a district commander, who is also a military officer, and each 

district has a number of administrative and technical offices. 

Administrative offices, such as resource management, security, and 

general counsel, provide general administrative support. Technical 

offices, such as engineering, construction, and real estate, provide 

technical services to customers on specific projects.

Corps districts vary widely in the number of full-time equivalents they 

employ for civil works activities. Following are full-time equivalent data (in 

parentheses) for the two largest and two smallest districts, as well as two 

medium-sized districts, as reported by the Corps.

• The two largest districts: New Orleans (1,295) and Portland (1,155).

• Two medium-sized districts: Kansas City (530) and Fort Worth (515).

• The two smallest districts: Charleston (123) and Honolulu (64).

Only district overhead is charged to projects; headquarters and division 

overhead is not.6 The Corps receives an appropriation that covers 

overhead expenses incurred by the Corps’ headquarters and divisions. 

Districts, however, do not receive an appropriation to fund their overhead, 

so to cover those costs, districts must include overhead as part of project 

costs and bill those costs directly to customers.7

Districts use the Corps’ revolving fund—a permanent appropriation 

established by the Civil Function Appropriations Act of 1954—to finance 

their overhead costs, then reimburse the fund with overhead payments 

received from project appropriations and customers.8 In this way, the 

revolving fund, which maintains a number of accounts to which district 

staff charge their time, allows the financing of agency activities because 

the Corps charges for services and uses the proceeds to finance its

spending, usually on a self-sustaining basis. Corps-wide policy includes a 

 

6 Certain centralized activities, such as information technology and human resource 

services, are directed by Corps headquarters and charged to districts. 

7 The Corps also has centers, such as the Huntsville Engineering Center, that do not 

receive an appropriation to fund their overhead.

8 Pub. L. No. 83-153, 67 Stat. 197, 1999 (1953), codified as amended at 33 U.S.C. §§ 

576, 701b-10.
 

Page 6 GAO-13-528 Army Corps Overhead Process

goal that each division’s overhead account achieve a balance of zero at 

the end of each fiscal year.9 Corps policy states that a balance within plus 

or minus 1 percent of actual expenses is considered the equivalent of a 

zero balance and, therefore, acceptable.10

The Corps receives the bulk of its funding from Congress. The Corps’ 

fiscal year 2012 appropriations for the Civil Works program totaled about 

$6.7 billion—about $5 billion in regular appropriations and about $1.7 

billion in disaster appropriations. The appropriation covering headquarters 

and division overhead expenses was $185 million. According to Corps 

officials, Congress provided about 73 percent of the Corps’ civil works

funding in fiscal year 2012. The remaining 27 percent—about $2.5 

billion—was provided by the Corps’ federal and nonfederal customers. 

Specifically, the Corps reported receiving about 17 percent of its fiscal 

year 2012 funding from federal customers on a reimbursable basis, about 

6 percent from nonfederal customers on a cost share basis, and about 4 

percent from federal customers on a direct fund basis, whereby the 

customer pays for Corps services in advance. Information on these 

federal and nonfederal customers is provided in table 1.

 

9 U.S. Army Corps of Engineers, Engineer Regulation 37-1-30, Change 4, February 28, 

2007, Chapter 20: Revolving Fund Accounting for Departmental Overhead and Change 5, 

June 29, 2007, Chapter 21: Revolving Fund Accounting for General and Administrative 

Overhead. 

10 To achieve this 1 percent goal, the Corps annually establishes quarterly targets, 

referred to as tolerance levels, for all divisions such that in the first quarter the division’s 

balance should fall within plus or minus 4 percent of actual expenses, the third quarter 

within plus or minus 3 percent, the second quarter within plus or minus 2 percent, and 

finally within plus or minus 1 percent by the fourth quarter. Tolerance levels are calculated 

by multiplying expenses by the various percentages. For example, the first quarter 

tolerance would be a division’s total expenses multiplied by 4 percent.
 

Page 7 GAO-13-528 Army Corps Overhead Process

Table 1: Information on the U.S. Army Corps of Engineers’ Federal and Nonfederal Customers 

Customer type

Funding 

mechanism

Description

of how the customer

pays for Corps services 

Description of how

the customer is billed

Example of a

customer and project

Federal Reimbursements Receives services and is later 

billed; pays for the entire cost 

of a project 

Receives standard 

monthly invoices from the 

Corps

U.S. Environmental Protection 

Agency: design and construction 

of a Superfund site

Direct fund Pays for services in advance; 

shares in operation and 

maintenance and some capital 

improvements related to 

projects

Receives standard 

monthly invoices or 

statements from the 

Corps

Bonneville Power Administration: 

operations and maintenance of a 

hydroelectric power plant

Nonfederal Cost share Shares the cost of a project 

with the federal government; 

pays for services in advance 

through money, land, or workin-kind

Billing is handled at the 

district level by the Corps 

project manager

Port Authority of New York and 

New Jersey: deepening of the 

New York Harbor

Source: GAO analysis U.S. Army Corps of Engineers information.

The Corps uses a multistep process to build overhead costs into projects. 

First, Corps policy establishes two categories of costs to calculate 

overhead. Second, the Corps calculates annual overhead rates for the 

two cost categories as part of its annual budget process. Third, the Corps 

bills projects for overhead costs based on the number of hours its staff 

charge to projects. Finally, the Corps monitors overhead costs and makes 

any necessary adjustments to overhead rates.

