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H.R. 157 / S. 160 , the District of Columbia House Voting Rights Act of 2009 introduced in the 111 th Congress, provided for a permanent increase in the size of the U.S. House of Representatives, from 435 seats to 437 seats. The bills specified that one of the additional seats was to be allocated to the District of Columbia while the other seat was to be assigned either by using the normal apportionment formula allocation procedure ( H.R. 157 ) or specifying that the seat would be allocated to Utah, the state which would have received the 436 th seat under the 2000 apportionment process. Thus, this would add a fourth seat to Utah's three ( S. 160 ). While both versions treated the District of Columbia as if it were a state for the purposes of the allocation of House seats, each bill restricted the District of Columbia to a single congressional seat under any future apportionments. Similar bills had been introduced in the 110 th Congress. On April 19, 2007, the House approved H.R. 1905 (a revised version of H.R. 1433 ) by a vote of 241 to 177 (Roll Call vote 231) and sent it to the Senate for consideration. On June 28, 2007, S. 1257 was reported out of the Senate Committee on Homeland Security and Governmental Affairs with amendments. On September 18, 2007, cloture on the motion to proceed to consideration of the measure was not invoked in the Senate on a Yea-Nay vote, 57 - 42, leaving the measure pending. No further action occurred on the legislation. The 435 seat limit for the size of the House was imposed in 1929 by statute (46 Stat. 21, 26-27). Altering the size of the House would require a new law setting a different limit. Article I, §2 of the Constitution establishes a minimum House size (one Representative for each state), and a maximum House size (one for every 30,000 persons, or 10,306 representatives based on the 2010 Census). For the 2010 apportionment, a House size of 468 would have resulted in no state losing seats held from the 112 th to the 116 th Congresses. However, by retaining seats through such an increase in the House size, other state delegations would become larger. At a House size of 468, California's delegation size, for example, would be 56 instead of 53 seats, Texas's delegation size would be 38 instead of 36 seats, and Florida's delegation size would be 29 instead of 27 seats. General congressional practice when admitting new states to the Union has been to increase the size of the House, either permanently or temporarily, to accommodate the new states. New states usually resulted in additions to the size of the House in the 19 th and early 20 th centuries. The exceptions to this general rule occurred when states were formed from other states (Maine, Kentucky, and West Virginia). These states' Representatives came from the allocations of Representatives of the states from which the new ones had been formed. When Alaska and Hawaii were admitted in 1959 and 1960 the House size was temporarily increased to 437. This modern precedent differed from the state admission acts passed following the censuses in the 19 th and early 20 th centuries which provided that new state representatives would be added to the apportionment totals. The apportionment act of 1911 anticipated the admission of Arizona and New Mexico by providing for an increase in the House size from 433 to 435 if the states were admitted. As noted above, the House size was temporarily increased to 437 to accommodate Alaska and Hawaii in 1960. In 1961, when the President reported the 1960 census results and the resulting reapportionment of seats in the reestablished 435-seat House, Alaska was entitled to one seat, and Hawaii to two seats. Massachusetts, Pennsylvania and Missouri each received one less seat than they would have if the House size had been increased to 438 (as was proposed by H.R. 10264, in 1962). Table 1 , below displays the apportionment of the seats in the House of Representatives based on the 2000 Census apportionment population (the current House apportionment) and the apportionment of seats in the House based on the 2010 Census apportionment population (the distribution of seats among the states for the 113 th Congress). In addition, Table 1 also shows the impact on the distribution of seats in the House if the District of Columbia were to be treated as if it were a state for apportionment purposes for both a House size of 435 seats and a House size of 437 seats. First, due to population changes between the 2000 Census and the 2010 Census, Table 1 shows a shift of 12 seats among 18 states for the 113 th Congress (beginning in January 2013). Illinois, Iowa, Louisiana, Massachusetts, Michigan, Missouri, New Jersey, and Pennsylvania will each lose one seat; New York and Ohio will each lose two seats. Arizona, Georgia, Nevada, South Carolina, Utah, and Washington will each gain one seat; Florida will gain two seats; and Texas will gain four seats. These are the actual seats to be allocated based on the results of the 2010 Census. Second, if the District of Columbia were to be given a vote in the House of Representatives and treated as if it were a state in the reapportionment of congressional seats following the 2010 census, and the House size remained at 435, Minnesota would lose a seat relative to what it is scheduled to get as a result of the 2010 Census. Thus, Minnesota's delegation would fall to seven Representatives if the District of Columbia were to given a vote and the House size remained at 435 Representatives. Third, if, on the other hand, the District of Columbia were to be given a vote in the House of Representatives and treated as if it were a state and the House size were to be increased to 437, the District of Columbia would receive one Representative and North Carolina would be entitled to fourteen Representatives, one more than the state is scheduled to receive in the apportionment following the 2010 census. Also, Minnesota would retain its eighth seat and no other state would be affected by the change. Another way to see the impact is to examine the allocation of the last seats assigned to the states when the District of Columbia is allocated a seat (presumably the 51 st seat). The actual apportionment is done through a "priority list" calculated using the equal proportions formula provided in 2 U.S.C. §2a.(a). Table 2 , below, displays the end of the priority list that was used to allocate Representatives based on the 2010 Census, including the District of Columbia. The law only provides for 435 seats in the House, but the table illustrates not only the last seats assigned by the apportionment formula (ending at 435), but the states that would just miss getting additional representation. Table 3 is similar to Table 2 , in that it displays the end of the priority list, but the last seat is 437 instead of 435. The priority values and the population needed to gain or lose a seat do not change if DC is treated like state, as DC is entitled the constitutional minimum of one Representative.

Two proposals (H.R. 157/S. 160, District of Columbia House Voting Rights Act of 2009) were introduced in the 111th Congress to provide for voting representation in the U.S. House of Representatives for the residents of the District of Columbia (DC). H.R. 157/S. 160, for purposes of voting representation, treated the District of Columbia as if it were a state, giving a House seat to the District, but restricting it to a single seat under any future apportionments. The bills also increased the size of the House to 437 members from 435, and gave the additional seat to the state that would have received the 436th seat under the 2000 apportionment, Utah. This report shows the distribution of House seats based on the 2010 Census for 435 seats and for 437 seats as specified in the proposal. North Carolina, which would receive the 436th seat in the 2010 apportionment is substituted for Utah, assuming that any new, similar legislation would adopt the same language as H.R. 157.

State laws that require parental involvement in a pregnant minor's abortion decision have gained greater visibility in light of recent attempts by Congress to criminalize the interstate transport of a minor to obtain an abortion. At least forty-four states have enacted statutes that require a minor to seek either parental notification or parental consent before obtaining an abortion. This report discusses the validity of state parental involvement laws in the context of Planned Parenthood of Southeastern Pennsylvania v. Casey , Ayotte v. Planned Parenthood of Northern New England , and other U.S. Supreme Court cases that address a minor's right to choose whether to terminate her pregnancy. In Casey, the Court upheld the right of a woman to choose whether to terminate her pregnancy, but permitted certain restrictions on a minor's ability to obtain an abortion, such as state parental consent requirements. In Ayotte , the Court reiterated that a state may require parental involvement in a pregnant minor's abortion decision. In addition to examining the relevant abortion decisions, this report reviews the state parental involvement laws, and discusses the availability of judicial bypass procedures and exceptions for medical emergencies. The report also highlights recent federal parental involvement legislation and provides a survey of current state parental involvement laws. In Roe v. Wade , the U.S. Supreme Court held that a woman has a constitutional right to choose whether to terminate her pregnancy. The Court in subsequent cases has affirmed the basic right to an abortion, but has also permitted restrictions on a woman's access to an abortion. Casey established, for example, that a state may require parental involvement in a pregnant minor's abortion decision if the involvement does not unduly burden the minor's right to choose whether to obtain an abortion. In that 1992 case, the Court considered a constitutional challenge to five provisions of the Pennsylvania Abortion Control Act of 1982. One provision required a pregnant minor seeking an abortion to obtain consent from one parent or guardian before the procedure would be performed. The Court upheld the parental consent provision and also concluded that a state law that banned abortion completely would be unconstitutional. In its holding, the Court shifted away from the trimester-based strict scrutiny standard of judicial review it used in Roe and articulated a new "undue burden" analysis. Courts will now invalidate a government-imposed abortion restriction if it imposes an "undue burden" on a woman's right to obtain an abortion. Applying the new standard, the Casey Court held that the parental consent provision did not unduly burden a pregnant minor's right to obtain an abortion because it included exceptions in the event of a medical emergency and when the minor demonstrates to a court that parental consent is not in her best interests. In January 2006, the Court confirmed the validity of state laws that place certain restrictions on a pregnant minor's right to obtain an abortion. In Ayotte , the Court considered a constitutional challenge to a state statute requiring parental notification before a minor may obtain an abortion. The plaintiffs argued that the New Hampshire Parental Notification Prior to Abortion Act violated the right of a woman to obtain an abortion because it did not contain an exception to allow a pregnant minor to obtain an abortion without parental notification when the procedure was necessary to preserve the minor's health. In writing for an unanimous Court, Justice O'Connor stated explicitly that the holding did not revisit Court precedent regarding abortion. Rather, the Court addressed the relatively narrow issue of remedies. It held that only certain applications of the act would violate a woman's constitutional right to an abortion, and remanded the case with orders for the lower courts to consider whether the act could be interpreted in a manner consistent with the judicial precedent that a state may not restrict access to an abortion when the health of the woman seeking the abortion is at issue. Despite its narrow holding, the Court in Ayotte expressly affirmed two legal propositions relating to pregnant minors' access to abortions: states have the right to require parental involvement in a minor's abortion decision, and a state may not restrict access to an abortion that is necessary to protect the life or health of a woman seeking an abortion. Twenty-two state parental involvement statutes require the consent of at least one parent or another adult relative before a pregnant minor may obtain an abortion, while 17 state statutes require only that the minor notify one or both parents that she intends to obtain an abortion. As discussed, the Court has held that a state law that requires parental involvement in a minor's abortion decision is unconstitutional if it unduly burdens the minor's right to terminate her pregnancy. Several Court cases preceding Casey and Ayotte expressly established that a state parental involvement statute that permits a parent to unilaterally prohibit a minor from obtaining an abortion would be unconstitutional. In Planned Parenthood of Central Missouri v. Danforth , the Court held that a state parental involvement statute must provide an alternate procedure for a minor to obtain authorization for an abortion. In Belotti v. Baird , the Court reiterated the Danforth holding and stated that such an alternative must provide a pregnant minor the opportunity to demonstrate that she is "mature enough and well enough informed" to make an abortion decision without parental involvement, or that the abortion is in her best interests. Thirty-seven state laws that require parental involvement in a pregnant minor's abortion decision provide for a judicial bypass procedure as the alternate means for a minor to obtain permission for an abortion. A judicial bypass procedure allows a minor who seeks an abortion to obtain permission from a court to waive the relevant parental involvement requirement. In cases preceding Casey , the Court held that adequate judicial bypass procedures are constitutional alternatives to state parental involvement statutes. Both Danforth and Belotti, for example, involved judicial bypass procedures that the Court upheld as valid safeguards of a pregnant minor's right to obtain an abortion. While the Court has invalidated state parental consent laws that do not include judicial bypass procedures, it has not determined whether a state law that requires parental notification must contain a judicial bypass procedure. In Ohio v. Akron Center for Reproductive Health, et al ., the Court held that the Ohio parental notification statute at issue was constitutional, suggesting that the statute's judicial bypass procedure adequately protected a pregnant minor's right to obtain an abortion. The Court expressly declined, however, to decide whether a state parental notification law that did not include a judicial bypass procedure would per se violate the Constitution. In Lambert v. Wicklund , the Court similarly declined to reach the question of whether a state parental notification law must contain a judicial bypass procedure. Rather, the Court held narrowly that the Montana parental notification law at issue, which contained a judicial bypass procedure, did not place an undue burden on a pregnant minor's right to obtain an abortion. Although the Court has refused to address directly whether a state parental notification law must contain a judicial bypass procedure, Court precedent appears to suggest that a parental notification law would be unconstitutional if it did not provide a pregnant minor with some alternative to parental notification. In H.L. v. Matheson , the Court upheld a state statute that requires an unemancipated minor who lives with her parents to notify them, "if possible," before she obtains an abortion, but also includes exceptions for a minor who demonstrates that notification is not in her best interests. Moreover, in Belotti , the Court indicated that a parental notification law would be unconstitutional if it did not provide an alternative to notification for a "mature" minor or when notification would not be in a minor's best interests. The Court has declined to establish specific parameters for the adequacy of judicial bypass procedures in the context of state parental involvement laws. In writing for the majority in Akron, Justice Kennedy rejected the dissenting opinion's call to articulate specific procedural thresholds for the constitutionality of a judicial bypass alternative, such as whether it must be anonymous or only confidential, or how quickly a state must provide a pregnant minor with the opportunity for a court proceeding. He stated only that the Ohio judicial bypass procedure contained "reasonable steps" to protect the identity of pregnant minors seeking a judicial bypass and that the procedure included adequate provisions to expedite a pregnant minor's request for a proceeding. The Court majority also held that a state may validly require a pregnant minor to establish "by clear and convincing evidence" during a judicial bypass hearing that she is mature enough to make an abortion decision without parental involvement. State parental involvement statutes in 10 states do not provide an exception to their consent or notification requirements during a medical emergency. In Ayotte , the Court expressly reiterated its prior holdings in Roe and Casey that a state may not restrict access to an abortion that is necessary to preserve the life or health of the pregnant woman. The Court also stated the factual proposition that in a small number of cases a pregnant minor requires an immediate abortion to prevent serious health consequences. Therefore, a state statute that restricts a pregnant minor's access to an abortion likely must include an exception for medical emergencies involving the minor's health or life. Legislation that would prohibit the knowing transport of a minor across state lines with the intent that the minor obtain an abortion has been introduced in both chambers. On January 25, 2011, Senator John E. Ensign introduced S. 167 , the Child Custody Protection Act (CCPA). Under the CCPA, an individual who knowingly transports a minor across state lines with the intent that the minor obtain an abortion will be fined in accordance with Title 18 of the U.S. Code, imprisoned for not more than one year, or both. The CCPA would not prohibit the transport of a minor across state lines if the abortion is necessary to save the life of the minor because her life is endangered by a physical disorder, physical injury, or physical illness, including a life endangering physical condition caused by or arising from the pregnancy. The Child Interstate Abortion Notification Act (CIANA), introduced as S. 1241 by Senator Marco Rubio on June 21, 2011, and as H.R. 2299 by Representative Ileana Ros-Lehtinen on June 22, 2011, would also prohibit the knowing transport of a minor across state lines with the intent that the minor obtain an abortion. Unlike the CCPA, however, the CIANA would also prohibit a physician from knowingly performing or inducing an abortion on a minor who is a resident of another state unless actual notice is provided to a parent of the minor at least 24 hours before performing the procedure. A physician who violated the notification requirement would be fined in accordance with Title 18 of the U.S. Code, imprisoned for not more than one year, or both. The notification requirement would not apply in certain specified situations, including instances where the minor declared in a signed written statement that she was the victim of sexual abuse, neglect, or physical abuse by a parent. The following table provides citations to state parental involvement statutes. Information concerning whether the applicable statute requires parental consent or notification is included in the table. Statutes that include judicial bypass provisions, medical emergency exceptions, and/or exceptions for a pregnant minor who is the victim of parental abuse or neglect are marked accordingly.

State laws that require parental involvement in a pregnant minor's abortion decision have gained greater visibility in light of recent attempts by Congress to criminalize the interstate transport of a minor to obtain an abortion. At least forty-four states have enacted statutes that require a minor to seek either parental notification or parental consent before obtaining an abortion. This report discusses the validity of state parental involvement laws in the context of Planned Parenthood of Southeastern Pennsylvania v. Casey, Ayotte v. Planned Parenthood of Northern New England, and other U.S. Supreme Court cases that address a minor's right to choose whether to terminate her pregnancy. The report reviews the various state parental involvement laws, and discusses the availability of judicial bypass procedures and exceptions for medical emergencies. The report also highlights recent federal parental involvement legislation and provides a survey of current state parental involvement laws.

Senate Rule XXVI establishes specific requirements for Senate committee procedures. In addition, each Senate committee is required to adopt rules, which may "not be inconsistent with the Rules of the Senate." Senate committees also operate according to additional established practices that are not necessarily reflected in their adopted rules. The requirement that each committee must adopt its own set of rules dates to the 1970 Legislative Reorganization Act (P.L. 91-510). That law built on the 1946 Legislative Reorganization Act (P.L. 79-601), which set out some requirements to which most Senate committees must adhere. Under the provisions of the 1970 law (now incorporated into Senate Rule XXVI, paragraph 2), Senate committees must adopt their rules and generally have them printed in the Congressional Record not later than March 1 of the first year of a Congress. Typically, the Senate also publishes a compilation of the rules of all the committees each Congress, and some individual committees also publish their rules as committee prints. Committee rules govern actions taken in committee proceedings only, and they are enforced in relation thereto by the committee's members in a similar way that rules enforcement occurs on the Senate floor. There is generally no means by which the Senate can enforce committee rules at a later point on the floor. So long as the committee met the requirement of Senate Rule XXVI that a physical majority be present for reporting a measure or matter, no point of order lies against the measure or matter on the floor on the grounds that the committee earlier acted in violation of other procedural requirements. Beyond the requirements of Senate rules and a committee's own formal rules, many committees have traditions or practices they follow that can affect their procedures. (One committee, for example, does not allow Senators to offer second-degree amendments during committee markups, though this restriction is not contained in either the Senate or the committee's rules.) An accounting of any such informal practices that committees might observe is not provided below. This report first provides a brief overview of Senate rules as they pertain to committees. The report then provides four tables that summarize each committee's rules in regard to meeting day, hearing and meeting notice requirements, and scheduling of witnesses ( Table 1 ); hearing quorum, business quorum, and amendment filing requirements ( Table 2 ); proxy voting, polling, and nominations ( Table 3 ); and investigations and subpoenas ( Table 4 ). Table 4 also identifies selected unique provisions some committees have included in their rules. The tables, however, represent only a portion of each committee's rules. Provisions of the rules that are substantially similar to or essentially restatements of the Senate's standing rules are not included. Although there is some latitude for committees to set their own rules, the standing rules of the Senate set out specific requirements that each committee must follow. The provisions listed below are taken from Rule XXVI of the Standing Rules of the Senate. (Some committees reiterate these rules in their own rules, but even for those committees that do not, these restrictions apply.) This is not an exhaustive explanation of Senate rules and their impact on committees. Rather, this summary is intended to provide a background against which to understand each committee's individual rules that govern key committee activities. Rules. Each committee must adopt rules; those rules must generally be published in the Congressional Record not later than March 1 of the first year of each Congress. If a committee adopts an amendment to its rules later in the Congress, that change becomes effective only when it is published in the Record (Rule XXVI, paragraph 2). Meetings. Committees and subcommittees are authorized to meet and hold hearings when the Senate is in session and when it has recessed or adjourned. A committee may not meet on any day (1) after the Senate has been in session for two hours, or (2) after 2 p.m. when the Senate is in session. Each committee must designate a regular day on which to meet weekly, biweekly, or monthly. (This requirement does not apply to the Appropriations Committee.) A committee is to announce the date, place, and subject of each hearing at least one week in advance, though any committee may waive this requirement for "good cause" (Rule XXVI, paragraph 5(a); Rule XXVI, paragraph 3). Special meeting. Three members of a committee may make a written request to the chair to call a special meeting. The chair then has three calendar days in which to schedule the meeting, which is to take place within the next seven calendar days. If the chair fails to do so, a majority of the committee members can file a written motion to hold the meeting at a certain date and hour (Rule XXVI, paragraph 3). Open meetings. Unless closed for reasons specified in Senate rules (such as a need to protect national security information), committee and subcommittee meetings, including hearings, are open to the public. When a committee or subcommittee schedules or cancels a meeting, it is required to provide that information—including the time, place, and purpose of the meeting—for inclusion in the Senate's computerized schedule information system. Any hearing that is open to the public may also be open to radio and television broadcasting at the committee's discretion. Committees and subcommittees may adopt rules to govern how the media may broadcast the event. A vote by the committee in open session is required to close a meeting (Rule XXVI, paragraph 5(b)). Quorums. Committees may set a quorum for doing business so long as it is not less than one-third of the membership. A majority of a committee must be physically present when the committee votes to order the reporting of any measure, matter, or recommendation. Agreeing to a motion to order a measure or matter reported requires the support of a majority of the members who are present. Proxies cannot be used to constitute a quorum (Rule XXVI paragraph 7(a)(1)). Meeting r ecord . All committees must make public a video, transcript, or audio recording of each open hearing of the committee within 21 days of the hearing. These shall be made available to the public "through the Internet" (Rule XXVI, paragraph 5(2)(A)). Proxy voting. A committee may adopt rules permitting proxy voting. A committee may not permit a proxy vote to be cast unless the absent Senator has been notified about the question to be decided and has requested that his or her vote be cast by proxy. A committee may prohibit the use of proxy votes on votes to report. However, even if a committee allows proxies to be cast on a motion to report, proxies cannot make the difference in ordering measure reported, though they can prevent it (Rule XXVI, paragraph 7(a)(3)). Investigations and subpoenas. Each standing committees (and its subcommittees) is empowered to investigate matters within its jurisdiction and issue subpoenas for persons and papers (Rule XXVI, paragraph 1). Witnesses selected by the minority. During hearings on any measure or matter, the minority shall be allowed to select witnesses to testify on at least one day when the chair receives such a request from a majority of the minority party members. This provision does not apply to the Appropriations Committee (Rule XXVI, paragraph 4(d)). Reporting. A Senate committee may report original bills and resolutions in addition to those that have been referred to it. As stated above in the quorum requirement, a majority of the committee must be physically present for a measure or matter to be reported, and a majority of those present is required to order a measure or matter favorably reported. A Senate committee is not required to issue a written report to accompany a measure or matter it reports. If the committee does write such a report, Senate rules specify a series of required elements that must be included in the report (Rule XXVI, paragraph 7(a)(3); Rule XXVI, paragraph 10(c)). Table 1 summarizes each's committee's rules in three areas: meeting day(s), notice requirements for meetings and hearings, and witness selection provisions. Many committees repeat or otherwise incorporate the provisions of Senate Rule XXVI, paragraph 4(a), which, as noted above, requires a week's notice of any hearing (except for the Appropriations and Budget committees) "unless the committee determines that there is good cause to begin such hearing at an earlier date." Provisions in committee rules are identified and explained in this column only to the extent that they provide additional hearing notice requirements, specifically provide the "good cause" authority to certain members (e.g., chair or ranking minority member), or apply the week's notice to meetings other than hearings (such as markups). Similarly, as noted in the report, Senate Rule XXVI, paragraph 4(d) (sometimes referred to as the "minority witness rule"), provides for the calling of additional witnesses in some circumstances (except for the Appropriations Committee). Some committees restate this rule in their own rules. Only committee rule provisions that go further in specifically addressing the selection of witnesses or a right to testify are identified in this column. Table 2 focuses on each's committee's rules on hearing quorums, business quorums, and requirements to file amendments prior to a committee markup. In regard to a business quorum, the "conduct of business" at a committee meeting typically refers to actions (such as debating and voting on amendments ) that allow the committee to proceed on measures up to the point of reporting. Some committees require that a member of the minority party be present for such conduct of business; such provisions are noted below. As noted earlier, Senate Rule XXVI, paragraph 7(a), requires a majority of the committee to be physically present (and a majority of those present to agree) to report out a measure or matter; this is often referred to as a "reporting quorum." The rule allows Senate committees to set lower quorum requirements, though not less than a third of membership for other business besides hearings. Some committees restate the Senate requirement in their own committee rules, but even those committees that do not are bound by the reporting quorum requirement. Table 2 does not identify committee rules that simply restate the reporting quorum requirement unless the committee has added additional requirements to its provisions (e.g., that a reporting quorum must include a member of each party). Though no Senate rules govern the practice, several committees require, in their committee rules, that Senators file with the committee any first-degree amendments they may offer during a committee markup before the committee meets. Such a provision allows the chair and ranking member of the committee to see what kind of issues may come up at the markup and may also allow them to negotiate agreements with amendment sponsors before the formal markup session begins. Some committees distribute such filed amendments in advanced of the markup to allow committee members a chance to examine them. It also provides an opportunity to Senators to draft second-degree amendments to possible first-degree amendments before the markup begins. Table 3 summarizes each's committee's rules on proxy voting, committee polling, and nominations. Since Senate rules require a majority of a committee to be physically present for a vote to report a measure or matter, a committee vote to report an item of business may not rely on the votes cast on behalf of absent Senators (that is, votes by proxy). Some committees effectively restate this requirement in their committee rules by either stating that proxies do not count toward reporting or referencing the proxy provisions of Senate Rule XXVI. However, committees may still allow (or preclude) proxy votes on a motion to report (as well as on other questions so long as members are informed of the issue and request a proxy vote). Table 3 identifies committees that explicitly allow or disallow proxy votes on a motion to report (even though such votes cannot, under Senate rules, count toward the presence of a "reporting quorum" or make the difference in successfully reporting a measure or matter). "Polling" is a method of assessing the position of the committee on a matter without the committee physically coming together. As such, it cannot be used to report out measures or matters, because Senate rules require a physical majority to be present to report a measure or matter. Polling may be used, however, by committees that allow it for internal housekeeping matters before the committee, such as questions concerning staffing or how the committee ought to proceed on a measure or matter. Senate Rule XXVI does not contain provisions specific to committee consideration of presidential nominations. Some committees, however, set out timetables in their rules for action or have other provisions specific to action on nominations. Some committees also provide in their rules that nominees must provide certain information to the committee. Such provisions are not detailed in this table except to the extent that the committee establishes a timetable for action that is connected to such submissions. This column of the table also identifies any committee provisions on whether nominees testify under oath. Table 4 describes selected key committee rules in relation to investigations and subpoenas. Note that some Senate committees do not have specific rules providing processes for committee investigations, and many also do not set out procedures for issuing subpoenas. The lack of any investigation or subpoena provisions does not mean the committees cannot conduct investigations or issue subpoenas; rather, the process for doing so is not specified in the committee's written rules. Some committees have provisions that are generally not included in other committee rules. Selected notable examples (that do not fit into other categories in other tables) are summarized in the last column of Table 4 .

Senate Rule XXVI establishes specific requirements for certain Senate committee procedures. In addition, each Senate committee is required to adopt rules to govern its own proceedings. These rules may "not be inconsistent with the Rules of the Senate." Senate committees may also operate according to additional established practices that are not necessarily reflected in their adopted rules but are not specifically addressed by Senate rules. In sum, Senate committees are allowed some latitude to establish tailored procedures to govern certain activities, which can result in significant variation in the way different committees operate. This report first provides a brief overview of Senate rules as they pertain to committee actions. The report then provides tables that summarize selected, key features of each committee's rules in regard to meeting day, hearing and meeting notice requirements, scheduling of witnesses, hearing quorum, business quorum, amendment filing requirements, proxy voting, polling, nominations, investigations, and subpoenas. In addition, the report looks at selected unique provisions some committees have included in their rules in the miscellaneous category. The tables, however, represent only a portion of each committee's rules, and provisions of the rules that are substantially similar to or essentially restatements of the Senate's Standing Rules are not included. This report will be not be updated further during the 114th Congress.

Levels of pay for congressional staff are a source of recurring questions among Members of Congress, congressional staff, and the public. In House committees, the chair and ranking member set the terms and conditions of employment for majority and minority staff, respectively. This includes job titles and descriptions; rates of pay, subject to maximum levels; and resources available to carry out their official duties. There may be interest in congressional pay data from multiple perspectives, including assessment of the costs of congressional operations; guidance in setting pay levels for staff in committee offices; or comparison of congressional staff pay levels with those of other federal government pay systems. Publicly available information sources do not provide aggregated congressional staff pay data in a readily retrievable form. Pay information in this report is based on the House Statement of Disbursements (SOD), published quarterly by the Chief Administrative Officer, as collated by LegiStorm, a private entity that provides some congressional data by subscription. Data in this report are based on official House reports, which afford the opportunity to use consistently collected data from a single source. Additionally, this report provides annual data, which allows for observations about the nature of House committee staff compensation over time. This report provides pay data for 11 staff position titles that are used in House committees, and for which sufficient data could be identified. Position titles and the years for which data are available since 2001 are provided in Table 1 . Titles were identified through a two-step process. The first step identified 358 job titles used in House committees in 2014. Of those titles, 282, or 78.8%, were filled by only one staff member, and were excluded. In the second step, the remaining 76 titles were assessed to determine how many of the House committees for which data were available employed staff with each title. Fifty-nine position titles that were used by six or fewer panels (five for minority positions) were excluded. Pay data were then collected for the remaining 17 positions. In order to be included, annual pay data for staff in each position needed to be available from at least five committees (four for minority positions). This eliminated another 6 positions, leaving 11. When committees had more than one staff member with the same job title, data for no more than two staff per committee were collected. House committee staff had to hold a position with the same job title in the same committee for the entire year examined, and not receive pay from any other congressional employing authority for their data to be included. Every recorded payment ascribed in the LegiStorm data to those staff for the fiscal year is tabulated. Data collected for this report may differ from an employee's stated annual salary due to the inclusion of overtime, bonuses, or other payments in addition to base salary paid in the course of a year. Pay data for staff working in Senate committee offices are available in CRS Report R44325, Staff Pay Levels for Selected Positions in Senate Committees, FY2001-FY2014 . Data describing the pay of congressional staff working in the personal offices of Senators and Members of the House are available in CRS Report R44324, Staff Pay Levels for Selected Positions in Senators' Offices, FY2001-FY2014 , and CRS Report R44323, Staff Pay Levels for Selected Positions in House Member Offices, 2001-2014 , respectively. Data presented here are subject to some challenges that could affect findings presented or their interpretation. Some of the concerns include the following: Given the large number of positions with titles held by one House employee, data provided here almost certainly do not represent all of the jobs carried out by House committee staff. The manner in which staff titles are assigned might have implications about the representativeness of the data provided. Of positions for which data were collected, two broad categories emerge. The first category identifies position titles that usually apply to one staff member per committee. Since almost all available data were collected for those positions, pay information provided is likely to be highly representative of what House committees pay staff in those positions. The second category includes positions for which committees might hire two or more staff members. Since pay data were collected for no more than two staff per committee for each position, it is more likely that data for those positions are a sample of staff in those positions rather than nearly complete data, and therefore may be less closely representative of what all staff in those positions are paid. Pay data provide no insight into the education, work experience, position tenure, full- or part-time status of staff, or other potential explanations for levels of compensation. Potential differences might exist in the job duties of positions with the same title. Aggregation of pay by job title rests on the assumption that staff with the same title carry out the same or similar tasks. Given the wide discretion congressional employing authorities have in setting the terms and conditions of employment, there may be differences in the duties of similarly titled staff that could have effects on their levels of pay. Tables in this section provide background information on House pay practices, comparative data for each position, and detailed data and visualizations for each position. Table 2 provides the maximum payable rates for House committee staff since 2001 in both nominal (current) and constant 2016 dollars. Constant dollar calculations throughout the report are based on the Consumer Price Index for All Urban Consumers (CPI-U), various years, expressed in 2016 dollars. Table 3 provides the available cumulative percentage changes in pay in constant 2016 dollars for each of the 11 positions, Members of Congress, and federal civilian workers paid under the General Schedule in Washington, DC, and surrounding areas. Table 4 - Table 14 provide tabular pay data for each House committee staff position. The numbers of staff whose data were counted are identified as observations in the data tables. Graphic displays are also included, providing representations of pay from three perspectives, including the following: a line graph showing change in pay, depending on data availability, in nominal (current) and constant 2016 dollars; a comparison at 5-, 10-, and 15-year intervals from 2015, depending on data availability, of the cumulative percentage change of pay for that position, in constant 2016 dollars, to changes in pay of Members of Congress and federal civilian workers paid under the General Schedule in Washington, DC, and surrounding areas; and distributions of 2015 pay in 2016 dollars, in $10,000 increments. Between 2011 and 2015, the change in median pay, in constant 2016 dollars, ranged from a 14.96% increase for communications directors to a -12.24% decrease for subcommittee staff directors. Of the eight staff positions for which data were available, two positions saw pay increases while six saw declines. This may be compared to changes to the pay of Members of Congress, -5.10%, and General Schedule, DC, -3.19%, over the same period. Between 2006 and 2015, all of the seven staff positions for which data were available saw decreases. The change in median pay, in constant 2016 dollars, ranged from a -4.78% decrease for counsels to a -31.06% decrease for professional staff members. This may be compared to changes to the pay of Members of Congress, -10.41%, and General Schedule, DC, -0.13%, over the same period. Between 2001 and 2015, all of the five staff positions for which data were available saw decreases. The change in median pay, in constant 2016 dollars, ranged from a -9.22% decrease for counsels to a -22.32% decrease for professional staff members. This may be compared to changes to the pay of Members of Congress, -10.40%, and General Schedule, DC, 7.36%, over the same period.

The level of pay for congressional staff is a source of recurring questions among Members of Congress, congressional staff, and the public. There may be interest in congressional pay data from multiple perspectives, including assessment of the costs of congressional operations; guidance in setting pay levels for staff in committee offices; or comparison of congressional staff pay levels with those of other federal government pay systems. This report provides pay data for 11 staff position titles that are used in House committees, and include the following: Chief Counsel; Communications Director; Counsel; Deputy Staff Director; Minority Professional Staff Member; Minority Staff Director; Professional Staff Member; Senior Professional Staff Member; Staff Assistant; Staff Director; and Subcommittee Staff Director. Tables provide tabular pay data for each House committee staff position. Graphic displays are also included, providing representations of pay from three perspectives, including the following: a line graph showing change in pay, depending on data availability; a comparison at 5-, 10-, and 15-year intervals from 2015, depending on data availability, of the cumulative percentage change of pay of that position, to changes in pay of Members of Congress and federal civilian workers paid under the General Schedule in Washington, DC, and surrounding areas; and distributions of 2015 pay, in $10,000 increments. In the past five years (2011-2015), the change in median pay, in constant 2016 dollars, ranged from a 14.96% increase for communications directors to a -12.24% decrease for subcommittee staff directors. Of the eight staff positions for which data are available, two positions saw pay increases while six saw declines from 2011 to 2015. This may be compared to changes to the pay of Members of Congress, -5.10%, and General Schedule, DC, -3.19%, over the same period. Pay data for staff working in Senate committee offices are available in CRS Report R44325, Staff Pay Levels for Selected Positions in Senate Committees, FY2001-FY2014. Data describing the pay of congressional staff working in the personal offices of Senators and Members of the House are available in CRS Report R44324, Staff Pay Levels for Selected Positions in Senators' Offices, FY2001-FY2014, and CRS Report R44323, Staff Pay Levels for Selected Positions in House Member Offices, 2001-2014, respectively. Information about the duration of staff employment is available in CRS Report R44683, Staff Tenure in Selected Positions in House Committees, 2006-2016, CRS Report R44685, Staff Tenure in Selected Positions in Senate Committees, 2006-2016, CRS Report R44682, Staff Tenure in Selected Positions in House Member Offices, 2006-2016, and CRS Report R44684, Staff Tenure in Selected Positions in Senators' Offices, 2006-2016.

SBA was established by the Small Business Act of 1953 to fulfill the role of several agencies that previously assisted small businesses affected by the Great Depression and, later, by wartime competition. SBA’s stated purpose is to promote small business development and entrepreneurship through business financing, government contracting, and technical assistance programs. In addition, SBA serves as a small business advocate, working with other federal agencies to, among other things, reduce regulatory burdens on small businesses. SBA also provides low-interest, long-term loans to individuals and businesses to assist them with disaster recovery through its Disaster Loan Program—the only form of SBA assistance not limited to small businesses. Homeowners, renters, businesses of all sizes, and nonprofit organizations can apply for physical disaster loans for permanent rebuilding and replacement of uninsured or underinsured disaster-damaged property. Small businesses can also apply for economic injury disaster loans to obtain working capital funds until normal operations resume after a disaster declaration. SBA’s Disaster Loan Program differs from the Federal Emergency Management Agency’s (FEMA) Individuals and Households Program (IHP). For example, a key element of SBA’s Disaster Loan Program is that the disaster victim must have repayment ability before a loan can be approved whereas FEMA makes grants under the IHP that do not have to be repaid. Further, FEMA grants are generally for minimal repairs and, unlike SBA disaster loans, are not designed to help restore the home to its predisaster condition. In January 2005, SBA began using DCMS to process all new disaster loan applications. SBA intended for DCMS to help it move toward a paperless processing environment by automating many of the functions staff members had performed manually under its previous system. These functions include both obtaining referral data from FEMA and credit bureau reports, as well as completing and submitting loss verification reports from remote locations. Our July 2006 report identified several significant limitations in DCMS’s capacity and other system and procurement deficiencies that likely contributed to the challenges that SBA faced in providing timely assistance to Gulf Coast hurricane victims as follows: First, due to limited capacity, the number of SBA staff who could access DCMS at any one time to process disaster loans was restricted. Without access to DCMS, the ability of SBA staff to process disaster loan applications in an expeditious manner was diminished. Second, SBA experienced instability with DCMS during the initial months following Hurricane Katrina, as users encountered multiple outages and slow response times in completing loan processing tasks. According to SBA officials, the longest period of time DCMS was unavailable to users due to an unscheduled outage was 1 business day. These unscheduled outages and other system-related issues slowed productivity and affected SBA’s ability to provide timely disaster assistance. Third, ineffective technical support and contractor oversight contributed to the DCMS instability that SBA staff initially encountered in using the system. Specifically, a DCMS contractor did not monitor the system as required or notify the agency of incidents that could increase system instability. Further, the contractor delivered computer hardware for DCMS to SBA that did not meet contract specifications. In the report released in February, we identified other logistical challenges that SBA experienced in providing disaster assistance to Gulf Coast hurricane victims. For example, SBA moved urgently to hire more than 2,000 mostly temporary employees at its Ft. Worth, Texas disaster loan processing center through newspaper and other advertisements (the facility increased from about 325 staff in August 2005 to 2,500 in January 2006). SBA officials said that ensuring the appropriate training and supervision of this large influx of inexperienced staff proved very difficult. Prior to Hurricane Katrina, SBA had not maintained the status of its disaster reserve corps, which was a group of potential voluntary employees trained in the agency’s disaster programs. According to SBA, the reserve corps, which had been instrumental in allowing the agency to provide timely disaster assistance to victims of the September 11, 2001 terrorist attacks, shrank from about 600 in 2001 to less than 100 in August 2005. Moreover, SBA faced challenges in obtaining suitable office space to house its expanded workforce. For example, SBA’s facility in Ft. Worth only had the capacity to house about 500 staff whereas the agency hired more than 2,000 mostly temporary staff to process disaster loan applications. While SBA was able to identify another facility in Ft. Worth to house the remaining staff, it had not been configured to serve as a loan processing center. SBA had to upgrade the facility to meet its requirements. Fortunately, in 2005, SBA was also able to quickly reestablish a loan processing facility in Sacramento, California, that had been previously slated for closure under an agency reorganization plan. The facility in Sacramento was available because its lease had not yet expired, and its staff was responsible for processing a significant number of Gulf Coast hurricane related disaster loan applications. As a result of these and other challenges, SBA developed a large backlog of applications during the initial months following Hurricane Katrina. This backlog peaked at more than 204,000 applications 4 months after Hurricane Katrina. By late May 2006, SBA took about 74 days on average to process disaster loan applications, compared with the agency’s goal of within 21 days. As we stated in our July 2006 report, the sheer volume of disaster loan applications that SBA received was clearly a major factor contributing to the agency’s challenges in providing timely assistance to Gulf Coast hurricane. As of late May 2006, SBA had issued 2.1 million loan applications to hurricane victims, which was four times the number of applications issued to victims of the 1994 Northridge, California, earthquake, the previous single largest disaster that the agency had faced. Within 3 months of Hurricane Katrina making landfall, SBA had received 280,000 disaster loan applications or about 30,000 more applications than the agency received over a period of about 1 year after the Northridge earthquake. However, our two reports on SBA’s response to the Gulf Coast hurricanes also found that the absence of a comprehensive and sophisticated planning process contributed to the challenges that the agency faced. For example, in designing DCMS, SBA used the volume of applications received during the Northridge, California, earthquake and other historical data as the basis for planning the maximum number of concurrent agency users that the system could accommodate. SBA did not consider the likelihood of more severe disaster scenarios and, in contrast to insurance companies and some government agencies, use the information available from catastrophe models or disaster simulations to enhance its planning process. Since the number of disaster loan applications associated with the Gulf Coast hurricanes greatly exceeded that of the Northridge earthquake, DCMS’s user capacity was not sufficient to process the surge in disaster loan applications in a timely manner. Additionally, SBA did not adequately monitor the performance of a DCMS contractor or stress test the system prior to its implementation. In particular, SBA did not verify that the contractor provided the agency with the correct computer hardware specified in its contract. SBA also did not completely stress test DCMS prior to implementation to ensure that the system could operate effectively at maximum capacity. If SBA had verified the equipment as required or conducted complete stress testing of DCMS prior to implementation, its capacity to process Gulf Coast related disaster loan applications may have been enhanced. In the report we issued in February, we found that SBA did not engage in comprehensive disaster planning for other logistical areas—such as workforce or space acquisition planning—prior to the Gulf Coast hurricanes at either the headquarters or field office levels. For example, SBA had not taken steps to help ensure the availability of additional trained and experienced staff such as (1) cross-training agency staff not normally involved in disaster assistance to provide backup support or (2) maintaining the status of the disaster reserve corps as I previously discussed. In addition, SBA had not thoroughly planned for the office space requirements that would be necessary in a disaster the size of the Gulf Coast hurricanes. While SBA had developed some estimates of staffing and other logistical requirements, it largely relied on the expertise of agency staff and previous disaster experiences—none of which reached the magnitude of the Gulf Coast hurricanes—and, as was the case with DCMS planning, did not leverage other planning resources, including information available from disaster simulations or catastrophe models. In our July 2006 report, we recommended that SBA take several steps to enhance DCMS, such as reassessing the system’s capacity in light of the Gulf Coast hurricane experience and reviewing information from disaster simulations and catastrophe models. We also recommended that SBA strengthen its DCMS contractor oversight and further stress test the system. SBA agreed with these recommendations. I note that SBA has completed an effort to expand DCMS’s capacity. SBA officials said that DCMS can now support a minimum of 8,000 concurrent agency users as compared with only 1,500 concurrent users for the Gulf Coast hurricanes. Additionally, SBA has awarded a new contract for the project management and information technology support for DCMS. The contractor is responsible for a variety of DCMS tasks on SBA’s behalf including technical support, software changes and hardware upgrades, and supporting all information technology operations associated with the system. In the report released in February, we identified other measures that SBA had planned or implemented to better prepare for and respond to future disasters. These steps include appointing a single individual to coordinate the agency’s disaster preparedness planning and coordination efforts, enhancing systems to forecast the resource requirements to respond to disasters of varying scenarios, redesigning the process for reviewing applications and disbursing loan proceeds, and enhancing its long-term capacity to acquire adequate facilities in an emergency. Additionally, SBA had planned or initiated steps to help ensure the availability of additional trained and experienced staff in the event of a future disaster. According to SBA officials, these steps include cross-training staff not normally involved in disaster assistance to provide back up support, reaching agreements with private lenders to help process a surge in disaster loan applications, and reestablishing the Disaster Active Reserve Corps, which had reached about 630 individuals as of June 2007. While SBA has taken a variety of steps to enhance its capacity to respond to disasters, I note that these efforts are ongoing and continued commitment and actions by agency managers are necessary. In June 2007, SBA released a plan for responding to disasters. While we have not evaluated the process SBA followed in developing its plan, according to the SBA plan, the agency is incorporating catastrophe models into its disaster planning processes as we recommended in both reports. For example, the plan states that SBA is using FEMA’s catastrophe model, which is referred to as HAZUS, in its disaster planning activities. Further, based on information provided by SBA, the agency is also exploring the use of models developed by private companies to assist in its disaster planning efforts. These efforts to incorporate catastrophe models into the disaster planning process appear to be at an early stage. SBA’s plan also anticipates further steps to ensure an adequate workforce is available to respond to a disaster, including training and using 400 non- disaster program office staff to assist in responding to the 2007 hurricane season and beyond. According to SBA officials, about 200 of these staff members will be trained in reviewing loan applications and providing customer service by the end of this month and the remainder will be trained by this Fall. We encourage SBA to actively pursue initiatives that may further enhance its capacity to better respond to future disasters, and we will monitor SBA’s efforts to implement our recommendations. Mr. Chairman, this concludes my prepared statement. I would be happy to answer any questions at this time. For further information on this testimony, please contact William B. Shear at (202) 512- 8678 or Shearw@gao.gov. Contact points for our Offices of Congressional Affairs and Public Affairs may be found on the last page of this statement. Individuals making key contributions to this testimony included Wesley Phillips, Assistant Director; Triana Bash; Alison Gerry; Marshall Hamlett; Barbara S. Oliver; and Cheri Truett. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

The Small Business Administration (SBA) helps individuals and businesses recover from disasters such as hurricanes through its Disaster Loan Program. SBA faced an unprecedented demand for disaster loan assistance following the 2005 Gulf Coast hurricanes (Katrina, Rita, and Wilma), which resulted in extensive property damage and loss of life. In the aftermath of these disasters, concerns were expressed regarding the timeliness of SBA's disaster assistance. GAO initiated work and completed two reports under the Comptroller General's authority to conduct evaluations and determine how well SBA provided victims of the Gulf Coast hurricanes with timely assistance. This testimony, which is based on these two reports, discusses (1) challenges SBA experienced in providing victims of the Gulf Coast hurricanes with timely assistance, (2) factors that contributed to these challenges, and (3) steps SBA has taken since the Gulf Coast hurricanes to enhance its disaster preparedness. GAO visited the Gulf Coast region, reviewed SBA planning documents, and interviewed SBA officials. GAO identified several significant system and logistical challenges that SBA experienced in responding to the Gulf Coast hurricanes that undermined the agency's ability to provide timely disaster assistance to victims. For example, the limited capacity of SBA's automated loan processing system--the Disaster Credit Management System (DCMS)--restricted the number of staff who could access the system at any one time to process disaster loan applications. In addition, SBA staff who could access DCMS initially encountered multiple system outages and slow response times in completing loan processing tasks. SBA also faced challenges training and supervising the thousands of mostly temporary employees the agency hired to process loan applications and obtaining suitable office space for its expanded workforce. As of late May 2006, SBA processed disaster loan applications, on average, in about 74 days compared with its goal of within 21 days. While the large volume of disaster loan applications that SBA received clearly affected its capacity to provide timely disaster assistance to Gulf Coast hurricane victims, GAO's two reports found that the absence of a comprehensive and sophisticated planning process beforehand likely limited the efficiency of the agency's initial response. For example, in designing the capacity of DCMS, SBA primarily relied on historical data such as the number of loan applications that the agency received after the 1994 Northridge, California, earthquake--the most severe disaster that the agency had previously encountered. SBA did not consider disaster scenarios that were more severe or use the information available from disaster simulations (developed by federal agencies) or catastrophe models (used by insurance companies to estimate disaster losses). SBA also did not adequately monitor the performance of a DCMS contractor or completely stress test the system prior to its implementation. Moreover, SBA did not engage in comprehensive disaster planning prior to the Gulf Coast hurricanes for other logistical areas, such as workforce planning or space acquisition, at either the headquarters or field office levels. While SBA has taken steps to enhance its capacity to respond to potential disasters, the process is ongoing and continued commitment and actions by agency managers are necessary. As of July 2006, SBA officials said that the agency had completed an expansion of DCMS's user capacity to support a minimum of 8,000 concurrent users as compared with 1,500 concurrent users supported for the Gulf Coast hurricanes. Further, in June 2007, SBA released a disaster plan. While GAO has not evaluated the process SBA followed in developing its plan, consistent with recommendations in GAO reports, the plan states that SBA is incorporating catastrophe models into its planning process, an effort which appears to be at an early stage. GAO encourages SBA to actively pursue the use of catastrophe models and other initiatives that may further enhance its capacity to better respond to future disasters.