Corps policy establishes two categories of costs to calculate overhead—

general and administrative (G&A) overhead expenses associated with 

district administrative offices and technical overhead expenses 

associated with district technical offices.

11 These two categories serve as 

the foundation for building district overhead into projects. Corps policy 

defines G&A overhead as costs of a general or administrative nature, and 

all G&A overhead charges are based on a single rate per division. 

 

11 U.S. Army Corps of Engineers, Engineer Regulation 37-1-30, Change 5, June 29, 2007, 

Chapter 21: Revolving Fund Accounting for General and Administrative Overhead and 

Engineer Regulation 37-1-30, Change 4, February 28, 2007, Chapter 20: Revolving Fund 

Accounting for Departmental Overhead. The Corps also refers to technical overhead as 

departmental overhead.

The Corps Uses a 

MultiStep Process to 

Build Overhead Costs 

into Its Projects

Corps Policy Establishes 

Two Categories of Costs to 

Calculate Overhead
 

Page 8 GAO-13-528 Army Corps Overhead Process

Examples of G&A overhead include costs to run the district resource 

management or security offices, such as employee salaries and benefits 

and utilities.12 Corps policy defines technical overhead as costs within a 

technical office—such as engineering or construction—that cannot be 

directly identified as part of or readily chargeable to a specific program or 

project. Examples of technical overhead are the hours spent by the head 

of the engineering office providing general supervision to engineering 

staff and the prorated portion of rent for the office space of the 

engineering staff. All technical overhead charges are based on four 

different rates per division—consolidated technical overhead, emergency 

management, operations, and regulatory.13 Corps headquarters officials

said that the four technical overhead rates reflect four distinct types of 

services rendered as follows:

• Consolidated technical overhead: This rate applies to state, local, and 

tribal governments working with the Corps to build new water 

resource projects. 

• Emergency management: This rate applies to services rendered to 

the Federal Emergency Management Agency and state and local 

emergency management entities.

• Operations: This rate applies to state, local, and tribal governments 

receiving Corps services for the operation and maintenance of 

existing water resource projects.

• Regulatory: This rate applies to customers seeking Corps’ permits to 

build on lands that might impact a wetland.

Using calculations based on the G&A rate and the applicable technical 

rates, districts build overhead costs into projects. This multistep process 

is outlined in fig. 2.

 

12 G&A overhead includes costs associated with all of the following offices within a district: 

executive office, resource management/comptroller, public affairs, counsel, human 

resources, logistics management, equal employment opportunity, safety and occupational 

health, provost marshal/security, internal review, information management, contracting, 

real property inventory/reconciliations, union activities, marketing and outreach program 

activities, and results from operations. 

13 Consolidated technical overhead is a single rate that covers the overhead of the 

following district technical offices: construction, engineering, program/project 

management, real estate, planning, and contracting.
 

Page 9 GAO-13-528 Army Corps Overhead Process

Figure 2: Overview of U.S. Army Corps of Engineers’ Process for Building Overhead Costs into Projects

a

Consolidated technical overhead is a single rate that covers the overhead of the following district 

technical offices: construction, engineering, program/project management, real estate, planning, and 

contracting.

b

Congress established a revolving fund for the Corps in the Civil Function Appropriations Act of 1954 

[Pub. L. No. 83-153, 67 Stat. 197, 1999 (1953), codified as amended at 33 U.S.C. §§ 576, 701b-10]. 

The fund allows the Corps to finance their overhead costs and then reimburse the fund with overhead 

amounts charged to and received from project appropriations and customers. The Corps established 

a goal that each division’s overhead account achieve a zero balance at the end of each fiscal year.

According to Corps Engineer Regulation 37-1-30: Chapter 20: Revolving Fund Accounting for 

Departmental Overhead, a balance within plus or minus 1 percent of actual expenses is considered 

the equivalent of a zero balance and, therefore, acceptable. To achieve this goal, the Corps annually 

establishes quarterly targets, referred to as tolerance levels, for all divisions such that in the first 

quarter the overhead balance should fall within plus or minus 4 percent of expenses, the second 

quarter within plus or minus 3 percent of expenses, the third quarter within plus or minus 2 percent of 

expenses, and finally within plus or minus 1 percent of expenses by the fourth quarter. Tolerance 

levels are calculated by multiplying expenses by the various percentages.
 

Page 10 GAO-13-528 Army Corps Overhead Process

Using the two categories of overhead defined in Corps policy as its 

starting point, each district administrative and technical office—with 

assistance from district budget staff—develops its own operating budget 

with estimated overhead for the year.14 For administrative offices, officials 

estimate annual expenses, and most of their employees’ time is charged 

as G&A overhead.15 For technical offices, officials estimate annual 

revenues and expenses and also calculate the portion of technical office 

labor costs that will be charged directly to projects and the portion that will 

be charged to overhead. For example, a district’s construction office 

operating budget might estimate that a project manager would spend 85 

percent of his/her time charging directly to projects and spend the 

remaining 15 percent of the time charging to overhead for activities such 

as attending training and staff meetings. The administrative and technical 

offices’ operating budgets also include costs for centrally provided 

services, such as information technology, as well as certain expenses 

with imposed caps, such as employee awards.

Once each district administrative and technical office completes its 

operating budget, the offices forward them to the district resource 

manager—who essentially serves as the chief financial officer for the 

district. The district resource manager reviews and verifies information 

from each office and then consolidates the submissions into a single 

district operating budget. A district advisory committee—known as the 

Program Budget Advisory Committee—reviews and recommends the 

budget to the district commander for approval. District operating budgets 

include proposed G&A and technical overhead rates for the district. Each 

overhead rate is determined by dividing the total estimated overhead 

costs for the category of overhead, such as G&A, by the total estimated 

direct labor expected to be charged to projects. For example, if a division 

estimated that the total G&A costs for all of its districts would be $200 

million and estimated that the total district labor charges expected to be 

directly billed to projects would be $1 billion, then the division’s G&A rate 

would be .20 ($200 million/$1 billion).

 

14 As is the case with districts, Corps centers generally use the same process to develop 

operating budgets and estimate overhead.

15 In some instances, G&A office employees charge their time directly to projects. For 

example, attorneys in the Office of Counsel providing services directly supporting projectrelated real estate activities will charge time to the project. 

The Corps Calculates 

Annual Overhead Rates in 

Its Budget Process
 

Page 11 GAO-13-528 Army Corps Overhead Process

Once district commanders approve their district’s operating budget, the 

district resource manager submits it to the division’s resource manager 

who reviews and verifies information and then consolidates all of the 

district operating budgets into a division-wide operating budget with a 

proposed single set of G&A and technical overhead rates for the division. 

As is the case with the districts, a division advisory committee—known as 

the Regional Program Budget Advisory Committee—reviews and 

recommends the budget to the division commander for approval.16 With 

limited exceptions, each division and district carries out this process

annually, with the result being a single set of G&A and technical overhead 

rates charged each year for each Corps division.17 Overhead rates may 

vary from division to division due to a number of factors, such as cost of 

living (e.g., rent is higher for the San Francisco District than the 

Albuquerque District) and composition of the workforce (e.g., a district 

with more senior level staff has higher salaries than a district with more 

junior level staff).

Once overhead rates have been calculated in the budget process, district 

staff perform their work and charge their time to various project and 

overhead revolving fund accounts. Those accounts are then reimbursed 

either through project appropriations or through bill payments from 

customers. Districts build overhead into projects using the rates provided 

in the approved division operating budget.18 Overhead charges are 

applied to each project based on the hours charged by Corps staff; 

 

16 Prior to fiscal year 2007, overhead rates were set at the district level. Corps officials told 

us that because rates varied by district, customers were “shopping around” for the best 

rates leading to an inefficient system. Starting in fiscal year 2007, the Corps switched to 

setting overhead rates at the division level to provide for a more effective and efficient 

system. Specifically, having divisions set overhead rates provides more consistency for 

customers and allows districts within a division to more easily share resources, according 

to Corps officials. 

17 Corps policy states that regional rates do not apply to the Pacific Ocean Division, 

districts outside the contiguous United States, and centers, but that the standard overhead 

account structure is to be used in these locations. Therefore, each of these locations sets 

its own rates. Corps officials explained that this difference is due to geographic issues. 

18 Corps customers also pay for the cost of centralized services, such as information 

technology, and may also pay the costs of Corps centers. For example, on a given project, 

if a district uses the services of a Corps center of expertise, such as the Hydrologic 

Engineering Center, then the customer pays for the direct services of the center employee 

and the associated overhead of the center, in the same way they do for district staff 

charging directly to their projects. 

The Corps Bills Projects 

for Overhead Costs Based 

on the Hours Charged by 

Corps Staff for Work 

Performed
 

Page 12 GAO-13-528 Army Corps Overhead Process

overhead charges are not applied to hours worked by contracted labor, 

which can represent a substantial amount of work. The Corps reports that 

it contracts out most of its design work and all of its construction work to 

private sector entities, such as architectural and engineering firms and 

construction companies.

Within each division, a single G&A rate is applied to all projects, whereas 

technical rates are applied depending on the technical office staff 

charging to the projects. For example, for an employee in the regulatory 

office, overhead charges would include both the technical overhead 

regulatory rate, along with the G&A rate, for each hour charged to a 

specific project. Fig. 3 shows the components of the hourly rate charged 

to Corps’ customers, along with an example of rates and associated 

costs. 
 

Page 13 GAO-13-528 Army Corps Overhead Process

Figure 3: Components of the Hourly Rate Charged to U.S. Army Corps of Engineers’ 

Customers

a

This example assumes a full-time employee with a $64,000 annual salary divided by 2,080 hours of 

work per year.

b

The Corps uses the term “total effective hourly salary” or “effective rate” to denote the cost per hour 

to fund a full-time employee’s hourly salary plus the Corps’ share of his or her benefits.

c

Technical overhead is associated with the overhead of district technical offices, such as engineering 

and construction. Technical overhead rates are applied depending on the technical office staff 

charging to projects. For example, for an employee in the regulatory office, overhead charges would 

include both the technical overhead regulatory rate, along with the G&A rate, for each hour charged 

to a specific project.

d

General and administrative overhead is associated with the overhead of district administrative 

offices, such as resource management and building security services. The general and administrative 

rate is applied to all projects.