RS21055 -- NATO Enlargement Updated May 5, 2003 Congress is now considering enlargement of NATO, an issue addressed at the allied summit in Prague, in November 2002. During the last round of enlargement, the Senate voted 80-19 on April 30, 1998, in favor of admitting Poland, theCzechRepublic, and Hungary to NATO. (A two-thirds Senate majority is necessary to admit new states becauseenlargement isconsidered an amendment to the original North Atlantic Treaty.) Other members of the alliance followed suit, andthe threecountries became members in March 1999. It was the fourth time that NATO had admitted new states, withmembershipincreasing from the original 12 to 19 today. At the previous NATO summit in April 1999, the allies underscored that they were open to further enlargement. Theycreated a Membership Action Plan (MAP), outlining structured goals for candidates, such as ending the danger ofethnicconflict, developing a democratic society with transparent political and economic processes and civilian control ofthemilitary, and pledging commitment to defense budgets to build military forces able to contribute to missions fromcollectivedefense to peacekeeping. (1) At Prague, on November 21, 2002, the current members' heads of state designated the three Baltic states (Latvia, Lithuania,and Estonia), Slovenia, Slovakia, Bulgaria, and Romania, as prospective members. In 1998, the congressional debate over NATO enlargement covered such issues as costs, mission, and qualifications of thecandidates. The issue of costs has now seemingly been put to rest because entry of Poland, the Czech Republic, andHungary does not appear to have required extra U.S. funds. Most observers believe that the three countries havecontributedto stability in Europe, and have made significant political contributions to the alliance in such matters as enhancingNATO'sunderstanding of central and eastern Europe, Russia, and the Balkans, given the history of the new members'involvementwith these regions. Militarily, their contribution is less apparent; each of the three contributes forces to theNATO-led peaceoperations in the Balkans, and is building forces to defend its borders. Pentagon officials believe that Poland hasmade thegreatest strides in restructuring and modernizing its military, and that the Czech Republic and Hungary have madeconsiderably less progress. (2) It should be noted thata period of years is normally necessary to rebuild a military that has hadan authoritarian tradition and convert it to one having civilian control, purge it of old-guard elements, reform itstraining,and purchase equipment compatible with a new set of allies. There has been some sentiment that NATO should delay invitations to candidate states until democratic processes are firmlyentrenched. For example, the recent Hungarian government of Victor Orban was criticized for an ethnic "status law"thatsome interpreted as cloaking Hungarian aspirations for territory from neighboring states having Hungarianminorities. (3) Others reject such sentiments, noting that Orban was freely elected, and dismissing the status law as nothing morethan apassing example of nationalist politics before a close election. Nonetheless, it is possible that the period betweennamingcandidate states for accession negotiations at Prague in November 2002 and the moment when current NATOmembergovernments decide whether to admit those candidates (such as the vote in the U.S. Senate), could see debates overwhethereach candidate continues to meet criteria for democracy, particularly if there is an election bringing in a governmentthatmember states view as extremist. The North Atlantic Treaty does not contain a provision for expelling ordisciplining amember state. Another factor for consideration could prove to be a prospective member's efforts to persuade its people that NATOmembership is desirable. Slovenia held a referendum on March 23, 2003; 66% of those voting, 66% supportedNATOmembership, despite popular opposition to the war in Iraq that approaches 80%. No other candidate state intendsto hold areferendum on NATO membership. The essence of the current enlargement debate is over qualifications, with no apparent consensus. Of an original ninecandidates, two candidates, Albania and Macedonia, did not receive invitations at Prague. (4) Each of these countries issmall, with comparably small militaries potentially capable of specialized functions, such as transport or medicalcare, forexample, but only minimally capable of building forces able to contribute to high-intensity conflict. In the view ofsomeobservers, to adhere to the letter of the military qualifications outlined in the 1999 summit communiqué,requiring newmembers to contribute to missions from peacekeeping to collective defense, would be tantamount to excluding theirentry. Many participants in the debate favor different standards that, in their view, reflect the current political situation in Europe,where Russia is no longer a military threat but ethnic conflict, nationalism, and terrorism are a danger. In suchcircumstances, they contend, political stability and a modernized military at least able to contribute to border defenseand topeace operations are an appropriate standard. Secretary of State Powell seemed to suggest such a standard in hisconfirmation hearing when he stressed a need for candidates to modernize their militaries, and to strengthen theirdemocratic structures. (5) An opposing view is that NATO should first clearly define its mission, above all with an agreement on what types ofout-of-area threats, such as terrorism, proliferation, or a disruption of the flow of oil, should be met with a possiblemilitaryresponse. At that point, enlargement should be considered, with a determination about which prospective membersmightcontribute to the mission. Some observers, also hesitant about enlargement, note that the United States flew over60 percentof combat missions in the Kosovo conflict. They prefer prospective members that could relieve the U.S. burden. Yet another view is that there is no clear dichotomy between collective defense (high-intensity conflict undertaken inresponse, for example, to the attacks of September 11, 2001) and collective security (peace operations andhumanitarianassistance). In this view, countries contributing to peace operations assist in building stable societies and preventing"blackholes," such as Bosnia or Afghanistan, where terrorism may take root. Countries involved in peace operations, then,arecontributing to the prevention of terrorism, and thereby to collective defense. The terrorist attacks against the United States on September 11, 2001, are affecting the enlargement debate. A likely part ofthe enlargement debate will be how prospective members might contribute to the conflict against terrorism or actto stem theflow of weapons of mass destruction. NATO seemed partially to settle one aspect of the debate over its missionshortlyafter the attacks when member states invoked Article V, the alliance's collective defense clause, to come to the aidof theUnited States in the conflict against terrorism. Previously, the European allies had resisted any statement that ArticleVshould be invoked in an out-of-area action against terrorism. At a NATO ministerial meeting in Reykjavik in May2002, theallies agreed that they must be able "to carry out the full range of... missions, ... to field forces wherever they areneeded,sustain operations over distance and time, and achieve their objectives." (6) However, not all member states have sufficiently mobile or appropriately trained forces for the current tasks in Afghanistanand Iraq, for example. Few allies besides the United States have special forces or mobile, large-formation combatforceswith the potential to contribute meaningfully to such conflicts. At the same time, a number of allies have anintelligencecapability, transport, medical units, and political influence that might assist in such conflicts. As the terrorism conflict unfolds, current members may examine how prospective members might be able to contribute.Contributions might include political influence and support, for example in the United Nations or with Russia orMuslimstates, and not necessarily military potential. They might also examine the level of internal security in the candidatecountries and ability to control borders, disrupt terrorist financial networks or apprehend terrorist suspects on theirsoil.Elements of the MAP that emphasize an end to corruption may be increasingly underscored, given thepost-September 11importance of preventing money-laundering, and combating a black economy. The alliance experienced sharp divisions over whether to use military force against Iraq. In January 2003, Bush Administration officials applauded the decision of the 7 candidate states (and others) to sign a letter that, in general,endorsed the U.S. position on Iraq; some candidates state representatives complained that they had been bullied bytheAdministration into signing the letter. Six of the seven candidate states joined the coalition. Slovenia was theexception,but allowed overflight by U.S. and UK forces. The failure to achieve consensus in the North Atlantic Council overhow andwhether to aid Turkey in the event of an attack by Iraq exposed serious divisions in the alliance. (7) The fractious debate inthe NAC led some Administration officials and Members of Congress to raise the issue of changing NATOdecision-makingprocedures. (8) The debate over enlargement is quite different in 2001 than it was in 1998. In 1998, several European allies stronglysupported enlargement. Today, most member states couch discussion of enlargement in careful terms. Most member states agree that Slovenia is politically qualified for membership; in addition, Hungary urges Slovenia'smembership, once NATO criteria for entry are met, for strategic reasons. Hungary is not contiguous with any otherNATOstate. Slovenia's entry into the alliance would provide Hungary with a land bridge to Italy, a clear advantage givenneutralAustria's refusal during the Kosovo war to permit NATO overflights to Hungary. Slovakia is a credible candidatein someNATO capitals, given the return in September 2002 elections of key elements of its reform government. SomenorthernEuropean allies, such as Poland, strongly support membership for the Baltic states; they contend that the Baltic stateshavemet OSCE and EU political guidelines for democracy, and cite the three countries' work to build stability in theregion andto establish better relations with Russia. U.S. officials state that the Baltic states have made the most progress inmeetingMAP requirements, although there is some criticism of how Latvia has handled sensitive documents. Italy, Greece, and Turkey are strong supporters of Bulgaria's and Romania's entry. They contend that these two countriescan contribute to stability in the Balkans, where Europe's greatest security needs lie. Critics counter that RomaniaandBulgaria continue to suffer from corruption in their governing structures, and that each must make stronger effortstomodernize its military. Bulgaria has also had a succession of governments that have followed an uncertain coursetowardspolitical and economic reform. The views of the Russian government play a role in the debate. Putin's softer rhetoric against NATO enlargement since theSeptember 11 terrorist attacks has allayed concerns that his government would strongly oppose enlargement. It ispossiblethat Putin now views a unified front against terrorism, in part due to Moscow's ongoing conflict in Chechnya, asmoreimportant than potential divisions with the allies over enlargement. The Duma and much of Russia's military andintelligence bureaucracy remain adamantly opposed to enlargement, which they view as a U.S.-led effort to movea militaryalliance closer to their territory. Officials from allied states often counter such an argument by underscoring thatenlargement's purpose in large part is to ensure stability in Europe, and that the addition of new member statesprovidesstability, and therefore security, to Russia's west. Putin may also view the entry of Estonia and Latvia into NATO(and theEU, in 2004) as a means to protect Russian minorities in those countries, given NATO and EU strictures over thetreatmentof ethnic minorities. In the spring of 2003, both the Senate Foreign Relations Committee and the Senate Armed Services Committee beganhearings on enlargement. Some individual Members have expressed their views, and relevant legislation has beenintroduced. The Senate Foreign Relations Committee produced a report on enlargement, together with theResolution ofRatification (Executive Report 108-6), the instrument on which the Senate will vote to give its advice and consenttorevision of the North Atlantic Treaty. In the 107th Congress, Rep. Shimkus and others introduced H.Con.Res. 116 , which calls for NATO invitationsto the Baltic states for membership at the 2002 summit, as long as they satisfy the alliance's qualifications. It passedbyvoice vote on October 7, 2002. On October 24, 2001, legislation was introduced in both Houses supporting further enlargement. Representative Bereuterintroduced H.R. 3167 , the Freedom Consolidation Act of 2001; Speaker Hastert and others cosponsored thebill. An identical Senate bill, S. 1572 , with cosponsors including Senators Durbin, Lieberman, Lott, Lugar,andMcCain, was also introduced. The bill recalled and approved legislation of the four previous Congresses that urgedenlargement and provided funding for particular candidates. The bill designated Slovakia as eligible to receive U.S.assistance under section 203(a) of the NATO Participation Act of 1994 (title II of P.L. 103-447 ). This section givesthePresident authority to establish a program of assistance with a government if he finds that it meets the requirementsofNATO membership. In the 107th Congress, Representative Gallegly introduced H.Res. 468 , which described NATO as key to U.S.interests in Europe and encourages a continued path of improving relations with Russia. It strongly urged invitationstomembership for the 7 countries ultimately invited at Prague. It passed the House 358-9 on October 7, 2002. The Senate Foreign Relations Committee marked up the Resolution of Ratification on April 30, 2003. The Resolution isthe instrument on which the Senate will vote to give its advice and consent to admission of the candidate states. TheCommittee's report accompanying the Resolution reviews the strengths and weaknesses of the candidate states,assessingtheir political, economic, and military policies. It also reviews NATO's mission and capabilities, relations withRussia, rolein the Balkan wars, and the Prague NATO summit. Secretary of Defense Rumsfeld has stirred NATO waters by suggesting the presence of an "old" and "new" Europe, theformer consisting of such countries as France and Germany, the latter consisting of recent new members andcandidatestates. Secretary Rumsfeld has suggested that the alliance's future belongs to the United States and the "new"Europe, withthe "old" Europe increasingly marginalized. European critics, some of them in the candidate states, oppose suchacategorization, noting that Germany has the largest economy in Europe, and that only France, with Britain, has amilitaryable to move its forces considerable distances for engagement in combat. These critics express concern that adividedNATO will not be effective in confronting threats that face each member state. (9) Accession negotiations between NATO and the candidate states were completed on March 26, 2003, and the candidate stategovernments signed protocols that have been sent to the 19 member states, each of which will follow itsconstitutionalprocedures to amend the North Atlantic Treaty to admit new members. All 19 members must agree on a prospectivemember's qualifications for it to enter NATO. The Bush Administration would like for the Senate to vote onenlargementbefore that August 2003 recess. NATO hopes to admit the successful candidates in May 2004.

This report provides a brief summary of the last round of NATO enlargement. The report analyzes the key military and political issues in the debate over seven prospective members named atNATO'sPrague summit. It then provides an overview of the positions of the allies and of Russia on enlargement, citing theeffectsof the terrorist attacks of September 11, 2001, on the United States. It concludes with a discussion of recentlegislation onenlargement. This report will be updated as needed. See also CRS Report RS21354, The NATO Summit atPrague, 2002,CRS Report RL30168, NATO Applicant States: A Status Report, and CRS Report RS21510,NATO's Decision-MakingProcedure.

Recognizing the human capital challenges facing federal agencies, Congress, the administration, and others are focusing increased attention on strategic human capital management. Congress has underscored the consequences of human capital weaknesses in federal agencies and pinpointed solutions through the oversight process and a wide range of hearings held over the last few years. The President, in August 2001, placed human capital at the top of his management agenda. The Office of Management and Budget is assessing agencies’ progress in addressing their individual human capital challenges. In January 2001, we designated strategic human capital management as a governmentwide high-risk area and stated that one of the pervasive human capital challenges facing the federal government was a lack of strategic human capital planning and organizational alignment. In March 2002, we issued our model of strategic human capital management, stating that federal agencies needed to adopt a consistent strategic approach to marshaling, managing, and maintaining the human capital needed to maximize government performance and ensure accountability. Several DOD studies have identified the need for a more strategic approach to human capital planning. The 8th Quadrennial Review of Military Compensation, completed in 1997, strongly advocated that DOD adopt a strategic human capital planning approach. The review found that DOD lacked an institutionwide process for systematically examining human capital needs or translating needs into a coherent strategy. Subsequent DOD and service studies, including those by the Defense Science Board Task Force on Human Resources Strategy (2000), the Naval Personnel Task Force (2000-2001), and the DOD Study on Morale and Quality of Life (2001), endorsed the concept of human capital strategic planning. For example, the Defense Science Board Task Force found there was “no overarching framework within which the future DOD workforce is being planned aside from planning conducted within the military services and ad hoc fora in the Office of the Secretary of Defense. An overarching strategic vision is needed that identifies the kind of capabilities that DOD will need in the future, the best way to provide those capabilities, and the changes in human resources planning and programs that will be required.” In view of these studies, the Office of the Secretary of Defense published the Military Personnel Human Resource Strategic Plan (referred to in this report as the military personnel strategic plan) in April 2002 to establish military personnel priorities for the next several years. DOD, in the military personnel strategic plan, states that the plan is intended to be a dynamic document that will be assessed and refined. In April 2002, DOD also published A New Social Compact: A Reciprocal Partnership Between the Department of Defense, Service Members and Families (or Social Compact) to review measures for improving the quality of life for military personnel and their families. These two plans were developed separately within the Office of the Under Secretary of Defense for Personnel and Readiness, and they differ in their methodological approach and structure. Nevertheless, DOD officials said the plans should be considered in conjunction as part of DOD’s overall strategic human capital strategy. DOD, in its military personnel strategic plan and Social Compact, recognizes that benefits are an important component to human capital management and deserve attention. In this regard, the two plans constitute a positive step forward in DOD’s strategic management of the military workforce. The Social Compact indicates that benefits are important to alleviating some of the hardships of military life and emphasizes that providing consistent, high-quality benefits that meet the needs of service members and their families can yield a committed and long-term workforce. The Social Compact also outlines DOD’s vision and goals for a number of benefit areas, including child and youth services, parent support, commissaries and exchanges, financial literacy, health, housing, spouse employment, fitness and recreation, and tuition assistance. The military personnel strategic plan indicates that DOD considers benefits important elements in its efforts to develop, sustain, and retain the force and to transition members from active duty. The plan lists a number of planned studies (see table 1) that ultimately could lead to changes in pay and benefits. While progress has been made, DOD’s human capital plans do not yet satisfy the two factors we identified in our model as critical to the success of strategic human capital planning (one of the four cornerstones of sound strategic human capital management). First, the plans do not specifically address how DOD will integrate and align benefits and other human capital approaches to meet its overall organizational goals. According to our model, effective organizations integrate human capital approaches as key strategic elements for accomplishing their mission and programmatic goals and results. These organizations consider further human capital initiatives or refinements in light of both changing organizational needs and the demonstrated successes or shortcomings of their human capital efforts. DOD’s military personnel strategic plan identifies more than 30 discrete initiatives. It is unclear from the plan how these initiatives are integrated and aligned with each other, except that they are grouped under five broadly stated human capital goals such as recruit the right number and quality of people. It is also unclear how the initiatives, many of which are studies, will work in conjunction with one another to meet DOD’s goals. For example, one of the initiatives is to study alternatives to the military retirement system. The plan does not explain how retirement reform may be integrated and aligned with other initiatives such as DOD’s study of variable career lengths for officers. In addition, the retirement study is listed under the human capital goal of transitioning members from active status but does not explain why a new approach to retirement may be needed to meet this goal. It is also unclear why the initiative was not listed under the human capital goal of developing, sustaining, and retaining the force, even though an organization’s retirement system is considered an important retention tool. Further, the military personnel strategic plan and the Social Compact, which were developed separately, address different sets of human capital issues, and there are no explicit linkages between the two plans. For example, while the Social Compact addresses such benefit areas as housing, health care, and family support, the military personnel strategic plan is silent on these topics. Thus, DOD lacks an overarching framework integrating its human capital plans for military personnel. DOD officials said they are working to improve the integration of the human capital plans by developing an “umbrella” plan. Secondly, the plans do not satisfy the critical success factor of using data in human capital decisions. We state in our model that a fact-based, performance-oriented approach to human capital management is crucial for maximizing the value of human capital as well as managing related risks. High-performing organizations use relevant and reliable data to determine key performance objectives and goals that enable them to evaluate the success of their human capital approaches. These organizations also identify current and future human capital needs, including the appropriate number of employees, the key competencies and skills mix for mission accomplishment, and the appropriate deployment of staff across the organization and then create strategies for identifying and filling gaps. The military personnel strategic plan provides measures of effectiveness for each initiative; however, these measures are not adequate to assess the success of DOD’s human capital approaches because they (1) do not describe the significance of outcomes in terms of programmatic goals and results, (2) are not always specific or stated as measurements, and (3) are activity-based rather than outcome-oriented. For example, one initiative calls for a study of sabbatical programs. However, the measure of effectiveness for this initiative is to implement guidance for a sabbatical- type program. The relationship between sabbatical programs and the human capital goal of improving retention is not described. In addition, DOD’s plans do not discuss, at a strategic level, military workforce needs or gaps. Furthermore, they do not address how the military workforce may change in its total end strength, distribution among the services, grade level, geographic deployment, or force mix. For example, DOD has faced challenges in providing benefits to service members that respond to their changing needs. A major demographic change has been the growing proportion of service members who are women. In 2000, women comprised about 15 percent of the active duty force, compared with 4 percent in 1974. Up to 10 percent of women in the military become pregnant each year. If these trends continue, DOD may need to take into account the benefits that this population values to better retain these trained, experienced service members. For example, we have recommended that DOD assess the feasibility, costs, and benefits of offering extended time off to parents of newborn or adopted children. Moreover, DOD lacks a process for enabling senior DOD officials to oversee the progress and implementation of its human capital plans from a strategic vantage point. Our model of strategic human capital management identifies the sustained and active commitment of senior leaders as a critical success factor for effective strategic human capital management. Top leaders need to stimulate and support efforts to integrate human capital approaches with organizational goals and direct that approaches be evaluated by the standard of how well they support the agency’s efforts to achieve program results. A senior DOD official told us that implementing the plan will be a long-term endeavor. One of the human capital goals in the military personnel strategic plan is to sustain the strategic management process and maintain its viability. According to the plan, DOD needs to establish a process and forum to regularly review the progress of its human capital strategy in order that its strategy will remain viable and relevant. The plan calls for the establishment of a Defense Human Resources Board by March 2003. However, DOD officials have not decided on the roles and responsibilities of the board, the composition of the board, or how the board would work with existing processes. DOD, in developing its human capital plans addressing military personnel and quality of life, has made progress in adopting a more strategic approach to human capital management. Since the military personnel strategic plan is intended to be a dynamic document that periodically will be assessed and refined, DOD will have opportunities to incorporate additional elements of human capital strategic planning in future iterations of the plan. A positive step toward such improvements would be the establishment of an oversight process enabling senior DOD officials to oversee the progress and implementation of the human capital plans. Such a process could assist in the integration and alignment of benefits and other human capital approaches to meet organizational goals and in promoting a fact-based, performance-oriented approach to human capital management. To improve DOD’s strategic human capital management, we recommend that you direct the Under Secretary of Defense for Personnel and Readiness to establish an oversight process by which senior DOD officials may integrate and align benefits and other human capital approaches and promote a fact-based, performance-oriented approach to human capital management. As one option, you may wish to consider incorporating this oversight responsibility into the mission of the planned Defense Human Resources Board. In written comments on a draft of this report, DOD concurred with our recommendation. DOD stated that it will establish a senior leader oversight process to ensure integration and alignment of benefits and other human capital approaches and to continue a fact-based, performance-oriented approach. DOD’s comments are reprinted in appendix I. To critique DOD’s human capital plans for military personnel, we drew primarily from our model of strategic human capital management. The model highlights some of the steps agencies can take to make progress in managing human capital strategically. The model identifies eight critical success factors, which are organized in pairs to correspond with four cornerstones of effective strategic human capital management. We focused on the two critical success factors that correspond to strategic human capital planning, namely (1) the integration and alignment of human capital approaches to meet organizational goals and (2) the use of data to make human capital decisions. We reviewed DOD’s human capital plans to determine the extent they satisfied these two critical success factors with respect to active duty military benefits. In analyzing DOD’s plans, we reviewed our prior work on military personnel issues and DOD studies of human capital management. We discussed the human capital plans with officials in the Office of the Under Secretary of Defense for Personnel and Readiness. We conducted our review from June to September 2002 in accordance with generally accepted government auditing standards. This report contains recommendations to you. Under 31 U.S.C. 720, the head of a federal agency is required to submit a written statement of the actions taken on our recommendations to the Senate Committee on Governmental Affairs and the House Committee on Government Reform not later than 60 days after the date of the report. A written statement also must be sent to the House and Senate Committees on Appropriations with the agency’s first request for appropriations made more than 60 days after the date of the report. We are sending copies to appropriate congressional committees and the Director, Office of Management and Budget. We will make copies available to other interested parties on request. In addition, the report will be available at no charge at the GAO Web site at http://www.gao.gov. If you or your staff has any questions regarding this report, please call me at (202) 512-5140. Brenda S. Farrell, Thomas W. Gosling, and Stefano Petrucci made significant contributions to this report.

The Department of Defense (DOD) has, in the past, lacked a strategic approach to human capital management. In April 2002, DOD issued two human capital strategic plans for military personnel. One plan addresses military personnel management and policies; the second addresses quality of life issues affecting service members and their families. As a follow-on to its recent work on benefits for military personnel, GAO reviewed the extent that these two plans, in addressing military benefits, promote (1) the integration and alignment of human capital approaches to meet organizational goals and (2) the use of reliable data to make human capital decisions--two critical success factors for human capital planning. GAO also reviewed DOD's plans for overseeing the progress and implementation of its human capital plans. DOD's human capital plans addressing military personnel and quality of life represent a positive step forward in fostering a more strategic approach to human capital management. The two plans lay some of the groundwork needed to incorporate benefits into the strategic management of human capital. The plans, for example, recognize that benefits are important elements to meeting recruiting and retention goals and to alleviating some of the hardships of military life. However, the two plans do not satisfy the two critical success factors GAO has identified for human capital planning. The plans do not specifically address how DOD will integrate and align benefits with other human capital approaches to meet organizational goals. DOD's plans identify a number of initiatives, but the plans do not describe how individual initiatives, many of which are studies, will work in conjunction with one another to meet DOD's goals and objectives. For example, one of DOD's initiatives is to study alternatives to the military retirement system, and another initiative is to study variable career lengths for officers. However, the human capital plans do not explain how these two initiatives may be integrated and aligned with each other to achieve desired outcomes. The military personnel strategic plan also does not identify outcome-oriented performance measures or discuss, at a strategic level, military workforce needs or gaps in meeting these needs--the kinds of data used by high-performing organizations to manage their human capital. DOD lacks a process for overseeing the progress and implementation of its human capital plans from a strategic vantage point. Without such a process, DOD may have difficulty integrating and aligning benefits and other human capital approaches to meet organizational goals and promoting a data-driven, performance-oriented approach to human capital management. Moreover, an oversight process could help DOD officials maintain the momentum of their strategic human capital planning efforts. DOD is considering establishing a Defense Human Resources Board to maintain the viability of its strategic human capital planning, but DOD officials have not determined the roles and responsibilities of the board.

Title insurance is designed to guarantee clear ownership of a property that is being sold. The policy is designed to compensate either the lender (through a lender’s policy) or the buyer (through an owner’s policy) up to the amount of the loan or the purchase price, respectively. Title insurance is sold primarily through title agents who check the history of a title by examining public records. The title policy insures the policyholder against any claims that existed at the time of purchase but were not in the public record. Title insurance premiums are paid only once during a purchase, refinancing, or, in some cases, home equity loan transaction. The title agent receives a portion of the premium as a fee for the title search and examination work and its commission. The party responsible for paying for the title policies varies by state. In many areas, the seller pays for the owner’s policy and the buyer pays for the lender’s policy, but the buyer may also pay for both policies—or split some, or all, of the costs with the seller. According to a recent nationwide survey, the average cost for simultaneously issuing lender’s and owner’s policies on a $180,000 loan (plus other associated title costs) was approximately $925, or about 34 percent of the average total loan origination and closing fees. We identified several important items for further study, including the way policy premiums are determined, the role played by title agents, the way that title insurance is marketed, the growth of affiliated business arrangements, and the involvement of and coordination among the regulators of the multiple types of entities involved in the marketing and sale of title insurance. For several reasons, the extent to which title insurance premium rates reflect insurers’ underlying costs is not always clear. First, the largest cost for title insurers is not losses from claims—as it is for most types of insurers—but expenses related to title searches and agent commissions (see fig. 1). However, most state regulators do not consider title search expenses to be part of the premium, and do not include them in regulatory reviews that seek to determine whether premium rates accurately reflect insurers’ costs. Second, many insurers provide discounted premiums on refinance transactions because the title search covers a relatively short period, but the extent of such discounts and their use is unclear. Third, the extent to which premium rates increase as loan amounts or purchase prices increase is also unclear. Costs for title search and examination work do not appear to rise as loan or purchase amounts increase, and such costs are insurers’ largest expense. If premium rates reflected the underlying costs, total premiums could reasonably be expected to increase at a relatively slow rate as loan or purchase amounts increased, however, it is not clear that they do so. Title agents play a more significant role in the title insurance industry than agents do in most other types of insurance, performing most underwriting tasks as well as the title search and examination work. However, the amount of attention they receive from state regulators is not clear. For example, according to data compiled by the American Land Title Association (ALTA), while most states require title agents to be licensed, 3 states plus the District of Columbia do not; 18 states and the District of Columbia do not require agents to pass a licensing exam. Although NAIC has produced model legislation that states can use in their regulatory efforts, according to NAIC, as of October 2005 only three states had passed the model law or similar legislation. For several reasons, the competitiveness of the title insurance market has been questioned. First, while consumers pay for title insurance, they generally do not know how to “shop around” for the best deal and may not even know that they can. Instead, they often rely on the advice of a real estate or mortgage professional in choosing a title insurer. As a result, title insurers and agents normally market their products exclusively to these types of professionals, who in some cases may recommend not the least expensive or most reputable title insurer or agent but the one that represents the professional’s best interests. Second, the title industry is highly concentrated. ATLA data show that in 2004 the five largest title insurers and their subsidiary companies accounted for over 90 percent of the total premiums written. Finally, the low level of losses title insurers generally suffer—and large increases in operating revenue in recent years—could create the impression of excessive profits, one potential sign of a lack of competition. The use of affiliated business arrangements involving title agents and others, such as lenders, real estate brokers, or builders has grown over the past several years. Within the title insurance industry, the term “affiliated business arrangements” generally refers to some level of joint ownership among a title insurer, title agent, real estate broker, mortgage broker, lender, and builder (see fig. 2). For example, a mortgage lender and a title agent might form a new jointly owned title agency, or a lender might buy a portion of an existing title agency. Such arrangements, which may provide consumers with “one-stop shopping” and lower costs, can also can also be abused, presenting conflicts of interest when they are used as conduits for giving referral fees back to the referring entity or when the profits from the title agency are significant to the referring entity. Several types of entities besides insurers and their agents are involved in the sale of title insurance, and the degree of involvement of and the extent of coordination among the regulators of these entities appears to vary. These entities include real estate brokers and agents, mortgage brokers, lenders, and builders, all of which may refer clients to particular agencies and insurers. These entities are generally overseen by a variety of state regulators, including insurance departments, real estate commissions, and state banking regulators, that interact to varying degrees. For example, one state insurance regulator with whom we spoke told us that the agency coordinated to some extent with the state real estate commission and at the federal level with HUD, but only informally. Another regulator said that it had tried to coordinate its efforts with other regulators in the state, but that the other regulators had generally not been interested. HUD, which is responsible for implementing RESPA, has conducted some investigations in conjunction with insurance regulators in some states. Some of these investigations of the marketing of title insurance by title insurers and agents, real estate brokers, and builders have turned up allegedly illegal activities. Federal and state investigations have identified two primary types of potentially illegal activities in the sale of title insurance, but the extent to which such activities occur in the title insurance industry is unknown. The first involves allegations of kickbacks–that is, fees that title agents or insurers may give to home builders, real estate agents and brokers, or lenders in return for referrals. Kickbacks are generally illegal. In several states, state insurance regulators identified captive reinsurance arrangements that title insurers and agents were allegedly using to inappropriately compensate others, such as builders or lenders, for referrals. State and federal investigators have also alleged the existence of inappropriate or fraudulent affiliated business arrangements. These involve a “shell” title agency that generally has no physical location, employees, or assets, and does not actually perform title and settlement business. Investigators alleged that the primary purpose of these shell companies was to provide kickbacks for business referrals. Investigators have also looked at the various types of alleged kickbacks that title agents have provided, including gifts, entertainment, business support services, training, and printing costs. Second, investigators have uncovered instances of alleged misappropriation or mishandling of customers’ premiums by title agents. For example, one licensed title insurance agent who was the owner (or partial owner) of more than 10 title agencies allegedly failed to remit approximately $500,000 in premiums to the title insurer. As a result, the insurer allegedly did not issue 6,400 title policies to consumers who had paid for them. In response to the investigations, insurers and industry associations say they have begun to address some concerns raised by affiliated businesses, but that clearer regulations and stronger enforcement are needed. One title insurance industry association told us that recent federal and state enforcement actions had motivated title insurers to address potential kickbacks and rebates through, for example, increased oversight of title agents. In addition, the insurers and associations said that competition from companies that break the rules hurt companies that were operating legally and that these businesses welcome greater enforcement efforts. Several associations also told us that clearer regulations regarding referral fees and affiliated business arrangements would aid the industry’s compliance efforts. Specifically, we were told that regulations need to be more transparent about the types of discounts and fees that are prohibited and the types that are allowed. Over the past several years, regulators and others have suggested changes to regulations that would affect the way title insurance is sold, and further study of the issues raised by these potential changes could be beneficial. In 2002, in order to simplify and improve the process of obtaining a home mortgage and to reduce settlement costs for consumers, HUD proposed revisions to the regulations that implement RESPA. But HUD later withdrew the proposal in response to considerable comments from the title industry, consumers, and other federal agencies. In June 2005, HUD announced that it was again considering revisions to the regulations. In addition, NAIC officials told us that the organization was considering changes to the model title insurance and agent laws to address current issues such as the growth of affiliated business arrangements and to more closely mirror RESPA’s provisions on referral fees and sanctions for violators. Finally, some consumer advocates have suggested that requiring lenders to pay for the title policies from which they benefit might increase competition and ultimately lower costs for consumers, because lenders could then use their market power to force title insurers to compete for business based on price. The issues identified today raise a number of questions that we plan to address as part of our ongoing work. We look forward to the continued cooperation of the title industry, state regulators, and HUD as we continue this work. Mr. Chairman, this completes my prepared statement. I would be pleased to answer any questions that you or Members of the Subcommittee may have. For further information about this testimony, please contact Orice Williams on (202) 512-8678 or williamso@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this statement. Individuals making key contributors to this testimony include Larry Cluff (Assistant Director), Tania Calhoun, Emily Chalmers, Nina Horowitz, Marc Molino, Donald Porteous, Melvin Thomas, and Patrick Ward. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

Title insurance is a required element of almost all real estate purchases and is not an insignificant cost for consumers. However, consumers generally do not have the knowledge needed to "shop around" for title insurance and usually rely on professionals involved in real estate--such as lenders, real estate agents, and attorneys--for advice in selecting a title insurer. Recent state and federal investigations into title insurance sales have identified practices that may have benefited these professionals and title insurance providers at the expense of consumers. At the request of the House Financial Services Committee, GAO currently has work under way studying the title insurance industry, including pricing, competition, the size of the market, the roles of the various participants in the market, and how the industry is regulated. This testimony discusses the preliminary results of GAO's work to date and identifies issues for further study. In so doing, this testimony focuses on: (1) the reasonableness of cost structures and agent practices common to the title insurance market that are not typical of other insurance markets; (2) the implications of activities identified in recent state and federal investigations that may have benefited real estate professionals rather than consumers; and (3) the potential need for regulatory changes that would affect the way that title insurance is sold. Some cost structures and agent practices that are common to the title insurance market are not typical of other lines of insurance and merit further study. First, the extent to which premium rates reflect underlying costs is not always clear. For example, most states do not consider title search and examination costs--insurers' largest expense--to be part of the premium, and do not review these costs. Second, while title agents play a key role in the underwriting process, the extent to which state insurance regulators review agents is not clear. Few states collect information on agents, and three states do not license them. Third, the extent to which a competitive environment exists within the title insurance market that benefits consumers is also not clear. Consumers generally lack the knowledge necessary to "shop around" for a title insurer and therefore often rely on the advice of real estate and mortgage professionals. As a result, title agents normally market their business to these professionals, creating a form of competition from which the benefit to consumers is not always clear. Fourth, real estate brokers and lenders are increasingly becoming full or part owners of title agencies, which may benefit consumers by allowing one-stop shopping, but may also create conflicts of interest. Finally, multiple regulators oversee the different entities involved in the title insurance industry, but the extent of involvement and coordination among these entities is not clear. Recent state and federal investigations have identified potentially illegal activities--mainly involving alleged kickbacks--that also merit further study. The investigations alleged instances of real estate agents, mortgage brokers, and lenders receiving referral fees or other inducements in return for steering business to title insurers or agents, activities that may have violated federal or state anti-kickback laws. Participants allegedly used several methods to convey the inducements, including captive reinsurance agreements, fraudulent business arrangements, and discounted business services. For example, investigators identified several "shell" title agencies created by a title agent and a real estate or mortgage broker that had no physical location or employees and did not perform any title business, allegedly serving only to obscure referral payments. Insurers and industry associations with whom we spoke said that they had begun to address such alleged activities but also said that current regulations needed clarification. In the past several years, regulators, industry groups, and others have suggested changes to the way title insurance is sold, and further study of these suggestions could be beneficial. For example, the Department of Housing and Urban Development announced in June 2005 that it was considering revisions to the regulations implementing the Real Estate Settlement Procedures Act. In addition, the National Association of Insurance Commissioners is considering changes to model laws for title insurers and title agents. Finally, at least one consumer advocate has suggested that requiring lenders to pay for the title policies from which they benefit might increase competition and ultimately lower consumers' costs.

a. The latest report was available Feb. 9, 2006, at http://www.fws.gov/endangered/expenditures/reports/FWS%20Endangered%20Species%202004%20Expenditures%20Report.pdf . b. See also Congressional Budget Office, Cost Estimate for H.R. 3824 , available at http://www.cbo.gov/showdoc.cfm?index=6663&sequence=0 , Feb. 9, 2006. Since conservation banks and tax incentives are addressed only in S. 2110 , they will be discussed outside the table to conserve space. Provisions related to conservation banks will be paraphrased and CRS comments arein italics. Page numbers refer to the PDF version of S. 2110 as introduced. Under S. 2110 , a conservation bank is defined as an area of land,water, or other habitat (not necessarily contiguous) that is managed in perpetuity orfor an "appropriate period" under an enforceable legal instrument and for the purposeof conserving and recovering habitat, or an endangered, threatened, or candidatespecies, or a species of special concern (p. 31). The conservation bank definition includes habitat "not necessarilycontiguous," which suggests that a bank could consist of segments of habitat ratherthan a block. Given the importance and benefits of habitat continuity for speciessurvival, some might argue that banks consisting of fragmented portions would haveless value than banks with contiguous habitats. This definition also mentions an"appropriate period" as an alternative to in perpetuity when referring to the lifetimeof the bank. The bill does not identify who will make the determination of anappropriate period or what criteria will be used. Credit is defined as the "unit of currency" of a conservation bank generatedby preserving or restoring habitat in an agreement, and quantified through theconservation values of a species or habitat. Conservation values are to be determinedby the Secretary for each bank and converted into a fixed number of credits (pp.31-32). The definition of credit is written in a way that appears to allow alternativesto money that could be exchanged to pay for the values being purchased out of thebank. There is no indication what those alternatives might be. There is littleguidance on how the Secretary will determine or measure conservation value, andhow much "value" will equal a credit. Due to the changing nature of habitat and thepotential for habitat improvement or degradation, conservation values may changewithin banks. There do not appear to be any provisions that allow the Secretary toreassign values to conservation banks. On the other hand, allowing the Secretaryto determine the value and credits for each bank, has the potential to insure thatthere will be consistency among banks. This may be helpful, since a credit programfor species could involve a wide range of habitat values. A service area is an area identified in a conservation bank agreement. Itincludes a soil type, watershed, habitat type, political boundary, or an area in afederally recognized conservation plan, among others, in which a credit may be usedto offset the effects of a project (p. 32). The scope of a service area may vary broadly under this definition, whichcould allow the Secretary to create areas that fit desired biological criteria. Because person under the ESA includes federal agencies, and page 32 includes a referenceto federally recognized conservation plans, the provisions on conservation bankingmay apply to federal agencies; it is unclear if this was intended. Conservation banks may be established by any private landowner who appliesand demonstrates that the affected area is managed under an enforceable legalinstrument and contributes to the conservation of a listed species, a candidate species,or a species of special concern (pp. 32-33). Secretary shall approve or disapprove abank within 180 days after the application is submitted (p. 33). A bank can bemanaged by a state, a holder of the bank, another party specified in the agreement,or a party that acquires property rights related to the conservation bank (p. 34). While conservation banks would require an enforceable legal instrument, thebill does not specify any contents for that instrument. There may be certain minimalcontents that all such instruments or banking agreements should contain to ensurethat protection of species and habitat will be effective and consistent from site to site. The time limit for a decision will allow approved banks to enter into the program andgain credits within six months, which some feel would encourage participation, butit is unclear whether this period will be sufficient for the Secretary to render adecision with adequate justification. Management of the bank is not restricted,which may relieve the burden of management from the landowner and allow otherentities (e.g., state agencies or non-governmental organizations) to manage the bank. However, no criteria for holders are stated. The holder of a conservation bank is required to establish an agreement thatdescribes the proposed management of the bank (p. 34). The agreement is submittedto the Secretary, who shall approve or disapprove it "as soon as practicable" (p. 35). Conditions for amending and nullifying the agreement are given (pp. 35-36). TheSecretary shall consider the use of banks for implementing recovery plans and mustadopt regulations on managing banks that balance the biological conditions of thetarget species and habitat with "economic free market principles" to ensure value tolandowners through a tradeable credit program (p. 36). A bank management agreement undergoes a separate approval process fromestablishing a conservation bank, and the deadline for approving or disapprovingbank management agreements is uncertain. No standards for acceptable agreementsare provided. An approved agreement does not seem to be required to transfercredits or to maintain a conservation bank. The bill does specify that the bank mustcontribute to the conservation of qualified species, but there is no requirement thatbanks be consistent with approved recovery plans, and it is not clear that bankmanagers must comply with the relevant agreement. The Secretary is to promulgate regulations on managing conservation banks(p. 37). The regulations are to relate to 11 subjects, including conservation andrecovery goals, activities that may be carried out in any conservation bank, measuresthat ensure the viability of conservation banks, "the demonstration of an adequatelegal control of property proposed to be included in the conservation bank" (p. 37),criteria for determining credits and an accounting system for them, and theapplicability of and compliance with §7 and §10 of ESA. Monitoring and reportingrequirements are also to be addressed in the regulations (pp. 37-38). The regulations are to include provisions "relating to" how the consultationrequirements of §7 of the ESA and the incidental take provisions apply in the contextof conservation banks. It is not clear whether the authority given the Secretary todevelop these regulations could be broad enough to eliminate consultation, or toauthorize the issuance of general incidental take permits for activities inconservation bank areas. The requirement that banks be financially viable (pp.37-38) appears to refer to both biological and financial viability. As to the latter,some contend that financial viability should be determined by market forces ratherthan the federal government, which should ensure the biological viability of thespecies or habitat should a bank fail. Biological data would determine how many credits a bank can sell (p. 38),and the Secretary is to establish a standard process by which credits could betransferred. Credit transfers can be used to comply with court injunctions, to meetrequirements of §§7(a), 7(b) or 10(a)(1) of the ESA, and to provide out-of-kindmitigation (p. 39). "Out-of-kind mitigation" is defined as mitigation involving thesame species or habitat, but in a different service area. Additional requirements mustbe met for approval of out-of-kind mitigation, and the Secretary is to give preferenceto in-kind mitigation to the maximum extent practicable (pp. 39-40). The Secretaryis not to regulate the price of credit transfers or to limit participation by any party inthe credit transfer process (p. 40). In some circumstances, credits may be transferredbefore the Secretary approves a bank (p. 41). The criteria for transferring credits do not include habitat or speciesrequirements for the area being mitigated by the purchase of credits. Habitat fordifferent species may not be interchangeable; therefore, if the area being mitigatedcontained habitat for an endangered species of salamander, there are norequirements that credits purchased will be from a conservation bank with similarhabitat. Out-of-kind mitigation is allowed when both ecological desirability andeconomic practicability can be met. The bill allows transfer of credits before thebank is approved if specified conditions can be met, which would seem to be a riskto the federal interest in species protection should the Secretary ultimately reject theapplication for establishing the bank. If the Secretary rejects a bank proposal, howwould that rejection affect any prior purchase of credits? Creation of conservation banks can be integrated with conservation plansdeveloped under §10 of the ESA if certain criteria are met (pp. 41-42). Any party toan agreement, including the United States, may sue for breach of the agreement, andsovereign immunity is waived for participating federal, state, tribal, and localgovernments (pp. 42-43). Subsection (g) (pp. 41-42) requires, to the maximum extent practicable , thata bank be integrated with habitat conservation plans developed under §10 of the ESAif the bank meets the ecological criteria of the habitat conservation plan andprovides greater economic benefits compared with other forms of mitigation ofhabitat destruction. Only a party to the agreement (not interested outsiders withstanding) may sue for breach of the agreement. How this restriction could affectenforcement actions under §10 is not clear. Since a party violating an agreement isnot likely to sue to enforce the agreement, this really means that only the Secretarycan enforce the agreement. "Equitable relief" is specifically allowed, despite thewording that judicial review is allowed for a breach of an agreement -- whichusually connotes a suit for damages. It is not clear in what circumstances states,local governments, or tribes would be defendants. Taxpayers may claim a tax credit based on the taxpayer's qualifiedconservation and recovery costs for the taxable year (pp. 56-62). Qualified costs arethose paid or incurred by the taxpayer in carrying out approved site-specific recoveryactions under §4(f) of ESA or other federal- or state-approved conservation andrecovery agreements that involve an endangered, threatened, or candidate species (p.57). The project must be undertaken according to a binding agreement, and the creditis subject to recapture if the agreement is breached or terminated (pp. 57-58 and 61). The amount of tax credit gained depends on the length of the agreement: 1) if it is forat least 99 years, the credit equals the reduction in the land's fair market value due tothe recovery action or agreement plus the property owner's actual costs; 2) if it is forat least 30 years but less than 99 years, the credit equals 75% of the above amounts;3) if it is for at least 10 years but less than 30 years, the credit equals 75% of theactual costs (pp. 57-58). The qualifications or standards for the binding agreement are unclear. Depending on the specifics of the agreement, the requirements for claiming the taxcredit may be more or less stringent than those for tax incentives that currently existfor similar conservation activities (e.g., the charitable deduction for conservationeasements under IRC §170). The taxpayer must submit to the IRS evidence of the binding agreement anda written verification from a biologist that the conservation and recovery practice isdescribed in the agreement and implemented during the taxable year in accordancewith the agreement's schedule (pp. 58-59). The credit may not be claimed if thetaxpayer received cost-share assistance from the federal or state government underany credit-eligible recovery action or agreement for that year (p. 59). There is anexception for individuals whose adjusted gross income is less than the limitations inIRC §32, the earned income tax credit (p. 59). Also, the taxpayer's qualified costs arereduced by any non-taxable governmental assistance for qualified conservation andrecovery costs received in the year the credit was claimed or in any prior year (p. 61). With respect to the second limitation regarding cost-share assistance, it isunclear as to whether the assistance must have been received for the specific projectfor which the credit is claimed. There are no requirements regarding thequalifications of the biologist who can verify the agreement. The basis of the property for which any credit is allowable must be reducedby the amount of the taxpayer's qualified costs, regardless of whether those costswere greater than the amount that the taxpayer's tax liability exceeded the sum of thespecified credits (p. 60). This could be interpreted to require that the taxpayer reduce the basis by thetotal qualified costs in the first taxable year even if the taxpayer did not claim the fullcredit in that year. Thus, the taxpayer would experience the negative consequencesfrom reducing the basis to account for the total costs without necessarily receivingthe positive benefits from claiming the full credit. The amount of any deduction or other tax credit must be reduced by thetaxpayer's qualified costs, limited to the taxpayer's tax liability (pp. 60-61). This appears to require that the taxpayer reduce all deductions and othercredits by the amount of the credit allowed, regardless of whether they are based onthe same expenses used for this credit. The credit is limited to the taxpayer's tax liability (including alternativeminimum tax liability) after applying certain credits (p. 57). Any portion of the creditthat cannot be claimed because of this limitation may be carried back for one yearand carried forward for 20 years (pp. 59-60). The new credit may be transferredthrough sale and repurchase agreements (p. 60). The tax consequences of such sale are unclear. This provision is unusual asno other tax credit is allowed to be sold.

The Endangered Species Act (ESA) protects species that are determined to be eitherendangered or threatened according to assessments of their risk of extinction. The ESA has not beenreauthorized since September 30, 1992, and efforts to do so have been controversial and complex. Some observers assert that the current ESA is a failure because few species have recovered, and thatit unduly and unevenly restricts the use of private lands. Others assert that since the act's passage,few species have become extinct, many have improved, and that restrictions to preserve species donot place a greater burden on landowners than many other federal, state, and local laws. This report provides a side-by-side analysis of two bills and a proposed amendment thatwould amend the ESA. This analysis compares H.R. 3824 , the Threatened andEndangered Species Recovery Act of 2005, as passed by the House; proposed House Amendment588 to H.R. 3824 (Miller/Boehlert Amendment); and S. 2110 , theCollaboration for the Recovery of Endangered Species Act. Proponents of each proposal indicate that it is designed to make the ESA more effective byredefining the relationship between private and public property uses and species protection,implementing new incentives for species conservation, and removing what some see as undue landuse restrictions. Thus, all three proposals contain provisions meant to encourage greater voluntaryconservation of species by states and private landowners, a concept that has been supported by manyobservers. Further, all three proposals would modify or eliminate certain procedural or otherelements of the current ESA that some have viewed as significant protections and prohibitions,including eliminating or changing the role of "critical habitat" (CH) (which would eliminate oneaspect of the current consultation process); making the listing of all threatened and endangeredspecies more difficult or less likely; expanding §10 permits allowing incidental take (which couldincur a greater need for agency oversight and enforcement); and expanding state rather than federalimplementation of ESA programs (which might make oversight more difficult). Proponents of thesechanges assert that tighter listing standards would enable a better focus on species with the most direneeds, and that other measures would achieve recovery of more species. Critics argue that proposedchanges create gaps in the ESA safety net of protections and prohibitions. It is difficult to assess whether, on balance, the proposals would be likely to achieve greaterprotection and recovery of species, or to what extent the controversies over land use constraintswould diminish. However, replacing some of the protections of the current ESA with newincentives, rather than adding the new incentives to the current protections, arguably makes adequatefunding of the new programs more critical to determining the outcome of the ESA. This report will be updated as events warrant.

On September 14, 2004, U.S. Trade Representative Robert B. Zoellick signed a free trade agreement (FTA) between Bahrain and the United States. Formal negotiations were launched in Manama, Bahrain on January 26, 2004, and were completed on May 27, 2004. The House Ways and Means Committee approved draft legislation implementing the agreement on November 3, 2005, with no amendments. Following approval of the draft legislation by the Senate Finance Committee on November 9, the Administration submitted implementing legislation ( S. 2027 / H.R. 4340 ) on November 16. Formal approval of the implementing legislation was given in separate votes by the House Ways and Means Committee and the Senate Finance Committee on November 18. The implementing legislation was passed by the House on December 7 and passed by the Senate and cleared for the White House on December 13. The agreement was signed into law by the President on January 11, 2006, as the United States-Bahrain Free Trade Agreement Implementation Act ( P.L. 109-169 ). The agreement entered into force on August 1, 2006, following the passage of legislation in Bahrain providing increased intellectual property rights (IPR) protection. According to the Bahrain-based Gulf Daily News , six new IPR laws were passed by both houses of Bahrain's parliament. The agreement entered into force following approval of the new laws by King Hamad bin Isa Al Khalifa. In the United States, the AFL/CIO provided the only significant opposition to the Agreement. Some House Democrats expressed labor concerns during the November 3 rd vote but eventually supported the agreement after receiving assurances from the Bahraini government that they would make progress on new legislation offering additional labor protections. The FTA is supported by the National Association of Manufacturers, the Bankers' Association for Finance and Trade, the Motion Picture Association of America, and PhRMA, the association of pharmaceutical manufacturers, among other groups. There has been some dissent in the Middle East region over the U.S.-Bahrain FTA. Saudi Arabia, a member of the Gulf Co-operation Council (GCC), has alleged that GCC countries that sign bilateral trade agreements with the United States violate a GCC economic agreement that members cannot grant greater trade preferences to non-GCC countries. According to press reports, Saudi Arabia has threatened imposing a 5% duty on any U.S. goods that are imported into the GCC and then exported to Saudi Arabia. According to one source, Saudi Arabia may be concerned that U.S. agricultural products, especially wheat, may be exported to Saudi Arabia via other GCC countries such as Bahrain. Bahrain officials have argued that Saudi Arabia has not contested other bilateral FTAs that Bahrain has signed, and alleges that Saudi Arabia's complaints are political, not economic, in nature. Domestically, some analysts have raised concern that the U.S. government strategy of completing FTAs with countries such as Bahrain, whose U.S. trade is relatively small, is not necessarily the best use of USTR's resources. Others argue that the USTR should be investing more resources into potentially more economically significant agreements such as the proposed Free Trade Area of the Americas (FTAA). The Administration contends that its FTA agreements are effective as building blocks to future agreements and increased political and economic reform. Many attribute Bahrain's selection as the first U.S. free trade agreement in the Persian Gulf to (1) the strong U.S.-Bahrain political military relationship, and (2) political and economic reform in Bahrain. This FTA is intended to be a building block for President Bush and Congress's Middle East free trade initiatives. Bahrain is a close U.S. partner in the Persian Gulf. It consists of 35 islands along the Persian Gulf between the east coast of Saudi Arabia and Qatar along the Persian Gulf. Virtually its entire domestic population of 667,000 is Muslim (70 % Shi'a/30% Sunni). It is a constitutional monarchy, ruled by the al-Khalifa family since 1783. Bahrain has hosted a U.S. military presence since World War II. It currently hosts the Fifth Fleet, which is the headquarters for the U.S. Persian Gulf naval forces. The Fifth Fleet headquarters is a command and administrative facility only; no U.S. warships are actually based in Bahrain's ports. In October 2001, Bahrain was designated a Major Non-NATO Ally (MNNA). Bahrain endorsed the U.S. campaign in Afghanistan and deployed a frigate to support allied operations during Operation Enduring Freedom. While Bahrain did not endorse the Iraq campaign, King al-Khalifa did not criticize it. King al-Khalifa, installed in 1999, has pushed for political and economic liberalization. In February 2001, Bahraini voters approved a referendum on the National Action Charter—the centerpiece of the King's political liberalization program. Since then, parliamentary elections have been held (October 2002), and in December 2002, the first legislative session since 1975 took place. Oil was discovered in Bahrain in 1932 by Standard Oil Company of California. Current production is around 40,000 barrels per day (b/d). The Bahrain National Gas Company operates a gas liquification plant that utilizes gas piped directly from Bahrain's oilfields. Gas reserves should last about 50 years at present rates of consumption. Revenues from oil and natural gas currently account for 16.5% of GDP and provide about 60% of government income. Among the Cooperation Council of the Arab States of the Gulf (GCC)—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates—Bahrain has the smallest proven oil reserves. The International Monetary Fund (IMF) estimates that Bahrain will run out of petroleum in 2018 if pumping continues at current levels. Bahrain and Saudi Arabia share ownership of the Abu Saafa oilfield, and since 1997, Saudi Arabia has given Bahrain the entire proceeds of the 140,000 b/d field. Financial institutions operate in Bahrain, both offshore and onshore, without impediments, and the financial sector is currently the second largest contributor to GDP. There are no restrictions on capital flows. More than 100 offshore banking units and representative offices are located in Bahrain, as well as 65 American firms. In the past two years, Bahrain has passed laws liberalizing foreign property ownership and tightening its anti-money laundering laws. Bahrain is the United States' 88 th largest goods export market. In 2005, U.S. exports to Bahrain were $351 million, up 16.2% from 2004. Aircraft, miscellaneous manufactures and agricultural products account for the majority of U.S. exports. U.S. imports from Bahrain in 2005 were $432 million, a 6.5% increase from 2004. Since tariffs between the United States and Bahrain are already low, the USTR estimates that the FTA will have little effect on U.S. imports from Bahrain. As a member of the Arab League, trade between Bahrain and Israel is technically subject to the Arab League boycott of Israel. However, in the case of Bahrain, the boycott is not strictly enforced and of little commercial significance. The Arab League boycott of Israel was raised at a June 2003 joint press conference by USTR Robert Zoellick and Bahraini Minister of Finance Abdullah Saif. Both Ambassador Zoellick and Minister Saif stressed that Bahrain was a member in good standing of the WTO, which does not permit boycotts of any kind. Nonetheless, neither specifically addressed if Bahrain would officially remove itself from the boycott. In September 2005, Bahrain announced that it will make efforts to remove the boycott. According to Bahrain's Treasurer, Ahmed bin Mohammed Al-Khalifa, "Bahrain recognizes the need to withdraw the primary boycott against Israel and is developing the means to achieve this." In May 2003, President Bush announced his goal of creating a free trade area of the Middle East by 2013, by accumulating bilateral agreements with individual countries in the region. A Middle East Free Trade Area (MEFTA) is an Administration strategy to create a free trade area among 20 Middle Eastern and North African countries and the United States by 2013. Currently, the United States has FTAs in force with Bahrain, Jordan, Morocco, and Israel. The proposed MEFTA plan was announced by President Bush on May 9, 2003. The United States also plans to expand its network of trade and investment framework agreements (TIFAs) and bilateral investment treaties (BITs) throughout the region. The FTA negotiations included thirteen working groups: Services, Financial Services, Telecommunications and E-Commerce, Sanitary and Phytosanitary Measures (SPS), Environment, Government Procurement, Legal, Technical Barriers to Trade (TBT), Customs, Market Access (both industrial and agricultural products), Intellectual Property Rights (IPR), Textiles, and Labor. The FTA eliminates tariffs on all consumer and industrial products. For agricultural products, 98% of U.S. exports to Bahrain are now duty free, with 10-year phase-outs for the remaining items. Textiles and apparel trade will be duty free immediately if the product contains either U.S. or Bahraini yarn. A temporary transitional allowance would allow duty free trade in products that do not yet meet these standards. According to the USTR, the agreement provides U.S. firms among the highest degree of access to service markets of any U.S. FTA to date. Key services sectors covered by the agreement include audiovisual, express delivery, telecommunications, computer and related services, distribution, healthcare, services incidental to mining, construction, architecture and engineering. U.S. financial service suppliers will have the right to establish subsidiaries, branches, and joint ventures in Bahrain and enjoy the benefits of strong regulatory transparency, including prior notice and comment and license approval within 120 days. For life and medical insurance, Bahrain agreed to allow access upon entry into force of the Agreement, and for non-life insurance will allow access within six months after entry into force of the Agreement. Bahrain has agreed that in revising its insurance laws and regulations, it will not discriminate against U.S. insurance suppliers and will allow existing insurance suppliers to continue current business activities. The agreement underscores Bahrain's open and developed financial sector, which includes both conventional and Islamic financial services. Bahrain will allow U.S.-based firms to offer services cross-border to Bahrainis in areas such as financial information and data processing, and financial advisory services. Bahrain will also allow U.S.-based asset managers (including insurance companies) to manage the portfolios of collective investment schemes established in Bahrain. Under the FTA, each government agreed that users of the telecom network will have reasonable and nondiscriminatory access to the network, preventing local firms from having preferential or "first right" of access to telecom networks. U.S. phone companies will have the right to interconnect with former monopoly networks in Bahrain at nondiscriminatory, cost-based rates, and will be able to build a physical network in Bahrain with nondiscriminatory access to key facilities, such as telephone switches and submarine cable landing stations. The Agreement requires each government to criminalize end-user piracy, providing strong deterrence against piracy and counterfeiting. Each government commits to having and maintaining authority to seize, forfeit, and destroy counterfeit and pirated goods and the equipment used to produce them. IPR laws will be enforced against goods-in-transit, to deter violators from using U.S. or Bahraini ports or free-trade zones to traffic in pirated products. Ex officio action may be taken in border and criminal IPR cases, thus providing more effective enforcement. The Agreement mandates both statutory and actual damages under Bahraini law for IPR violations, which will deter piracy. Under these provisions, monetary damages can be awarded even if actual economic harm (retail value, profits made by violators) cannot be determined. According to both countries, the intellectual property chapter does not "affect the ability of either Party to take necessary measures to protect public health by promoting access to medicines for all, in particular concerning cases such as HIV/AIDS, tuberculosis, malaria, and other epidemics as well as circumstances of extreme urgency or national emergency." The FTA also expressly states that it will not prevent effective utilization of the 2003 WTO consensus allowing developing countries that lack pharmaceutical manufacturing capacity to import drugs under compulsory licenses. According to the Bush Administration, the agreement fully meets the labor objectives set out by the Congress. Labor obligations are part of the core text of the Agreement. Each government commits to strive to ensure that its laws provide for labor standards consistent with internationally recognized labor rights. The Agreement includes a cooperative mechanism to promote respect for the principles embodied in the ILO Declaration on Fundamental Principles and Rights at Work, and compliance with ILO Convention 182 on the Worst Forms of Child Labor. The labor ministries, together with other appropriate agencies, agree to establish priorities and develop specific cooperative activities. Labor rights have been arguably the only major area of contention. Several Members of Congress and the AFL-CIO have criticized Bahrain for not making enough advances in reforming its labor laws. Issues of concern include a ban on workers in the same company forming more than one union, laws regarding penalties for anti-union discrimination, the ability of companies to withhold foreign workers' salaries for up to three months, and restrictions on unions calling strikes. However, Bahrain has introduced reforms and recently agreed to apply International Labor Organization (ILO) and to introduce labor law changes to make its laws fully ILO-consistent.

U.S. Trade Representative Robert B. Zoellick signed the U.S.-Bahrain Free Trade Agreement (FTA) on September 14, 2004. The implementing legislation was passed by the House on December 7, 2005, and passed by the Senate and cleared for the White House on December 13, 2005. The agreement was signed into law by the President on January 11, 2006, as the United States-Bahrain Free Trade Agreement Implementation Act (P.L. 109-169). Under the agreement, all bilateral trade in consumer and industrial goods will be duty free and 98% of U.S. agricultural exports will be duty free. The FTA is to support economic reform, both within Bahrain, and throughout the Middle East. This report will be updated as events warrant. For more information on Bahrain's politics, security, and US policy, see CRS Report 95-1013, Bahrain: Reform, Security, and U.S. Policy, by [author name scrubbed].

The potential for biomass to meet U.S. renewable energy demands has yet to be fully explored. Non-food and other types of biomass (e.g., manure) have traditionally been considered by some as waste material and as such have been deposited in landfills, used for animal feed, or applied to crop production lands. However, high fuel prices, environmental concerns, and sustainability issues have led policy makers to create legislation that would encourage conversion of biomass into liquid fuels (e.g., ethanol, biodiesel), electricity, or thermal energy. Over the last five years, there has been increasing interest in cellulosic biomass (e.g., crop residues, prairie grasses, and woody biomass) because it does not compete directly with crop production for food—although it may compete for land—and because it is located in widely dispersed areas. Classification of biomass as an energy resource has prompted the investigation of its use for purposes additional to liquid fuel (e.g., on-site heating and lighting purposes, off-site electricity). Biomass is organic matter that can be converted into energy. Common examples of biomass include food crops, crops for energy (e.g., switchgrass or prairie perennials), crop residues (e.g., corn stover), wood waste and byproducts (both mill residues and traditionally noncommercial biomass in the woods), and animal manure. Over the last few years, the concept of biomass has grown to include such diverse sources as algae, construction debris, municipal solid waste, yard waste, and food waste. Some argue that biomass is a renewable resource that is widely available, that may be obtained at minimal cost, and that may produce less greenhouse gas than fossil fuels under certain situations. Others contend that biomass has seen limited use as an energy source thus far because it is not readily available as a year-round feedstock, is often located at dispersed sites, can be expensive to transport, lacks long-term performance data, requires costly technology to convert to energy, and might not meet quality specifications to reliably fuel electric generators. Woody biomass has received special attention because of its widespread availability, but to date has been of limited use for energy production except for wood wastes at sawmills. Wood can be burned directly, usually to produce both heat or steam and electricity (called combined heat and power, or CHP), or digested to produce liquid fuels. Biomass from forests, as opposed to mill wastes, has been of particular interest, because it is widely accepted that many forests have excess biomass (compared to historical levels) called hazardous fuels that can contribute to catastrophic wildfires. Removing these hazardous fuels from forests could reduce the threat of catastrophic wildfires, at least in some ecosystems, while providing a feedstock for energy production. The term biomass was first introduced by Congress in the Powerplant and Industrial Fuel Use Act of 1978 ( P.L. 95-620 ) as a type of alternate fuel. However, the term was first defined in the Energy Security Act of 1980 ( P.L. 96-294 ), in Title II, Biomass Energy and Alcohol Fuels, as "any organic matter which is available on a renewable basis, including agricultural crops and agricultural wastes and residues, wood and wood wastes and residues, animal wastes, municipal wastes, and aquatic plants." The Energy Security Act of 1980 contained two additional definitions for biomass, excluding aquatic plants and municipal waste, in Title II, Subtitle C, Rural, Agricultural, and Forestry Biomass Energy. Three pertinent laws contain biomass definitions: the Food, Conservation, and Energy Act of 2008 (2008 farm bill, P.L. 110-246 ); the Energy Independence and Security Act of 2007 (EISA, P.L. 110-140 ); and the Energy Policy Act of 2005 (EPAct05, P.L. 109-58 ). The term is mentioned several times throughout the three acts, but is not defined for each provision of the law. In some cases, an individual law has multiple biomass definitions related to various provisions. For example, one definition is included in the 2008 farm bill and three are provided in EISA. EPAct05 has six biomass definitions. The tax code contains four additional definitions. In total, 14 biomass definitions have been included in legislation and the tax code since 2004. Table 1 includes definitions from the three laws and from the tax code, and contains additional comments. The definitions are built into the many provisions and programs that may support research and development, encourage technology transfer, and reduce technology costs for landowners and businesses. Thus, because the various definitions determine which feedstocks can be used under the various programs, the definitions are critical to the research, development, and application of biomass used to produce energy. Of the many biomass definitions, two may be considered by policy makers, scientists, and program managers as the most comprehensive for energy production purposes: the definition in Title IX of the 2008 farm bill and the definition in Title II of EISA. Both laws provide an extensive definition for renewable biomass, but each law defines renewable biomass somewhat differently. The recognition of biomass as renewable means that biomass is considered by some to be an infinite feedstock that may be replenished in a short time frame. Both definitions consider crops, crop residues, plants, algae, animal waste, food waste, and yard waste, among other items, as appropriate biomass feedstock. Whether the biomass is grown on federal lands is an important distinction between the two definitions for renewable biomass. The 2008 farm bill includes biomass from federal lands as a biofuel feedstock. In contrast, to be eligible for the Renewable Fuel Standard (RFS) under EISA, biomass cannot be removed from federal lands, and the law excludes crops from forested lands. In the 113 th Congress, there was some congressional discussion and legislation to expand the EISA definition to include biomass from federal lands to better meet the RFS biofuels usage mandate. None of the legislation was enacted. EISA expanded the RFS and restricted the definition of biomass. As described above, the renewable biomass definition for the RFS under EISA excludes biomass removed from federal lands and crops from forested lands as biofuel feedstocks. Advocates for this definition include groups who favor minimal land disturbance (for ecological reasons as well as to sustain sequestered carbon) and are concerned that incentives to use wood waste might increase land disturbance, especially timber harvesting on federal lands. Opponents of this definition include groups who seek to use materials from federal lands and other forested lands (i.e., not tree plantations) as a source of renewable energy while possibly contributing to long-term, sustainable management of those lands. Advocates of the renewable biomass definition in the 2008 farm bill include groups who seek to use the potentially substantial volumes of waste woody biomass from federal lands and other (non-plantation) forest lands (e.g., waste from timber harvests, from pre-commercial thinnings, or from wildfire fuel reduction treatments) as a source of renewable energy. Opponents include groups who seek to preserve forested land and federal land, and who are concerned that incentives for using wood waste would encourage activities that could disturb forest lands, possibly damaging important wildlife habitats and water quality, as well as releasing carbon from forest soils. It is not clear whether the biomass definitions in the 2008 farm bill and in EISA constitute a barrier to biomass feedstock development for conversion to liquid fuels. Concerns for some landowners and business entities that wish to enter the biomass feedstock market include economic stability, risk/reward ratio, revenue generation, land use designation, and lifecycle greenhouse gas emissions. Additionally, the feedstock development potential of woody biomass varies by region. For example, biomass stock tends to be located on private forest land in the southeastern United States and on federal land in the western United States. Different regions may require different resources to develop a robust biomass feedstock market. There is mixed support for biomass use, including its feedstock development. Recent agricultural and energy legislation has incorporated provisions and established programs to promote the development and use of biomass as a renewable energy source. For example, in the 113 th Congress, the House passed H.R. 2 , which would have allowed Indian tribes, from FY2014-FY2018, to carry out demonstration projects to promote biomass energy production on Indian forest land and in nearby communities by providing tribes with reliable supplies of woody biomass from federal lands. However, there also have been efforts in Congress to stall or prevent the use of biomass for energy production, which in turn would impact biomass feedstock development. For instance, there were repeated attempts to eliminate certain portions of the Renewable Fuel Standard ( H.R. 4849 ; 113 th Congress). Further, the House initially passed an FY2015 National Defense Authorization Act ( H.R. 3979 ; 113 th Congress) that would have prohibited the Department of Defense (DOD) from large-scale purchases of biofuels unless they are cost-competitive, and would have also required DOD to provide a business case analysis to Congress before constructing a biofuel refinery. The provisions were significantly modified in a later version of the bill that passed both chambers and was signed into law ( P.L. 113-291 ). The success of the provisions and programs that support biomass as a renewable feedstock will be partly determined by landowner participation rates. Participation rates may depend on the definition provided in the legislation that authorizes financial and technical support. Landowners are eligible to receive financial or technical assistance for biomass feedstock development based on the renewable biomass definition for a specific program. One program that may have the potential to increase the level of private landowner participation in the biomass feedstock market is the Biomass Crop Assistance Program (BCAP), established in Section 9011 of the 2008 farm bill. BCAP, administered by the USDA Farm Service Agency, is intended to support the establishment and production of eligible crops for conversion to bioenergy. The definition for biomass contained in legislation determines what sources of material are deemed eligible as biomass and which lands are eligible for biomass removal for inclusion in the RFS and for treatment in the tax code. The biomass definition in legislation influences decisions on the types of crops grown, where they are grown, and their potential preferred energy uses, among other things. Biomass definitions typically contain three components: agriculture (e.g., crops), forestry (e.g., slash, pre-commercial thinnings), and waste (e.g., food, yard). Multiple biomass definitions can be included in a single piece of legislation to meet the requirements of associated programs or provisions. Environmental groups, private entities aspiring to participate in biomass-to-energy initiatives, and federal agencies that administer biomass-to-energy programs are likely to closely monitor biomass definitions proposed during future farm bill and energy debates in Congress. Biomass debate and action in the 113 th Congress was minimal, although bills were introduced to modify its definition ( H.R. 4426 , H.R. 4956 , H.R. 3084 , S. 1267 ). Further, debates about the definition of biomass were not as extensive in the 113 th Congress as they were in previous Congresses (e.g., 111 th Congress). Forthcoming congressional consideration of energy issues, particularly legislation involving the Renewable Fuel Standard or energy tax incentives, may prompt further discussion about the biomass definition in the 114 th Congress.

The use of biomass as an energy feedstock has regularly been presented as a potentially viable alternative to address U.S. energy security concerns, foreign oil dependence, and rural economic development, and as a tool to possibly help improve the environment (e.g., through greenhouse gas emission reduction). Biomass (organic matter that can be converted into energy) may include food crops, crops grown specifically to produce energy (e.g., switchgrass or prairie perennials), crop residues, wood waste and byproducts, and animal manure. Most legislation involving biomass has focused on encouraging the production of liquid fuels from corn. Efforts to promote the use of biomass for power generation have focused on wood, wood residues, and milling waste. Comparatively less emphasis has been placed on the use of non-corn-based biomass feedstocks—other food crops, non-food crops, crop residues, animal manure, and more—as renewable energy sources for liquid fuel use or for power generation. This is partly due to the variety, lack of availability, and dispersed location of non-corn-based biomass feedstock. The technology development status and costs to convert non-corn-based biomass into energy are also viewed by some as obstacles to rapid technology deployment. To aid in understanding the role of biomass as an energy resource, this report investigates the characterization of biomass in legislation. For over 30 years, the term biomass has been a part of legislation enacted by Congress for various programs, indicating some interest by the general public and policy makers in expanding its use. Biomass-related legislation has provided financial incentives to develop technologies that use biomass. How biomass is defined influences decisions about the types of crops that are grown, where they are grown, and potential preferred energy uses, among other things. There have been 14 biomass definitions included in legislation and in the tax code since 2004. Future discussions about energy—particularly legislation involving the Renewable Fuel Standard, energy tax incentives, or tribal biomass demonstration projects—may prompt further discussion about the definition of biomass. For example, one point of contention regarding the biomass definition and the Renewable Fuel Standard is whether the term should be defined to include biomass from federal lands. Some argue that removal of biomass from these lands may lead to ecological harm. Others contend that biomass from federal lands can aid the production of renewable energy to meet certain mandates (e.g., the Renewable Fuel Standard) and that removal of biomass can enhance forest protection from wildfires. Bills introduced in the 113th Congress (e.g., H.R. 4426, H.R. 4956, H.R. 3084, S. 1267) would have modified the biomass definition. However, little legislative action occurred regarding the definition of biomass in the 113th Congress. This report lists biomass definitions enacted by Congress in legislation and the tax code since 2004, and discusses the similarities and differences among the definitions.

The length of time a congressional staff member spends employed in Congress, or job tenure, is a source of recurring interest among Members of Congress, congressional staff, those who study staffing in the House and Senate, and the public. There may be interest in congressional tenure information from multiple perspectives, including assessment of how a congressional office might oversee human resources issues, how staff might approach a congressional career, and guidance for how frequently staffing changes may occur in various positions. Others might be interested in how staff are deployed, and could see staff tenure as an indication of the effectiveness or well-being of Congress as an institution. This report provides tenure data for 13 staff position titles that are typically used in House committees, and information for using those data for different purposes. The positions include the following: Chief Clerk Chief Counsel Communications Director Counsel Deputy Staff Director Minority Professional Staff Member Minority Staff Director Press Secretary Professional Staff Member Senior Professional Staff Member Staff Assistant Staff Director Subcommittee Staff Director Publicly available information sources do not provide aggregated congressional staff tenure data in a readily retrievable or analyzable form. Data in this report are based on official House pay reports, from which tenure information arguably may be most reliably derived, and which afford the opportunity to use complete, consistently collected data. Tenure information provided in this report is based on the House's Statement of Disbursements (SOD), published quarterly by the House Chief Administrative Officer, as collated by LegiStorm, a private entity that provides some congressional data by subscription. House committee staff tenure data were calculated for each year between 2006 and 2016. Annual data allow for observations about the nature of staff tenure in House committees over time. For each year, all staff with at least one week's service on March 31 were included. All employment pay dates from October 2, 2000, to March 24 of each reported year are included in the data. Utilizing official salary expenditure data from the House may provide more complete, robust findings than other methods of determining staff tenure, such as surveys; the data presented here, however, are subject to some challenges that could affect the interpretation of the information presented. Tenure information provided in this report may understate the actual time staff spend in particular positons, due in part to several features of the data. Figure 1 provides potential examples of congressional staff, identified as Jobholders A-D, in a given position. Some individuals, represented as Jobholder A, may have an unknown length of prior service before October 2, 2000, when the data begin. In the data captured for this report, no jobholders fall into this category. The earliest date at which House committee staff included in this report received pay was October 4, 2000. Thus, the tenure periods of all staff for which data are provided completely begin within the observed period of time; some tenure periods, as represented by Jobholders B and C, also end within the observed period. The data last capture those who were employed in House committees as of March 31, 2016, represented as Jobholder D, and some of those individuals likely continued to work in the same roles after that date. Data provided in this report represent an individual's consecutive time spent working in a particular position in a House committee. They do not necessarily capture the overall time worked in a House office or across a congressional career. If a person's job title changes, for example, from staff assistant to professional staff member, the time that individual spent as a staff assistant is recorded separately from the time that individual spent as a professional staff member. If a person stops working for the House for some time, that individual's tenure in his or her preceding position ends, although he or she may return to work in Congress at some point. No aggregate measure of individual congressional career length is provided in this report. Other data concerns arise from the variation across committees and lack of other demographic information about staff. Potential differences might exist in the job duties of positions with the same or similar title, and there is wide variation among the job titles used for various positions in congressional offices. The Appendix provides the number of related titles included for each job title for which tenure data are provided. Aggregation of tenure by job title rests on the assumption that staff with the same or similar title carry out the same or similar tasks. Given the wide discretion congressional employing authorities have in setting the terms and conditions of employment, there may be differences in the duties of similarly titled staff that could have effects on the interpretation of their time in a particular position. As presented here, tenure data provide no insight into the education, age, work experience, pay, full- or part-time status of staff, or other potential data that might inform explanations of why a congressional staff member might stay in a particular position. Tables in this section provide tenure data for selected positions in House committees and detailed data and visualizations for each position. Table 1 provides a summary of staff tenure for selected positions since 2006. The data include job titles, average and median years of service, and grouped years of service for each positon. The "Trend" column provides information on whether the time staff stayed in a position increased, was unchanged, or decreased between 2006 and 2016. Table 2 - Table 14 provide information on individual job titles over the same period. In all of the data tables, the average and the median length of tenure columns provide two different measures of central tendency, and each may be useful for some purposes and less suitable for others. The average represents the sum of the observed years of tenure, divided by the number of staff in that position. It is a common measure that can be understood as a representation of how long an individual remains, on average, in a job position. The average can be affected disproportionately by unusually low or high observations. A few individuals who remain for many years in a position, for example, may draw the average tenure length up for that position. A number of staff who stay in a position for only a brief period may depress the average length of tenure. Another common measure of central tendency, the median, represents the middle value when all the observations are arranged by order of magnitude. The median can be understood as a representation of a center point at which half of the observations fall below, and half above. Extremely high or low observations may have less of an impact on the median. Generalizations about staff tenure are limited in at least three potentially significant ways, including the following: the relatively brief period of time for which reliable, largely inclusive data are available in a readily analyzable form; how the unique nature of congressional work settings might affect staff tenure; and the lack of demographic information about staff for which tenure data are available. Considering tenure in isolation from demographic characteristics of the congressional workforce might limit the extent to which tenure information can be assessed. Additional data on congressional staff regarding age, education, and other elements would be needed for this type of analysis, and are not readily available at the position level. Finally, since each House committee serves as its own hiring authority, variations from committee to committee, which for each position may include differences in job duties, work schedules, office emphases, and other factors, may limit the extent to which data provided here might match tenure in a particular office. Despite these caveats, a few broad observations can be made about staff in House committees. Between 2006 and 2016, staff tenure, based on the trend of the median number of years in the position, appears to have increased by six months or more for staff in nine position titles in House committees. The median tenure was unchanged for four positions. This may be consistent with overall workforce trends in the United States. Although pay is not the only factor that might affect an individual's decision to remain in or leave a particular job, staff in positions that generally pay less typically remained in those roles for shorter periods of time than those in higher-paying positions. Some of these lower-paying positions may also be considered entry-level positions in some House committees; if so, House office employees in those roles appear to follow national trends for others in entry-level types of jobs, remaining in the role for a relatively short period of time. Similarly, those in more senior positions, which often require a particular level of congressional or other professional experience, typically remained in those roles comparatively longer, similar to those in more senior positions in the general workforce. There is wide variation among the job titles used for various positions in congressional offices. Between October 2000 and March 2016, House and Senate pay data provided 13,271 unique titles under which staff received pay. Of those, 1,884 were extracted and categorized into one of 33 job titles used in CRS Reports about Member or committee offices. Office type was sometimes related to the job titles used. Some titles were specific to Member (e.g., District Director, State Director, and Field Representative) or committee (positions that are identified by majority, minority, or party standing, and Chief Clerk) offices, while others were identified in each setting (Counsel, Scheduler, Staff Assistant, and Legislative Assistant). Other job title variations reflect factors specific to particular offices, since each office functions as its own hiring authority. Some of the titles may distinguish between roles and duties carried out in the office (e.g., chief of staff, legislative assistant, etc.). Some offices may use job titles to indicate degrees of seniority. Others might represent arguably inconsequential variations in title between two staff members who might be carrying out essentially similar activities. Examples include the following: Seemingly related job titles, such as Administrative Director and Administrative Manager, or Caseworker and Constituent Advocate Job titles modified by location, such as Washington, DC, State, or District Chief of Staff Job titles modified by policy or subject area, such as Domestic Policy Counsel, Energy Counsel, or Counsel for Constituent Services Committee job titles modified by party or committee subdivision. This could include a party-related distinction, such as a Majority, Minority, Democratic, or Republican Professional Staff Member. It could also denote Full Committee Staff Member, Subcommittee Staff Member, or work on behalf of an individual committee leader, like the Chair or Ranking Member. The titles used in this report were used by most House committees, but a number of apparently related variations are included to ensure inclusion of additional offices and staff. Table A-1 provides the number of related titles included for each position used in this report or related CRS Reports on staff tenure. A list of all titles included by category is available to congressional offices upon request.