According to Corps billing officials, customers who fund the Corps 

through a reimbursable or direct fund basis typically receive standard 

invoices or statements that include a breakout of these G&A and 

technical overhead costs. The billing for customers who share the costs 
 

Page 14 GAO-13-528 Army Corps Overhead Process

of a project with the Corps, on the other hand, is handled by each 

individual district. According to the Corps, district project managers 

determine what is included in the billing information provided to 

customers.

Periodically throughout the year, Corps headquarters, divisions, and 

districts monitor actual overhead expenses incurred, compare them with 

budgeted overhead estimates, and adjust rates charged to customers, if 

necessary, to help ensure the difference between budgeted and actual 

overhead is as close to zero as possible by the end of the fiscal year. 

Corps guidance calls for reviews of expenses and income no less than 

quarterly to determine whether budget projections and the existing 

overhead rates are on track. Corps officials told us that district staff, 

including those from resource management and budget, meet at least 

quarterly to review their actual expenditure of funds under a given budget. 

Corps officials further stated that division resource management and 

other officials meet at least quarterly with district staff to help ensure that 

actual expenses align with budgeted amounts. Moreover, Corps officials 

stated that, in a process known as the Directorate Management Review, 

Corps headquarters reviews overhead for all divisions on a quarterly 

basis to determine if there are any differences between budgeted and 

actual overhead that fall outside of targeted tolerance levels and the 

reasons for such differences. Based on these reviews, division 

commanders are responsible for ensuring that appropriate action is taken, 

such as adjusting overhead rates, reducing expenditures, or providing 

rebates to customers. Corps headquarters officials said that if the Corps 

takes in more revenue than was budgeted, this “income” is factored into 

the calculation of overhead rates for the next fiscal year, potentially 

resulting in lower overhead rates. The opposite is true if the Corps takes 

in less revenue than was budgeted.

The Corps is able to monitor overhead because it tracks overhead costs 

separately from other project costs in its financial management system by 

using specific accounting codes to identify overhead.19 According to 

Corps officials, district staff are responsible for entering project activity 

data into the headquarters’ financial management system using these 

 

19 The Corps uses its Corps of Engineers Financial Management System to perform key 

financial management functions supporting the Corps’ military and civil works missions.

The Corps Monitors 

Overhead Costs and Makes 

Any Necessary 

Adjustments 
 

Page 15 GAO-13-528 Army Corps Overhead Process

codes. We reviewed one district’s expense reports and found that 

overhead costs were broken out separately from other project costs using 

categories such as training and rent. We also reviewed examples of the 

Corps’ standard billings to customers and found that they all included a 

breakdown of G&A and technical overhead. According to Corps officials, 

tracking overhead costs is essential to meet the tolerance level goals set 

by the Corps for each fiscal quarter.

Customers’ views on whether overhead information is accessible and 

understandable varied. Half of the 16 highest paying customers we 

interviewed said overhead information is generally accessible and 

understandable; 1 of the 16 said overhead information is not accessible 

and understandable; and the remaining 7 had no opinion on accessibility 

and/or understandability. For those customers who offered no opinion on 

one aspect of overhead information, such as accessibility, they generally 

offered a positive opinion on the other aspect of information, 

understandability. Like these 16 customers, the views of the 8 other 

Corps customers we interviewed varied. In addition, customers we 

interviewed provided some common views on overhead information, 

stating that overhead information is important, but that overall project 

costs are more important than overhead costs. They also emphasized the 

importance of good communication with the Corps to understanding 

overhead information.

Customers’ views fell into three broad categories: (1) overhead 

information is generally accessible and understandable, (2) overhead 

information is not accessible and understandable, and (3) no opinion on 

whether overhead information is accessible and/or understandable.

In our interviews with the highest paying federal and nonfederal 

customers in each of the 8 Corps divisions in fiscal year 2012, 8 of 16 

customers said overhead information is generally accessible and 

understandable. For example, one nonfederal customer said overhead 

information is accessible and easy to understand because the information 

is included in its project agreement with the Corps, which is signed prior 

to the start of a project. Another federal customer we interviewed said that 

the Corps provides overhead information in monthly bills and that this 

information was also understandable. Moreover, that customer pointed 

out that, if more overhead information was needed, she could ask the 

Corps for such information and the Corps would provide it.

Customers’ Views on 

Overhead Information

Customers’ Views Varied 

on Whether Overhead 

Information Is Accessible 

and Understandable

Overhead Information is 

Generally Accessible and 

Understandable
 

Page 16 GAO-13-528 Army Corps Overhead Process

While half of the highest paying customers said overhead information is 

generally accessible and understandable, seven of them noted that 

understanding overhead information required some work. For example, 

one federal customer said it sometimes takes several e-mail exchanges 

with the Corps to understand overhead terminology. While generally 

understanding overhead information, this customer said he would like to 

review bills with the Corps to better understand what is charged as 

overhead on a project. Another federal customer said that a customer 

must be familiar with the Corps and its processes to understand the 

overhead billing. Moreover, two federal customers said that they do not 

have a complete understanding of overhead charges because the Corps 

does not provide a detailed breakdown of overhead costs throughout the 

course of the project. 