The length of time a congressional staff member spends employed in a particular position in Congress—or congressional staff tenure—is a source of recurring interest to Members, staff, and the public. A congressional office, for example, may seek this information to assess its human resources capabilities, or for guidance in how frequently staffing changes might be expected for various positions. Congressional staff may seek this type of information to evaluate and approach their own individual career trajectories. This report presents a number of statistical measures regarding the length of time House committee staff stay in particular job positions. It is designed to facilitate the consideration of tenure from a number of perspectives. This report provides tenure data for a selection of 13 staff position titles that are typically used in House committee offices, and information on how to use those data for different purposes. The positions include Chief Clerk, Chief Counsel, Communications Director, Counsel, Deputy Staff Director, Minority Professional Staff Member, Minority Staff Director, Press Secretary, Professional Staff Member, Senior Professional Staff Member, Staff Assistant, Staff Director, and Subcommittee Staff Director. House committee staff tenure data were calculated as of March 31, for each year between 2006 and 2016, for all staff in each position. An overview table provides staff tenure for selected positions for 2016, including summary statistics and information on whether the time staff stayed in a position increased, was unchanged, or decreased between 2006 and 2016. Other tables provide detailed tenure data and visualizations for each position title. Between 2006 and 2016, staff tenure, based on the trend of the median number of years in the position, appears to have increased by six months or more for staff in nine position titles in House committees. The median tenure was unchanged for four positions. These findings may be consistent with overall workforce trends in the United States. Pay may be one of many factors that affect an individual's decision to remain in or leave a particular job. House committee staff holding positions that are generally lower-paid typically remained in those roles for shorter periods of time than those in generally higher-paying positions. Lower-paying positions may also be considered entry-level roles; if so, tenure for House committee employees in these roles appears to follow national trends for other entry-level jobs, which individuals hold for a relatively short period of time. Those in more senior positions, where a particular level of congressional or other professional experience is often required, typically remained in those roles comparatively longer, similar to those in more senior positions in the general workforce. Generalizations about staff tenure are limited in some ways, because each House committee serves as its own hiring authority. Variations from office to office, which might include differences in job duties, work schedules, office emphases, and other factors, may limit the extent to which data provided here might match tenure in another office. Direct comparisons of congressional employment to the general labor market may have similar limitations. Change in committee leadership, for example, may cause staff tenure periods to end abruptly and unexpectedly. This report is one of a number of CRS products on congressional staff. Others include CRS Report R43947, House of Representatives Staff Levels in Member, Committee, Leadership, and Other Offices, 1977-2016, by [author name scrubbed], [author name scrubbed], and [author name scrubbed] and CRS Report R44322, Staff Pay Levels for Selected Positions in House Committees, 2001-2014, coordinated by [author name scrubbed].

This report provides a summary and analysis of selected provisions of S. 1733 , the Clean Energy Jobs and American Power Act. The topics covered include electric power and incentives for the development of natural gas technologies. The report also compares those provisions with counterparts, if any, in H.R. 2454 , the American Clean Energy and Security Act. Other aspects of S. 1733 and H.R. 2454 are covered in additional CRS reports. These reports are available in the climate change section of the CRS website, located at http://crs.gov/Pages/subissue.aspx?cliid=2645&parentid=2522 . The remainder of this report is divided into the following sections: Electric Power and Natural Gas Technologies. Electric Power Transmission and Related Technologies Subtitle H of Division A has two sections dealing with the use of low carbon emitting energy technologies. Section 181, Clean Energy and Accelerated Emission Reduction Program , directs the EPA administrator to "establish a program to promote dispatchable power generation projects that can accelerate the reduction of power sector carbon dioxide and other greenhouse gas emissions" (emphasis added). The term "dispatchable" is not defined in the bill, but would normally refer to power generating units that can be run at-will by system operators. In this sense a natural gas, nuclear, or coal unit is dispatchable while a wind or solar plant is not, because wind and solar generation is dependent on weather and diurnal conditions. The EPA administrator is directed to establish rules within 90 days of enactment for providing incentives to dispatchable power projects that generate 300,000 gigawatt-hours (Gwh) of electricity annually. To put this generation target in context, a reasonably large power plant with a capacity of 500 megawatts (i.e., 0.5 gigawatts) that operates the equivalent of 85% of the time would generate 3,723 Gwh annually. Therefore it would take about 81 of these 500 Mw plants to meet the goal of generating 300,000 Gwh annually under this program. To qualify for incentives, an eligible project must produce emissions of greenhouse gases (GHG) that are below the 2007 average emissions per megawatt-hour (Mwh) by the United States electric power sector, according to the following schedule ( Table 1 ): The bill speaks to reductions in the emissions of all GHG released by power plants, but information is readily available only for power plant carbon dioxide emissions (CO 2 is, in any event, the predominant GHG in the electric power sector). Table 2 , below, shows average CO 2 emission per Mwh for the electric power sector as a whole in 2007, the 2007 values for several specific combustible fuel sources, and estimated emissions for new natural gas plants. These estimates, which include no carbon controls, show that only new high efficiency natural gas plants can meet the reduction targets of 25% for 2010 to 2020 and 40% for 2021 to 2025. It does not appear that any combustible fuel source can meet the 65% target which begins in 2026 without carbon controls. Nuclear power is a dispatchable option which could meet these targets since carbon emissions are essentially zero. Geothermal power has very small emissions per Mwh ( Table 2 ) and is dispatchable, but with current technology plants are limited to small installations in the western United States. Another alternative could be to link wind or solar power with electricity storage, creating a combined system which could be dispatched as needed However, current electricity storage technologies are limited by cost, technical, and environmental factors. In allocating incentives the administrator is to give priority to projects with one or more of the following characteristics: Power generation and energy storage projects intended to integrate variable renewable electricity sources, such as solar and wind power, into the grid. Power generation projects with carbon capture and sequestration that do not qualify for other aid under S. 1733 . Projects that achieve the greatest reduction in GHG emissions per dollar of incentive payment. Several features of Section 181 are unspecified or unclear. These include: The total dollar amount and form of the incentives. By what point in time projects must enter service to qualify for incentives. Whether the emission reduction target varies for a project over time. For example, assume a project enters service in 2010 and must therefore meet the 25 percent reduction in GHG emission goal ( Table 1 ). If the project is still operating in 2021 to 2025, does it have to further reduce emissions to meet the 40% reduction target that begins in that period in order to continue to receive incentives, or does the higher target only apply to new units that enter service during that period? The bill states that "Not later than 3 years after the date of enactment of this Act, the Administrator shall provide incentives for eligible projects that generate 300,000 gigawatt-hours of electricity per year." It is not clear from this language if the Administrator must make all awards within three years of enactment, or must merely begin making awards by that deadline. Section 182 of Subtitle H, Advanced Natural Gas Technologies , would establish two programs for accelerating the deployment of advanced natural gas technologies. Under one program, for "Natural Gas Electricity Generation Grants," the EPA Administrator "may provide" (but apparently is not required to provide) research and development grants "to support the deployment of low greenhouse-gas-emitting end-use technologies, including carbon capture and sequestration technologies, for natural gas electricity generation." Under the second program, for "Natural Gas Residential and Commercial Technology Grants," the Administrator is directed to establish a grant program for research, development, demonstration, and deployment of low GHG emitting end-use technologies for the commercial and residential sectors. Grants can be made to private or municipal utilities, research and development establishments, and other types of businesses. Although these programs are under the direction of the EPA, the Secretary of Energy is the official directed to report to the Congress every 180 days on the status and results achieved by these programs. There are no directly comparable provisions in H.R. 2454 . Section 175 of Subtitle H of H.R. 2454 does provide for a government program to help develop and demonstrate high efficiency natural gas burning combustion turbines, for use in combined cycle power plants. The section directs the Secretary of Energy to carry out a multiyear, multiphase program of research, development, and technology demonstration that ultimately will lead to gas turbine combined cycle efficiency of 65%. H.R. 2454 contains several provisions relating to electric power transmission that have no counterparts in S. 1733 . These provisions are briefly summarized below. For more detail see CRS Report R40643, Greenhouse Gas Legislation: Summary and Analysis of H.R. 2454 as Passed by the House of Representatives , coordinated by [author name scrubbed] and [author name scrubbed]. Subtitle F of Title I of H.R. 2454 deals with transmission planning and permitting. The subtitle provides for the following in respect to transmission planning: Establishes a national transmission planning policy, which states that transmission planning "should facilitate the deployment of renewable and other zero-carbon and low-carbon energy sources for generating electricity to reduce greenhouse gas emissions while ensuring reliability, reducing congestion, ensuring cyber-security, minimizing environmental harm, and providing for cost-effective electricity services throughout the United States…." Directs the Federal Energy Regulatory Commission to define electric transmission planning principles, based on the national policy, which can be used by planning entities. FERC is to facilitate coordination between state, regional, and industry transmission planning entities. In respect to permitting, the bill grants FERC new federal siting and permitting authority within the Western Interconnection. This authority to supersede state permitting decisions applies only to proposed transmission projects that meet certain criteria, including interstate projects "identified as needed in significant measure to meet demand for renewable energy." H.R. 2454 includes several provisions aimed at supporting development and installation of smart grid technologies (see Title I, Subtitle E). The bill would direct the Department of Energy and Environmental Protection Agency to identify products that could be cost-effectively equipped with smart grid capability. The legislation would also direct the Federal Trade Commission to initiate a rulemaking to determine whether smart grid information, such as potential dollar savings to the consumer, should be added to ENERGY GUIDE product labels. (ENERGY GUIDE is an existing federal program for labeling energy efficient products.) The legislation would establish requirements for electric power retailers to reduce their peak loads using smart grid and other energy efficient technologies; and would modify an energy efficiency public information program authorized by the Energy Policy Act of 2005 (EPACT05) to make it into a smart grid and energy efficiency information program. H.R. 2454 would also modify an EPACT05 energy efficiency appliance rebate program to add appliances with smart grid capabilities. Additionally, H.R. 2454 would require state regulatory authorities and self-regulating power suppliers (such as municipal utilities) to consider implementing standards intended to ensure that utility smart grid systems would be compatible with plug-in electric drive vehicles. Section 152 of Subtitle F of H.R. 2454 provides for net metering of federal agencies. Net metering is a ratemaking concept intended to encourage the development of "distributed generation" (i.e., electricity generated at the customer's site, possibly, but not necessarily, using renewable energy). Net metering is intended to make distributed generation more economical by requiring the utility that supplies electricity to a facility to also take any electricity generated by that facility, such as from rooftop solar panels or an on-site diesel generator. The ultimate utility bill to the facility is reduced by the amount of electricity supplied to the power company. Section 152 amends the Public Utility Regulatory Policies Act of 1978 to require state regulatory authorities to consider ordering utilities under their jurisdiction to implement net metering for federal facilities. It also requires non-regulated utilities (such as many municipal utilities) to make the same evaluation. The net metering standard must be adopted if it is consistent with state law and is found by the controlling regulatory authority to be "appropriate." Section 153 of Subtitle F would amend EPACT05 to provide for incentives for the development and construction of transmission lines and related facilities using currently non-commercial technology. The categories of technology include "advanced electric transmission property" (essentially high-efficiency underground transmission lines and associated equipment), "advanced electric transmission manufacturing plant" (plants that manufacture the "advanced electric transmission property"), and "high efficiency transmission property" (essentially high-efficiency overhead transmission lines and associated equipment). All three categories of technology would be added to the list of technologies qualifying for the new loan guarantee program added to EPACT05 by the American Recovery and Reinvestment Act of 2009. Additionally, "advanced electric transmission property" and "advanced electric transmission manufacturing plant" only would be added to the original loan guarantee program included in EPACT05. This program was originally created to support the development of low carbon and other advanced energy technologies.

This report provides a summary and analysis of selected provisions of the chairman's mark of S. 1733, the Clean Energy Jobs and American Power Act. The topics covered include electric power and incentives for the development of natural gas technologies. The report also compares those provisions with H.R. 2454, the American Clean Energy and Security Act. In S. 1733, Subtitle H of Division A has two sections dealing with the use of low carbon emitting energy technologies. Section 181, Clean Energy and Accelerated Emission Reduction Program, directs the EPA administrator to "establish a program to promote dispatchable power generation projects that can accelerate the reduction of power sector carbon dioxide and other greenhouse gas emissions" (emphasis added). The term "dispatchable" is not defined in the bill, but would normally refer to power generating units that can be run at-will by system operators, such as natural gas, nuclear, or coal units. Several features of Section 181 are unspecified or unclear, including the total dollar amount and form of the incentives, whether the emission reduction target for a specific project would change over time, and the deadline for making incentive awards. Section 182 of Subtitle H, Advanced Natural Gas Technologies, would establish two grant programs for accelerating the development of advanced natural gas technologies in the power generation, commercial, and residential sectors. No parts of H.R. 2454 are directly comparable to sections 181 and 182 of S. 1733. Closest in intent is Section 175 of Subtitle H of H.R. 2454, which provides for a government program to help develop and demonstrate high efficiency natural gas burning combustion turbines, for use in combined cycle power plants. H.R. 2454 has several provisions relating to electric power transmission that have no counterparts in S. 1733. These provisions of H.R. 2454 involve transmission planning and permitting; development and deployment of smart grid technologies; requirements for electric utilities to reduce peak demand; net metering for federal agencies; and incentives for transmission technology development. These elements of H.R. 2454 are summarized in this report and discussed in more detail in CRS Report R40643, Greenhouse Gas Legislation: Summary and Analysis of H.R. 2454 as Passed by the House of Representatives, coordinated by [author name scrubbed] and [author name scrubbed].

Taxpayers are seen as more likely to pay taxes on income if the realization of that income has been communicated to the Internal Revenue Service (IRS). To encourage compliance with tax laws, the Internal Revenue Code (IRC) includes a number of information reporting requirements regarding payments that may result in taxable income for the payee. One such reporting requirement, contained in IRC § 6041(a), applies to certain payments made by persons in the course of a trade or business. Under IRC § 6041(a), if the total amount of payments made to a single payee over a year equals at least $600, the payer is required to file an information return with the IRS providing information identifying the payer, the payee, and the total amounts paid to that payee over the past calendar year. The information returns required to be filed under IRC § 6041 are typically versions of Form 1099. A copy of this information return must also be provided to the payee. Although payees may receive copies of information returns, payees are not required to file any information returns under IRC § 6041. Section 6041 was amended twice in 2010: once by § 9006 of the Patient Protection and Affordable Care Act (PPACA) and a second time by § 2101 of the Small Business Jobs Act of 2010. Both amendments were subsequently repealed by the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011. As a result, the information reporting requirements have been restored to their pre-PPACA scope. They may, however, be subject to stronger enforcement as a result of a surviving provision of the Small Business Jobs Act that revised the penalties for failing to file an accurate 1099 with the IRS or failing to provide an accurate copy of that form to the payee. This report briefly discusses the procedures and penalties under current law applicable to the information reporting requirements under IRC § 6041, and also briefly describes recent amendments that have been repealed. For a more detailed discussion of the repealed amendments, including responses to them by various stakeholders, see CRS Report R41504, 1099 Information Reporting Requirements and Penalties as Modified by the Patient Protection and Affordable Care Act and the Small Business Jobs Act of 2010 , by [author name scrubbed] and [author name scrubbed]. The procedures for filing information returns with the IRS were not changed by either PPACA or the Small Business Jobs Act; therefore, the repeal of the amendments to § 6041 has no effect on those procedures. The deadline for filing an information return with the IRS is February 28 of the year following the calendar year in which payments were made, or March 31 if filed electronically. Copies of information returns must be provided to payees no later than January 31 of the year following the calendar year in which the payments were made. Information returns must accurately identify both the payer and the payee of the payments as well as the total amount paid. The payees are required to provide their names, addresses, and taxpayer identification numbers to payers in order to facilitate information reporting. The information return must include all of these as well as the address and telephone number of the payer. It is the payer's obligation to request information from the payee, and the payee is required to provide it. The payer may use Form W-9 to request the information from U.S. persons. If the payee does not provide a taxpayer identification number, the payer is generally required to collect backup withholding from payments due to the payee. For 2010-2012, the backup withholding rate is 28%. A payee is subject to a penalty of $50 for each failure to provide the correct taxpayer identification number to a payer who has requested it. The IRS recently promulgated regulations governing the reporting of credit card and third party network transactions. These regulations are not affected by the repeal described above, and create an exception to the information reporting requirements of § 6041. For payments made after December 31, 2010, Treasury Regulation § 1.6041-1(a)(1)(iv) states that any transaction that is subject to reporting under § 6050W, without regard to the third party network de minimus threshold, will not be reported under § 6041. Thus, if payments are made by credit card or through a third party network, the payer generally will not be required to report them on an information return. Both the failure to submit an accurate information return to the IRS and the failure to provide a copy of the information return to the payee are subject to monetary penalties assessed by the IRS. As a unique information return is required with respect to each payee, penalties are assessed on each deficient information return. Both § 6721 (pertaining to failure to file accurate returns with the IRS) and § 6722 (pertaining to failure to provide payees with correct copies of the information returns) of the IRC have been amended by the Small Business Jobs Act to revise the amounts of the penalties. Section 6722 has been amended to change the structure of the penalty so that it is similar to the structure of the § 6721 penalty. In so doing, the effect is that the amended penalty may be lower than it previously would have been where corrective action is taken. The changes to both sections are scheduled to become effective for returns required to be filed after December 31, 2010. Thus, the new penalty amounts are expected to apply to returns that report payments made during calendar year 2010. For information returns that are due before the amendments take effect, the penalty for failing to file a correct and timely return with the IRS is $50 for each defective return not to exceed $250,000 for a single payer. If the deficiency is corrected within 30 days of the due date, the penalty is reduced to $15 per return, not to exceed $75,000. If corrected later than 30 days, but before August 1, the penalty is $30 per return, not to exceed $150,000. No penalty will be assessed against a person if defects are corrected by August 1, and the total number of defective returns does not exceed the greater of 10 or one-half percent of the total number of information returns required to be filed by the person. Some small businesses may be able to take advantage of reduced ceilings on aggregate penalties for payers with gross receipts of less than $5 million. For these payers, the ceilings are $100,000 (for uncorrected violations), $25,000 (if corrected within 30 days), and $50,000 (if corrected after 30 days, but on or before August 1). Higher penalties may also be assessed where persons intentionally disregard their duty to file an information return. (See Table 1 .) Failure to provide a correct and timely statement to a payee is also subject to a $50 penalty per return, not to exceed $100,000 per payer. Higher penalties may also be assessed where persons intentionally disregard their duty to provide a payee with a copy of an information return. (See Table 2 .) Section 2102 of the Small Business Jobs Act modified the penalties for failing to provide information returns to the IRS or to the appropriate payee in a timely fashion. These amendments have not been repealed by the 112 th Congress. The penalties for failing to file information returns with the IRS were increased across the board, as described in Table 1 . These amounts will also be updated in 2017, and every five years after, to account for inflation. Section 2102 of the Small Business Jobs Act also modified the penalty scheme for failures to provide copies of information returns to payees. As described in Table 2 , the amended penalties mirror the amounts that would be assessed for a failure to file information returns with the IRS and are similarly indexed for inflation. In addition to raising the base penalty, the amendments also provide reduced penalties if corrective actions are taken. Because the prior penalty scheme did not take corrective action into account, penalties under the amended provision may actually be less than what would have been assessed under the old scheme if corrective action is taken. It is a misdemeanor for any person to willfully fail to make an information return as required by law. Persons convicted of this offense may be punished by a fine of up to $25,000, imprisonment for up to one year, or both. A willful violation occurs when there is "a voluntary, intentional violation of a known legal duty." However, a violation that results from a good-faith misunderstanding of the requirements of the IRC is not a willful violation, as that term has been interpreted by the courts. Neither the Small Business Jobs Act nor PPACA changed the criminal penalties applicable to the willful failure to make an information return. Section 6041 was amended twice in 2010: once by § 9006 of PPACA and a second time by § 2101 of the Small Business Jobs Act of 2010. Both amendments were subsequently repealed by the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011. Each repealed amendment is described below. For a more detailed discussion of the repealed expansions, including responses to them by various stakeholders, see CRS Report R41504, 1099 Information Reporting Requirements and Penalties as Modified by the Patient Protection and Affordable Care Act and the Small Business Jobs Act of 2010 , by [author name scrubbed] and [author name scrubbed]. For payments made after December 31, 2011, § 9006 of PPACA amended the reporting requirement in IRC § 6041 in two principal ways. First, payments to corporations would no longer be automatically exempt from reporting requirements by virtue of the payee's corporate status, superseding existing regulations to the contrary. Second, the types of payments that could trigger the reporting requirement were expanded to include amounts paid in consideration of property and other gross proceeds. Although now repealed, the effect of this amendment would have been to require those engaged in a trade or business to report a broader range of payments made to a broader range of payees in order to encourage the voluntary reporting of taxable income and also to facilitate the enforcement and collection of taxes on income that is not voluntarily reported. Section 2101 of the Small Business Jobs Act expanded the payers who would be required to comply with the section's reporting requirements to include landlords. Generally, those receiving rental income from real estate have not been considered to be engaged in a trade or business; however, the recent amendment of § 6041 would have changed this. Solely for purposes of § 6041(a), most landlords would have been considered to be engaged in the trade or business of renting real estate and, therefore, might have been required to file Forms 1099 to report payments made in conjunction with their rental properties.

Taxpayers are seen as more likely to report items of income on their tax returns if they know that a third party has reported it to the Internal Revenue Service (IRS); if follows, therefore, that expanding information reporting requirements under the Internal Revenue Code (IRC) can improve the collection of federal tax revenue. However, as those requirements are expanded, those who must comply with the requirements generally will face an increased administrative burden. This tension between the desire to improve tax compliance and the concomitant burden imposed on taxpayers was recently highlighted after expansions of the reporting requirements in IRC § 6041 were met by protests that the changes imposed too great a burden, particularly on small businesses. As a result of these objections, the expansions to the information reporting requirement were repealed shortly after they were enacted. IRC § 6041 requires payments totaling at least $600 in a single calendar year to a single recipient to be reported to the IRS. The required return is generally a Form 1099, which is prepared by the entity making the payment and identifies to whom payment was made, the amount of the payment, and the general reason for the payment. The form is filed with the IRS and a copy is provided to the payee. The form is required only when the payer is considered to be engaged in a trade or business and has made the payment in connection with that trade or business. The scope of IRC § 6041 was expanded by both the Patient Protection and Affordable Care Act (PPACA; P.L. 111-148) and the Small Business Jobs Act of 2010 (P.L. 111-240). Section 9006 of PPACA would have made payments to corporations and payments for goods or other property subject to reporting. Section 2101 of the Small Business Jobs Act would have made most landlords subject to the reporting requirements of IRC § 6041. The expansions made by both bills were subsequently repealed by the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011 (P.L. 112-9). The Small Business Jobs Act also increased the penalties for failure to file an information return (IRC § 6721) and the penalties for failing to provide a copy of the information return to the payee (IRC § 6722). These changes have not been repealed and will apply to any information returns required to be filed after December 31, 2010.

The initial response to a public health emergency—for instance an outbreak of an infectious disease—generally occurs at the local and state levels and could involve disease surveillance, laboratory testing, epidemiologic investigation, communication, and health care treatment. As a public health emergency develops, each plays a critical role in an effective response. Local and state health departments collect and monitor data, such as reports from clinicians, for disease trends and evidence of an outbreak. Laboratory personnel test clinical and environmental samples for possible exposures and identification of illnesses. Epidemiologists in the health departments use disease surveillance systems to detect clusters of suspicious symptoms or diseases in order to facilitate early detection of disease and treatment of victims. Public health officials provide needed information to the clinical community, other responders, and the public and implement control measures to prevent additional cases from occurring. Health care providers treat patients and limit the spread of infectious disease. All these response activities require a workforce that is sufficiently skilled and adequate in number. The federal government provides funding and resources to state and local entities to support preparedness and response efforts. For example, in fiscal year 2002 CDC’s Public Health Preparedness and Response for Bioterrorism cooperative agreement program provided approximately $918 million to states to improve bioterrorism preparedness and response as well as other public health emergency preparedness capacities. Similarly, HRSA’s Bioterrorism Hospital Preparedness cooperative agreement program provided approximately $125 million to states in fiscal year 2002 to enhance the capacity of hospitals and associated health care entities to respond to bioterrorist attacks. HHS renewed these cooperative agreements for the period of August 31, 2003 through August 30, 2004. For these renewed agreements, CDC’s program and HRSA’s program distributed about $870 million and about $498 million, respectively. Among the other resources that the federal government provides is the Strategic National Stockpile, which contains pharmaceuticals and medical supplies that can be delivered to the site of a public health emergency anywhere in the United States within 12 hours of the decision to deploy them. The federal government also supports preparedness efforts for an influenza pandemic. HHS’s National Vaccine Program Office is responsible for the development of federal plans for vaccine and immunization activities and coordinating these efforts among federal agencies. To foster state and local planning, HHS issued interim planning guidance for the states in 1997 that outlined general federal and state responsibilities during an influenza pandemic. HHS expects that if a pandemic occurs, both the vaccines that are used to prevent influenza and the antiviral drugs that are used to treat influenza will be in short supply. The guidance discussed certain key issues related to limited supplies of the influenza vaccine and antiviral drugs—for instance the amount of vaccine and antiviral drugs that will be purchased at the federal level; the division of responsibility between the public and private sectors for the purchase, distribution, and administration of these supplies during a pandemic; and priorities for vaccinating population groups, such as health workers and public health personnel involved in the pandemic response, and persons traditionally considered to be at increased risk of severe influenza illness and mortality. States reported that as of the summer of 2003 they have made improvements in their preparedness to respond to major public health threats, but no aspect of preparedness has been fully addressed by all of the states. Specifically, although states have strengthened their disease surveillance systems, laboratory capacity, communications, workforce, surge capacity, regional coordination across state borders, and readiness to utilize the Strategic National Stockpile, all of these important aspects of preparedness require additional work. Although some states have made improvements to their disease surveillance systems, the nation’s ability to detect and report a disease outbreak is not uniformly strong across all states. For example, about half of the states reported that their health departments are capable of receiving and evaluating urgent disease reports on a 24-hour-per-day, 7-day-per-week basis; however, few states reported having the ability to rapidly detect an outbreak of an influenza-like illness in the state. Similarly, few states reported efforts to strengthen links between their public health and animal surveillance systems and the veterinary community in order to monitor diseases in animals that may be spread to humans, such as the West Nile virus. States have increased their capacity to test and identify specimens and improve laboratory security, although laboratory capacity is not uniformly robust in all states. All states participate in CDC’s Laboratory Response Network, a network of local, state, federal, and international laboratories that are equipped to respond to biological and chemical terrorism, emerging infectious diseases and other public health threats. However, only about half of the states reported that they have at least one public health laboratory within the state that has the appropriate instrumentation and appropriately trained staff to conduct certain tests for rapidly detecting and correctly identifying biological agents. About half of the states reported that they had a facility with a biosafety level sufficient to handle such agents as anthrax. About half the states also reported that laboratory security within the state is consistent with HHS guidelines, which include recommendations for protecting laboratory personnel and preventing the unauthorized removal of dangerous biologic agents from the laboratory. Although improving, communication, both among those involved in responding to a major public health threat—such as public health officials, health care providers, and emergency management agencies—and with the public, remains a challenge. CDC’s Health Alert Network has been expanded—most of the states reported that the local health departments that cover at least 90 percent of their populations are involved in this network. However, many states reported that they were still in the process of assessing their communication needs. Although about half the states have a plan for educating the public about the risks posed by bioterrorism and other public health threats, few states have mechanisms in place for communicating with the general public during an incident about such issues as when it is necessary to go to the hospital. States have increased the number of personnel essential to public health preparedness, but concerns about workforce shortages remain. Most of the states reported that the bioterrorism preparedness funding from CDC allowed each to appoint an executive director of its bioterrorism preparedness and response program, to designate a response coordinator, and to hire at least one epidemiologist for each metropolitan area with a population greater than 500,000. However, most states continue to have staffing concerns. As we have reported previously, some state and local health officials have had difficulty finding and hiring epidemiologists and laboratory personnel. The ability to hire and retain personnel in these areas is still a concern for state and local health officials, who identify workforce shortages as a long-term challenge to their preparedness efforts. Most states lack surge capacity—that is, the capacity to respond to the large influx of patients that could occur during a public health emergency. For example, few states reported that they had the capacity to evaluate, diagnose, and treat 500 or more patients involved in a single incident. Furthermore, no state reported having protocols in place for augmenting personnel in response to large influxes of patients, and few states reported having plans for sharing clinical personnel among hospitals. In addition, few states reported having the capacity to rapidly establish clinics to immunize or provide treatment to large numbers of patients. Few states have regional plans in place that would coordinate the response among states during a public health emergency, and state officials remain concerned about a lack of regional planning across state borders. Few states have completed regional response plans for incidents of bioterrorism and other public health threats and emergencies. Most of the states that do have such plans have not established training programs to support their plans or mechanisms to test their plans. Most state plans for using the Strategic National Stockpile in the event of a public health emergency have not been fully developed. All states have prepared preliminary plans for the receipt and management of stockpile materials, but only about a third of the states have plans that outline how they would distribute antibiotics, chemical/nerve agent antidotes, and other materials to areas within the state. Federal officials have not finalized plans for responding to an influenza pandemic, and state influenza pandemic response plans are in various stages of completion. As we have reported previously, federal officials have drafted but not finalized the federal influenza pandemic plan. In 2000, we recommended that HHS complete the national plan for responding to an influenza pandemic, but HHS reported recently that the plan was still under review within HHS. However, HHS is taking other steps to prepare for an influenza pandemic. For example, CDC has increased the supply of ventilators and added an antiviral drug to the Strategic National Stockpile. HHS is also coordinating with other federal partners, such as the Department of Agriculture, to improve the nation’s ability to respond to public health emergencies involving the veterinary and agricultural sectors. Despite the absence of a finalized, federal response plan for an influenza pandemic, states are developing their own response plans. According to HHS officials, as of February 2004, 15 states have final or draft plans, and 34 states are actively working on plans. In these plans, states have had to make assumptions about what the federal role during an influenza pandemic will be. It is still unclear whether the private sector, the public sector, or both will have responsibility for purchasing and distributing vaccines and antiviral drugs. Some states have assumed that vaccine supply will be under the control of the federal government, while others have assumed that it will not. States have also made different assumptions about who will pay for vaccines, antiviral medications, and related supplies. States have taken many actions to improve their ability to respond to a major public health threat, but no state has reported being fully prepared. Federal plans for the purchase, distribution, and administration of vaccines and drugs in response to an influenza pandemic still have not been finalized, complicating the efforts of states to develop their state plans and heightening concern about our nation’s ability to respond effectively to an influenza pandemic. States are more prepared now, but much remains to be accomplished. Mr. Chairman, this completes my prepared statement. I would be happy to respond to any questions you or other Members of the Committee may have at this time. For further information about this testimony, please contact Janet Heinrich at (202) 512-7119. Angela Choy, Maria Hewitt, Krister Friday, Nkeruka Okonmah, and Michele Orza also made key contributions to this statement. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

The anthrax incidents in the fall of 2001 and the severe acute respiratory syndrome (SARS) outbreak in 2002-2003 have raised concerns about the nation's ability to respond to a major public health threat, whether naturally occurring or the result of bioterrorism. The anthrax incidents strained the public health system, including laboratory and workforce capacities, at the state and local levels. The SARS outbreak highlighted the challenges of responding to new and emerging infectious disease. The current influenza season has heightened concerns about the nation's ability to handle a pandemic. GAO was asked to examine improvements in state and local preparedness for responding to major public health threats and federal and state efforts to prepare for an influenza pandemic. This testimony is based on GAO's recent report, HHS Bioterrorism Preparedness Programs: States Reported Progress but Fell Short of Program Goals for 2002, GAO-04- 360R (Feb. 10, 2004). This testimony also updates information contained in GAO's report on federal and state planning for an influenza pandemic, Influenza Pandemic: Plan Needed for Federal and State Response, GAO- 01-4 (Oct. 27, 2000). Although states have further developed many important aspects of public health preparedness, since April 2003, no state is fully prepared to respond to a major public health threat. States have improved their disease surveillance systems, laboratory capacity, communication capacity, and workforce needed to respond to public health threats, but gaps in each remain. Moreover, regional planning between states is lacking, and many states lack surge capacity--the capacity to evaluate, diagnose, and treat the large numbers of patients that would present during a public health emergency. Although states are developing plans for receiving and distributing medical supplies and material for mass vaccinations from the Strategic National Stockpile in the event of a public health emergency, most of these plans are not yet finalized. HHS has not published the federal influenza pandemic plan, and most of the state plans have not been finalized. In 2000, GAO recommended that HHS complete the national plan for responding to an influenza pandemic, but according to HHS, the plan is still under review. Absent a federal plan, key questions about the federal role in the purchase, distribution, and administration of vaccines and antiviral drugs during a pandemic remain unanswered. HHS reports that most states continue to develop their state plans despite the lack of a federal plan.

Defense, like the rest of the government and the private sector, is relying on technology to make itself more efficient. The Department is depending more and more on high-performance computers linked together in a vast collection of networks, many of which are themselves connected to the worldwide Internet. Hackers have been exploiting security weaknesses of systems connected to the Internet for years, they have more tools and techniques than ever before, and the number of attacks is growing every day. These attacks, coupled with the rapid growth and reliance on interconnected computers, have turned cyberspace into a veritable electronic frontier. The need to secure information systems has never been greater, but the task is complex and often difficult to understand. Information systems security is complicated not only by rapid growth in computer use and computer crime, but also by the complexity of computer networks. Most large organizations today like Defense have a conglomeration of mainframes, PCs, routers, servers, software, applications, and external connections. In addition, since absolute protection is not feasible, developing effective information systems security involves an often complicated set of trade-offs. Organizations have to consider the (1) type and sensitivity of the information to be protected, (2) vulnerabilities of the computers and networks, (3) various threats, including hackers, thieves, disgruntled employees, competitors, and in Defense’s case, foreign adversaries and spies, (4) countermeasures available to combat the problem, and (5) costs. In managing security risks, organizations must decide how great the risk is to their systems and information, what they are going to do to defend themselves, and what risks they are willing to accept. In most cases, a prudent approach involves selecting an appropriate level of protection and then ensuring that any security breaches that do occur can be effectively detected and countered. This generally means that controls be established in a number of areas, including, but not limited to: a comprehensive security program with top management commitment, sufficient resources, and clearly assigned roles and responsibilities for those responsible for the program’s implementation; clear, consistent, and up-to-date information security policies and vulnerability assessments to identify security weaknesses; awareness training to ensure that computer users understand the security risks associated with networked computers; assurance that systems administrators and information security officials have sufficient time and training to do their jobs properly; cost-effective use of technical and automated security solutions; and a robust incident response capability to detect and react to attacks and to aggressively track and prosecute attackers. The Department of Defense’s computer systems are being attacked every day. Although Defense does not know exactly how often hackers try to break into its computers, the Defense Information Systems Agency (DISA) estimates that as many as 250,000 attacks may have occurred last year. According to DISA, the number of attacks has been increasing each year for the past few years, and that trend is expected to continue. Equally worrisome are DISA’s internal test results; in assessing vulnerabilities, DISA attacks and successfully penetrates Defense systems 65 percent of the time. Not all hacker attacks result in actual intrusions into computer systems; some are attempts to obtain information on systems in preparation for future attacks, while others are made by the curious or those who wish to challenge the Department’s computer defenses. For example, Air Force officials at Wright-Patterson Air Force Base told us that, on average, they receive 3,000 to 4,000 attempts to access information each month from countries all around the world. into sensitive Defense systems. They have “crashed” entire systems and networks, denying computer service to authorized users and preventing Defense personnel from performing their duties. These are the attacks that warrant the most concern and highlight the need for greater information systems security at Defense. To further demonstrate the seriousness of some these attacks, I would like to briefly discuss the 1994 hacker attacks the Subcommittee asked us to specifically examine on the Air Force’s Rome Laboratory in Rome, New York. This incident demonstrates how easy it is for hackers to gain access to our nation’s most important and advanced research. Rome Laboratory is the Air Force’s premier command and control research facility—it works on very sensitive research projects such as artificial intelligence and radar guidance. In March and April 1994, a British hacker known as “Datastream Cowboy” and another hacker called “Kuji” (hackers commonly use nicknames or “handles” to conceal their real identities) attacked Rome Laboratory’s computer systems over 150 times. To make tracing their attacks more difficult, the hackers weaved their way through international phone switches to a computer modem in Manhattan. The two hackers used fairly common hacker techniques, including loading “Trojan horses” and “sniffer” programs, to break into the lab’s systems. Trojan horses are programs that when called by authorized users perform useful functions, but that also perform unauthorized functions, often usurping the privileges of the user. They may also add “backdoors” into a system which hackers can exploit. Sniffer programs surreptitiously collect information passing through networks, including user identifications and passwords. The hackers took control of the lab’s network, ultimately taking all 33 subnetworks off-line for several days. The attacks were initially suspected by a systems administrator at the lab who noticed an unauthorized file on her system. After determining that their systems were under attack, Rome Laboratory officials notified the Air Force Information Warfare Center and the Air Force Office of Special Investigations. Working together, these Air Force officials regained control of the lab’s network and systems. They also monitored the hackers by establishing an “electronic fishbowl” in which they limited the intruders’ access to one isolated subnetwork. tactics, such as where the enemy is located and what targets are to be attacked. The hackers also launched other attacks from the lab’s computer systems, gaining access to systems at NASA’s Goddard Space Flight Center, Wright-Patterson Air Force Base, and Defense contractors around the country. Datastream Cowboy was caught in Great Britain by Scotland Yard authorities, due in large part to the Air Force’s monitoring and investigative efforts. Legal proceedings are still pending against the hacker for illegally using and stealing British telephone service; no charges have been brought against him for breaking into U.S. military computer systems. Kuji was never caught. Consequently, no one knows what happened to the data stolen from Rome Lab. In general, Defense does not assess the damage from the computer attacks because it can be expensive, time-consuming and technically difficult. But in the Rome case, Air Force Information Warfare Center staff estimated that the attacks on the Rome Lab cost the government over half a million dollars. This included costs for time spent to take the lab’s systems off the networks, verify the integrity of the systems, install security “patches,” and restore computer service. It also included costs for the Office of Special Investigations and Warfare Center personnel deployed to the lab. But the estimate did not include the value of the research data that was compromised by the hackers. Information in general is very difficult to value and appraise. In addition, the value of sensitive Defense data may be very different to an adversary than to the military, and may vary a great deal, depending on the adversary. Rome Lab officials told us, however, that if their air tasking order research project had been damaged beyond repair, it would have cost about $4 million and 3 years to reconstruct it. In addition, the Air Force could not determine whether any of the attacks were a threat to national security. It is quite possible that at least one of the hackers may have been working for a foreign country interested in obtaining military research data or learning what the Air Force is working on. While this is only one example of the thousands of attacks Defense experiences each year, it demonstrates the damage caused and the costs incurred to verify sensitive data and patch systems. systems experts believe that computer attacks are capable of disrupting communications, stealing sensitive information, and threatening our ability to execute military operations. The National Security Agency and others have acknowledged that potential adversaries are attempting to obtain such sensitive information by hacking into military computer systems. Countries today do not have to be military superpowers with large standing armies, fleets of battleships, or squadrons of fighters to gain a competitive edge. Instead, all they really need to steal sensitive data or shut down military computers is a $2,000 computer and modem and a connection to the Internet. Defense officials and information systems security experts believe that over 120 foreign countries are developing information warfare techniques. These techniques allow our enemies to seize control of or harm sensitive Defense information systems or public networks which Defense relies upon for communications. Terrorists or other adversaries now have the ability to launch untraceable attacks from anywhere in the world. They could infect critical systems, including weapons and command and control systems, with sophisticated computer viruses, potentially causing them to malfunction. They could also prevent our military forces from communicating and disrupt our supply and logistics lines by attacking key Defense systems. Several studies document this looming problem. An October 1994 report entitled Information Architecture for the Battlefield prepared by the Defense Science Board underscores that a structured information systems attack could be prepared and exercised by a foreign country or terrorist group under the guise of unstructured hacker-like activity and, thus, could “cripple U.S. operational readiness and military effectiveness.” The Board added that “the threat . . . goes well beyond the Department. Every aspect of modern life is tied to a computer system at some point, and most of these systems are relatively unprotected.” Given our dependence on these systems, information warfare has the potential to be an inexpensive but highly effective tactic which many countries now plan to use as part of their overall security strategy. methods of attack. Defense has taken steps to strengthen its information systems security, but it has not established a comprehensive and effective security program that gives sufficient priority to protecting its information systems. Some elements of a good security program are in place. Most notably, Defense has implemented a formal information warfare program. DISA is in charge of the program and has developed and begun implementing a plan for protecting against, detecting, and reacting to information systems attacks. DISA established its Global Defensive Information Warfare Control Center and its Automated Systems Security Incident Support Team (ASSIST) in Arlington, Virginia. Both the center and ASSIST provide centrally coordinated, around-the-clock response to attacks and assistance to the entire Department. Each of the military services has established computer emergency response capabilities, as well. The Air Force is widely recognized as the leader among the services for having developed considerable experience and technical resources to defend its information systems. However, many of Defense’s policies relating to computer systems attacks are outdated and inconsistent. They do not set any standards or require actions for what we and many others believe are important security activities, such as periodic vulnerability assessments, internal reporting of attacks, correction of known vulnerabilities, and damage assessments. In addition, many of the Department’s system and network administrators are not adequately trained and do not have enough time to do their jobs properly. Computer users throughout the Department are often unaware of fundamental security practices, such as using sound passwords and protecting them. Further, Defense’s efforts to develop automated programs and use other technology to help counter information systems attacks need to be much more aggressive and implemented on a departmentwide basis, rather than in the few current locations. administrators receive enough time and training to do their jobs properly. Further, we recommend that Defense assess its incident response capability to determine its sufficiency in light of the growing threat, and implement more proactive and aggressive measures to detect systems attacks. The fact that these important elements are missing indicates that Defense has not adequately prioritized the need to protect its information resources. Top management at Defense needs to ensure that sufficient resources are devoted to information security and that corrective measures are successfully implemented. We have testified and reported on information systems weaknesses for several years now. In November 1991, I testified before the Subcommittee on Government Information and Regulation on a group of Dutch hackers breaking into Defense systems. Some of the issues and problems we discussed here today existed then; some have worsened, and new challenges arise daily as technology continues to advance. Without increased attention by Defense top management and continued oversight by the Congress, security weaknesses will continue. Hackers and our adversaries will keep compromising sensitive Defense systems. That completes my testimony. I’ll be happy to answer any questions you or Members of the Subcommittee may have. The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and MasterCard credit cards are accepted, also. 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GAO discussed information security procedures at the Department of Defense (DOD). GAO noted that: (1) as many as 250,000 DOD computer systems were attacked in 1995; (2) hackers successfully penetrate DOD computer systems 65 percent of the time; (3) hackers attack DOD computer systems to steal and destroy sensitive data and install reentry devices; (4) these attacks cost the government over half a million dollars, including the cost of disconnecting the system, verifying the system's integrity, installing security patches, and restoring computer services; (5) hackers are capable of disrupting communications and threatening U.S. military operations; (6) DOD faces a huge challenge in protecting its computer systems due to the size of its information infrastructure, increasing amounts of sensitive data, Internet use, and skilled hackers; (7) DOD has established a Global Information Warfare Control Center and a Automated Systems Security Incident Support Team to provide around-the-clock service and respond to computer attacks; (8) many DOD policies pertaining to computer security are outdated and inconsistent and DOD system and network administrator's are inadequately trained to perform their jobs; and (9) DOD needs to be more aggressive in developing an automated program that responds to computer attacks.