One of the 16 highest paying customers said that overhead information is 

not accessible and therefore was unable to assess whether it is 

understandable. This nonfederal customer said that a Corps district had 

denied a request for overhead rates and a detailed breakdown of 

overhead costs by Corps employee. Asked about this, district officials 

said they had reached an agreement with the customer to provide 

detailed overhead information and provided a sample report 

demonstrating the overhead information, but that the customer did not 

respond to the Corps’ request to accept this information. However, this 

customer disagreed and said the overhead information request is still 

unresolved, making it difficult to manage ongoing projects without 

knowing how the Corps spends project funds or what it charges for 

overhead. Neither the customer nor the Corps provided us written 

documentation substantiating the resolution of the overhead information 

request.

In addition to our interviews with the highest paying customers, we 

interviewed eight additional customers. Two of these customers—

customers we identified as potentially having concerns about the Corps’ 

overhead process—said the Corps provides them with little or no 

overhead information and that what overhead information they do receive 

is difficult to understand.20 One of those customers told us that the Corps 

had not provided overhead information when it was requested. Corps 

officials said that although they do not have a formal written policy on 

 

20 See appendix I for additional information on how these customers were selected. 

Overhead Information is Not 

Accessible and Not 

Understandable
 

Page 17 GAO-13-528 Army Corps Overhead Process

providing overhead information to customers, overhead information is 

available to any customer upon request.

Seven of the 16 highest paying customers did not have an opinion on 

accessibility and/or understandability of overhead information. Those that 

offered no opinion on one aspect, such as accessibility, generally offered 

a positive opinion on the other aspect, understandability.

• Two of the seven highest paying customers did not express an 

opinion on whether overhead information is accessible and 

understandable. One nonfederal customer told us that he did not 

request overhead information from the Corps, in part because he 

accepts the Corps’ overhead rates and charges as a given. Because 

he does not request overhead information, this customer could not 

comment on whether overhead information is accessible and 

understandable. Another nonfederal customer said he was more 

concerned about the overall costs of the project than the overhead 

charges and, therefore, had no opinion on the accessibility and 

understandability of overhead information. In additional interviews with 

eight federal and nonfederal customers, one nonfederal customer was 

not concerned about overhead information, explaining that he agreed 

to project costs up front with the Corps and from that point on both 

parties are responsible for their share of the costs.

• Three of the seven highest paying customers stated that overhead 

information is accessible but had no opinion on whether the 

information is understandable. For example, one nonfederal customer 

said that overhead information is available, if needed, but this 

customer does not request such information because he has a good 

working relationship with the Corps and trusts that the Corps is 

building overhead into projects appropriately. This customer did not, 

however, offer an opinion on whether overhead information is 

understandable. Another nonfederal customer told us that he has

requested and received overhead information from the Corps, but he 

offered no opinion on understanding overhead information.

• Two of the seven highest paying customers expressed no opinion on 

the accessibility of overhead information but stated such information 

was understandable. For example, one federal customer said that 

while he has not requested overhead information, the Corps explained 

how it builds overhead into its projects during project meetings and 

that he understood this information. Another federal customer said 

that while he has no opinion on the accessibility of information, he is 

able to understand overhead using his agencies’ in-house expertise.

No Opinion on Whether 

Overhead Information is 

Accessible and/or 

Understandable
 

Page 18 GAO-13-528 Army Corps Overhead Process

Of the 24 customers we interviewed, a number expressed common views 

regarding overhead information. Specifically, these included:

• Overhead information is important. Most customers told us that 

overhead information is important and that knowing those costs up 

front is also important. Specifically, some customers told us that 

knowing overhead costs up front helps their organizations determine 

whether costs are reasonable before starting a project with the Corps. 

In some cases, customers said they could secure services from a 

source other than the Corps, so overhead information is important in 

determining whether to select the Corps to manage their projects. 

Some customers said due to the direct impact of overhead costs on 

the project’s total cost, knowing those costs up front allows their 

organizations to plan project funding appropriately.

• Overall project cost is more important than overhead costs. Some 

customers we interviewed said they were more interested in the 

overall project cost than specific overhead charges. Ten of 16 highest 

paying customers said they had requested a detailed breakdown of 

project costs including overhead charges. This was the most frequent 

type of information requested from the Corps, according to our 

interviews. In substantiating what we learned from customers, Corps 

headquarters officials told us that customers are more interested in 

the overall project cost than overhead costs, and customers typically 

do not ask for overhead information. Specifically, Corps officials said 

that customers who pay for Corps services on a reimbursable basis—

typically federal agencies—receive regular bills or statements that 

include a breakdown of overhead charges and, therefore, may be 

more aware of overhead costs and any rate changes.

• Good communication is important to understanding overhead 

information. Four of the highest paying customers that expressed 

positive views on the accessibility and understandability of overhead 

information said their organizations have good communication and 

working relationship with the Corps. For example, one of the 

nonfederal highest paying customers said that his organization 

communicates frequently with the Corps and has developed a positive 

working relationship with the Corps over decades that could serve as 

a model for other organizations. Three of the highest paying 

customers added that communication such as discussions of 

overhead at regular project meetings or a fact sheet would help them 

better understand overhead information.

Customers Provided 

Additional Views on 

Overhead Information
 

Page 19 GAO-13-528 Army Corps Overhead Process

We provided a draft of this report for review and comment to the 

Department of Defense. Because the report does not contain any 

recommendations, the department did not provide written comments. The 

department did provide technical comments, which we incorporated into 

the report as appropriate.

As agreed with your office, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 7 days from the 

report date. At that time, we will send copies to the Secretary of Defense, 

the Chief of Engineers and Commanding General of the U.S. Army Corps 

of Engineers, the appropriate congressional committees, and other 

interested parties. In addition, the report will be available at no charge on 

the GAO website at http://www.gao.gov.

If you or your staff members have any questions about this report, please 

contact me at (202) 512-3841 or fennella@gao.gov. Contact points for 

our Offices of Congressional Relations and Public Affairs may be found 

on the last page of this report. GAO staff who made key contributions to 

this report are listed in appendix III. 

Sincerely yours,

Anne-Marie Fennell

Director, Natural Resources and Environment

Agency Comments 

and Our Evaluation
Appendix I: Objectives, Scope, and 

Methodology

Page 20 GAO-13-528 Army Corps Overhead Process

Our objectives were to examine (1) how the U.S. Army Corps of 

Engineers (Corps) builds overhead costs into its projects and (2) Corps 

customers’ views on overhead information.

To address the first objective, we reviewed Corps documentation 

regarding its overhead determination and billing processes including, 

among other things, overhead briefings, budget memos, and guidance 

from headquarters and the eight Corps divisions that conduct civil works 

projects. We interviewed officials at Corps headquarters, two of eight 

division offices (North Atlantic and Northwest), and 4 of 38 district offices 

(Baltimore, New Orleans, Portland, and Vicksburg) about the overhead 

process and information used to estimate, allocate, and bill overhead to 

projects. We selected these offices to ensure geographic variation. We 

interviewed eight Corps officials from four Corps districts knowledgeable 

about the overhead process, including estimating overhead costs and 

setting overhead rates. Specifically, we interviewed four randomly 

selected Corps resource managers—a district’s chief financial officer who 

oversees the formulation of a district’s operating budget including district 

overhead rates—as well as the heads of four Corps technical offices who 

oversee the estimates of overhead by employee. We received a 

demonstration on how the Corps’ financial management system is 

designed to track overhead separately from other project costs, reviewed 

examples of Corps billings to customers provided by the Corps and some 

Corps customers, reviewed Corps financial management system 

documentation, interviewed selected Corps customers, and interviewed 

Corps officials knowledgeable about how the Corps tracks and bills 

overhead costs. While we generally reviewed the Corps’ methodology to 

develop overhead rates, we did not evaluate the accuracy or legal 

sufficiency of the Corps’ overhead formulas and calculations.1 For civil 

works projects, we only focused on general and administrative and 

technical overhead. Although the Corps charges overhead for military and 

civil works projects, we did not review how the Corps charges overhead 

to military projects.

In addressing the second objective, we interviewed six Corps customers 

from the North Atlantic and Northwest Divisions, respectively, to gather 

their views on the Corps’ overhead process, including whether overhead 

 

1 This report is intended to provide a descriptive overview of the Corps’ practices. It does 

not attempt to evaluate the legal sufficiency or propriety of these practices.

Appendix I: Objectives, Scope, and 

Methodology 
Appendix I: Objectives, Scope, and 

Methodology

Page 21 GAO-13-528 Army Corps Overhead Process

information is accessible and understandable. Specifically, we 

interviewed Bonneville Power Administration, Bureau of Reclamation, 

Environmental Protection Agency, Maryland Department of Natural 

Resources, Wicomico County Department of Public Works, and a military 

customer. We selected these customers to provide geographic variation 

and to ensure representation of at least one customer from each type of 

funding mechanism—reimbursable, cost share, and direct fund basis. The 

views of these customers are not generalizable to all Corps civil works 

customers but provide illustrative examples for the six customers. To help 

us understand the nature of concerns certain customers had expressed 

about the Corps’ overhead to congressional staff and to design a 

structured interview protocol, we selected two additional customers to 

interview—Southeast Louisiana Floodplain Authority–East and Southeast 

Louisiana Floodplain Authority–West. We randomly selected these 

customers from an extensive list of potential customers who had 

previously expressed concerns to congressional staff. Although these 

customers added to the geographic variation and to the variety of funding 

mechanisms represented, their views do not represent the views of Corps 

civil works customers generally, but rather, are indicative of customers 

that had previously expressed concerns to congressional staff. We then 

sought to determine views from a broader group of customers by 

conducting structured interviews with the 16 highest paying federal and 

highest paying nonfederal customers in fiscal year 2012—one in each 

category from all 8 Corps divisions. The names of the 16 customers we 

interviewed are listed in table 2. Our questions covered the importance 

customers place on obtaining overhead information, availability of and 

access to such information, and the extent to which the overhead 

information they receive is understandable. A detailed list of structured 

interview questions is presented in appendix II. The structured interview 

results are not generalizable to all Corps civil works customers but 

provide illustrative examples for the 16 customers. We conducted 

structured phone interviews from January 2013 to March 2013, and we 

completed 16 of 16 interviews. Prior to interviewing the 16 customers, we 

pretested the structured interview with two customers to ensure that the 

questions were relevant, free of bias, clearly stated, and easy to

understand and, based on those results, made adjustments to the 

structured interview as necessary. To ensure tabulated responses were 

accurate, we checked data recorded during structured interviews. We 

also spoke with Corps officials regarding customer views on the 

accessibility and understandability of overhead information.
Appendix I: Objectives, Scope, and 