The National Weather Service (NWS), at the discretion of the Secretary of Commerce, has statutory authority for weather forecasting and for issuing storm warnings (15 U.S.C. §313). The NWS provides weather, water, and climate forecasts and warnings for the United States, its territories, adjacent waters, and ocean areas. The 114 th Congress has expressed its interest in improving forecasts and warnings to protect life and property in the United States from severe weather events through its role in oversight, appropriations, and the authorization of language regarding NWS. NWS is one of several line offices within the National Oceanic and Atmospheric Administration (NOAA). In 2014, NWS restructured its organization structure, which is reflected in its annual congressional budget justifications since then. This report includes tables that summarize appropriated funding for NWS, and the programs within NWS that generate forecasts and warnings, and the funding for NWS in its restructured accounts since FY2014. The report also includes a table with a brief summary and analysis of various bills introduced in the 114 th Congress that would have some bearing, directly or indirectly, on NWS operations. To date, none of the bills has been enacted. NWS's core mission is to provide weather forecasts and warnings for protection of life and property. Apart from the budget for procuring weather satellites, NWS received the most funding of any agency or program within the FY2016 budget for NOAA. Prior to FY2015, NWS's Local Warnings and Forecasts (LW&F) program received approximately 70% of NWS funding each year (from FY2009 through FY2014, see Table 1 ), suggesting that short-term weather prediction and warning is a high priority for NWS and for NOAA, in accord with NOAA's statutory authority. The 122 NWS weather forecast offices distributed throughout the United States provide the forecasts and warnings familiar to most people (see box below). Starting in FY2015, NWS restructured its programs, spreading out the LW&F activities among five separate subprograms. The restructuring makes it difficult to compare funding for LW&F activities prior to FY2015 with funding for forecast and warning activities after FY2014. According to NOAA, the restructuring was "part of a broader effort to align the NWS budget to function and link to performance." Also, NOAA cited two reports that included recommendations for realigning and restructuring its operations. NOAA stated that its commitment to forecasts and warnings continues: "NWS is dedicated to serving the American public by providing a broad spectrum of weather, climate, and hydrological forecast guidance and decision support services. NWS strives to meet society's need for weather and hydrological forecast information." Table 2 displays NWS funding in the restructured accounts for FY2014 through the FY2017 proposed budget. It also shows the percentage of total NOAA funding represented by each account within NWS. As stated above, the restructuring makes it difficult to compare LW&F funding prior to FY2015 with the restructured accounting; however, total NWS funding as a percentage of total NOAA funding appears to have dropped by a percentage point or two in the last few years. The proposed budget for NWS in FY2017 is nearly $5 million less than the enacted budget in FY2016, whereas total proposed spending for NOAA in FY2017 represents an increase of slightly more than 1% over the FY2016 enacted figure. Both the House and the Senate appropriations committees have reported FY2017 appropriations bills that would fund NOAA, including NWS, for FY2017. Reports accompanying each appropriation bill contain language that may influence NWS operations in FY2017 and beyond. In addition, several bills were introduced in the 114 th Congress that, if enacted, could affect NWS. Some of the bills focus on single topics, such as increasing the number of Doppler radar stations across the country. Other bills would address a broader array of programs within NOAA and NWS. Several bills may affect NWS only indirectly, such as those that would authorize strategies to improve resilience to extreme weather events. Table 3 lists legislation introduced in the 114 th Congress that may affect NWS and briefly summarizes relevant provisions. Many different components and programs within NOAA contribute to NWS's mission of providing weather forecasts and warnings. Several of the bills listed in Table 3 indicate congressional interest in some of those components and programs, such as the research programs within the office of Oceans and Atmospheric Research at NOAA, and in the challenge of improving the integration of research results into operational weather forecasting (e.g., H.R. 1561 , S. 1331 ). Several of the bills are more narrowly focused, such as those that would require additional Doppler radars to provide coverage for large population centers or state capitals (e.g., H.R. 3538 , H.R. 5089 , S. 2058 ) or those that would require additional personnel at NWS forecast offices (e.g., S. 1573 ). NOAA weather satellites are also critical components of the NWS's core mission, and Congress has been concerned about possible gaps in coverage and about the future of the weather satellite programs. Congress has expressed concern about the future of the weather satellite program in annual appropriations bills and accompanying reports and will likely continue to do so for the foreseeable future, as the budget for satellite acquisitions continues to be a major component of overall NOAA annual spending. Furthermore, Congress likely will continue to introduce legislation that would shape NWS operations, directly or indirectly, in an overall effort to improve NWS's ability to provide forecasts and warnings for protection of life and property in the United States.

The mission of the National Weather Service (NWS) is to provide weather forecasts and warnings for the protection of life and property. Apart from the budget for procuring weather satellites, NWS received the most funding (about $1.1 billion) of any office or program within the FY2016 budget for the National Oceanic and Atmospheric Administration (NOAA). The largest fraction of the NWS budget has been devoted to local forecasts and warnings, suggesting that short-term weather prediction and warning is a high priority for NWS and for NOAA, in accord with NOAA's statutory authority. Starting in FY2015, NWS restructured its programs, spreading out the local warning and forecast activities among five separate subprograms. The restructuring makes it difficult to compare funding for local warning and forecast activities prior to FY2015 with funding for forecast and warning activities after FY2014. According to NOAA, the restructuring was "part of a broader effort to align the NWS budget to function and link to performance." Several bills introduced in the 114th Congress would directly or indirectly affect NWS if enacted. Some of the bills focus on single topics, such as increasing the number of NWS-operated Doppler radar stations across the country (e.g., H.R. 3538, H.R. 5089, S. 2058). Other bills would address a broader array of programs within NOAA and NWS (e.g., H.R. 1561, S. 1331, S. 1573). Several bills may affect NWS only indirectly, such as those that would authorize strategies to improve resilience to extreme weather events (e.g., H.R., 2227, H.R. 2804, H.R. 3190). Other bills relate to NOAA weather satellites, which are critical components of NWS's mission to provide weather forecasts and warnings (e.g., S. 1331). Congress has been concerned about possible gaps in coverage and the future of the weather satellite programs. The 114th Congress has expressed its interest in improving forecasts and warnings to protect life and property in the United States from severe weather events through its role in oversight, appropriations, and the authorization of language regarding NWS. To date, none of the bills introduced in the 114th Congress has been enacted. However, Congress likely will continue to introduce legislation in the future that would shape NWS operations, directly or indirectly, in an effort to improve forecasts and warnings.

The Commerce Clause provides that "Congress shall have Power ... To regulate Commerce ... among the several States...." The Supreme Court has long held that the Clause prohibits states from unduly burdening interstate commerce even in the absence of federal regulation. This restriction, known as the dormant or negative Commerce Clause, "reflect[s] a central concern of the Framers" that "the new Union would have to avoid the tendencies toward economic Balkanization that had plagued relations among the Colonies and later among the States under the Articles of Confederation." Thus, the dormant Commerce Clause "prevent[s] a State from retreating into economic isolation or jeopardizing the welfare of the Nation as a whole, as it would do if it were free to place burdens on the flow of commerce across its borders that commerce wholly within those borders would not bear." A further rationale is that out-of-state entities subject to any burden are likely not in a position to use the state's political process to seek relief. The dormant Commerce Clause prohibits state laws that discriminate against interstate commerce. Thus, while a state law that "regulates even-handedly to effectuate a legitimate local public interest" and has "only incidental" effect on interstate commerce is constitutionally permissible "unless the burden imposed on such commerce is clearly excessive in relation to the putative local benefits" ("the Pike test"), a discriminatory state law is "virtually per se invalid." Traditionally, such laws have only been permissible if they meet the high standard of "advanc[ing] a legitimate local purpose that cannot be adequately served by reasonable nondiscriminatory alternatives." It would appear, therefore, that the bond taxing schemes used by almost all of the states, which exempt the interest on state-issued bonds while taxing the interest on other states' bonds, are facially discriminatory and should be subject to a high level of scrutiny. However, a wrinkle to this analysis was added in April 2007 when the Supreme Court decided a case, United Haulers Ass ' n, Inc. v. Oneida-Herkimer Solid Waste Mgmt. Authority , in which a plurality of the Court subjected a facially discriminatory state law to a lower standard of scrutiny because it benefitted a public entity, as opposed to an in-state private entity. The challenged law required trash haulers to deliver waste to a processing facility owned by a public entity. The Court had previously struck down a similar law, but distinguished the two cases because the processing facility in the prior case was privately owned while the United Haulers facility was publicly owned. In United Haulers , the Court found "[c]ompelling reasons" for distinguishing between state laws that favor governmental units and those that favor in-state private entities over their competitors. The Court, stating that "any notion of discrimination assumes a comparison of substantially similar entities," reasoned that state and local governments are not substantially similar to private entities due to their public welfare responsibilities. These responsibilities, the Court explained, meant that laws favoring governmental units have "any number of legitimate goals," while laws favoring in-state private entities generally represent "simple economic protectionism." Thus, the Court reasoned, such laws should not be viewed with "equal skepticism." The Court explained that treating them equally "would lead to unprecedented and unbounded interference by the courts with state and local government," which was particularly inappropriate when the challenged law addressed a traditional government function such as waste disposal. A majority of the Court could not agree on the standard under which to examine laws favoring public entities. A plurality of four justices stated that the proper standard was the Pike test—that is, whether "the burden imposed on interstate commerce is clearly excessive in relation to the putative local benefits." The plurality did not find the challenged law's burden to be excessive to its benefits, which included providing health and environmental benefits and an effective way to finance waste-disposal services. The dormant Commerce Clause is not implicated when a state acts as a market participant as opposed to a market regulator. This is because the "Commerce Clause responds principally to state taxes and regulatory measures impeding free private trade in the national marketplace," and "[t]here is no indication of a constitutional plan to limit the ability of the States themselves to operate freely in the free market." The market participant doctrine does not apply when the state is acting in its governmental capacity by assessing and computing taxes. It appears only two cases have addressed whether state laws taxing interest earned on bonds issued by other states while exempting interest earned on bonds issued by that state violate the Commerce Clause. In 1994, an Ohio appellate court held in Shaper v. Tracy that such treatment was constitutional. In 2006, the Kentucky court of appeals held the opposite in Kentucky Department of Revenue v. Davis . In November 2007, the U.S. Supreme Court heard oral arguments in Davis . In the Shaper case, an Ohio court of appeals rejected the claim made by an Ohio taxpayer that the state's bond taxing scheme was unconstitutional. The court began by agreeing with the taxpayer that the market participant doctrine did not apply because Ohio was acting as a market regulator, and not participant, when it determined how to tax out-of-state bonds. However, the court then ruled that the taxing scheme did not implicate the Commerce Clause because the scheme benefitted the state. The court based this conclusion on its analysis of the Supreme Court's Commerce Clause jurisprudence, which the court found to only involve challenges to state actions giving in-state private entities a competitive advantage over out-of-state entities, and not challenges to state actions benefitting the state itself. The court, while noting that no Supreme Court decision was directly on point, found two cases to be useful. The first was Bonaparte v. Tax Court, in which the Supreme Court determined that a state law exempting state-issued public debt held by residents, while taxing non-residents, did not violate the Full Faith and Credit Clause. The court placed significance on the Supreme Court's statements in Bonaparte that "the Constitution does not prohibit a State from including in the taxable property of her citizens so much of the registered public debt of another State as they respectively hold, although the debtor State may exempt it from taxation or actually tax it" and "[w]e know of no provision of the Constitution of the United States which prohibits such taxation." The second case was South Carolina v. Baker , in which the Supreme Court held that the federal government could tax state-issued bonds. While noting that the tax in Baker was not challenged under the Commerce Clause, the Shaper court quoted the Supreme Court's statement that "[t]he owners of state bonds have no constitutional entitlement not to pay taxes on income they earn from the bonds and States have no constitutional entitlement to issue bonds paying lower interest rates than other issuers." The court, after noting that Ohio had a "legitimate interest in tapping a major source of tax revenue" and bond purchasers are "major beneficiaries" of the public purposes for which the bond proceeds would be used, concluded by stating it could not hold the Ohio law unconstitutional "given the lack of any precedent to apply the Commerce Clause to this type of taxation scheme." In the Davis case, the Kentucky court of appeals held that the state's bond taxing scheme violated the Commerce Clause. The court began by noting that the "'fundamental command' of the Commerce Clause is that 'a State may not tax a transaction or incident more heavily when it crosses state lines than when it occurs entirely within the State,'" and therefore discriminatory state laws were presumptively invalid. Based on this, the court reasoned that "[c]learly, Kentucky's bond taxation system is facially unconstitutional as it obviously affords more favorable taxation treatment to in-state bonds than it does to extraterritorially issued bonds." The court rejected the state's argument that it should adopt the Shaper court's holding, stating that the Shaper analysis was incomplete because "a potentially problematic and constitutionally infirm statute does not become permissible simply because it has not been previously found to be unconstitutional." The court also dismissed the relevance of the Bonaparte decision because it dealt with the Full Faith and Credit Clause and not the Commerce Clause. Finally, the court rejected the argument that Kentucky's taxing scheme did not implicate the dormant Commerce Clause because the state was acting as a market participant, explaining that Kentucy was a market participant when issuing the bonds but a market regulator when choosing how to tax its citizens. The U.S. Supreme Court heard oral arguments in the Davis case on November 5, 2007. A transcript of the oral arguments is available on the Supreme Court's website at http://www.supremecourtus.gov/oral_arguments/argument_transcripts/06-666.pdf . As discussed, the Supreme Court decided United Haulers just prior to granting certiorari in Davis . Under the Court's jurisprudence prior to United Haulers , it seems there was a significant chance that Kentucky's bond taxing scheme would be unconstitutional because it facially discriminates against out-of-state entities, and the Court's jurisprudence suggested that such laws were impermissible unless the state could show the law served a legitimate state purpose and there were no other reasonable ways to advance that purpose. This high level of scrutiny is generally fatal to the challenged state law. The United Haulers decision suggests a different outcome by indicating that a less stringent analysis applies when the state law benefits state and local governments as opposed to in-state private entities. Questions exist about how the Court may apply United Haulers to Davis , in part because only a plurality in United Haulers agreed it was appropriate to use the Pike test in examining the permissibility of state laws benefitting public entities. Furthermore, it is possible the Court will distinguish Davis from United Haulers . One basis for doing so is that the state law in United Haulers benefitted a publicly owned entity over private entities, while the one in Davis benefits states over other states. The Court's analysis in United Haulers was based on its finding that while "any notion of discrimination assumes a comparison of substantially similar entities," governmental units and private entities are not "substantially similar" because the former have public welfare responsibilities not imposed on the latter. Thus, a key question in Davis seems to be whether Kentucky is "substantially similar" to the other states whose bonds it taxes; if so, that could be constitutionally fatal for Kentucky's bond taxing scheme. On the other hand, if the Court does apply an analysis similar to United Haulers in Davis , this suggests that Kentucky's taxing scheme would be constitutionally permissible. Policy concerns, such as a desire to not upset the state bond market and the expectations of bond purchasers, could provide additional justifications for the Court to find the taxing scheme to be constitutional. Congress's authority under the Commerce Clause has been described as plenary and limited only by other constitutional provisions. Congress may, therefore, regulate by expressly authorizing the states to take an action that would otherwise be an unconstitutional burden on interstate commerce. Thus, if the Court were to hold that Kentucky's taxing scheme violates the dormant Commerce Clause, it appears Congress could authorize such tax treatment so long as it did not violate any other constitutional provision.

Most states exempt from state income taxes the interest earned on bonds issued by that particular state and its political subdivisions, while taxing the interest earned on bonds issued by other states and their political subdivisions. Some argue that these state tax schemes violate the Commerce Clause by discriminating against out-of-state bonds. Courts in two states have examined this issue. On November 5, 2007, the U.S. Supreme Court heard oral arguments in one of these cases, Department of Revenue of Kentucky v. Davis.

The United States has an abundance of natural resources. For much of the nation's history, energy availability was not a concern as commerce and industry needs could be met by domestic supplies. However, industrialization and population growth, and the continuing development of a consumer-oriented society, led to growing dependence on foreign sources of energy during the 20 th century to supplement the demands of a growing economy. Recognition of the implications of dependence on foreign sources of energy, coupled with concerns over the volatility of prices driven by fluctuations in supply spurred by world events, prompted federal efforts to increase U.S. energy independence and reduce domestic consumption. A major result has been the establishment of a number of programs focused on energy efficiency and conservation of domestic resources and on research programs that target the development of renewable sources of energy. Many of these programs have roots going back almost 40 years and have been redesigned many times over that period. Many of the current programs have been reauthorized and redesigned periodically to meet changing economic conditions and national interests. The programs apply broadly to sectors ranging from industry to academia, and from state and local governments to rural communities. Each program has been designed to meet current needs as well as future anticipated challenges. Since 2005, Congress has enacted several major energy laws: the Energy Policy Act of 2005 (EPACT 2005; P.L. 109-58 ); the Energy Independence and Security Act of 2007 (EISA; P.L. 110-140 ); the Energy Improvement and Extension Act (EIEA), enacted as Division B of the Emergency Economic Stabilization Act (EESA; P.L. 110-343 ); and the American Recovery and Reinvestment Act (ARRA; P.L. 111-5 ). Each of those laws established, expanded, or modified energy efficiency and renewable energy research, development, demonstration, and deployment (RDD&D) programs. The Department of Energy (DOE) operates the greatest number of efficiency and renewable energy incentive programs. The Department of the Treasury and the Department of Agriculture (USDA) operate several programs. A few programs can also be found among the Departments of the Interior (DOI), Labor (DOL), Housing and Urban Development (HUD), and Veterans Affairs (VA), and the Small Business Administration (SBA). This report outlines current federal programs and provisions providing grants, loans, loan guarantees, and other direct or indirect incentives for energy efficiency, energy conservation, and renewable energy RDD&D. The programs are grouped by administering agency with references to applicable federal agency websites. Incentives are summarized and indexed in the appendixes. Most program descriptions were compiled from authorizing statutes, the U.S. Code, and Administration budget request documents. Other program descriptions and some funding information were compiled from The Database of State Incentives for Renewables and Efficiency (DSIRE), the Assistance Listings (formerly the Catalog of Federal Domestic Assistance or CFDA) housed on the beta.SAM.gov website , and the Energy Star website. Most budgetary figures were compiled from executive agency budget justifications and congressional committee reports. For more information on agriculture-related grant programs, please see CRS Report R43416, Energy Provisions in the 2014 Farm Bill (P.L. 113-79): Status and Funding , by [author name scrubbed]. For more information on programs supporting the development and deployment of alternatives to conventional fuels and engines in transportation, please also see CRS Report R42566, Alternative Fuel and Advanced Vehicle Technology Incentives: A Summary of Federal Programs , by [author name scrubbed] et al. Please note that tax credits for biofuels and vehicles are covered in detail another CRS Report R42566, Alternative Fuel and Advanced Vehicle Technology Incentives: A Summary of Federal Programs , by [author name scrubbed] et al. Cross-Cutting Appendix A. Summary of Federal Renewable Energy and Energy Efficiency Incentives/Index of Programs Appendix B. Index of Programs by Applicant Eligibility and Technology Type Appendix C. Expired Federal Energy Efficiency and Renewable Energy Incentive Programs 1. Assisted Housing Stability and Energy and Green Retrofit Investments Program (Recovery Act Funded) 2. Clean Renewable Energy Bonds (CREBs) 3. Energy Efficiency and Conservation Block Grants Program (EECBG) 4. Energy Efficiency and Renewable Energy Technology Deployment, Demonstration, and Commercialization Grant Program 5. Energy Efficient Appliance Rebate Program (EEARP) 6. Energy Efficient Appliance Tax Credit for Manufacturers 7. New Era Rural Technology Competitive Grants Program 8. Program of Competitive Grants for Worker Training and Placement in High Growth and Emerging Industry Sectors 9. Qualified Energy Conservation Bonds 10 . Qualifying Advanced Energy Manufacturing Investment Tax Credit 11. Renewable Energy Grants (1603 Program) Appendix D. Appendix D. Summary of Expired Federal Renewable Energy and Energy Efficiency Incentives/Index of Programs

Energy is crucial to the operation of a modern industrial and services economy. Concerns about the availability and cost of energy and about environmental impacts of fossil energy use have led to the establishment of a wide variety of federal incentives for renewable energy and energy efficiency. These incentives are aimed at the implementation of renewable energy and energy efficiency measures and the development and commercialization of renewable energy and energy efficiency technologies. Many of the existing energy efficiency and renewable energy programs have authorizations tracing back to the 1970s. Many of the programs have been reauthorized and redesigned repeatedly to meet changing economic factors. The programs apply broadly to sectors ranging from industry to academia, and from state and local governments to rural communities. Since 2005, Congress has enacted several major energy laws: the Energy Policy Act of 2005 (EPACT 2005; P.L. 109-58); the Energy Independence and Security Act of 2007 (EISA; P.L. 110-140); the Energy Improvement and Extension Act (EIEA), enacted as Division B of the Emergency Economic Stabilization Act (EESA; P.L. 110-343); and the American Recovery and Reinvestment Act (ARRA; P.L. 111-5). Each of those laws established, expanded, or modified energy efficiency and renewable energy research, development, demonstration, and deployment (RDD&D) programs. The Department of Energy (DOE) operates the greatest number of efficiency and renewable energy incentive programs. The Department of the Treasury and the Department of Agriculture (USDA) operate several programs. A few programs can also be found among the Departments of the Interior (DOI), Labor (DOL), Housing and Urban Development (HUD), and Veterans Affairs (VA), and the Small Business Administration (SBA). This report describes federal programs that provide grants, loans, loan guarantees, and other direct or indirect incentives for energy efficiency, energy conservation, and renewable energy. For each program, the report provides the administering agency, authorizing statute(s), annual funding, and the program expiration date. The appendixes provide summary information in a tabular format and also list recently expired programs.

The United States Congress is served by a group of young adults known as pages. Pages have been employed since the early Congresses, and some Members of Congress have served as pages. Today, congressional pages include students who are juniors in high school and who may come from all areas of the United States and its territories. The page system is formally provided for in law, although the rationale for the page service or for using high school students is not. Since the earliest accounts of pages, it has been widely noted in debates and writings within Congress that pages provide needed messenger services: From the origin of the present government, in 1789, to the present time, they [messengers] have been under the orders and resolutions of the House, and experience has attested to the necessity of their services. The use of boys or pages, was introduced at a later period; but from the first session of Congress held at the city of Washington [1800], they have continued to be employed by the House, with the approbation of the House. Being a page provides a unique educational opportunity, affording young adults an opportunity to learn about Congress, the legislative process, and to develop workplace and leadership skills. Over the years, there has been concern about having young pages serve Congress. In the 1800s and early 1900s, some House pages were as young as 10 and Senate pages as young as 13. Later, they were as old as 18. At various times, congressional actions related to employing pages have addressed the lack of supervised housing as well as pages' ages, tenure, selection, education, and management. Far-reaching reforms in the page system were implemented in 1982 and 1983, following press reports of insufficient supervision, alleged sexual misconduct, and involvement in the trafficking of drugs on Capitol Hill. Most reports of misbehavior were later found to be unsubstantiated. As a consequence of the allegations, however, both the House and Senate for the first time provided supervised housing for their pages; established separate page schools and took over the education of the pages, which had been provided under contract by the District of Columbia school system; and developed more educational and recreational opportunities for their pages. In the 110 th Congress (2007-2008), at the request of then House Speaker Nancy Pelosi and Republican Leader John Boehner, the House inspector general (IG) conducted an inquiry into the supervision and operation of the House Page Residence Hall, and subsequently issued a confidential report recommending changes. In 2008, an independent study, conducted by consultants to the House, was conducted. In response to the findings of those efforts, the House implemented new policies to enhance the safety and supervision of the pages and oversight of the page program. These changes followed investigations of allegations related to the page program participants, including the exchange of inappropriate communications between a Member of the House and former pages, and of misbehavior by a few pages in the 109 th and 110 th Congresses. A follow up review of the page program was carried out in the summer of 2010 by the same independent consultants. According to House leaders, concerns raised in 2008, including costs and the need for the program, remained. In August 2011, Speaker John Boehner and Democratic Leader Nancy Pelosi announced the termination of the House page program effective August 31. In a Dear Colleague Letter, the leaders cited both changes in technology obviating the need for most page services, and the program's costs as reasons to discontinue the program. In the 112 th Congress, (2011-2012), H.Res. 397 , entitled Reestablishing the House of Representatives Page Program, was introduced by Representative Dan Boren. The resolution would have created an advisory panel to make recommendations for the operation of a reestablished page program. The House page program would have been reestablished in the first school semester after the advisory panel submitted its recommendations to the Committee on House Administration. Membership of the nine-person advisory body would have been composed of three Members of the House from the majority party of the House, three Members of the House from the minority party, and three individuals who were not Members and who had served as House pages. The measure was referred to the Committee on House Administration, and no further action was taken. Pages serve principally as messengers. They carry documents between the House and Senate, Members' offices, committees, and the Library of Congress. They prepare the Senate chamber for each day's business by distributing the Congressional Record and other documents related to the day's agenda, assist in the cloakrooms and chambers; and when Congress is in session, they sit near the dais where they may be summoned by Members for assistance. In the House, pages also previously raised and lowered the flag on the roof of the Capitol. There are 30 Senate page positions, 16 for the majority party and 14 for the minority party. The office of the Sergeant at Arms supervises the Senate page program. The Senate page program consists of four quarters, two academic year sessions and two shorter summer sessions. It is administered by the Senate Sergeant at Arms, the Senate page program director, and the principal of the Senate page school. Senate pages are paid a stipend, and deductions are taken for taxes and residence hall fee, which includes a meal plan. Pages must pay their transportation costs to Washington, DC, but their uniforms are supplied. The uniforms consist of navy blue suits, white shirts, red and blue striped tie, dark socks, and black shoes. The Senate provides its pages education and supervised housing in the Daniel Webster Page Residence near the Hart Senate Office Building. The Senate Page School is located in the lower level of Webster Hall. Pages who serve during the academic year are educated in this school, which is also accredited by the Middle States Association of Colleges and Schools. The junior-year curriculum is geared toward college preparation and emphasis is given to the unique learning opportunities available in Washington, DC. Early morning classes are held prior to the convening of the Senate. The House page program was administered by the Office of the Clerk, under the supervision of the House Page Board. The board, established in statute, is composed of two Members from each party, including the chair, as well as the Clerk and the Sergeant at Arms of the House, a former House page, and the parent of a House page. Participants in the House page program typically served for one academic semester during the school year, or during a summer session. House pages received a stipend for their services, and deductions were taken from their salaries for federal and state taxes, Social Security, and a residence hall fee, which included a meal plan. The pages were required to live in the supervised House Page Dormitory near the Capitol. They were responsible for the cost of their uniforms—navy jackets, dark grey slacks or skirts, long sleeve white shirt, red and blue striped tie, and black shoes—and transportation to and from Washington, DC. During the school year, pages were educated in the House Page School located in the Thomas Jefferson Building of the Library of Congress. The page school, which is accredited by the Middle States Association of Colleges and Schools, offered a junior-year high-school curriculum, college preparatory courses, and extracurricular and weekend activities. Classes were usually held five days a week, commencing at 6:45 a.m., prior to the convening of the House.

For more than 180 years, messengers known as pages have served the United States Congress. Pages must be high school juniors and at least 16 years of age. Several incumbent and former Members of Congress as well as other prominent Americans have served as congressional pages. Senator Daniel Webster appointed the first Senate page in 1829. The first House pages began their service in 1842. Women were first appointed as pages in 1971. In August 2011, House leaders announced the termination of that chamber's page program. Senate pages are appointed and sponsored by Senators for one academic semester of the school year, or for a summer session. The right to appoint pages rotates among Senators pursuant to criteria set by the Senate's leadership. Academic standing is one of the most important criteria used in the final selection of pages. Selection criteria for House pages was similar when the page program operated in that chamber. Prospective Senate pages are advised to contact their Senators to request consideration for a page appointment.

The ADA Amendment Act (ADAAA), P.L. 110-325 , was enacted in 2008 to amend the Americans with Disabilities Act (ADA). The Americans with Disabilities Act (ADA) is a broad civil rights act prohibiting discrimination against individuals with disabilities. As stated in the act, its purpose is "to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities." The ADAAA reiterated this purpose, and also emphasized that it was "reinstating a broad scope of protection" for individuals with disabilities. The threshold issue in any ADA case is whether the individual alleging discrimination is an individual with a disability. Several Supreme Court decisions interpreted the definition of disability, generally limiting its application. Congress responded to these decisions by enacting the ADA Amendments Act, P.L. 110-325 , which rejects the Supreme Court and lower court interpretations and amends the ADA to provide broader coverage. Two of the major changes made by the ADA Amendments Act are to expand the current interpretation of when an impairment substantially limits a major life activity (rejecting the Supreme Court's interpretation in Toyota ), and to require that the determination of whether an impairment substantially limits a major life activity must be made without regard to the use of mitigating measures (rejecting the Supreme Court's decisions in Sutton , Murphy , and Kirkingburg ). On March 25, 2011, the Equal Employment Opportunity Commission (EEOC) issued final regulations implementing the ADA Amendments Act. The ADA Amendments Act defines the term disability with respect to an individual as "(A) a physical or mental impairment that substantially limits one or more of the major life activities of such individual; (B) a record of such an impairment; or (C) being regarded as having such an impairment (as described in paragraph (3))." Paragraph (3) discusses the "regarded as" prong of the definition and provides that an individual is "regarded as" having a disability regardless of whether the impairment limits or is perceived to limit a major life activity, and that the "regarded as" prong does not apply to impairments that are transitory and minor. Although this is essentially the same statutory language as was in the original ADA, P.L. 110-325 contains new rules of construction regarding the definition of disability, which provide that the definition of disability shall be construed in favor of broad coverage to the maximum extent permitted by the terms of the act; the term "substantially limits" shall be interpreted consistently with the findings and purposes of the ADA Amendments Act; an impairment that substantially limits one major life activity need not limit other major life activities to be considered a disability; an impairment that is episodic or in remission is a disability if it would have substantially limited a major life activity when active; and the determination of whether an impairment substantially limits a major life activity shall be made without regard to the ameliorative effects of mitigating measures, except that the ameliorative effects of ordinary eyeglasses or contact lenses shall be considered. The findings of the ADA Amendments Act include statements indicating a determination that the Supreme Court decisions in Sutton and Toyota as well as lower court cases had narrowed and limited the ADA from what was originally intended by Congress. P.L. 110-325 specifically states that the then-current Equal Employment Opportunity Commission (EEOC) regulations defining the term "substantially limits" as "significantly restricted" are "inconsistent with congressional intent, by expressing too high a standard." The EEOC issued final ADAAA regulations on March 25, 2011, which will become effective on May 24, 2011. Proposed regulations were published in the Federal Register on September 23, 2009, and the EEOC received over 600 comments and held a series of "Town Hall Listening Sessions." In general, the final regulations streamlined the organization of the proposed regulations, and moved many examples from the regulation to the appendix. The EEOC notes that the appendix will be published in the Code of Federal Regulations (CFR), and "will continue to represent the Commission's interpretation of the issues discussed in the regulations, and the Commission will be guided by it when resolving charges of employment discrimination under the ADA." The final regulations track the statutory language of the ADA but also provide several clarifying interpretations. Several of the major regulatory interpretations are as follows: including the operation of major bodily functions in the definition of major life activities; adding rules of construction for when an impairment substantially limits a major life activity, and providing examples of impairments that will most often be found to substantially limit a major life activity; interpreting the coverage of transitory impairments; interpreting the use of mitigating measures; and interpreting the "regarded as" prong of the definition. The first prong of the statutory definition of disability, referred to by EEOC as "actual disability," provides that an individual with "a physical or mental impairment that substantially limits one or more of the major life activities of such individual" is an individual with a disability. The final regulations provide a list of examples of major life activities. In addition to those listed in the statute (caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, and working), the EEOC includes sitting, reaching, and interacting with others. Major life activities also include major bodily functions. In addition to the statutory examples (functions of the immune system, normal cell growth, digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine, and reproductive functions), the EEOC includes special sense organs, genitourinary, cardiovascular, hemic, lymphatic and musculoskeletal. The final regulations also provide that the operation of a major bodily function includes the operation of an individual organ within a body system. The EEOC emphasizes that the ADAAA requires an individualized assessment but notes that because of the statute's requirement for broad coverage, some impairments will almost always be determined to be a disability. The final regulations list impairments that fall within this category. They include deafness, blindness, an intellectual disability, missing limbs or mobility impairments requiring the use of a wheelchair, autism, cancer, cerebral palsy, diabetes, epilepsy, HIV infection, multiple sclerosis, muscular dystrophy, major depressive disorder, bipolar disorder, post-traumatic stress disorder, obsessive compulsive disorder, and schizophrenia. In addition, the EEOC provides that the focus when considering whether an activity is a major life activity should be on "how a major life is substantially limited, and not on what outcomes an individual can achieve." For example, the EEOC noted that an individual with a learning disability my achieve a high level of academic success but may be substantially limited in the major life activity of learning. The final regulations provide rules of construction to assist in determining whether an impairment substantially limits an individual in a major life activity. Generally, the regulations provide that not every impairment is a disability but an impairment does not have to prevent or severely limit a major life activity to be considered substantially limiting. The term substantially limits is to be broadly construed to provide expansive coverage, and requires an individualized determination. The ADAAA specifically provides that an impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active. In its appendix to the regulations, the EEOC states that "[t]he fact that the periods during which an episodic impairments is active and substantially limits a major life activity may be brief or occur infrequently is no longer relevant to determining whether an impairment substantially limits a major life activity." For example, the EEOC notes that an individual with post-traumatic stress disorder who has intermittent flashbacks is substantially limited in brain function and thinking. A mitigating measure, for example, a wheelchair or medication, eliminates or reduces the symptoms or impact of an impairment. The ADAAA provided that when determining when an impairment substantially limits a major life activity, the ameliorative effects of mitigating measures shall not be used. However, ordinary eyeglasses and contact lenses may be considered. The EEOC final regulations track the statutory language, and also provide that the negative side effects of a mitigating measure may be taken into account in determining whether an individual is an individual with a disability. Although the EEOC would not allow a covered entity to require the use of a mitigating measure, if an individual does not use a mitigating measure, this may affect whether an individual is qualified for a job or poses a direct threat. The third prong of the statutory definition of disability is "being regarded as having an impairment." The ADAAA further describes being regarded as having an impairment by stating that an individual meets this prong of the definition "if the individual establishes that he or she has been subjected to an action prohibited under this Act because of an actual or perceived physical or mental impairment whether or not the impairment limits or is perceived to limit a major life activity." The statute also provides that the "regarded as" prong does not apply to transitory or minor impairments, and a transitory impairment is defined as an impairment with an actual or expected duration of six months or less. The EEOC final regulations echo the statutory language, and encourage the use of the "regarded as" prong when reasonable accommodation is not at issue. The EEOC emphasizes that even if an individual is regarded as having a disability, there is no violation of the ADA unless a covered entity takes a prohibited action, such as not hiring a qualified individual because he or she is regarded as having a disability. A covered entity may challenge a claim under the "regarded as" prong by showing that the impairment is both transitory and minor, or by showing that the individual is not qualified or would pose a direct threat. However, it should be noted that the defense that an impairment is transitory and minor is only available under the "regarded as" prong. The rules of construction discussed previously concerning the first or actual prong specifically state that the effects of an impairment lasting fewer than six months can be substantially limiting.

The ADA Amendment Act (ADAAA), P.L. 110-325, was enacted in 2008 to amend the Americans with Disabilities Act (ADA) definition of disability. On March 25, 2011, the Equal Employment Opportunity Commission (EEOC) issued final regulations implementing the ADAAA. The final regulations track the statutory language of the ADA but also provide several clarifying interpretations. Several of the major regulatory interpretations are, including the operation of major bodily functions in the definition of major life activities; adding rules of construction for when an impairment substantially limits a major life activity and providing examples of impairments that will most often be found to substantially limit a major life activity; interpreting the coverage of transitory impairments; interpreting the use of mitigating measures; and interpreting the "regarded as" prong of the definition.

The Marine Protection, Research, and Sanctuaries Act of 1972 (MPRSA, P.L. 92-532) has two basic aims: to regulate intentional ocean disposal of materials, and to authorize related research. Title I of the act, which is often referred to as the Ocean Dumping Act, contains permit and enforcement provisions for ocean dumping. Research provisions are contained in Title II; Title IV authorizes a regional marine research program; and Title V addresses coastal water quality monitoring. The third title of the MPRSA, which authorizes the establishment of marine sanctuaries, is not addressed here. This report presents a summary of the law, describing the essence of the statute. It is an excerpt from a larger document, CRS Report RL30798, Environmental Laws: Summaries of Major Statutes Administered by the Environmental Protection Agency . Descriptions of many details and secondary provisions are omitted here, and even some major components are only briefly mentioned. Further, this report describes the statute, but does not discuss its implementation. Table 1 shows the original enactment and subsequent amendments. Table 2 , at the end of this report, cites the major U.S. Code sections of the codified statute. The nature of marine pollution requires that it be regulated internationally, since once a pollutant enters marine waters, it knows no boundary. Thus, a series of regional treaties and conventions pertaining to local marine pollution problems and more comprehensive international conventions providing uniform standards to control worldwide marine pollution has evolved over the last 40 years. At the same time that key international protocols were being adopted and ratified by countries worldwide (in the early 1970s), the United States enacted the MPRSA to regulate disposal of wastes in marine waters that are within U.S. jurisdiction. It implements the requirements of the London Convention, which is the international treaty governing ocean dumping. The MPRSA requires the Environmental Protection Agency (EPA) Administrator, to the extent possible, to apply the standards and criteria binding upon the United States that are stated in the London Dumping Convention. This convention, signed by more than 85 countries, includes annexes that prohibit the dumping of mercury, cadmium, and other substances such as DDT and PCBs, solid wastes and persistent plastics, oil, high-level radioactive wastes, and chemical and biological warfare agents; and requires special permits for other heavy metals, cyanides and fluorides, and medium- and low-level radioactive wastes. The MPRSA uses a comprehensive and uniform waste management system to regulate disposal or dumping of all materials into ocean waters. Prior to 1972, U.S. marine waters had been used extensively as a convenient alternative to land-based sites for the disposal of various wastes such as sewage sludge, industrial wastes, and pipeline discharges and runoff. The basic provisions of the act have remained virtually unchanged since 1972, but many new authorities have been added. These newer parts include (1) research responsibilities for EPA; (2) specific direction that EPA phase out the disposal of "harmful" sewage sludges and industrial wastes; (3) a ban on the ocean disposal of sewage sludge and industrial wastes by December 31, 1991; (4) inclusion of Long Island Sound within the purview of the act; and (5) inclusion of medical waste provisions. Authorizations for appropriations to support provisions of the law expired at the end of FY1997 (September 30, 1997). Authorities did not lapse, however, and Congress has continued to appropriate funds to carry out the act. Four federal agencies have responsibilities under the Ocean Dumping Act: EPA, the U.S. Army Corps of Engineers, the National Oceanic and Atmospheric Administration (NOAA), and the Coast Guard. EPA has primary authority for regulating ocean disposal of all substances except dredged spoils, which are under the authority of the Corps of Engineers. NOAA is responsible for long-range research on the effects of human-induced changes to the marine environment, while EPA is authorized to carry out research and demonstration activities related to phasing out sewage sludge and industrial waste dumping. The Coast Guard is charged with maintaining surveillance of ocean dumping. Title I of the MPRSA prohibits all ocean dumping, except that allowed by permits, in any ocean waters under U.S. jurisdiction, by any U.S. vessel, or by any vessel sailing from a U.S. port. Certain materials, such as high-level radioactive waste, chemical and biological warfare agents, medical waste, sewage sludge, and industrial waste, may not be dumped in the ocean. Permits for dumping of other materials, except dredge spoils, can be issued by the EPA after notice and opportunity for public hearings where the Administrator determines that such dumping will not unreasonably degrade or endanger human health, welfare, the marine environment, ecological systems, or economic potentialities. The law regulates ocean dumping within the area extending 12 nautical miles seaward from the U.S. baseline and regulates transport of material by U.S.-flagged vessels for dumping into ocean waters. EPA designates sites for ocean dumping and specifies in each permit where the material is to be disposed. EPA is required to prepare an annual report of ocean dumping permits for material other than dredged material. In 1977, Congress amended the act to require that dumping of municipal sewage sludge or industrial wastes that unreasonably degrade the environment cease by December 1981. (However, that deadline was not achieved, and amendments passed in 1988 extended the deadline to December 1991.) In 1986, Congress directed that ocean disposal of all wastes cease at the traditional 12-mile site off the New York/New Jersey coast (that is, it barred issuance of permits at the 12-mile site) and directed that disposal be moved to a new site 106 miles offshore. In 1988, Congress enacted several laws amending the Ocean Dumping Act, with particular emphasis on phasing out sewage sludge and industrial waste disposal in the ocean, which continued despite earlier legislative efforts. In 1992, Congress amended the act to permit states to adopt ocean dumping standards more stringent than federal standards and to require that permits conform with long-term management plans for designated dumpsites, to ensure that permitted activities are consistent with expected uses of the site. Virtually all ocean dumping that occurs today is dredged material, sediments removed from the bottom of waterbodies in order to maintain navigation channels and port berthing areas. Other materials that are dumped include vessels, fish wastes, and human remains. The Corps of Engineers issues permits for ocean dumping of dredged material, using EPA's environmental criteria and subject to EPA's concurrence. The bulk of dredged material disposal results from maintenance dredging by the Corps itself or its contractors. According to data from the Corps, amounts of dredged material sediment that are disposed each year at designated ocean sites fluctuate, averaging in recent years about 47 million cubic yards. Before sediments can be permitted to be dumped in the ocean, they are evaluated to ensure that the dumping will not cause significant harmful effects to human health or the marine environment. EPA is responsible for developing criteria to ensure that the ocean disposal of dredge spoils does not cause environmental harm. Permits for ocean disposal of dredged material are to be based on the same criteria utilized by EPA under other provisions of the act, and to the extent possible, EPA-recommended dumping sites are used. Where the only feasible disposition of dredged material would violate the dumping criteria, the Corps can request an EPA waiver. Amendments to MPRSA enacted in 1992 expanded EPA's role in permitting of dredged material by authorizing EPA to impose permit conditions or even deny a permit, if necessary to prevent environmental harm to marine waters. Permits issued under the Ocean Dumping Act specify the type of material to be disposed, the amount to be transported for dumping, the location of the dumpsite, the length of time the permit is valid, and special provisions for surveillance. The EPA Administrator can require a permit applicant to provide information necessary for the review and evaluation of the application. In addition to issuing individual permits for non-dredged material, EPA has issued general permits under the MPRSA for several types of disposal activities, such as burial at sea of human remains, transportation and disposal of vessels, and disposal of manmade ice piers in Antarctica. The act authorizes EPA to assess civil penalties of not more than $50,000 for each violation of a permit or permit requirement, taking into account such factors as gravity of the violation, prior violations, and demonstrations of good faith; however, no penalty can be assessed until after notice and opportunity for a hearing. Criminal penalties (including seizure and forfeiture of vessels) for knowing violations of the act also are authorized. In addition, the act authorizes penalties for ocean dumping of medical wastes (civil penalties up to $125,000 for each violation and criminal penalties up to $250,000, five years in prison, or both). The Coast Guard is directed to conduct surveillance and other appropriate enforcement activities to prevent unlawful transportation of material for dumping, or unlawful dumping. Like many other federal environmental laws, the Ocean Dumping Act allows individuals to bring a citizen suit in U.S. district court against any person, including the United States, for violation of a permit or other prohibition, limitation, or criterion issued under Title I of the act. In conjunction with the Ocean Dumping Act, the Clean Water Act (CWA) regulates all discharges into navigable waters including the territorial seas. Although these two laws overlap in their coverage of dumping from vessels within the territorial seas, any question of conflict is essentially moot because EPA has promulgated a uniform set of standards (40 CFR Parts 220-229). The Ocean Dumping Act preempts the CWA in coastal waters or open oceans, and the CWA controls in estuaries. States are permitted to regulate ocean dumping in waters within their jurisdiction under certain circumstances. Title II of the MPRSA authorizes two types of research: general research on ocean resources, under the jurisdiction of NOAA; and EPA research related to phasing out ocean disposal activities. NOAA is directed to carry out a comprehensive, long-term research program on the effects not only of ocean dumping, but also of pollution, overfishing, and other human-induced changes on the marine ecosystem. Additionally, NOAA assesses damages from spills of petroleum and petroleum products. EPA's research role includes "research, investigations, experiments, training, demonstrations, surveys, and studies" to minimize or end the dumping of sewage sludge and industrial wastes, along with research on alternatives to ocean disposal. Amendments in 1980 required EPA to study technological options for removing heavy metals and certain organic materials from New York City's sewage sludge. Title IV of the MPRSA established nine regional marine research boards for the purpose of developing comprehensive marine research plans, considering water quality and ecosystem conditions and research and monitoring priorities and objectives in each region. The plans, after approval by NOAA and EPA, are to guide NOAA in awarding research grant funds under this title of the act. Title V of the MPRSA established a national coastal water quality monitoring program. It directs EPA and NOAA jointly to implement a long-term program to collect and analyze scientific data on the environmental quality of coastal ecosystems, including ambient water quality, health and quality of living resources, sources of environmental degradation, and data on trends. Results of these activities (including intensive monitoring of key coastal waters) are intended to provide information necessary to design and implement effective programs under the Clean Water Act and Coastal Zone Management Act.

The Marine Protection, Research, and Sanctuaries Act (MPRSA) has two basic aims: to regulate intentional ocean disposal of materials, and to authorize related research. Permit and enforcement provisions of the law are often referred to as the Ocean Dumping Act. The basic provisions of the act have remained virtually unchanged since 1972, when it was enacted to establish a comprehensive waste management system to regulate disposal or dumping of all materials into marine waters that are within U.S. jurisdiction, although a number of new authorities have been added. This report presents a summary of the law. Four federal agencies have responsibilities under the Ocean Dumping Act: the Environmental Protection Agency (EPA), the U.S. Army Corps of Engineers, the National Oceanic and Atmospheric Administration (NOAA), and the Coast Guard. EPA has primary authority for regulating ocean disposal of all substances except dredged spoils, which are under the authority of the Corps of Engineers. NOAA is responsible for long-range research on the effects of human-induced changes to the marine environment, while EPA is authorized to carry out research and demonstration activities related to phasing out sewage sludge and industrial waste dumping. The Coast Guard is charged with maintaining surveillance of ocean dumping. Title I of the MPRSA prohibits all ocean dumping, except that allowed by permits, in any ocean waters under U.S. jurisdiction, by any U.S. vessel, or by any vessel sailing from a U.S. port. Certain materials, such as high-level radioactive waste, chemical and biological warfare agents, medical waste, sewage sludge, and industrial waste, may not be dumped in the ocean. Permits for dumping of other materials, except dredge spoils, can be issued by the EPA after notice and opportunity for public hearings where the Administrator determines that such dumping will not unreasonably degrade or endanger human health, welfare, the marine environment, ecological systems, or economic potentialities. Permits specify the type of material to be disposed, the amount to be transported for dumping, the location of the dumpsite, the length of time the permit is valid, and special provisions for surveillance. The law regulates ocean dumping within the area extending 12 nautical miles seaward from the U.S. baseline and regulates transport of material by U.S.-flagged vessels for dumping into ocean waters. EPA designates sites for ocean dumping and specifies in each permit where the material is to be disposed. Title II of the MPRSA authorizes two types of research: general research on ocean resources, under the jurisdiction of NOAA; and EPA research related to phasing out ocean disposal activities. NOAA is directed to carry out a comprehensive, long-term research program on the effects not only of ocean dumping, but also of pollution, overfishing, and other human-induced changes on the marine ecosystem. EPA's research role includes "research, investigations, experiments, training, demonstrations, surveys, and studies" to minimize or end the dumping of sewage sludge and industrial wastes, along with research on alternatives to ocean disposal. (Title III, concerning marine sanctuaries, is not discussed in this report.) Title IV of the MPRSA established nine regional marine research boards for the purpose of developing comprehensive marine research plans, considering water quality and ecosystem conditions and research and monitoring priorities and objectives in each region. Title V of the MPRSA established a national coastal water quality monitoring program. It directs EPA and NOAA jointly to implement a long-term program to collect and analyze scientific data on the environmental quality of coastal ecosystems, including ambient water quality, health and quality of living resources, sources of environmental degradation, and data on trends.

The President is responsible for appointing individuals to positions throughout the federal government. In some instances, the President makes these appointments using authorities granted by law to the President alone. Other appointments are made with the advice and consent of the Senate via the nomination and confirmation of appointees. Presidential appointments with Senate confirmation are often referred to with the abbreviation PAS. This report identifies, for the 114 th Congress, all nominations to full-time positions requiring Senate confirmation in 40 organizations in the executive branch (27 independent agencies, 6 agencies in the Executive Office of the President [EOP], and 7 multilateral organizations) and 4 agencies in the legislative branch. It excludes appointments to executive departments and to regulatory and other boards and commissions, which are covered in other Congressional Research Service (CRS) reports. Information for this report was compiled using the Legislative Information System (LIS) Senate nominations database at http://www.lis.gov/nomis , the Congressional Record (daily edition), the Weekly Compilation of Presidential Documents , telephone discussions with agency officials, agency websites, the United States Code , and the 2016 Plum Book ( United States Government Policy and Supporting Positions ). Related CRS reports regarding the presidential appointments process, nomination activity for other executive branch positions, recess appointments, and other appointment-related matters may be found at http://www.crs.gov . During the 114 th Congress, President Barack Obama submitted 43 nominations to the Senate for full-time positions in independent agencies, agencies in the EOP, multilateral agencies, and legislative branch agencies. Of these nominations, 22 were confirmed, 16 were returned to the President, and 5 were withdrawn. Table 1 summarizes the appointment activity. The length of time a given nomination may be pending in the Senate varies widely. Some nominations are confirmed within a few days, others are not confirmed for several months, and some are never confirmed. This report provides, for each agency nomination confirmed in the 114 th Congress, the number of days between nomination and confirmation ("days to confirm"). Under Senate Rules, nominations not acted on by the Senate at the end of a session of Congress (or before a recess of 30 days) are returned to the President. The Senate, by unanimous consent, often waives this rule—although not always. In the case of nominations that are returned to the President and resubmitted, this report measures the days to confirm from the date of receipt of the resubmitted nomination, not the original. For agency nominations confirmed in the 114 th Congress, a mean of 174.1 days elapsed between nomination and confirmation. The median number of days elapsed was 152.0. Agency profiles in this report are organized in two parts. The first table lists the titles and pay levels of all the agency's full-time PAS positions as of the end of the 114 th Congress. For most presidentially appointed positions requiring Senate confirmation, pay levels fall under the Executive Schedule. As of the end of the 114 th Congress, these pay levels range from level I ($205,700) for Cabinet-level offices to level V ($150,200) for lower-ranked positions. The second table lists appointment action for vacant positions during the 114 th Congress in chronological order. This table provides the name of the nominee, position title, date of nomination or appointment, date of confirmation, and number of days between receipt of a nomination and confirmation, and notes relevant actions other than confirmation (e.g., nominations returned to or withdrawn by the President). When more than one nominee has had appointment action, the second table also provides statistics on the length of time between nomination and confirmation. The average days to confirm are provided in two ways: mean and median. The mean is a more familiar measure, though it may be influenced by outliers in the data. The median, by contrast, does not tend to be influenced by outliers. In other words, a nomination that took an extraordinarily long time to be confirmed might cause a significant change in the mean, but the median would be unaffected. Examining both numbers offers more information with which to assess the central tendency of the data. Appendix A provides two tables. Table A-1 relists all appointment action identified in this report and is organized alphabetically by the appointee's last name. Table entries identify the agency to which each individual was appointed, position title, nomination date, date confirmed or other final action, and duration count for confirmed nominations. In the final two rows, the table includes the mean and median values for the "days to confirm" column. Table A-2 provides summary data from the appointments identified in this report and is organized by agency type, including independent executive agencies, agencies in the EOP, multilateral organizations, and agencies in the legislative branch. The table summarizes the number of positions, nominations submitted, individual nominees, confirmations, nominations returned, and nominations withdrawn for each agency grouping. It also includes mean and median values for the number of days taken to confirm nominations in each category. Appendix B provides a list of department abbreviations. Appendix A. Summary of All Nominations and Appointments to Independent and Other Agencies Appendix B. Agency Abbreviations

The President makes appointments to positions within the federal government, either using the authorities granted by law to the President alone or with the advice and consent of the Senate. This report identifies all nominations during the 114th Congress that were submitted to the Senate for full-time positions in 40 organizations in the executive branch (27 independent agencies, 6 agencies in the Executive Office of the President [EOP], and 7 multilateral organizations) and 4 agencies in the legislative branch. It excludes appointments to executive departments and to regulatory and other boards and commissions, which are covered in other Congressional Research Service (CRS) reports. Information for each agency is presented in tables. The tables include full-time positions confirmed by the Senate, pay levels for these positions, and appointment action within each agency. Additional summary information across all agencies covered in the report appears in an appendix. During the 114th Congress, the President submitted 43 nominations to the Senate for full-time positions in independent agencies, agencies in the EOP, multilateral agencies, and legislative branch agencies. Of these 43 nominations, 22 were confirmed, 5 were withdrawn, and 16 were returned to him in accordance with Senate rules. For those nominations that were confirmed, a mean (average) of 174.1 days elapsed between nomination and confirmation. The median number of days elapsed was 152.0. Information for this report was compiled using the Legislative Information System (LIS) Senate nominations database at http://www.lis.gov/nomis, the Congressional Record (daily edition), the Weekly Compilation of Presidential Documents, telephone discussions with agency officials, agency websites, the United States Code, and the 2016 Plum Book (United States Government Policy and Supporting Positions). This report will not be updated.

The number of foreign-born people residing in the United States (37 million) is at the highest level in our history and has reached a proportion of the U.S. population (12.4%) not seen since the early 20 th century. Of the foreign-born residents in the United States, approximately one-third are naturalized citizens, one-third are legal permanent residents, and one-third are unauthorized (illegal) residents. There is a broad-based consensus that the U.S. immigration system, based upon the Immigration and Nationality Act (INA), is broken. This consensus erodes, however, as soon as the options to reform the U.S. immigration system are debated. The 110 th Congress is faced with a strategic question of whether to continue to build on incremental reforms of specific elements of immigration (e.g., border security, employment verification, temporary workers, or alien children) or whether to comprehensively reform the INA. While it appears that bipartisan as well as bicameral agreement on specific revisions to the INA may be achievable, it is also clear that many think a comprehensive overhaul of the INA is overdue and necessary. President George W. Bush has stated that comprehensive immigration reform is a top priority of his second term, and his principles of reform include increased border security and enforcement of immigration laws within the interior of the United States, as well as a major overhaul of temporary worker visas, expansion of permanent legal immigration, and revisions to the process of determining whether foreign workers are needed. Some in the Bush Administration reportedly advocated to replace or supplement the current legal immigration preference system with a point system that would assign prospective immigrants with credits if they have specified attributes (e.g., educational attainment, work experience, language proficiency). The thorniest of these immigration issues remains the treatment of unauthorized aliens in the United States. Future debates will reflect the divergent views on how to address the more than 12 million illegal alien population, as well as what the level of future permanent immigration should be. The policy issues for Congress are twofold: whether and how to reform the nation's legal immigration system; and whether border security and interior enforcement provisions—as well as the resources of the immigration agencies charged with the administration and enforcement of immigration laws—are sufficient to implement comprehensive immigration reform. Immigration enforcement encompasses an array of legal tools, policies, and practices to prevent and investigate violations of immigration laws. The spectrum of enforcement issues ranges from visa policy at consular posts abroad and border security along the country's perimeter, to the apprehension, detention, and removal of unauthorized aliens in the interior of the country. Illustrative among these issues likely to arise in the 110 th Congress are border security, worksite enforcement, alien smuggling, and the role of state and local law enforcement. Border security involves securing the many means by which people and goods enter the country. Operationally, this means controlling the official ports of entry through which legitimate travelers and commerce enter the country, and patrolling the nation's land and maritime borders to interdict illegal entries. In recent years, Congress has passed a series of provisions aimed at strengthening immigration-related border security. Whether additional changes are needed to further control the border remains a question. For two decades it has been unlawful for an employer to knowingly hire, recruit or refer for a fee, or continue to employ an alien who is not authorized to be so employed. The large and growing number of unauthorized aliens in the United States, the majority of whom are in the labor force, have led many to criticize the adequacy of the current worksite enforcement measures. Efforts to strengthen worksite enforcement, however, are sometimes met by opposition of increased bureaucratic burdens for employers and fears that more stringent penalties may inadvertently foster discrimination against legal workers with foreign appearances. Many contend that the smuggling of aliens into the United States constitutes a significant risk to national security and public safety. Since smugglers facilitate the illegal entry of persons into the United States, some maintain that terrorists may use existing smuggling routes, methods, and organizations to enter undetected. In addition to generating billions of dollars in revenues for criminal enterprises, alien smuggling can lead to collateral crimes including kidnaping, homicide, high speed flight, identity theft, and the manufacturing and distribution of fraudulent documents. Past efforts to tighten laws on alien smuggling, however, sparked opposition from religious and humanitarian groups who asserted that the forms of relief and assistance that they may provide to aliens might be deemed as the facilitation of alien smuggling. There are ongoing questions about the adequacy of the resources given to the agencies charged with the administration and enforcement of immigration laws. Concerns have been raised that increased funding has been directed to border enforcement in recent years, while interior enforcement resources have not reached sufficient levels. For example, some contend that decisions on which aliens to release from detention and when to release the aliens may be based on availability of detention space, not on the merits of individual cases, and that DHS Immigration and Customs Enforcement (ICE) does not have enough detention space to house all those who should be detained. The debate is also likely to continue over whether DHS has adequate resources to fulfill its border security mission. Notwithstanding an increase in ICE agents, many maintain that the number is still insufficient in the interior of the country. As a result, some recommend that state and local law enforcement be more engaged in enforcing immigration laws. Others question whether state and local law enforcement officers possess adequate authority to enforce all immigration laws—that is, both civil violations (e.g., lack of legal status, which may lead to removal through an administrative system) and criminal punishments (e.g., alien smuggling, which is prosecuted in the courts). Whether state and local law enforcement agencies have sufficient resources and immigration expertise as well as whether state and local funds should be used to enforce federal immigration law are also controversial. The challenge inherent in this policy issue is balancing employers' hopes to increase the supply of legally present foreign workers, families' longing to reunite and live together, and a widely-shared wish among the stakeholders to improve the policies governing legal immigration into the country. The scope of this issue includes temporary admissions (e.g., guest workers, foreign students), permanent admissions (e.g. employment-based, family-based), and legalization and status adjustment for aliens not currently eligible for legal status. Four major principles underlie current U.S. policy on permanent immigration: the reunification of families, the admission of immigrants with needed skills, the protection of refugees, and the diversity of admissions by country of origin. The INA specifies a complex set of numerical limits and preference categories that give priorities for permanent immigration reflecting these principles. Legal permanent residents (LPRs) refer to foreign nationals who live lawfully and permanently in the United States. During FY2005, a total of 1.1 million aliens became LPRs in the United States. Of this total, 57.8% entered on the basis of family ties. Other major categories in FY2005 were employment-based LPRs (including spouses and children) at 22.0%, and refugees/asylees adjusting to LPR status at 12.7%. A variety of constituencies are advocating a substantial increase in legal immigration and perhaps a significant reallocation between these visa categories. The desire for higher levels of employment-based immigration is complicated by the significant backlogs in family-based immigration due to the sheer volume of aliens eligible to immigrate to the United States. Citizens and LPRs often wait years for the relatives' petitions to be processed and visa numbers to become available. Meanwhile, others question whether the United States can accommodate higher levels of immigration and frequently cite the costs borne by local communities faced with increases in educational expenses, emergency medical care, human services, and infrastructure expansion, which are sparked by population growth. The INA provides for the temporary admission of various categories of foreign nationals, who are known as nonimmigrants. Nonimmigrants are admitted for a temporary period of time and a specific purpose. They include a wide range of visitors, including tourists, students, and temporary workers. Among the temporary worker provisions are the H-1B visa for professional specialty workers, the H-2A visa for agricultural workers, and the H-2B visa for nonagricultural workers. Foreign nationals also may be temporarily admitted to the United States for employment-related purposes under other categories, including the B-1 visa for business visitors, the E visa for treaty traders and investors, and the L-1 visa for intracompany transfers. Many business people express concern that a scarcity of labor in certain sectors may curtail the pace of economic growth. A leading legislative response to skills mismatches and labor shortages is to increase the supply of temporary foreign workers. While the demand for more skilled and highly-trained foreign workers garners much of the attention, there is also pressure to increase unskilled temporary foreign workers, commonly referred to as guest workers. Those opposing increases in temporary workers assert that there is no compelling evidence of labor shortages. Opponents maintain that salaries and compensation would be rising if there is a labor shortage and if employers wanted to attract qualified U.S. workers. Some allege that employers prefer guest workers because they are less demanding in terms of wages and working conditions, and that expanding guest worker visas would have a deleterious effect on U.S. workers. The debate over comprehensive immigration reform is further complicated by proposals to enable unauthorized aliens residing in the United States to become LPRs (e.g., "amnesty," cancellation of removal, or earned legalization). These options generally require the unauthorized aliens to meet specified conditions and terms as well as pay penalty fees. Proposed requirements include documenting physical presence in the United States over a specified period; demonstrating employment for specified periods; showing payment of income taxes; or leaving the United States to obtain the legal status. Using a point system that credits aliens with equities in the United States (e.g., work history, tax records, and family ties) would be another possible avenue. A corollary option would be guest worker visas tailored for unauthorized aliens in the United States. There are also options (commonly referred to as the DREAM Act) that would enable some unauthorized alien students to become LPRs through an immigration procedure known as cancellation of removal. The policy question here is how to establish an appropriate balance among the goals of protecting vulnerable and displaced people, maintaining homeland security, and minimizing the abuse of humanitarian policies. Specific topics include refugee admissions and resettlement, asylum reform, temporary protected status, unaccompanied alien children, victims of trafficking and torture, and other humanitarian relief from removal. The scope of rights, privileges, benefits, and duties possessed by aliens in the United States is likely to be a significant issue in the 110 th Congress. The degree to which such persons should be accorded certain rights and privileges as a result of their presence in the United States, along with the duties owed by such aliens given their legal status, remains the subject of intense debate. Specific policy areas include due process rights, tax liabilities, military service, eligibility for federal assistance, educational opportunities, and pathways to citizenship. During the 109 th Congress, both chambers passed major overhauls of immigration law but did not reach agreement on a comprehensive reform package. In December 2005, the House passed H.R. 4437 , the Border Protection, Antiterrorism, and Illegal Immigration Control Act of 2005, which had provisions on border security; the role of state and local law enforcement in immigration enforcement; employment eligibility verification; and worksite enforcement, smuggling, detention, and other enforcement-related issues. H.R. 4437 also contained provisions on unlawful presence, voluntary departure, and removal. In May 2006, the Senate passed S. 2611 , the Comprehensive Immigration Reform Act of 2006, which combined provisions on enforcement and on unlawful presence, voluntary departure, and removal with reform of legal immigration. These revisions to legal immigration would have included expanded guest worker visas and increased legal permanent admissions. S. 2611 also would have enabled certain groups of unauthorized aliens in the United States to become LPRs if they paid penalty fees and met a set of other requirements. Senate action on comprehensive immigration reform legislation stalled at the end of June 2007 after several weeks of intensive debate. The bipartisan compromise was negotiated with Bush Administration officials and introduced in the Senate on May 21, 2007. The bill includes provisions aimed at strengthening employment eligibility verification and interior immigration enforcement, as well increasing border security. It would substantially revise legal immigration with a point system and expanded temporary worker programs. Unauthorized aliens in the United States would be able to become LPRs if they meet certain requirements, pay penalty fees, and meet other requirements. A modified version of that compromise ( S. 1639 ) was introduced June 18, 2007, but failed a key cloture vote on June 28, 2007. The House Judiciary Subcommittee on Immigration, Citizenship, Refugees, Border Security, and International Law held multiple hearings weekly in April, May, and June on various aspects of comprehensive immigration reform.

U.S. immigration policy is a highly contentious issue in the 110th Congress. The number of foreign-born people residing in the United States is at the highest level in U.S. history and has reached a proportion of the U.S. population not seen since the early 20th century. There is a broad-based consensus that the U.S. immigration system is broken. This consensus erodes, however, as soon as the options to reform the U.S. immigration system are debated. Senate action on comprehensive immigration reform legislation stalled at the end of June 2007 after several weeks of intensive debate. This report synthesizes the major elements of immigration reform in the 110th Congress and provides references to other CRS reports that fully analyze these legislative elements. It will be updated as needed.

We substantiated the allegation of gross mismanagement of property at IHS. Specifically, we found that thousands of computers and other property, worth millions of dollars, have been lost or stolen over the past several years. We analyzed IHS reports for headquarters and the 12 regions from the last 4 fiscal years. These reports identified over 5,000 property items, worth about $15.8 million, that were lost or stolen from IHS headquarters and field offices throughout the country. The number and dollar value of this missing property is likely much higher because IHS did not conduct full inventories of accountable property for all of its locations and did not provide us with all inventory documents as requested. Despite IHS attempts to obstruct our investigation, our full physical inventory at headquarters and our random sample of property at 7 field locations, identified millions of dollars of missing property. Our analysis of Report of Survey records from IHS headquarters and field offices show that from fiscal year 2004 through fiscal year 2007, IHS property managers identified over 5,000 lost or stolen property items worth about $15.8 million. Although we did receive some documentation from IHS, the number and dollar value of items that have been lost or stolen since 2004 is likely much higher for the following reasons. First, IHS does not consistently document lost or stolen property items. For example, 9 of the 12 IHS regional offices did not perform a full physical inventory in fiscal year 2007. Second, an average of 5 of the 12 regions did not provide us with all of the reports used to document missing property for each year since fiscal year 2004, as we requested. Third, we found about $11 million in additional inventory shortages from our analysis of inventory reports provided to us by IHS, but we did not include this amount in our estimate of lost or stolen property because IHS has not made a final determination on this missing property. Some of the egregious examples of lost or stolen property include: In April 2007, a desktop computer containing a database of uranium miners’ names, social security numbers, and medical histories was stolen from an IHS hospital in New Mexico. According to an HHS report, IHS attempted to notify the 849 miners whose personal information was compromised, but IHS did not issue a press release to inform the public of the compromised data. From 1999 through 2005, IHS did not follow required procedures to document the transfer of property from IHS to the Alaska Native Tribal Health Consortium, resulting in a 5-year unsuccessful attempt by IHS to reconcile the inventory. Our analysis of IHS documentation revealed that about $6 million of this property—including all-terrain vehicles, generators, van trailers, pickup trucks, tractors, and other heavy equipment—was lost or stolen. In September 2006, IHS property staff in Tucson attempted to write off over $275,000 worth of property, including Jaws of Life equipment valued at $21,000. The acting area director in Tucson refused to approve the write-off because of the egregious nature of the property loss. To substantiate the whistleblower’s allegation of missing IT equipment, we performed our own full inventory of IT equipment at IHS headquarters. Our results were consistent with what the whistleblower claimed. Specifically, of the 3,155 pieces of IT equipment recorded in the records for IHS headquarters, we determined that about 1,140 items (or about 36 percent) were lost, stolen, or unaccounted for. These items, valued at around $2 million, included computers, computer servers, video projectors, and digital cameras. According to IHS records, 64 of the items we identified as missing during our physical inventory were “new” in April 2007. During our investigation of the whistleblower’s complaint, IHS made a concerted effort to obstruct our work. For example, the IHS Director over property misrepresented to us that IHS was able to find about 800 of the missing items from the whistleblower’s complaint. In addition, an IHS property specialist attempted to provide documentation confirming that 571 missing items were properly disposed of by IHS. However, we found that the documentation he provided was not dated and contained no signatures. Finally, IHS provided us fabricated receiving reports after we questioned them that the original reports provided to us were missing key information on them. Figure 1 shows the fabricated receiving report for a shipment of new scanners delivered to IHS. ? As shown in figure 1, there is almost a 3-month gap between the date the equipment was received in September and the date that the receiving report was completed and signed in December—even though the document should have been signed upon receipt. In fact, the new receiving report IHS provided was signed on the same date we requested it, strongly suggesting that IHS fabricated these documents in order to obstruct our investigation. We selected a random sample of IT equipment inventory at seven IHS field offices to determine whether the lack of accountability for inventory was confined to headquarters or occurred elsewhere within the agency. Similar to our finding at IHS headquarters, our sample results also indicate that a substantial number of pieces of IT equipment were lost, stolen, or unaccounted for. Specifically, we estimate that for the 7 locations, about 1,200 equipment items or 17 percent, with a value of $2.6 million were lost, stolen or unaccounted for. Furthermore, some of the missing equipment from the seven field locations could have contained sensitive information. We found that many of the missing laptops were assigned to IHS hospitals and, therefore, could have contained patient information and social security numbers and other personal information. IHS has also exhibited ineffective management over the procurement of IT equipment, which has led to wasteful spending of taxpayer funds. Some examples of wasteful spending that we observed during our audit of headquarters and field offices include: Approximately 10 pieces of IT equipment, on average, are issued for every one employee at IHS headquarters. Although some of these may be older items that were not properly disposed, we did find that many employees, including administrative assistants, were assigned two computer monitors, a printer and scanner, a blackberry, subwoofer speakers, and multiple computer laptops in addition to their computer desktop. Many of these employees said they rarely used all of this equipment, and some could not even remember the passwords for some of their multiple laptops. IHS purchased numerous computers for headquarters staff in excess of expected need. For example, IHS purchased 134 new computer desktops and monitors for $161,700 in the summer of 2007. As of February 2008, 25 of these computers and monitors—valued at about $30,000—were in storage at IHS headquarters. In addition, many of the computer desktops and monitors purchased in the summer of 2007 for IHS headquarters were assigned to vacant offices. The lost or stolen property and waste we detected at IHS can be attributed to the agency’s weak internal control environment and its ineffective implementation of numerous property policies. In particular, IHS management has failed to establish a strong “tone at the top” by allowing inadequate accountability over property to persist for years and by neglecting to fully investigate cases related to lost and stolen items. Furthermore, IHS management has not properly updated its personal property management policies, which IHS has not revised since 1992. Moreover, IHS did not (1) conduct annual inventories of accountable property; (2) use receiving agents for acquired property at each location and designate property custodial officers in writing to be responsible for the proper use, maintenance, and protection of property; (3) place barcodes on accountable property to identify it as government property; (4) maintain proper individual user-level accountability, including custody receipts, for issued property; (5) safeguard IT equipment; or (6) record certain property in its new property management information system. To strengthen IHS’s overall control environment and “tone at the top”, we made 10 recommendations to IHS to update its policy and enforce property management policies of both the HHS and IHS. Specifically, we recommended that the Director of IHS should direct IHS property officials to take the following 10 actions: Update IHS personal property management policies to reflect any policy changes that have occurred since the last update in 1992. Investigate circumstances surrounding missing or stolen property instead of writing off losses without holding anyone accountable. Enforce policy to conduct annual inventories of accountable personal property at headquarters and all field locations. Enforce policy to use receiving agents to document the receipt of property and distribute the property to its intended user and to designate property custodial officers in writing to be responsible for the proper use, maintenance, and protection of property. Enforce policy to place bar codes on all accountable property. Enforce policy to document the issuance of property using hand receipts and make sure that employees account for property at the time of transfer, separation, change in duties, or on demand by the proper authority. Maintain information on users of all accountable property, including their buildings and room numbers, so that property can easily be located. Physically secure and protect property to guard against loss and theft of equipment. Enforce the use of the property management information system database to create reliable inventory records. Establish procedures to track all sensitive equipment such as blackberries and cell phones even if they fall under the accountable dollar threshold criteria. HHS agreed with 9 of the 10 recommendations. HHS disagreed with our recommendation to establish procedures to track all sensitive equipment such as blackberries and cell phones even if they fall under the accountable dollar threshold criteria. We made this recommendation because we identified examples of lost or stolen equipment that contained sensitive data, such as a PDA containing medical data for patients at a Tucson, Arizona area hospital. According to an IHS official, the device contained no password or data encryption, meaning that anyone who found (or stole) the PDA could have accessed the sensitive medical data. While we recognize that IHS may have taken steps to prevent the unauthorized release of sensitive data and acknowledge that it is not required to track devices under a certain threshold, we are concerned about the potential harm to the public caused by the loss or theft of this type of equipment. Therefore, we continue to believe that such equipment should be tracked and that our recommendation remains valid. Mr. Chairman and Members of the Committee, this concludes our statement. We would be pleased to answer any questions that you or other members of the committee may have at this time. For further information about this testimony, please contact Gregory D. Kutz at (202) 512-6722 or kutzg@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this testimony. In addition to the individual named above, the individuals who made major contributions to this testimony were Verginie Amirkhanian, Erika Axelson, Joonho Choi, Jennifer Costello, Jane Ervin, Jessica Gray, Richard Guthrie, John Kelly, Bret Kressin, Richard Kusman, Barbara Lewis, Megan Maisel, Andrew McIntosh, Shawn Mongin, Sandra Moore, James Murphy, Andy O’Connell, George Ogilvie, Chevalier Strong, Quan Thai, Matt Valenta, and David Yoder. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

In June 2007, GAO received information from a whistleblower through GAO's FraudNET hotline alleging millions of dollars in lost and stolen property and gross mismanagement of property at Indian Health Service (IHS), an operating division of the Department of Health and Human Services (HHS). GAO was asked to conduct a forensic audit and related investigations to (1) determine whether GAO could substantiate the allegation of lost and stolen property at IHS and identify examples of wasteful purchases and (2) identify the key causes of any loss, theft, or waste. GAO analyzed IHS property records from fiscal years 2004 to 2007, conducted a full physical inventory at IHS headquarters, and statistically tested inventory of information technology (IT) equipment at seven IHS field locations in 2007 and 2008. GAO also examined IHS policies, conducted interviews with IHS officials, and assessed the security of property. Millions of dollars worth of IHS property has been lost or stolen over the past several years. Specifically: IHS identified over 5,000 lost or stolen property items, worth about $15.8 million, from fiscal years 2004 through 2007. These missing items included all-terrain vehicles and tractors; Jaws of Life equipment; and a computer containing sensitive data, including social security numbers. GAO's physical inventory identified that over 1,100 IT items, worth about $2 million, were missing from IHS headquarters. These items represented about 36 percent of all IT equipment on the books at headquarters in 2007 and included laptops and digital cameras. Further, IHS staff attempted to obstruct GAO's investigation by fabricating hundreds of documents. GAO also estimates that IHS had about 1,200 missing IT equipment items at seven field office locations worth approximately $2.6 million. This represented about 17 percent of all IT equipment at these locations. However, the dollar value of lost or stolen items and the extent of compromised data are unknown because IHS does not consistently document lost or stolen property, and GAO only tested a limited number of IHS locations. Information related to cases where GAO identified fabrication of documents and potential release of sensitive data was referred to the HHS Inspector General for further investigation. GAO identified that the loss, theft, and waste can be attributed to IHS's weak internal control environment. IHS management has failed to establish a strong "tone at the top," allowing property management problems to continue for more than a decade with little or no improvement or accountability for lost and stolen property and compromise of sensitive personal data. In addition, IHS has not effectively implemented numerous property policies, including the proper safeguards for its expensive IT equipment. For example, IHS disposed of over $700,000 worth of equipment because it was "infested with bat dung."