Methodology

Page 22 GAO-13-528 Army Corps Overhead Process

Table 2: List of Highest Paying Customers Interviewed

Customer Federal / nonfederal Corps Division

1. American Samoa Government Nonfederal Pacific Ocean 

2. Coastal Restoration and Protection Authority Nonfederal Mississippi Valley 

3. County of Los Angeles, Department of Beach and Harbors Nonfederal South Pacific 

4. Logan County Commission Nonfederal Lakes and Rivers

5. NAF Financial Services Nonfederal South Atlantic 

6. Port Authority of New York and New Jersey Nonfederal North Atlantic 

7. Port of Corpus Christi Authority Nonfederal Southwest 

8. State of Idaho Nonfederal Northwest 

9. U.S. Department of Commerce, National Oceanic and Atmospheric Administration Federal Pacific Ocean 

10. U.S. Department of Homeland Security, Federal Emergency Management Agency Federal Mississippi Valley 

11. U.S. Department of Homeland Security, U.S. Customs and Border Protection Federal Southwest 

12. U.S. Department of Veterans Affairs Federal Lakes and Rivers

13. U.S. Department of Veterans Affairs Federal South Atlantic 

14. U.S. Department of Veterans Affairs Federal South Pacific 

15. U.S. Environmental Protection Agency Federal North Atlantic 

16. U.S. Environmental Protection Agency Federal Northwest

Source: U.S. Army Corps of Engineers.

We conducted this performance audit from July 2012 to June 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. 
Appendix II: Structured Interview Administered 

to U.S. Army Corps of Engineers’ Customers

Page 23 GAO-13-528 Army Corps Overhead Process

We conducted structured interviews with 16 Corps customers that the 

Corps identified as the highest paying federal and highest paying 

nonfederal customers in fiscal year 2012—one in each category from all 

eight Corps divisions. This appendix presents the detailed list of the 

structured interview questions we asked.

SECTION 1: BACKGROUND

1. Please briefly describe your current position at your organization, including the number of years you have held that position.

2. Now we’d like you to generally describe your experience working with the Corps within the last 3 years. Specifically:

a. About how many years has your organization been a customer of the Corps?

b. How many active projects have you had during this period? 

Interview instruction: Base the next question off of the answer in part a. If they said they had 2-3 active projects, than read the 

question as is. If they say they had 10-20 or more projects, than ask them to discuss maybe the 2-3 largest ones. 

c. Could you briefly describe these projects? In doing so, we’re looking for the services the Corps provided to those projects and 

the current state of the project, such as design or construction.

Appendix II: Structured Interview 

Administered to U.S. Army Corps of 

Engineers’ Customers 
Appendix II: Structured Interview Administered 

to U.S. Army Corps of Engineers’ Customers

Page 24 GAO-13-528 Army Corps Overhead Process

SECTION 2: IMPORTANCE OF AND REQUESTING OVERHEAD INFORMATION

Thinking of the active projects we just discussed over our 3-year time frame, I’d now like to walk you through a series of specific 

questions on Corps overhead. If you need me to repeat anything, please don’t hesitate to stop me. 

3. How important, if at all, are each of the following types of overhead information for your organization in conducting 

business with the Corps? I will read you a list of 5 types of information and for each of these types of information, please tell me if it is 

very important, somewhat important, or not important. 

Very 

important

Somewhat 

important Not important Not applicable

Don’t 

know

a. The total overhead cost 

for your project

b. The overhead rate 

applied to your project

c. The methodology used 

to calculate overhead 

rates

d. Notice of changes in 

overhead rates

e. A detailed breakdown 

of charges for your 

project, including 

overhead

f. Other: Please 

describe: 

__________________

Interview instruction: If the respondent answers not applicable and/or don’t know in question 3 (i.e., how important are each of the 

following types of overhead information), then skip question 3a. Otherwise, proceed with question 3a.

3a. Why is overhead information important for your organization in conducting business with the Corps?
Appendix II: Structured Interview Administered 

to U.S. Army Corps of Engineers’ Customers

Page 25 GAO-13-528 Army Corps Overhead Process

4. During the past 3 years, did you request any of the following types of overhead information from the Corps? I will read you a 

list of the same five types of information and for each of these types of information, please tell me if you requested it or if you did not 

request it. 

Yes, 

requested

No, did not 

request

Not 

applicable

Don’t 

know

a. The total overhead cost 

for your project

b. The overhead rate 

applied to your project

c. The methodology used 

to calculate overhead 

rates

d. Notice of changes in 

overhead rates

e. A detailed breakdown 

of charges for your 

project, including 

overhead

f. Other: Please 

describe: 

__________________

_ 
Appendix II: Structured Interview Administered 

to U.S. Army Corps of Engineers’ Customers

Page 26 GAO-13-528 Army Corps Overhead Process

Interview instruction: If the respondent answers no in questions 3 and 4 (i.e., overhead information is not important to them and they 

have not requested it), than skip question 5. Otherwise, proceed with question 5. 

5. During the past 3 years, have you received enough of each of the following types of overhead information for your 

organization in conducting business with the Corps? I will read you a list of the same five types of information and for each of 

these types of information, please tell me if you have received enough, some but not enough, or none for your purpose. 