must not increase or decrease total Medicare payments. Physicians could, however, experience increases or decreases in their payments from Medicare, depending on the services and procedures they provide. HCFA published a notice of proposed rulemaking in the June 18, 1997, Federal Register describing its proposed revisions to physician practice expense payments. HCFA estimated that its revisions, had they been in effect in fiscal year 1997, would have reallocated $2 billion of the $18 billion of the practice expense component of the Medicare fee schedule that year. The revisions would generally increase Medicare payments to physician specialties that provide more office-based services while decreasing payments to physician specialties that provide primarily hospital-based services. The revisions could also affect physicians’ non-Medicare income, since many other health insurers use the Medicare fee schedule as the basis for their payments. Some physician groups argued that HCFA based its proposed revisions on invalid data and that the reallocations of Medicare payments would be too severe. Subsequently, the Balanced Budget Act of 1997 delayed implementation of the resource-based practice expense revisions until 1999 and required HCFA to publish a revised proposal by May 1, 1998. The act also required us to evaluate the June 1997 proposed revisions, including their potential impact on beneficiary access to care. HCFA faced significant challenges in revising the practice expense component of the fee schedule—perhaps more challenging than the task of estimating the physician work associated with each procedure. Practice expenses involve multiple items, such as the wages and salaries of receptionists, nurses, and technicians employed by the physician; the cost of office equipment such as examining tables, instruments, and diagnostic equipment; the cost of supplies such as face masks and wound dressings; and the cost of billing services and office space. Practice expenses are also expected to vary significantly. For example, a general practice physician in a solo practice may have different expenses than a physician in a group practice. For most physician practices, the total of supply, equipment, and nonphysician labor expenses is probably readily available. However, Medicare pays physicians by procedure, such as a skin biopsy; therefore, HCFA had to develop a way to estimate the portion of practice expenses associated with each procedure—information that is not readily available. representative sample of physician practices. However, the feasibility of completing such an enormous data collection task within reasonable time and cost constraints is doubtful, as evidenced by HCFA’s unsuccessful attempt to survey 5,000 practices. After considering this option and the limitations of survey data already gathered by other organizations, HCFA decided to use expert panels to estimate the relative resources associated with medical procedures and convened 15 specialty-specific clinical practice expense panels (CPEP). Each panel included 12 to 15 members; about half the members of each panel were physicians, and the remaining members were practice administrators and nonphysician clinicians such as nurses. HCFA provided national medical specialty societies an opportunity to nominate the panelists, and panel members represented over 60 specialties and subspecialties. Each panel was asked to estimate the practice expenses associated with selected procedure codes. Some codes, called “redundant codes,” were assigned to two or more CPEPs so that HCFA and its contractor could analyze differences in the estimates developed by the various panels. For example, HCFA included the repair of a disk in the lower back among the procedures reviewed by both the orthopedic and neurosurgery panels. We believe that HCFA’s use of expert panels is a reasonable method for estimating the direct labor and other direct practice expenses associated with medical services and procedures. We explored alternative primary data-gathering approaches, such as mailing out surveys, using existing survey data, and gathering data on-site, and we concluded that each of those approaches has practical limitations that preclude their use as reasonable alternatives to HCFA’s use of expert panels. Gathering data directly from a limited number of physician practices would, however, be a useful external validity check on HCFA’s proposed practice expense revisions and would also help HCFA identify refinements needed during phase-in of the fee schedule revisions. HCFA staff believed that each of the CPEPs developed reasonable relative rankings of their assigned procedure codes. However, they also believed that the CPEP estimates needed to be adjusted to convert them to a common scale, eliminate certain inappropriate expenses, and align the panels’ estimates with data on aggregate practice expenses. While we agree with the intent of these adjustments, we identified methodological weaknesses with some and a lack of supporting data with others. HCFA staff found that labor estimates varied across CPEPs for the same procedures and therefore used an adjustment process referred to as “linking” to convert the different labor estimates to a common scale. HCFA’s linking process used a statistical model to reconcile significant differences between various panels’ estimates for the same procedure (for example, hernia repair). HCFA used linking factors derived from its model to adjust CPEP’s estimates. HCFA’s linking model works best when the estimates from different CPEPs follow certain patterns; however, we found that, in some cases, the CPEP data deviated considerably from these patterns and that there are technical weaknesses in the model that raise questions about the linking factors HCFA used. HCFA applied two sets of edits to the direct expense data in order to eliminate inappropriate or unreasonable expenses: one based on policy considerations, the other to correct for certain estimates HCFA considered to be unreasonable. The most controversial policy edit concerned HCFA’s elimination of nearly all expenses related to physicians’ staff, primarily nurses, for work they do in hospitals. HCFA excluded these physician practice expenses from the panels’ estimates because, under current Medicare policy, those expenses are covered by payments to hospitals rather than to physicians. We believe that HCFA acted appropriately according to Medicare policy by excluding these expenses. However, shifts in medical practices affecting Medicare’s payments may have resulted in physicians absorbing these expenses. In a notice published in the October 1997 Federal Register, HCFA asked for specific data from physicians, hospitals, and others on this issue. After we completed our field work, HCFA received some limited information, which we have not reviewed. HCFA officials said that they will review that information to determine whether a change in their position is warranted. If additional data indicate that this practice occurs frequently, it would be appropriate for HCFA to determine whether Medicare reimbursements to hospitals and physicians warrant adjustment. HCFA also limited some administrative and clinical labor estimates that it believes are too high. Specifically, HCFA believes that (1) the administrative labor time estimates developed by the CPEPs for many diagnostic tests and minor procedures seemed excessive compared with the administrative labor time estimates for a midlevel office visit; and (2) the clinical labor time estimates for many procedures appeared to be excessive compared with the time physicians spend in performing the procedures. Therefore, HCFA capped the administrative labor time for several categories of services at the level of a midlevel office visit. Furthermore, with certain exceptions, HCFA capped nonphysician clinical labor at 1-1/2 times the number of minutes it takes a physician to perform a procedure. HCFA has not, however, conducted tests or studies that validate the appropriateness of these caps and thus cannot be assured that they are necessary or reasonable. Various physician groups have suggested that HCFA reclassify certain administrative labor activities as indirect expenses. Such a move could eliminate the need for limiting some of the expert panels’ administrative labor estimates, which some observers believe are less reliable than the other estimates they developed. HCFA officials said that they are considering this possibility. Finally, HCFA adjusted the CPEP data so that it was consistent in the aggregate with national practice expense data developed from the American Medical Association’s (AMA) Socioeconomic Monitoring System (SMS) survey—a process that it called “scaling.” HCFA found that the aggregate CPEP estimates for labor, supplies, and equipment each accounted for a different portion of total direct expenses than the SMS data did. For example, labor accounted for 73 percent of total direct expenses in the SMS survey data but only 60 percent of the total direct expenses in the CPEP data. To make the CPEP percentages mirror the SMS survey percentages, HCFA inflated the CPEPs’ labor expenses for each code by 21 percent and the medical supply expenses by 6 percent and deflated the CPEPs’ medical equipment expenses by 61 percent. that supports all or nearly all services provided by a practice, such as an examination table, HCFA assumed a utilization rate of 100 percent. Scaling provided HCFA with a cap on the total amount of practice expenses devoted to equipment that was not dependent upon the equipment rate assumptions HCFA used. While HCFA officials acknowledge that their equipment utilization rate assumptions are not based on actual data, they claim that the assumptions are not significant for most procedures since equipment typically represents only a small fraction of a procedure’s direct expenses. The AMA and other physician groups that we contacted have said, however, that HCFA’s estimates greatly overstate the utilization of most equipment, which results in underestimating equipment expenses used in developing new practice expense fees. HCFA agrees that the equipment utilization rates will affect each medical specialty differently, especially those with high equipment expenses, but HCFA staff have not tested the effects of different utilization rates on the various specialties. In a notice in the October 1997 Federal Register, HCFA asked for copies of any studies or other data showing actual utilization rates of equipment, by procedure code. This is consistent with the Balanced Budget Act of 1997 requirement that HCFA use actual data in setting equipment utilization rates. It is not clear whether beneficiary access to care will be adversely affected by Medicare’s new fee schedule payments for physician practice expenses. This will depend upon such factors as the magnitude of the Medicare payment reductions experienced by different medical specialties, other health insurers’ use of the fee schedule, and fees paid by other purchasers of physician services. 20 percent, and 11 percent, respectively, for these specialties once the new practice expense component of the fee schedule is fully implemented in 2002. Additionally, Medicare payments for surgical services were reduced by 10.4 percent beginning in 1998 as a result of provisions contained in the Balanced Budget Act. The combined impact of the proposed and prior changes on physicians’ incomes will affect some medical specialties more than others. Therefore, there is a continuing need to monitor indicators of beneficiary access to care, focusing on services and procedures with the greatest reductions in Medicare payments. Even though HCFA has made considerable progress developing new practice expense fees, much remains to be done before the new fee schedule payments are implemented starting in 1999. For example, HCFA has not collected actual data that would serve as a check on the panels’ data and as a test of its assumptions and adjustments. Furthermore, HCFA has done little in the way of conducting sensitivity analyses to determine which of its adjustments and assumptions have the greatest effects on the proposed fee schedule revisions. There is no need, however, for HCFA to abandon the work of the expert panels and start over using a different methodology; doing so would needlessly increase costs and further delay implementation of the fee schedule revisions. The budget neutrality requirement imposed by the Congress means that some physician groups would benefit from changes in Medicare’s payments for physician practice expenses to the detriment of other groups. As a result, considerable controversy has arisen within the medical community regarding HCFA’s proposed fee schedule revisions, and such controversy can be expected to continue following issuance of HCFA’s next notice of proposed rulemaking, which is due May 1, 1998. Similar controversy occurred when Medicare initially adopted a resource-based payment system for physician work in 1992. Since that time, however, medical community confidence in the physician work component of the fee schedule has increased. give physicians greater assurance that the revisions HCFA proposes are appropriate and sound. HCFA officials said that they would carefully review and consider each of our recommendations as they develop their rule. Mr. Chairman, this concludes my statement. I will be happy to answer your questions. The first copy of each GAO report and testimony is free. Additional copies are $2 each. 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Pursuant to a congressional request, GAO discussed the efforts of the Health Care Financing Administration (HCFA) to revise the practice expense component of Medicare's physician fee schedule. GAO noted that: (1) HCFA's general approach for collecting information on physicians' practice expenses was reasonable; (2) HCFA convened 15 panels of experts to identify the resources associated with several thousand services and procedures; (3) HCFA made various adjustments to the expert panels' data that were intended to: (a) convert the panels' estimates to a common scale; (b) eliminate expenses reimbursed to hospitals rather than to physicians; (c) reduce potentially excessive estimates; and (d) ensure consistency with aggregate survey data on practice expenses for equipment, supplies, and nonphysician labor; (4) while GAO agrees with the intent of these adjustments, GAO believes that some have methodological weaknesses, and other adjustments and assumptions lack supporting data; (5) HCFA has done little in the way of performing sensitivity analyses that would enable it to determine the impact of the various adjustments, methodologies, and assumptions, either individually or collectively; (6) such sensitivity analyses could help determine whether the effects of the adjustments and assumptions warrant additional, focused data gathering to determine their validity; (7) GAO believes this additional work should not, however, delay phase-in of the fee schedule revisions; (8) since implementation of the physician fee schedule in 1992, Medicare beneficiaries have generally experienced very good access to physician services; (9) the eventual impact of the new practice expense revisions on Medicare payments to physicians is unknown at this time, but they should be considered in the context of other changes in payments to physicians by Medicare and by other payers; (10) recent successes in health care cost control are partially the result of purchasers and health plans aggressively seeking discounts from providers; (11) how Medicare payments to physicians relate to those of other payers will determine whether the changes in Medicare payments to physicians reduce Medicare beneficiaries' access to physician services; and (12) this issue warrants continued monitoring, and possible Medicare fee schedule adjustments, as the revisions are phased in.

The length of time a congressional staff member spends employed in Congress, or job tenure, is a source of recurring interest among Members of Congress, congressional staff, those who study staffing in the House and Senate, and the public. There may be interest in congressional tenure information from multiple perspectives, including assessment of how a congressional office might oversee human resources issues, how staff might approach a congressional career, and guidance for how frequently staffing changes may occur in various positions. Others might be interested in how staff are deployed, and could see staff tenure as an indication of the effectiveness or well-being of Congress as an institution. This report provides tenure data for 15 staff position titles that are typically used in Senate committees, and information for using those data for different purposes. The positions include the following: Chief Clerk Chief Counsel Communications Director Counsel Deputy Staff Director Legislative Assistant Minority Staff Director Press Secretary Professional Staff Member Senior Counsel Senior Professional Staff Member Staff Assistant Staff Director Subcommittee Staff Director Systems Administrator Publicly available information sources do not provide aggregated congressional staff tenure data in a readily retrievable or analyzable form. Data in this report are based on official Senate pay reports, from which tenure information arguably may be most reliably derived, and which afford the opportunity to use complete, consistently collected data. Tenure information provided in this report is based on the Senate's Report of the Secretary of the Senate , published semiannually, as collated by LegiStorm, a private entity that provides some congressional data by subscription. Senate committee staff tenure data were calculated for each year between 2006 and 2016. Annual data allow for observations about the nature of staff tenure in Senate committees over time. For each year, all staff with at least one week's service on March 31 were included. All employment pay dates from October 2, 2000 to March 24 of each reported year are included in the data. Utilizing official salary expenditure data from the Senate may provide more complete, robust findings than other methods of determining staff tenure, such as surveys; the data presented here, however, are subject to some challenges that could affect the interpretation of the information presented. Tenure information provided in this report may understate the actual time staff spend in particular positons, due in part to several features of the data. Figure 1 provides potential examples of congressional staff, identified as Jobholders A-D, in a given position. Some individuals, represented as Jobholder A, may have an unknown length of prior service before October 2, 2000, when the data begin. In the data captured for this report, no jobholders fall into this category. The earliest date at which Senate committee staff included in this report received pay was October 4, 2000. Thus, the tenure periods of all staff for which data are provided completely begin within the observed period of time; some tenure periods, as represented by Jobholders B and C, also end within the observed period. The data last capture those who were employed in Senate committees as of March 31, 2016, represented as Jobholder D, and some of those individuals likely continued to work in the same roles after that date. Data provided in this report represent an individual's consecutive time spent working in a particular position in a Senate committee. They do not necessarily capture the overall time worked in a Senate office or across a congressional career. If a person's job title changes, for example, from staff assistant to professional staff member, the time that individual spent as a staff assistant is recorded separately from the time that individual spent as a professional staff member. If a person stops working for the Senate for some time, that individual's tenure in his or her preceding position ends, although he or she may return to work in Congress at some point. No aggregate measure of individual congressional career length is provided in this report. Other data concerns arise from the variation across commirrees and lack of other demographic information about staff. Potential differences might exist in the job duties of positions with the same or similar title, and there is wide variation among the job titles used for various positions in congressional offices. The Appendix provides the number of related titles included for each job title for which tenure data are provided. Aggregation of tenure by job title rests on the assumption that staff with the same or similar title carry out the same or similar tasks. Given the wide discretion congressional employing authorities have in setting the terms and conditions of employment, there may be differences in the duties of similarly titled staff that could have effects on the interpretation of their time in a particular position. As presented here, tenure data provide no insight into the education, age, work experience, pay, full- or part-time status of staff, or other potential data that might inform explanations of why a congressional staff member might stay in a particular position. Tables in this section provide tenure data for selected positions in Senate committees and detailed data and visualizations for each position. Table 1 provides a summary of staff tenure for selected positions since 2006. The data include job titles, average and median years of service, and grouped years of service for each positon. The "Trend" column provides information on whether the time staff stayed in a position increased, was unchanged, or decreased between 2006 and 2016. Table 2 - Table 16 provide information on individual job titles over the same period. In all of the data tables, the average and the median length of tenure columns provide two different measures of central tendency, and each may be useful for some purposes and less suitable for others. The average represents the sum of the observed years of tenure, divided by the number of staff in that position. It is a common measure that can be understood as a representation of how long an individual remains, on average, in a job position. The average can be affected disproportionately by unusually low or high observations. A few individuals who remain for many years in a position, for example, may draw the average tenure length up for that position. A number of staff who stay in a position for only a brief period may depress the average length of tenure. Another common measure of central tendency, the median, represents the middle value when all the observations are arranged by order of magnitude. The median can be understood as a representation of a center point at which half of the observations fall below, and half above. Extremely high or low observations may have less of an impact on the median. Generalizations about staff tenure are limited in at least three potentially significant ways, including the following: the relatively brief period of time for which reliable, largely inclusive data are available in a readily analyzable form; how the unique nature of congressional work settings might affect staff tenure; and the lack of demographic information about staff for which tenure data are available. Considering tenure in isolation from demographic characteristics of the congressional workforce might limit the extent to which tenure information can be assessed. Additional data on congressional staff regarding age, education, and other elements would be needed for this type of analysis, and are not readily available at the position level. Finally, since each Senate committee serves as its own hiring authority, variations from committee to committee, which for each position may include differences in job duties, work schedules, office emphases, and other factors, may limit the extent to which data provided here might match tenure in a particular office. Despite these caveats, a few broad observations can be made about staff in Senate committees. Between 2006 and 2016, staff tenure, based on the trend of the median number of years in the position, appears to have increased by six months or more for staff in four position titles in Senate committees. The median tenure was unchanged for seven positions, and decreased for four positions. This may be consistent with overall workforce trends in the United States. Although pay is not the only factor that might affect an individual's decision to remain in or leave a particular job, staff in positions that generally pay less typically remained in those roles for shorter periods of time than those in higher-paying positions. Some of these lower-paying positions may also be considered entry-level positions in some Senate committees; if so, Senate committee employees in those roles appear to follow national trends for others in entry-level types of jobs, remaining in the role for a relatively short period of time. Similarly, those in more senior positions, which often require a particular level of congressional or other professional experience, typically remained in those roles comparatively longer, similar to those in more senior positions in the general workforce. There is wide variation among the job titles used for various positions in congressional offices. Between October 2000 and March 2016, House and Senate pay data provided 13,271 unique titles under which staff received pay. Of those, 1,884 were extracted and categorized into one of 33 job titles used in CRS Reports about Member or committee offices. Office type was sometimes related to the job titles used. Some titles were specific to Member (e.g., District Director, State Director, and Field Representative) or committee (positions that are identified by majority, minority, or party standing, and Chief Clerk) offices, while others were identified in each setting (Counsel, Scheduler, Staff Assistant, and Legislative Assistant). Other job title variations reflect factors specific to particular offices, since each office functions as its own hiring authority. Some of the titles may distinguish between roles and duties carried out in the office (e.g., chief of staff, legislative assistant, etc.). Some offices may use job titles to indicate degrees of seniority. Others might represent arguably inconsequential variations in title between two staff members who might be carrying out essentially similar activities. Examples include the following: Seemingly related job titles, such as Administrative Director and Administrative Manager, or Caseworker and Constituent Advocate Job titles modified by location, such as Washington, DC, State, or District Chief of Staff Job titles modified by policy or subject area, such as Domestic Policy Counsel, Energy Counsel, or Counsel for Constituent Services Committee job titles modified by party or committee subdivision. This could include a party-related distinction, such as a Majority, Minority, Democratic, or Republican Professional Staff Member. It could also denote Full Committee Staff Member, Subcommittee Staff Member, or work on behalf of an individual committee leader, like the Chair or Ranking Member. The titles used in this report were used by most Senate committees, but a number of apparently related variations are included to ensure inclusion of additional offices and staff. Table A-1 provides the number of related titles included for each position used in this report or related CRS Reports on staff tenure. A list of all titles included by category is available to congressional offices upon request.

The length of time a congressional staff member spends employed in a particular position in Congress—or congressional staff tenure—is a source of recurring interest to Members, staff, and the public. A congressional office, for example, may seek this information to assess its human resources capabilities, or for guidance in how frequently staffing changes might be expected for various positions. Congressional staff may seek this type of information to evaluate and approach their own individual career trajectories. This report presents a number of statistical measures regarding the length of time Senate committee staff stay in particular job positions. It is designed to facilitate the consideration of tenure from a number of perspectives. This report provides tenure data for a selection of 15 staff position titles that are typically used in Senate committee offices, and information on how to use those data for different purposes. The positions include Chief Clerk, Chief Counsel, Communications Director, Counsel, Deputy Staff Director, Legislative Assistant, Minority Staff Director, Press Secretary, Professional Staff Member, Senior Counsel, Senior Professional Staff Member, Staff Assistant, Staff Director, Subcommittee Staff Director, and Systems Administrator. Senate committee staff tenure data were calculated as of March 31, for each year between 2006 and 2016, for all staff in each position. An overview table provides staff tenure for selected positions for 2016, including summary statistics and information on whether the time staff stayed in a position increased, was unchanged, or decreased between 2006 and 2016. Other tables provide detailed tenure data and visualizations for each position title. Between 2006 and 2016, staff tenure, based on the trend of the median number of years in the position, appears to have increased by six months or more for staff in four position titles in Senate committees. The median tenure was unchanged for seven positions, and decreased for four positions. These findings may be consistent with overall workforce trends in the United States. Pay may be one of many factors that affect an individual's decision to remain in or leave a particular job. Senate committee staff holding positions that are generally lower-paid typically remained in those roles for shorter periods of time than those in generally higher-paying positions. Lower-paying positions may also be considered entry-level roles; if so, tenure for Senate committee employees in these roles appears to follow national trends for other entry-level jobs, which individuals hold for a relatively short period of time. Those in more senior positions, where a particular level of congressional or other professional experience is often required, typically remained in those roles comparatively longer, similar to those in more senior positions in the general workforce. Generalizations about staff tenure are limited in some ways, because each Senate committee serves as its own hiring authority. Variations from office to office, which might include differences in job duties, work schedules, office emphases, and other factors, may limit the extent to which data provided here might match tenure in another office. Direct comparisons of congressional employment to the general labor market may have similar limitations. Change in committee leadership, for example, may cause staff tenure periods to end abruptly and unexpectedly. This report is one of a number of CRS products on congressional staff. Others include CRS Report R43946, Senate Staff Levels in Member, Committee, Leadership, and Other Offices, 1977-2016, by [author name scrubbed], [author name scrubbed], and [author name scrubbed], and CRS Report R44325, Staff Pay Levels for Selected Positions in Senate Committees, FY2001-FY2014, coordinated by [author name scrubbed].

In July 2014, the General Counsel of the National Labor Relations Board ("Board") announced that he had authorized complaints against McDonald's, USA, LLC ("McDonald's USA"), for alleged violations of the National Labor Relations Act ("NLRA" or "the Act") by the company and its franchisees. Prior to the announcement, numerous charges of unfair labor practices had been investigated by the Office of General Counsel. These charges involved a variety of actions, including terminations and reductions in hours, undertaken allegedly in response to union organizing. The effort to recognize McDonald's USA and its franchisees as joint employers of the individuals who have alleged unfair labor practices is consistent with the General Counsel's other attempts to have the Board reevaluate when an entity will be considered a joint employer. In a June 2014 amicus brief, for example, the General Counsel encouraged the Board to abandon its existing joint employer standard, which has been in place since 1984. If the Board were to adopt a new standard that made it more likely for parties in a franchise arrangement to be considered joint employers, some contend that it could have a significant impact on the economy and small-business ownership. Some companies, it is argued, might be reluctant to establish franchise relationships for fear of being exposed to possible unfair labor practice claims. Nevertheless, the General Counsel maintains that the Board's current standard ignores Congress's intent that the term "employer" in the NLRA should be construed broadly in light of economic realities and the statute's underlying goals. This report examines the Board's existing joint employer standard. The report also reviews Browning-Ferris Industries of California , the case that prompted the General Counsel's amicus brief, and the unfair labor practice allegations involving McDonald's USA. The NLRA recognizes the right of employees to engage in collective bargaining through representatives of their own choosing. By "encouraging the practice and procedure of collective bargaining," the Act attempts to mitigate and eliminate labor-related obstructions to the free flow of commerce. The NLRA also prohibits certain misconduct by both employers and unions that interferes with the collective bargaining right. Section 8(a)(1) of the NLRA states that it shall be an unfair labor practice for an employer to "interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7." Similarly, section 8(b)(1)(A) of the NLRA provides that it shall be an unfair labor practice for a labor organization or its agents to "restrain or coerce ... employees in the exercise of the rights guaranteed in section 7 ..." When individuals work pursuant to an arrangement that involves two businesses, such as a contract that provides for one business supplying workers to another, questions may arise concerning which entity should be considered the "employer" for purposes of the NLRA. In some cases, these businesses may be deemed joint employers because they both exercise some control over the individuals' terms and conditions of employment. In NLRB v. Browning-Ferris Industries of Pennsylvania , the U.S. Court of Appeals for the Third Circuit ("Third Circuit") observed: "[T]he 'joint employer' concept recognizes that the business entities involved are in fact separate but that they share or co-determine those matters governing the essential terms and conditions of employment." In 1984, the Board established a joint employer standard that followed the Third Circuit's reasoning in Browning-Ferris Industries of Pennsylvania . In Laerco Transportation & Warehouse , the Board considered whether Laerco, a provider of trucking and warehouse services, and CTL, a company that provided drivers to Laerco, were joint employers. Citing the Third Circuit's opinion, the Board elaborated on the court's standard, noting: "To establish joint employer status there must be a showing that the employer meaningfully affects matters relating to the employment relationship such as hiring, firing, discipline, supervision, and direction." In Laerco Transportation , the record indicated that CTL made all of the employment decisions with regard to the drivers provided to Laerco, and was primarily responsible for resolving most problems that arose with the drivers. In addition, any supervision of the drivers provided by Laerco was minimal and routine. In light of these factors, the Board concluded that Laerco did not possess sufficient control over CTL's employees to support a joint employer finding. In TLI, Inc ., another 1984 case involving drivers provided by one company to another, the Board confirmed that there must be a showing that an employer meaningfully affects matters relating to the employment relationship to establish joint employer status. In this case, the Board concluded that Crown Zellerbach, a forest products company that leased drivers from TLI, was not a joint employer of these drivers because it had little impact on the terms and conditions of their employment. The Board explained that Crown did not hire or terminate the drivers, and did not discipline them. In addition, the Board found that the supervision and direction exercised by Crown on a day-to-day basis was limited and routine. Because Crown appeared to exercise only minimal control over the drivers, the Board maintained that it should not be deemed a joint employer. While the Board has continued to follow the joint employer standard established in Laerco Transportation , its solicitation of briefs in Browning-Ferris Industries of California may arguably signal a willingness to revise that standard. Browning-Ferris Industries of California was decided by the regional director of the Board's Region 32 in August 2013. In April 2014, the Board agreed to review the regional director's decision because "it raises substantial issues warranting review." In Browning-Ferris Industries of California , the regional director considered whether Browning-Ferris, a waste management company, is a joint employer of individuals provided by Leadpoint Business Services to perform sorting and housekeeping duties. The dispute arose after a union petitioned to represent all full and regular part-time workers employed by Leadpoint and Browning-Ferris. After examining the relationship between the parties and the relevant workers, the regional director concluded that Browning-Ferris and Leadpoint are not joint employers. Citing a labor services agreement between the parties, the regional director noted that Leadpoint has the sole authority to set the wage rates for the employees it provides to Browning-Ferris. In addition, under the agreement, Leadpoint has the sole responsibility to counsel, discipline, and terminate employees assigned to Browning-Ferris. The regional director further noted that Browning-Ferris does not control the daily work performed by the employees provided by Leadpoint. Quoting TLI, Inc. , the regional director concluded that Browning-Ferris "does not 'share, or co-determine [with Leadpoint] those matters governing the essential terms and employment' of Leadpoint's housekeepers, sorter, or screen cleaners at [Browning-Ferris's] Facility.'" After agreeing to review the regional director's decision in Browning-Ferris Industries of California , the Board invited the filing of briefs, including amicus briefs, to address the issues raised in the case. The parties and amici were invited to address one or more of the following questions: 1. Under the Board's current joint-employer standard, as articulated in TLI, Inc . ... and Laerco Transportation ... is Leadpoint Business Services the sole employer of the petitioned-for employees? 2. Should the Board adhere to its existing joint-employer standard or adopt a new standard? What considerations should influence the Board's decision in this regard? 3. If the Board adopts a new standard for determining joint-employer status, what should that standard be? If it involves the application of a multifactor test, what factors should be examined? What should be the basis or rationale for such a standard? In an amicus brief, the Board's General Counsel urged the Board to abandon its current joint-employer standard, contending that "it undermines the fundamental policy of the Act to encourage stable and meaningful collective bargaining." The General Counsel declined to address the Board's first question, but provided responses for the second and third questions. The General Counsel encouraged the Board to adopt a new standard that considers the totality of the circumstances, including how the alleged joint employers have structured their commercial relationship. The General Counsel reasoned that this new standard would allow the Board to find joint employer status where industrial realities make an entity essential for meaningful bargaining. For example, a company that receives workers from a "supplier" company and that has some control over the wages paid by the supplier company should be deemed a joint employer because meaningful bargaining over wages could not occur without its involvement. In this way, the standard proposed by the General Counsel would recognize the potential to control terms and conditions of employment as sufficient to find joint employer status. Whether the Board will adopt a new joint employer standard is not clear. Amicus briefs for Browning-Ferris Industries of California were due by June 26, 2014. The parties to the case were required to file their briefs by July 10, 2014. The Board has not indicated when a decision will be issued. At least 310 unfair labor practice charges involving McDonald's USA and its franchisees have been filed with the Board. While many of these cases have been closed, 107 cases have been found to have merit. Regional directors in at least 17 of the Board's regions have issued complaints against McDonald's USA and its franchisees as joint employers. In a fact sheet devoted to the McDonald's USA cases, the Board maintains that "McDonald's, USA, LLC, through its franchise relationship and its use of tools, resources and technology, engages in sufficient control over its franchisees' operations, beyond protection of the brand, to make it a putative joint employer with its franchisees, sharing liability for violations of our Act." In general, the complaints issued against McDonald's USA and its franchisees appear to follow a similar pattern. The complaints identify the existence of a franchise agreement between McDonald's USA and the franchisee, indicate that McDonald's USA possessed and/or exercised control over the labor relations policies of the franchisee, and state that McDonald's USA is a joint employer of the franchisee's employees. The complaints also describe the alleged misconduct that would constitute a violation of the NLRA, if true, such as termination because of union activity, and threats of reprisal for engaging in union activity. In his amicus brief for Browning-Ferris Industries of California , the General Counsel argued that the current joint employer standard undermines meaningful collective bargaining when there is a franchise relationship: In these commercial arrangements, an employer inserts an intermediary between it and the workers and designates the intermediary as the workers' sole "employer." But notwithstanding the creation of an intermediary, franchisors typically dictate the terms of franchise agreements and "can exert significant control over the day-to-day operations of their franchisees," including the number of workers employed at a franchise and hours each employee works. If the Board adopts the totality of the circumstances standard advocated by the General Counsel, and further examination of the franchise relationship between McDonald's USA and its franchisees reveals that the influence of McDonald's USA over the working conditions of its franchisees' employees is significant enough that bargaining has to include McDonald's USA to be meaningful, it seems likely that the Board would conclude that McDonald's USA and its franchisees are joint employers. Nevertheless, the General Counsel has also emphasized that a franchisor will probably not be considered a joint employer if it simply sets rules or policies to maintain the uniformity of brand or product quality. In a December 2014 statement, McDonald's USA seemed to highlight brand quality as a hallmark of its franchise agreements: McDonald's serves its 2,500 independent franchisees' interests by protecting and promoting the McDonald's brand and by providing access to resources related to food quality, customer service, and restaurant management, among other things. These optional resources help entrepreneurs operate successful businesses. This relationship does not establish a joint employer relationship under the law ... McDonald's USA also emphasized the need for further fact-finding before a final resolution could be reached. Such a resolution may be years away, however, as many expect the cases involving McDonald's USA and Browning-Ferris Industries of California to be appealed after the Board issues its decisions.

This report examines the standard used currently by the National Labor Relations Board ("Board") to determine whether two businesses may be considered joint employers for purposes of the rights and protections afforded by the National Labor Relations Act ("NLRA"). In a June 2014 amicus brief filed with the Board, the Board's General Counsel encouraged the adoption of a new joint employer standard that would consider the totality of the circumstances, including how the alleged joint employers have structured their commercial relationship. Following the filing of the amicus brief, the General Counsel also authorized complaints to be filed against McDonald's, USA, LLC ("McDonald's USA"), and its franchisees, as joint employers, for alleged violations of the NLRA. These activities may arguably suggest that a change in the Board's joint employer standard may be imminent. In addition to reviewing the Board's joint employer standard, the report also discusses Browning-Ferris Industries of California, the case that prompted the General Counsel's amicus brief, and the unfair labor practice allegations involving McDonald's USA.

Prior to the September 11, 2001 terrorist attacks, insurance covering terrorism losses wasnormally included in general insurance policies without a specific premium being paid. Essentiallymost policyholders received this coverage for free. The attacks, and the more than $30 billion ininsured losses that resulted from them, caused a rethinking of the possibilities of future terroristattacks. In response to the new appreciation of the threat and the perceived inability to calculate theprobability and loss data critical for pricing insurance, both primary insurers and reinsurers pulledback from offering terrorism coverage. Many argued that terrorism risk is essentially uninsurableby the private market due to the uncertainty and potentially massive losses involved. Becauseinsurance is required for a variety of economic transactions, many feared that a lack of insuranceagainst terrorism loss would have wider economic impact, particularly on large-scale developmentsin urban areas that would be tempting targets for terrorism. Congress responded to the disruption in the insurance market by passing the Terrorism RiskInsurance Act of 2002 (1) (TRIA), which was signed by the President in November 2002. TRIA created the Terrorism RiskInsurance Program, which was enacted as a temporary program, expiring at the end of 2005, to calmthe insurance markets through a government backstop for terrorism losses and give the privateindustry time to gather the data and create the structures and capacity necessary for private insuranceto cover terrorism risk. Terrorism insurance has become widely available under TRIA and the insurance industry hasgreatly expanded its financial capacity in the past three years. It appears, however, that less progresshas been made on creating terrorism models that are sufficiently robust for insurers to return tooffering widespread terrorism coverage without a government backstop, and that practically noprogress has been made on a private pooling mechanism to cover terrorism risk. Some see the pastthree years as proof of the argument that the private market will never be able to offer insurance tocover terrorism risk and continue to see the possibility of wider economic consequences if terrorisminsurance again is unavailable. Others, notably the U.S. Treasury Department, respond that TRIAitself is retarding the growth of this private market and should be allowed to expire, or at least bereduced from its current form. Congress responded to the impending expiration of TRIA with two different bills thatinitially passed the respective houses. The Senate bill, Senator Christopher Dodd's S. 467 , was approved by the Senate on November, 18, 2005. The large majority of the language fromthe House bill, Representative Richard Baker's H.R. 4314 , was inserted into S.467 and passed by the House on December 7, 2005. S. 467 was entitled theTerrorism Risk Insurance Extension Act, whereas H.R. 4314 was entitled the TerrorismRisk Insurance Revision Act and the titles did reflect essential differences between the two bills. Senator Dodd introduced S. 467 on February 18, 2005. As introduced, it wasidentical to a bill, S. 2764 , introduced by Senator Dodd in the 108th Congress. S.467, as introduced, would have explicitly extended TRIA for two years, until the end of2007, and would have added a "soft landing" year by changing the definition of an insured loss sothat policies written in the second year and extending into a third year would be covered. Theindividual insurer deductible was to remain at 15% of earned premiums during the extension, whilethe insurance industry aggregate loss retention amount was to increase from the current $15 billionin 2005 to $17.5 billion for 2006 and finally $20 billion for 2007. S. 467 also would havedirected the Treasury to promulgate new rules including group life insurance under TRIA. On June 30, 2005, the Department of the Treasury released a report on TRIA accompaniedby a letter from Secretary Snow indicating that TRIA had achieved its goal of stabilizing theinsurance market and that the Administration would not support an extension without significantchanges reducing the taxpayer exposure from the program. On November 16, 2005, the SenateCommittee on Banking, Housing, and Urban Affairs marked up S. 467 and substitutedan amendment by Chairman Richard Shelby for the original text. It then reported the bill favorablyto the full Senate by voice vote. As amended, S. 467 would have extended the current program two years andfurther increased the private sector's exposure to terrorism risk over the life of the act, as did theoriginal legislation. During the three years covered by the initial act, insurance industry deductiblesand aggregate retention rose each year. S. 467 continued to increase these. It would havealso reduced the types of insurance covered by the program and increased the size of a terrorist eventnecessary to trigger the program. Specifically, it removed commercial auto, burglary and theft,surety, farm owners multiple peril, and professional liability (except for directors and officersliability), as covered lines; raised the insurer deductible to 17.5% in 2006 and 20% in 2007;decreased the federal share of insured losses from 10% to 15% for 2007; and raised the event triggerto $50 million in 2006 and $100 million in 2007. S. 467 was brought to the Senate floor and passed by unanimous consent onNovember 18, 2005. The House brought the bill to floor and amended it with most of the text of H.R. 4314 before passing it on December 7, 2005. H.R. 4314 was introduced by Representative Baker on November 14, 2005, andmarked up by the House Financial Services Committee on November 16. Three amendments, byChairman Michael Oxley and Representatives Barney Frank and Debbie Wasserman Schultz, wereadopted in committee by voice vote. (2) Chairman Oxley's amendment made a number of changes,including adjusting the exact deductibles for various insurance lines, reducing the program triggeramount in program years after the second year and striking language that would have preemptedsome state laws relating to rate and form filing. Representative Frank's amendment increased thesize needed by a company or municipality to be considered an "exempt commercial purchaser" ofinsurance. Representative Wasserman Schultz's amendment added the requirement that life insurersnot deny insurance coverage based on lawful overseas travel. The amended bill was favorablyreported to the full House by a vote of 64-3. In the 108th Congress, the committee had reportedfavorably a straightforward extension of TRIA with relatively minor changes. H.R. 4313 , however, went well beyond the previously reported House bill or the changes recommendedby Secretary Snow. H.R. 4314 as reported would have limited the types of insurance covered byremoving commercial auto insurance. However, it would have expanded the program to coverdomestic terrorist events and increased the covered types of insurance to include group life andspecific coverage for nuclear, biological, chemical, and radiological (NBCR) events. It would haveraised the event trigger to $50 million in 2006 and added an additional $50 million to this for everyfuture year the program is in effect. It also would have changed the insurer deductible but wouldhave done so differently for different lines of insurance, raising it to as high as 25% for casualtyinsurance but lowering it to 7.5% for NCBR events. H.R. 4314 would have lowered thefederal share of insured losses to 80% for events under $10 billion but raised it gradually to 95% forevents over $40 billion. In the case of a terrorist act, the deductibles and event triggers would havereset to lower levels, with deductibles possibly as low as 5% in the event of a large attack. It wouldhave removed the cap on the mandatory recoupment provision so that all money expended underTRIA would be recouped by the federal government through a surcharge on insurers in the yearsafter the attack. H.R. 4314 also would have created "TRIA Capital Reserve Funds (CRF),"to allow insurers to set aside untaxed reserves to tap in the case of a terrorist event. With a few changes, notably the addition of language striking Section 107 of the originalTRIA, the language of H.R. 4314 as it was reported was inserted into the Senate-passed S. 467 , and this amended version of S. 467 passed the House 371-49 onDecember 7, 2005. Shortly after passage, the House called for a conference committee to resolvedifferences with the Senate and appointed conferees. The Executive Office of the President issued a Statement of Administration Policy supporting S. 467 on November 17, 2005. It also indicated that the Administration would stronglyoppose "any efforts to add lines of coverage, including group life insurance." On December 7, 2005,a Statement of Administration Policy was issued that specifically opposed the House-passed versionof S. 467. Following the House appointment of conferees on December 7, 2005, the Senate did notappoint conferees. Instead, it took up and passed a further amendment ( S.Amdt. 2689 )to S. 467 by unanimous consent on December 16, 2005. The House followed this withpassage of this version of S. 467 by voice vote on December 17, 2005. S. 467 was signed by the President on December 22, 2005, becoming PublicLaw 109-144. P.L. 109-144 closely follows S. 467 as initially passed by the Senate onNovember 18, 2005. The significant difference is an increase in the aggregate retention amount from$17.5 billion and $20 billion to $25 billion and $27.5 billion for 2006 and 2007. Table 1. Side-by Side: Terrorism Risk Insurance Act of 2002, Initial Senate- and House-passed Legislation,andTerrorism Risk Insurance Extension Act of 2005 Notes: The initial House-passed S. 467 would strike essentially all of 15 U.S.C. 6701 note (which sets out sections 101-108 of P.L. 107-297 )and replaces it with a similar structure, including in some cases, identical language. The section numbers for this House-passed S. 467 citedin this side-by-side are, therefore, those that would appear in the Code if the bill were enacted, except for the provision entitled "Litigation Management." In contrast, both the initial S. 467 and P.L. 109-144 simply amend 15 U.S.C. 6701 note. The section numbers cited in this side-by-side are thusthose of the bill and law.

Prior to the September 11, 2001, terrorist attacks, insurance covering terrorism losses wasnormally included in general insurance policies without cost to policyholders. Following the attacks,both primary insurers and reinsurers pulled back from offering terrorism coverage, citing particularlyan inability to calculate the probability and loss data critical for insurance pricing. Some argued thatterrorism risk would never be insurable by the private market due to the uncertainty and potentiallymassive losses involved. Because insurance is required for a variety of economic transactions, it wasfeared that a lack of insurance against terrorism loss would have wider economic impact. Congress responded to the disruption in the insurance market by passing the Terrorism RiskInsurance Act of 2002 (TRIA). TRIA created a temporary program, expiring at the end of 2005, tocalm the insurance markets through a government backstop for terrorism losses and to give theprivate industry time to gather the data and create the structures and capacity necessary for privateinsurance to cover terrorism risk. From 2002 to 2005, terrorism insurance became widely availableand largely affordable, and the insurance industry greatly expanded its financial capacity. There was,however, little apparent success on a longer term private solution and fears persisted about widereconomic consequences if insurance were not available. To a large degree, the same concerns andarguments that accompanied the initial passage of TRIA were before Congress as it considered TRIAextension legislation. Congress responded to the impending expiration of TRIA with the passage of two differentbills. The Senate bill, S. 467 , was approved by the Senate on November 18, 2005. Thelarge majority of the language from the House bill, H.R. 4314 , was inserted into S.467 and passed by the House on December 7, 2005. S. 467 was titled theTerrorism Risk Insurance Extension Act, whereas H.R. 4314 was titled the Terrorism RiskInsurance Revision Act. These titles did reflect essential differences between the two bills. S.467 extended the current program by two years and further increased the private sector'sexposure to terrorism risk, as did the original act. (During the three years covered by the initial act,insurance industry deductibles and aggregate retention rose each year.) S. 467 continuedto increase these and also reduced the types of insurance covered by the program and increased thesize of terrorist event necessary to trigger the program. H.R. 4314 extended the programfor two or possibly three years and substantially revised many aspects of it. Among the notablechanges, it excluded some lines of coverage and included others that were not covered before. Itsegmented lines of insurance, introducing different deductibles for different lines. It included theconcept of resetting the deductibles and the trigger amount to lower amounts if a terrorist attackoccurs in the future. The final version signed into law closely tracked the Senate legislation. This report briefly outlines the issues involved with terrorism insurance and includes aside-by-side of the initial TRIA, TRIA-extension legislation as considered in the House and Senate,and the final bill as signed by the President. It will not be updated.