Received 

enough

Received 

some but not 

enough

Received 

none

Not 

applicable

Don’t 

know

a. The total overhead cost 

for your project

b. The overhead rate 

applied to your project

c. The methodology used 

to calculate overhead 

rates

d. Notice of changes in 

overhead rates

e. A detailed breakdown 

of charges for your 

project, including 

overhead

f. Other: Please 

describe: 

__________________

_ 
Appendix II: Structured Interview Administered 

to U.S. Army Corps of Engineers’ Customers

Page 27 GAO-13-528 Army Corps Overhead Process

SECTION 3: IMPACT QUESTIONS

Interview instruction: Base the asking of questions 6 and 7 on the answer to question 5. You may skip one or both depending on the 

answers provided. Also, repeat their answers to question 5 in asking each question. 

6. In the previous question, you said that you “received some but not enough” or “received none” of a particular type of overhead 

information. What impact, if any, did this have on your organization? And please explain why.

7. Referring again to your response to question five, you said that you “received enough” of a particular type of overhead information. 

What impact, if any, did the availability of overhead information have on your organization? And please explain why.

8. For the active projects within the last 3 years, do you recall the Corps providing general overhead information prior to signing an 

initial project contract or agreement? Y/N Please explain.

Interview instruction: If the respondent answers no to question 8, skip questions 9 and 10. If yes, proceed in asking 9 and 10.

9. To what extent were you satisfied with the overhead information the Corps’ provided prior to the signing of the initial 

project contract or agreement?

Very satisfied Somewhat 

satisfied Not satisfied Not applicable

Don’t 

know

__________________

_ 

10. Please explain why you were or were not satisfied with the overhead information you received prior to signing an initial project 

contract or agreement.
Appendix II: Structured Interview Administered 

to U.S. Army Corps of Engineers’ Customers

Page 28 GAO-13-528 Army Corps Overhead Process

SECTION 4: OVERALL OPINION OF ACCESS TO AND EASE OF 

UNDERSTANDING OVERHEAD INFORMATION 

11. Given all of the responses to the questions I’ve already asked, how accessible is information on Corps overhead? 

Available and 

easy to 

access

Available but 

hard to 

access

Not available Not 

applicable

Don’t 

know

__________________

_ 

Interview instruction: If the respondent answers not applicable and/or don’t know in question 11 (i.e., how available is overhead 

information), then skip question 11a. Otherwise, proceed with question 11a.

11a. Why is overhead information either available and easy to access, available, but hard to access or not available?

12. Given all of the responses to the questions I’ve already asked, how understandable is information on Corps overhead? 

Easy to 

understand

Understanda

ble but 

requires 

some work

Not 

understandab

le

Not 

applicable

Don’t 

know

__________________

_ 

Interview instruction: If the respondent answers not applicable and/or don’t know in question 12 (i.e., how available is overhead

information), then skip question 12a. Otherwise, proceed with question 13.

12a. Why is overhead information either easy to understand, understandable, but requires some work, or not understandable?
Appendix II: Structured Interview Administered 

to U.S. Army Corps of Engineers’ Customers

Page 29 GAO-13-528 Army Corps Overhead Process

13. During the past 3 years, in which of the following ways has the Corps communicated overhead information on your 

current active project(s)? I will read you a list of five ways in which the Corps may have communicated this information and for 

each way, please tell me if you received it or you did not receive it. 

Yes, I received 

overhead 

information in 

this manner

No, I did not 

receive 

overhead 

information in 

this manner

Not 

applicable

Don’t 

know

a. Memoranda of 

Agreement/Project 

Partnership 

Agreement/Contract

b. Project update meetings 

with Corps project manager

c. Invoices/billing

d. Overhead briefing 

e. Overhead fact sheet 

f. Other – please specify 

___________________
Appendix II: Structured Interview Administered 

to U.S. Army Corps of Engineers’ Customers

Page 30 GAO-13-528 Army Corps Overhead Process

SECTION 5: OPEN ENDED QUESTIONS 

14. Please describe any concerns you have had about Corps’ overhead charges. In your answer, please any general concerns with 

overhead charges and any specific examples. 

15. How did the Corps help resolve your concerns about overhead charges?

16. Do you think the Corps can make any improvement to help ensure information on the overhead costs you are paying is available to 

you and easy to access? Y/N Please explain.

17. Do you think the Corps can make any improvement to help ensure information on the overhead costs you are paying is easy for 

you to understand? Y/N Please explain.

18. Do you have suggestions for any other individuals or organizations we should consider reaching out to in reviewing the Corps’

overhead process? Y/N. If yes, please provide the contact information.

19. Do you have any other comments about the Corps’ overhead process? Y/N. If yes, please describe.
Appendix III: GAO Contact and Staff 

Acknowledgments

Page 31 GAO-13-528 Army Corps Overhead Process

Anne-Marie Fennell, (202) 512-3841 or fennella@gao.gov

In addition to the individual named above, Vondalee R. Hunt (Assistant 

Director), Mark A. Braza, Nkenge Gibson, Mark Keenan, Jeanette 

Soares, and Jack Warner made key contributions to this report. Cheryl 

Arvidson, Arkelga Braxton, Peter B. Grinnell, Armetha Liles, and Vasiliki 

Theodoropoulos also made important contributions to this report.

Appendix III: GAO Contact and Staff 

Acknowledgments 

GAO Contact

Staff 

Acknowledgments 

(361427)
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