The Robinson-Patman Act (15 U.S.C. §§13, 13a, 13b, 21a) was enacted in 1936 with the specific purpose of creating and maintaining a market atmosphere in which small business could compete effectively, at least in the purchase of commodities, with its larger rivals. The immediate impetus for that Depression-era legislation was the concern for smaller grocery store operators who complained that their businesses were suffering as the direct result of the activities of the chain grocery stores generally and the Great Atlantic & Pacific Tea Company (A&P) particularly. In pertinent part, the statute states that it shall be unlawful for any person engaged in commerce, in the course of such commerce, either directly or indirectly, to discriminate in price between different purchasers of commodities of like grade and quality, where either or any of the purchases involved in such discrimination are in commerce, where such commodities are sold for use, consumption, or sale within the United States ..., and where the effect of such discrimination may be substantially to lessen competition or tend to create a monopoly in any line of commerce, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with the customers of either of them. Very simply, the Act prohibits sellers in interstate commerce from charging different purchasers different prices for goods of "like grade and quality." The Act applies only to the sale of goods ( i.e., it does not apply to the sale of services) and only where each sale is of goods purchased for resale within the United States ( i.e., it does not prohibit price differentials between goods sold for resale within the United States and those sold for export.) Among the affirmative defenses permitted to refute the Robinson-Patman illegality of differential pricing is the so-called "meeting competition" defense, which has at least two levels: a defendant may assert (and must prove) that the lower price charged to a favored buyer was selected in order to permit the seller to meet that of a competing seller (primary line competition); or he may assert (and must prove) that the challenged price was necessary in order to enable his buyer to meet the competition of one of the buyer's competitors (secondary line competition). A seller may not, however, knowingly "beat" the prices of a competitor. A Robinson-Patman defendant may also successfully defend his challenged pricing activity if he can show that his price differentials were "cost justified"— i.e., that the price differential made only due allowance for the costs incurred in producing or delivering the goods. In addition, the 1938 Nonprofit Institutions Act (15 U.S.C. §13c), which expressly permitted price breaks on "purchases of their supplies for their own use by schools, colleges, universities, public libraries, churches, hospitals, and charitable institutions not operated for profit" (emphasis added), created a broad exemption from the general price-discrimination prohibition: The underlying intent in granting such an exemption was indisputably to permit institutions which are not in business for a profit to operate as inexpensively as possible. Two Supreme Court opinions, announced in the mid-1970s and early 1980s, provided significant interpretations of the scope of the nonprofit exemption from the Robinson-Patman prohibition. Both involved challenges to the practice of a pharmaceutical supplier who was selling its products to certain hospitals at prices lower than those charged to retail pharmacists in the areas surrounding the hospitals in question. Abbott Laboratories v. Portland Retail Druggists Association, Inc. , 425 U.S. 1 (1976), discussed the "for their own use" phrase in the Nonprofit Institutions Act; the provision was interpreted strictly. The Court relied largely on the "for their own use" language to hold that purchases made by a nonprofit hospital are not all necessarily exempt from price discrimination prohibitions, only those made in order to able to meet the needs of the hospital ( e.g., dispensing to inpatients, outpatients treated in the hospital, emergency room use) and those of staff physicians, medical and nursing students, and their dependents: "The Congress surely did not intend to give the hospital a blank check" Although the Court included within permissible uses by the hospital, "genuine take home prescription[s], intended, for a limited and reasonable time, as a continuation of, or supplement to, the treatment that was administered at the hospital to the patient who needed, and now continues to need, that treatment," it specifically excluded from the Robinson-Patman exemption embodied in the Nonprofit Institutions Act "the refill for the hospital's former patient." Further, the Court refused to sanction purchases by the hospital-based physician for use in "that portion of his private practice unconnected with the hospital." While the primary concern addressed by the Court in Portland was the sale of pharmaceuticals to nonprofit hospitals for all uses, including patient care and resale, four years later, in Jefferson County Pharmaceutical Ass ' n., Inc. v. Abbott Laboratories , 460 U.S. 150 (1983), the Court set out the limits of the exception to Robinson-Patman for government purchases; Jefferson County presented an issue "limited to state [read "nonprofit hospital"] purchases for the purposes of competing against private enterprise—with the advantage of discriminatory prices—in the retail market." Jefferson County stressed that Robinson-Patman's prohibitions against unjustified discriminatory price differentials in the sale of commodities of "like grade and quality" dictated that government [nonprofit hospital] purchases for use in retail competition with private enterprise, as opposed to those for "traditional governmental [hospital] functions," are fully subject to the strictures of the Act. The Court held that purchases of pharmaceuticals by the University of Alabama Hospital for uses other than in the treatment of its patients, as, for example, in retail sales, may not be made at prices which would give the University Hospital an unfair price advantage over its competitors in the retail sale of pharmaceuticals. Health maintenance organizations were found to be "eligible institutions" under the Nonprofit Institutions Act in De Modena v. Kaiser Foundation Health Plan, Inc. , 743 F.2d 1388 (9 th Cir. 1984), cert. denied , 469 U.S. 1229 (1985). After acknowledging that the Act "does not explicitly list HPs [health plans]," and that no case law at that time specifically included HPs as "charitable" institutions, the appeals court relied on "precedent defining the term charitable for purposes of the tax code and the law of charitable trusts" to reach its conclusion: "[T]he emergence of social welfare, insurance, and municipal hospitals [has] drastically reduced the number of poor requiring free or below cost medical services . . . . This reduction eliminated the rationale upon which the traditional, limited definition of charitable was predicated, resulting in a move towards a less restrictive interpretation of the term in recent years. Now all non-profit organizations which promote health are considered charitable under the law of charitable trusts. Further, a number of courts have specifically held that health maintenance organizations, such as HPs, are charitable institutions for tax purposes. . . . Given this increasingly liberal interpretation of the term, we conclude that the [defendant] HPs are charitable institutions within the meaning of the Nonprofit Institutions Act. Further, the court relied on the expression of the "for their own use" criterion propounded by the Supreme Court in Abbott Laboratories v. Portland Retail Druggists to decide that the "basic institutional function" of a health plan—providing a "complete panoply" of health-care services, including continuing and preventative services, to its members—requires that "drugs purchased by an HMO . . . for resale to its members [be considered as] purchased for the HMO's `own use' within the meaning of the Nonprofit Institutions Act." Since its enactment, the Robinson-Patman Act has been less than enthusiastically viewed by the Department of Justice, which has believed since 1936 that the Act is not beneficial to consumers. Accordingly, government enforcement of the Act has always been entrusted to the Federal Trade Commission (FTC). In its 1977 Report on the Robinson-Patman Act, the Antitrust Division noted that It should not be surprising ... that Robinson-Patman can be shown to have many adverse effects on the economy. To be sure, there are some who do not recognize these effects or who argue that they are outweighed by benefits to specific sectors of the economy, notably small business; to competition by preventing increased concentration in a line of commerce; and to public values in general by establishing as a legal norm the concept of `fair dealing' in pricing. But any discussion of the benefits of Robinson-Patman can be made only with a clear understanding of the burdens that the statute places on American economic activity. In the mid 1970s, the 94 th Congress, through an Ad Hoc Subcommittee of the House Small Business Committee, held hearings on and considered proposals to amend or repeal the Robinson-Patman Act. Although the Subcommittee received several draft bills from the Department of Justice to either substantially amend, or to repeal the Act, no legislation was introduced at that time; nor are we aware of any introduced at any time thereafter.

The Robinson-Patman Act (hereinafter, R-P), 15 U.S.C. § § 13, 13a, 13b, 21a, makes it unlawful, with certain exceptions, to knowingly sell goods "in commerce," for use or sale within the United States, at differing prices to contemporaneous buyers of those goods. Enacted during the Depression at the behest of small grocers who feared the buying power of large and growing chain grocers, it is the exception to the notion that the antitrust laws protect competition, not competitors in that it generally prohibits precisely the kind of price differentiation which would normally be thought to result from vigorous competition . Allegations of R-P violations may be defended by asserting and proving either that the differing prices reflect only the cost of the seller's manufacture or delivery (the "cost justification" defense); or, that the seller is attempting either (1) to meet the competition of another seller, or (2) enable his buyer to meet the competition of a competitor of the buyer ("meeting competition" defense). In addition, there is also a broad exception to the prohibition against price discrimination when one of the sales is made to any of certain entities listed in the Nonprofit Institutions Act, 15 U.S.C. § 13c, and the goods are purchased for the institution's "own use"; nonprofits may not, however, take advantage of their privileged Robinson-Patman status to purchase commodities at favorable prices in order to compete commercially with entities not so entitled. Further, lower courts have found that health maintenance organizations (HMOs) qualify as organizations entitled to take advantage of the Nonprofit Institutions Act, on the theory that they perform services that traditionally have been considered as "charitable," although the Supreme Court has not had occasion to rule on the status of HMOs. The "in commerce" language of Robinson-Patman has been held to mean that the interstate commerce requirement is satisfied only when at least one of the two (or more) sales is made "in the stream of commerce"—i.e., across state lines. This report will be updated as warranted.

Historically, tribes have been granted federal recognition through treaties, by the Congress, or through administrative decisions within the executive branch— principally by the Department of the Interior. In a 1977 report to the Congress, the American Indian Policy Review Commission criticized the criteria used by the department to assess whether a group should be recognized as a tribe. Specifically, the report stated that the criteria were not very clear and concluded that a large part of the department’s tribal recognition policy depended on which official responded to the group’s inquiries. Until the 1960s, the limited number of requests by groups to be federally recognized gave the department the flexibility to assess a group’s status on a case-by-case basis without formal guidelines. However, in response to an increase in the number of requests for federal recognition, the department determined that it needed a uniform and objective approach to evaluate these requests. In 1978, it established a regulatory process for recognizing tribes whose relationship with the United States had either lapsed or never been established—although tribes may seek recognition through other avenues, such as legislation or Department of the Interior administrative decisions unconnected to the regulatory process. In addition, not all tribes are eligible for the regulatory process. For example, tribes whose political relationship with the United States has been terminated by Congress, or tribes whose members are officially part of an already recognized tribe, are ineligible to be recognized through the regulatory process and must seek recognition through other avenues. The regulations lay out seven criteria that a group must meet before it can become a federally recognized tribe. Essentially, these criteria require the petitioner to show that it is a distinct community that has continuously existed as a political entity since a time when the federal government broadly acknowledged a political relationship with all Indian tribes. The burden of proof is on petitioners to provide documentation to satisfy the seven criteria. A technical staff within BIA, consisting of historians, anthropologists, and genealogists, reviews the submitted documentation and makes its recommendations on a proposed finding either for or against recognition. Staff recommendations are subject to review by the department’s Office of the Solicitor and senior officials within BIA. The Assistant Secretary-Indian Affairs makes the final decision regarding the proposed finding, which is then published in the Federal Register and a period of public comment, document submission, and response is allowed. The technical staff reviews the comments, documentation, and responses and makes recommendations on a final determination that are subject to the same levels of review as a proposed finding. The process culminates in a final determination by the Assistant Secretary who, depending on the nature of further evidence submitted, may or may not rule the same as the proposed finding. Petitioners and others may file requests for reconsideration with the Interior Board of Indian Appeals. While we found general agreement on the seven criteria that groups must meet to be granted recognition, there is great potential for disagreement when the question before the BIA is whether the level of available evidence is high enough to demonstrate that a petitioner meets the criteria. The need for clearer guidance on criteria and evidence used in recognition decisions became evident in a number of recent cases when the previous Assistant Secretary approved either proposed or final decisions to recognize tribes when the staff had recommended against recognition. Much of the current controversy surrounding the regulatory process stems from these cases. For example, concerns over what constitutes continuous existence have centered on the allowable gap in time during which there is limited or no evidence that a petitioner has met one or more of the criteria. In one case, the technical staff recommended that a petitioner not be recognized because there was a 70-year period for which there was no evidence that the petitioner satisfied the criteria for continuous existence as a distinct community exhibiting political authority. The technical staff concluded that a 70-year evidentiary gap was too long to support a finding of continuous existence. The staff based its conclusion on precedent established through previous decisions in which the absence of evidence for shorter periods of time had served as grounds for finding that petitioners did not meet these criteria. However, in this case, the previous Assistant Secretary determined that the gap was not critical and issued a proposed finding to recognize the petitioner, concluding that continuous existence could be presumed despite the lack of specific evidence for a 70- year period. The regulations state that lack of evidence is cause for denial but note that historical situations and inherent limitations in the availability of evidence must be considered. The regulations specifically decline to define a permissible interval during which a group could be presumed to have continued to exist if the group could demonstrate its existence before and after the interval. They further state that establishing a specific interval would be inappropriate because the significance of the interval must be considered in light of the character of the group, its history, and the nature of the available evidence. Finally, the regulations also note that experience has shown that historical evidence of tribal existence is often not available in clear, unambiguous packets relating to particular points in time. The department grappled with the issue of how much evidence is enough when it updated the regulations in 1994 and intentionally left key aspects of the criteria open to interpretation to accommodate the unique characteristics of individual petitions. Leaving key aspects open to interpretation increases the risk that the criteria may be applied inconsistently to different petitioners. To mitigate this risk, BIA uses precedents established in past decisions to provide guidance in interpreting key aspects in the criteria. However, the regulations and accompanying guidelines are silent regarding the role of precedent in making decisions or the circumstances that may cause deviation from precedent. Thus, petitioners, third parties, and future decisionmakers, who may want to consider precedents in past decisions, have difficulty understanding the basis for some decisions. Ultimately, BIA and the Assistant Secretary will still have to make difficult decisions about petitions when it is unclear whether a precedent applies or even exists. Because these circumstances require judgment on the part of the decisionmaker, public confidence in the BIA and the Assistant Secretary as key decisionmakers is extremely important. A lack of clear and transparent explanations for their decisions could cast doubt on the objectivity of the decisionmakers, making it difficult for parties on all sides to understand and accept decisions, regardless of the merit or direction of the decisions reached. Accordingly, in our November report, we recommend that the Secretary of the Interior direct the BIA to provide a clearer understanding of the basis used in recognition decisions by developing and using transparent guidelines that help interpret key aspects of the criteria and supporting evidence used in federal recognition decisions. The department, in commenting on a draft of this report, generally agreed with this recommendation. Because of limited resources, a lack of time frames, and ineffective procedures for providing information to interested third parties, the length of time needed to rule on petitions is substantial. The workload of the BIA staff assigned to evaluate recognition decisions has increased while resources have declined. There was a large influx of completed petitions ready to be reviewed in the mid-1990s. Of the 55 completed petitions that BIA has received since the inception of the regulatory process in 1978, 23 (or 42 percent) were submitted between 1993 and 1997 (see fig. 1). The chief of the branch responsible for evaluating petitions told us that, based solely on the historic rate at which BIA has issued final determinations, it could take 15 years to resolve all the currently completed petitions. In contrast, the regulations outline a process for evaluating a completed petition that should take about 2 years. Compounding the backlog of petitions awaiting evaluation is the increased burden of related administrative responsibilities that reduce the time available for BIA’s technical staff to evaluate petitions. Although they could not provide precise data, members of the staff told us that this burden has increased substantially over the years and estimate that they now spend up to 40 percent of their time fulfilling administrative responsibilities. In particular, there are substantial numbers of Freedom of Information Act (FOIA) requests related to petitions. Also, petitioners and third parties frequently file requests for reconsideration of recognition decisions that need to be reviewed by the Interior Board of Indian Appeals, requiring the staff to prepare the record and response to issues referred to the Board. Finally, the regulatory process has been subject to an increasing number of lawsuits from dissatisfied parties, filed by petitioners who have completed the process and been denied recognition, as well as current petitioners who are dissatisfied with the amount of time it is taking to process their petitions. Staff represents the vast majority of resources used by BIA to evaluate petitions and perform related administrative duties. Despite the increased workload faced by the BIA’s technical staff, the available staff resources to complete the workload have decreased. The number of BIA staff members assigned to evaluate petitions peaked in 1993 at 17. However, in the last 5 years, the number of staff members has averaged less than 11, a decrease of more than 35 percent. In addition to the resources not keeping pace with workload, the recognition process also lacks effective procedures for addressing the workload in a timely manner. Although the regulations establish timelines for processing petitions that, if met, would result in a final decision in approximately 2 years, these timelines are routinely extended, either because of BIA resource constraints or at the request of petitioners and third parties (upon showing good cause). As a result, only 12 of the 32 petitions that BIA has finished reviewing were completed within 2 years or less, and all but 2 of the 13 petitions currently under review have already been under review for more than 2 years. While BIA may extend timelines for many reasons, it has no mechanism that balances the need for a thorough review of a petition with the need to complete the decision process. The decision process lacks effective time frames that create a sense of urgency to offset the desire to consider all information from all interested parties in the process. BIA recently dropped one mechanism for creating a sense of urgency. In fiscal year 2000, BIA dropped its long-term goal of reducing the number of petitions actively being considered from its annual performance plan because the addition of new petitions would make this goal impossible to achieve. The BIA has not replaced it with another more realistic goal, such as reducing the number of petitions on ready status or reducing the average time needed to process a petition once it is placed on active status. As third parties become more active in the recognition process—for example, initiating inquiries and providing information—the procedures for responding to their increased interest have not kept pace. Third parties told us that they wanted more detailed information earlier in the process so they could fully understand a petition and effectively comment on its merits. However, there are no procedures for regularly providing third parties with more detailed information. For example, while third parties are allowed to comment on the merits of a petition prior to a proposed finding, there is no mechanism to provide any information to third parties prior to the proposed finding. In contrast, petitioners are provided an opportunity to respond to any substantive comment received prior to the proposed finding. As a result, third parties are making FOIA requests for information on petitions much earlier in the process and often more than once in an attempt to obtain the latest documentation submitted. Since BIA has no procedures for efficiently responding to FOIA requests, staff members hired as historians, genealogists, and anthropologists are pressed into service to copy the voluminous records needed to respond to FOIA requests. In light of these problems, we recommended in our November report that the Secretary of the Interior direct the BIA to develop a strategy that identifies how to improve the responsiveness of the process for federal recognition. Such a strategy should include a systematic assessment of the resources available and needed that leads to development of a budget commensurate with workload. The department also generally agreed with this recommendation. In conclusion, the BIA’s recognition process was never intended to be the only way groups could receive federal recognition. Nevertheless, it was intended to provide the Department of the Interior with an objective and uniform approach by establishing specific criteria and a process for evaluating groups seeking federal recognition. It is also the only avenue to federal recognition that has established criteria and a public process for determining whether groups meet the criteria. However, weaknesses in the process have created uncertainty about the basis for recognition decisions, calling into question the objectivity of the process. Additionally, the amount of time it takes to make those decisions continues to frustrate petitioners and third parties, who have a great deal at stake in resolving tribal recognition cases. Without improvements that focus on fixing these problems, parties involved in tribal recognition may look outside of the regulatory process to the Congress or courts to resolve recognition issues, preventing the process from achieving its potential to provide a more uniform approach to tribal recognition. The result could be that the resolution of tribal recognition cases will have less to do with the attributes and qualities of a group as an independent political entity deserving a government-to-government relationship with the United States, and more to do with the resources that petitioners and third parties can marshal to develop successful political and legal strategies. Mr. Chairman, this completes my prepared statement. I would be happy to respond to any questions you or other Members of the Committee may have at this time. For further information, please contact Barry Hill on (202) 512-3841. Individuals making key contributions to this testimony and the report on which it was based are Robert Crystal, Charles Egan, Mark Gaffigan, Jeffery Malcolm, and John Yakaitis.

In 1978, the Bureau of Indian Affairs (BIA) established a regulatory process for recognizing tribes. The process requires tribes that are petitioning for recognition to submit evidence that they have continuously existed as an Indian tribe since historic times. Recognition establishes a formal government-to-government relationship between the United States and a tribe. The quasi-sovereign status created by this relationship exempts some tribal lands from most state and local laws and regulations, including those that regulate gambling. GAO found that the basis for BIA's tribal recognition decisions is not always clear. Although petitioning tribes must meet set criteria to be granted recognition, no guidance exists to clearly explain how to interpret key aspects of the criteria. This lack of guidance creates controversy and uncertainty for all parties about the basis for decisions. The recognition process is also hampered by limited resources; a lack of time; and ineffective procedures for providing information to interested third parties, such as local municipalities and other Indian tribes. As a result, the number of completed petitions waiting to be considered is growing. BIA estimates that it may take up to 15 years before all currently completed petitions are resolved; the process for evaluating a petition was supposed to take about two years. This testimony summarizes a November report (GAO-02-49).

The BSA is "the primary U.S. anti-money laundering (AML) law" regulating financial institutions. Among other things, the Act and related regulations impose certain reporting and recordkeeping requirements and require certain institutions to establish AML programs that meet specified minimum standards. The BSA and related regulations provide for civil and criminal penalties for violations of their provisions, as well as the forfeiture of assets involved in a violation. The level of BSA penalties varies based on the type of entity charged with a violation, the type of violation, and the defendant's level of intent. The Financial Crimes Enforcement Network (FinCEN), a bureau within the Department of the Treasury primarily charged with administering the BSA, has enforcement authority to bring administrative actions for failure to meet BSA requirements. The Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation, the Federal Reserve, the Securities and Exchange Commission, the Financial Industry Regulatory Authority, and the National Credit Union Administration also have authority to enforce the BSA's requirements against the institutions they regulate. Moreover, the Department of Justice (DOJ) regularly brings criminal charges for BSA violations. Commentators have noted an increase in the frequency with which BSA enforcement actions have involved an assessment by federal regulators of monetary penalties, and an increase in the size of those penalties. According to a June 2016 study conducted by National Economic Research Associates, Inc. (NERA), nearly 90% of BSA/AML enforcement actions from 2012 through 2015 involved an assessment of money penalties, compared to less than half of such enforcement actions from 2002 through 2011. NERA also observed that BSA/AML penalties "have grown substantially in both absolute terms and as a proportion of firm capital." Specifically, NERA found that more than 80% of the total money penalties imposed for BSA/AML violations since 2002 have been levied after 2012. Moreover, according to that same report, since October 2009, nearly one-third of BSA/AML penalties have exceeded 10% of a defendant institution's capital. By contrast, no penalty imposed before 2007 exceeded 9% of a defendant institution's capital. Two recent BSA/AML enforcement actions stand out for their size. In 2012, HSBC Holdings plc and HSBC Bank USA N.A. (together, HSBC) were assessed a $665 million civil money penalty, forfeited roughly $1.2 billion, and entered into a deferred prosecution agreement (DPA) based on, among other things, their failure to maintain an effective AML program and conduct appropriate due diligence on foreign correspondent account holders. The HSBC enforcement action was pursued concurrently by the DOJ, the OCC, the Federal Reserve, and the Department of the Treasury. Pursuant to the DPA, HSBC admitted responsibility for violating the BSA and associated regulations from 2006 to 2010. Specifically, HSBC admitted that during the relevant time period, it "ignored the money laundering risks associated with doing business with certain Mexican customers and failed to implement a BSA/AML program that was adequate to monitor suspicious transactions from Mexico." According to the DPA, as a result of HSBC's failures, at least $881 million in drug trafficking proceeds were laundered through HSBC Bank USA without being detected. In a series of other BSA enforcement actions, a number of federal regulators assessed large penalties against JPMorgan Chase Bank, N.A. (JPMorgan) in January 2014 for its role in the Bernard L. Madoff Ponzi scheme. JPMorgan entered into a DPA with the U.S. Attorney's Office for the Southern District of New York concerning Madoff-related BSA violations. Pursuant to the DPA, JPMorgan admitted that it violated the BSA by failing to maintain an effective AML compliance program and failing to file suspicious activity reports (SARs) concerning transactions related to the Madoff scheme. JPMorgan further agreed to forfeit $1.7 billion to compensate victims of the Madoff fraud—the largest-ever penalty for a BSA violation. Separately, the OCC and FinCEN assessed civil money penalties of $350 million and $461 million, respectively, against JPMorgan for its Madoff-related BSA violations. A second recent trend in BSA/AML enforcement is an increased emphasis by regulators on the acceptance of responsibility by institutions charged with BSA violations. In 2013, FinCEN Director Jennifer Shasky Calvery indicated that FinCEN had changed its approach of generally allowing financial institutions charged with BSA violations to enter into settlements "without admitting or denying" the facts alleged in a penalty assessment. Shasky Calvery noted that in FinCEN's most recent enforcement actions, defendant institutions had been required to stipulate to a statement of facts, reflecting the agency's new position that "[a]cceptance of responsibility and acknowledgment of the facts is a critical component of corporate responsibility." Two years later, FinCEN's Director of Enforcement confirmed the agency's changed approach when she indicated that FinCEN operates under a "presumption" that "a settlement of an enforcement action will include an admission to the facts, as well as the violation of law." Along these lines, NERA's 2016 study found that four of the six largest BSA/AML violations charged between 2010 and 2015 "required the [defendant] financial institution to admit the accuracy of government claims and accept responsibility for the actions of its officers, agents, and employees who violated BSA/AML regulations." Finally, commentators have noted an increased risk of individual liability for BSA violations. In December 2014, FinCEN assessed a $1 million civil money penalty against Thomas Haider, the former Chief Compliance Officer of MoneyGram International for willful violations of the BSA's program requirements and failure to timely file SARs concerning fraudulent telemarketing operations and other schemes. FinCEN's enforcement action led to litigation over the application of the BSA to individuals. In January 2016, a federal district court held in U.S. Department of Treasury v. Haider that individuals can be liable for violations of the BSA's AML program requirements. In that case, Haider argued that individuals cannot be liable for violations of the BSA's program requirements because the relevant BSA provision provides that "financial institution[s] shall establish anti-money laundering programs," in contrast to the BSA's provision requiring the filing of SARs, which provides that "any financial institution, and any director, officer, employee, or agent of any financial institution , [may be required] to report suspicious transactions relevant to a possible violation of law or regulation." The court rejected this argument, reasoning that because the BSA's general civil penalty provision authorizes the imposition of money penalties against, among other individuals, "officer[s]" of financial institutions, Haider could be held liable for violations of the BSA's AML program requirements. Regulators have recently pursued a number of other BSA enforcement actions against individual compliance officers. This increased emphasis on individual prosecutions is broadly consistent with the approach outlined by the DOJ in the September 2015 "Yates Memo," which emphasized the importance of individual accountability for corporate wrongdoing. Current Deputy Attorney General Rod Rosenstein has indicated that while he "generally agree[s] with the critique that motivated" the Yates Memo, the memo is currently under review. Accordingly, it remains to be seen whether the DOJ under President Trump will maintain the previous Administration's emphasis on individual responsibility in white-collar enforcement actions and prosecutions.

This report provides an overview of recent trends in the enforcement of the Bank Secrecy Act (BSA), the principal U.S. anti-money laundering law regulating financial institutions. The report begins by providing general background information on BSA penalties and enforcement. The report concludes by discussing three recent trends that commentators have observed in BSA enforcement: (1) an increase in the frequency with which BSA enforcement actions involve an assessment of money penalties, and an increase in the size of those penalties, (2) an increased emphasis by regulators on the acceptance of responsibility by institutions entering into settlement agreements for BSA violations, and (3) an increased risk of individual liability for BSA violations.

Airports are a linchpin in the nation’s air transportation system. This is true for both the 71 largest airports, as well as for the nation’s 3,233 smaller commercial and general aviation airports. While small airports handle only about 10 percent of scheduled passenger traffic in total , they also serve a majority of the nation’s general aviation activity. For many communities, a small airport is their primary access to air transportation. Smaller airports also provide important economic benefits to their communities in the form of jobs and transport. The National Civil Aviation Review Commission—established by the Congress to determine how to fund U.S. civil aviation—reported in December 1997 that more funding is needed, not only to develop system capacity at the larger airports but also to preserve smaller airports. In 1996, tax-exempt bonds, the Airport Improvement Program (AIP), and passenger facility charges (PFC) together provided about $6.6 billion of the total $7 billion in funding for large and small airports. State grants and airport revenue contributed the remaining funding for airports. Table 1 lists these sources of funding and their amounts in 1996. The amount and type of funding varies significantly with airports’ size. The nation’s 3,233 smaller national system airports obtained about $1.5 billion in funding in 1996, about 22 percent of the total for 1996. As shown in figure 1, smaller airports relied on AIP grants for half of their funding, followed by tax-exempt airport and special facility bonds,and state grants. PFCs accounted for only 7 percent of smaller airports’ funding mix. Conversely, larger airports received more than $5.5 billion in funding, relying on airport bonds for 62 percent of their total funding, followed by PFC collections. AIP grants accounted for only 10 percent of larger airports’ funding. Small airports’ planned capital development during 1997 through 2001 may cost nearly $3 billion per year, or $1.4 billion per year more than these airports raised in 1996. Figure 2 compares small airports’ total funding for capital development in 1996 with their annual planned spending for development. Funding for 1996, the bar on the left, is shown by source (AIP, PFCs, state grants, and bonds). Planned spending for small airports, the bar on the right, is shown by the relative priority FAA has assigned to the projects, as follows: Reconstruction and mandated projects, FAA’s highest priorities, total $750 million per year and are for projects to maintain existing infrastructure (reconstruction) or to meet federal mandates, including safety, security, and environmental requirements (including noise mitigation requirements). Other high-priority projects, primarily adding capacity, account for another $373 million per year. Other AIP-eligible projects, a lower priority for FAA, such as bringing airports up to FAA’s design standards, add another $1.37 billion per year, for a total of nearly $2.5 billion per year in projects eligible for AIP funding. Finally, small airports anticipate another $465 million per year on projects that are not eligible for AIP funding, such as expanding commercial space in terminals and constructing parking garages. Planned development 1997 through 2001 (annualized) Given this picture of funding and planned spending for development for small airports, it is difficult to develop a precise estimate of the extent to which AIP-eligible projects are deferred or canceled because some form of funding cannot be found for them. FAA does not maintain information on whether eligible projects that do not receive AIP funding are funded from other sources, deferred, or canceled. We were not successful in developing an estimate from other information sources, mainly because comprehensive data are not kept on the uses to which airport and special facility bonds are put. But even if the entire bond financing available to smaller airports were spent on AIP-eligible projects, these airports would have, at a minimum, about $945 million a year in AIP-eligible projects that are not funded. Conversely, if none of the financing from bonds were applied to AIP-eligible projects, then the full $1.41 billion funding shortfall for smaller airports would apply to these projects. As a proportion of total funding, the potential funding shortfall for smaller airports is more significant than it is for large airports. For large airports, the difference between 1996 funding and planned development is about $1.5 billion. However, because large airports obtained $5.5 billion in funding in 1996 versus $1.5 billion for small airports, large airports’ potential shortfall represents 21 percent of their planned development costs as compared to small airports’ potential shortfall of 48 percent. Therefore, while larger and smaller airports’ respective shortfalls are similar in size, the greater scale of larger airports’ planned development causes their shortfall to differ considerably in proportion. Proposals to increase airport funding or make better use of existing funding vary in the extent to which they would help smaller airports and close the gap between their funding and the costs of planned development. For example, increasing AIP funding would help smaller airports more than larger airports because current funding formulas would channel an increasing proportion of AIP funds to them. Conversely, any increase in PFC funding would help larger airports almost exclusively because they handle more passengers and are more likely to have a PFC in place. Changes to the current design of AIP or PFCs could, however, lessen the concentration of benefits on one group of airports. FAA has also used other mechanisms to better use and extend existing funding sources, such as state block grants and pilot projects to test innovative financing. So far, these mechanisms have had mixed success. Under the existing distribution formula, increasing total AIP funding would proportionately help smaller airports more than large and medium hub airports. Appropriated AIP funding for fiscal year 1998 was $1.7 billion; smaller airports received about 60 percent of this total. We calculated how much funding each group would receive under the existing formula, at funding levels of $2 billion and $2.347 billion. We chose these funding levels because the National Civil Aviation Review Commission and the Air Transport Association (ATA), the commercial airline trade association, have recommended that future AIP funding levels be stabilized at a minimum of $2 billion annually, while two airport trade groups—the American Association of Airport Executives and the Airports Council International-North America—have recommended a higher funding level, such as AIP’s authorized funding level of $2.347 billion for fiscal year 1998. Table 2 shows the results. As indicated, smaller airports’ share of AIP would increase under higher funding levels if the current distribution formula were used to apportion the additional funds. Increasing PFC-based funding, as proposed by the Department of Transportation and backed by airport groups, would mainly help larger airports, for several reasons. First, large and medium hub airports, which accounted for nearly 90 percent of all passengers in 1996, have the greatest opportunity to levy PFCs. Second, such airports are more likely than smaller airports to have an approved PFC in place. Finally, large and medium hub airports would forgo little AIP funding if the PFC ceiling were raised or eliminated. Most of these airports already return the maximum amount that must be turned back for redistribution to smaller airports in exchange for the opportunity to levy PFCs. If the airports currently charging PFCs were permitted to increase them beyond the current $3 ceiling, total collections would increase from the $1.35 billion that FAA estimates was collected during 1998. Most of the additional collections would go to larger airports. For every $1 increase in the PFC ceiling, we estimate that large and medium hub airports would collect an additional $432 million, while smaller airports would collect an additional $46 million (see fig. 2). In total, a $4 PFC ceiling would yield $1.9 billion, a $5 PFC would yield $2.4 billion, and a $6 PFC would yield $2.8 billion in total estimated collections. In recent years, the Congress has directed FAA to undertake steps to find ways to extend existing AIP funds, especially for small airports that rely more extensively on AIP funds than do large airports. The airport community’s interest in these efforts has varied. For example, the state block grant program, which allows the participating states to direct grants to smaller airports, has been proven successful. Others efforts, such as pilot projects to test innovative financing and privatization, have received less interest from airports and are still being tested. Finally, one idea, using AIP grants to capitalize state revolving loan funds, has not been attempted but could help smaller airports. Implementing this idea would require legislative changes. In 1996, we testified before this Subcommittee that FAA’s pilot program for state block grants was a success. The program allows FAA to award AIP funds in the form of block grants to designated states, which, in turn, select and fund AIP projects at small airports. In 1996, the program was expanded from seven to nine states and made permanent. Both FAA and the participating states believe that they are benefiting from the program. In recent years, FAA, with congressional urging and direction, has sought to expand airports’ available capital funding through more innovative methods, including the more flexible application of AIP funding and efforts to attract more private capital. The 1996 Federal Aviation Reauthorization Act gave FAA the authority to test three new uses for AIP funding—(1) projects with greater percentages of local matching funds, (2) interest costs on debt, and (3) bond insurance. These three innovative uses could be tested on up to a total of 10 projects. Another innovative financing mechanism that we have recommended—using AIP funding to help capitalize state airport revolving funds—while not currently permitted, may hold some promise. FAA is testing 10 innovative uses of AIP funding totaling $24.16 million, all at smaller airports. Five projects tested the benefits of the first innovative use of AIP funding—allowing local contributions in excess of the standard matching amount, which for most airports and projects is otherwise fixed at 10 percent of the AIP grant. FAA and state aviation representatives generally support the concept of flexible matching because it allows projects to begin that otherwise might be postponed for lack of sufficient FAA funding; in addition, flexible funding may ultimately increase funding to airports. The remaining five projects test the other two mechanisms for innovative financing. Applicants have generally shown less interest in these other options, which, according to FAA officials, warrant further study. Some federal transportation, state aviation, and airport bond rating and underwriting officials believe using AIP funding to capitalize state revolving loan funds would help smaller airports obtain additional financing. Currently, FAA cannot use AIP funds for this purpose because AIP construction grants can go only to designated airports and projects. However, state revolving loan funds have been successfully employed to finance other types of infrastructure projects, such as wastewater projects and, more recently, drinking water and surface transportation projects.While loan funds can be structured in various ways, they use federal and state moneys to capitalize the funds from which loans are then made. Interest and principal payments are recycled to provide additional loans. Once established, a loan fund can be expanded through the issuance of bonds that use the fund’s capital and loan portfolio as collateral. These revolving funds would not create any contingent liability for the U.S. government because they would be under state control. Declining airport grants and broader government privatization efforts spurred interest in airport privatization as another innovative means of bringing more capital to airport development, but thus far efforts have shown only limited results. As we previously reported, the sale or lease of airports in the United States faces many hurdles, including legal and economic constraints. As a way to test privatization’s potential, the Congress directed FAA to establish a limited pilot program under which some of these constraints would be eased. Starting on December 1, 1997, FAA began accepting applications from airports to participate in the pilot program on a first-come, first-served basis for up to five airports, at least one of which must be a general aviation airport. Thus far, two airports—one general aviation and one nonhub commercial service airport—have applied to be part of the program. Mr. Chairman, this concludes my prepared statement. I would be happy to respond to any questions that you or Members of the Subcommittee may have. The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and MasterCard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent. U.S. General Accounting Office P.O. Box 37050 Washington, DC 20013 Room 1100 700 4th St. NW (corner of 4th and G Sts. NW) U.S. General Accounting Office Washington, DC Orders may also be placed by calling (202) 512-6000 or by using fax number (202) 512-6061, or TDD (202) 512-2537. Each day, GAO issues a list of newly available reports and testimony. To receive facsimile copies of the daily list or any list from the past 30 days, please call (202) 512-6000 using a touchtone phone. A recorded menu will provide information on how to obtain these lists.

Pursuant to a congressional request, GAO discussed airport funding issues as they apply to smaller airports, focusing on: 1) how much funding has been made available to airports, particularly smaller airports, for their capital development and what are the sources of these funds; (2) comparing airports' plans for future development with current funding levels; and (3) what effect will various proposals to increase or make better use of existing funding have on smaller airports' ability to fulfill their capital development plans. GAO noted that: (1) in 1998, GAO reported that the 3,304 airports that make up the federally supported national airport system obtained about $7 billion from federal and private sources for capital development; (2) the nation's 3,233 smaller airports accounted for 22 percent of this total, or about $1.5 billion; (3) as a group, smaller airports depend heavily on federal grants, receiving half of their funding from the federally-funded Airport Improvement Program (AIP) and the rest from airport bonds, state grants, and passenger facility charges; (4) by contrast, the 71 largest airports in the national airport system obtained $5.5 billion in funding, mostly from tax-exempt bonds and relied on AIP for only 10 percent of their funding; (5) small airports planned to spend nearly $3 billion per year for capital development during 1997 through 2001, or $1.4 billion per year more than they were able to fund in 1996; (6) smaller airports' planned development consists of projects eligible for AIP grants, like runways, and projects not eligible for grants, like terminal retail space; (7) at least $945 million and as much as $1.4 billion of smaller airports' planned development that are eligible for grants may not be funded on an annual basis; (8) the difference between funding and planned development is much greater for smaller commercial and general aviation airports than it is for large airports; (9) several initiatives to increase or make better use of existing funding have emerged in recent years, including increasing the amount of AIP funding and raising the maximum amount airports can levy in passenger facility charges; (10) under current formulas, increasing the amount of AIP funding would help smaller airports more than larger airports, while raising passenger facility charges would mainly help larger airports; and (11) other initiatives for making better use of federal grant monies, such as AIP block grants to states, have primarily been directed toward smaller airports, but none appears to offer a major breakthrough in reducing the shortfall between funding and the levels airports plan to spend on development.

During the legislative process, many documents are prepared by Congress and its committees. Governmental and nongovernmental entities track and record congressional activities, and many more entities chronicle and analyze the development of public policy. The wide availability of such information can be daunting to those involved in policy and legislative research. The purpose of this report is to assist congressional staff in identifying and accessing key resources used during such research. The resources' titles and access information are presented in eight tables. The tables provide information on how to find congressional documents ( Table 1 ); information on tracking legislative activity ( Table 2 ); executive branch documents and information ( Table 3 ); information about legislative support agencies ( Table 4 ); congressional news sources ( Table 5 ); policy and scholarly research sources ( Table 6 and Table 7 ); and research-related training and services for congressional staff ( Table 8 ). This report does not define or describe the purpose of the various information resources and documents; that information can be found in companion CRS Report RL33895, Researching Current Federal Legislation and Regulations: A Guide to Resources for Congressional Staff . Additional reports on congressional operations are available in the " Congressional Process, Administration, & Elections " page on CRS.gov, at http://www.crs.gov/iap/congressional-process-administration-and-elections . This report is not a comprehensive catalog of resources for conducting policy and legislative research; instead, it provides a selection of widely used electronic resources. Some of the resources mentioned are available only with a paid subscription, whereas others are free; this availability is noted in the report along with the access points for congressional staff. Print resources for time periods not covered by the resources listed in the tables may be available from the Congressional Research Service (CRS), the Law Library of Congress, or the House and Senate Libraries. The inclusion of resources in this report does not imply endorsement by CRS of the content or the products listed. In addition, CRS does not acquire or manage congressional offices' access to subscription resources. CRS is available for consultation on policy and legislative research or to perform such research upon request. CRS can also advise congressional staff on the use of the resources listed in this report, including advice on how to select the best resource to use, how to search for information within a resource, or how to develop the most effective research methodology. Table 1 serves as a reference guide for locating congressional documents using both freely available and subscription-based resources. The first column of the tables lists documents commonly used in policy and legislative research and typical citations for such documents. The second column lists resources where these documents can be accessed. The third column contains explanatory notes. Table 2 provides information about how to access House and Senate committee schedules, floor schedules, calendars, and floor proceedings, all of which can be helpful in tracking congressional activities. Access to subscription resources can vary among CRS, Senate, and House offices. See the notes within the tables for more information. CRS subscriptions can be accessed through the CRS La Follette Congressional Reading Room (locations and hours of operation are available in Table 8 ). Unless otherwise indicated, all other resources are freely available. Table A-1 provides additional information on the resources in Table 1 , including more detailed descriptions and URLs linking directly to the resources (when available). Table 3 serves as a reference guide for locating executive branch documents and information using freely available resources. The first column of the table lists documents or information commonly used in policy and legislative research and typical citations for such documents, where applicable. The second column lists resources where these materials can be accessed. The third column contains explanatory notes. Table A-1 provides additional information on the resources in Table 3 , including more detailed descriptions and URLs linking directly to the resources (when available). The legislative support agencies are designed to be nonpartisan, objective, and impartial. The agencies each serve the Congress in different ways. Contact information for each agency and a description of each agency and its services is outlined in Table 4 , below. Table 5 , Table 6 , and Table 7 serve as finding aids for selected resources covering news, scholarly, and policy research that may be related to Congress and the legislative process. Resources in these tables may contain editorial content and analysis. Inclusion of these resources does not imply endorsement of the views held by the publications listed. Please note that these tables are meant to serve as suggested starting points rather than comprehensive lists of news, scholarly, and policy resources. Congressional users may also access databases subscribed to by the Library of Congress such as ProQuest, LexisNexis, Factiva, EBSCOhost, and many others, onsite in the CRS La Follette Congressional Reading Room and the public reading rooms at the Library of Congress. Additionally, requests for literature searches and full text of specific articles can be submitted to CRS. Congressional users also have access to various databases through the House Library and the Senate Library. Table 8 contains a list of locations where congressional staff can obtain training and other services on Capitol Hill. Table A-1 provides an alphabetical listing of, and additional details about, the resources listed in Table 1 , Table 3 , and Table 4 .

This report is intended to serve as a finding aid for congressional documents, executive branch documents and information, news articles, policy analysis, contacts, and training, for use in policy and legislative research. It does not define or describe the purpose of various government documents; that information can be found in companion CRS Report RL33895, Researching Current Federal Legislation and Regulations: A Guide to Resources for Congressional Staff. This report is not intended to be a definitive list of all resources, but rather a guide to pertinent subscriptions available in the House and Senate in addition to select resources freely available to the public. This report is intended for use by congressional staff and will be updated as needed.

Outreach efforts by EAC representatives indicate that most employees support many portions of the legislative proposal under consideration by the Subcommittee but have concerns about provisions in the proposal related to pay. Specifically, employees generally support provisions that make the authorities provided to GAO for voluntary early retirement pay incentives permanent, to provide enhancements in vacation time and relocation expenses deemed necessary by the Comptroller General to recruit and retain top employees, and to establish a private sector exchange program. However, many employees are concerned about the provisions that change the way that annual pay decisions are made and, to a lesser extent, the proposed change to traditional protections for pay retention. Employees had differing opinions about the proposed change to GAO’s name. Most employees support the Comptroller General’s proposed provisions to make permanent GAO’s 3-year authority to offer voluntary early retirement and voluntary separation payments to provide flexibility to realign GAO’s workforce. In addition, GAO employees recognize that attracting and retaining high-quality employees and managers throughout the organization is vitally important for the future of GAO. Employees thus generally support the provisions to offer flexible relocation reimbursements, provide upper-level hires with 6-hour leave accrual, and establish an executive exchange program with private sector organizations. Most employees commented positively on these authorities so long as there are internal controls to monitor and report on their use, as are present to provide accountability for other authorities throughout GAO. Many employees expressed concern about the provisions that affect the determination of annual pay increases and pay retention. The opinions expressed by employees generally fall into three categories: (1) general concerns and some supporting views regarding changes in traditional civil service employment rules that could reduce the amount of annual pay increases provided for economic adjustments but provide greater opportunity for rewarding performance, (2) concerns about making a portion of annual economic adjustments variable based on performance assessment, and to a lesser extent (3) concerns about the loss of traditional pay retention protections. The first area of employee concern is proposed changes to traditional federal civil service employment rules that have historically provided a fixed annual increase for all federal employees determined by the President and the Congress. Government employees in general, and GAO employees in particular, often conduct work that can have far reaching implications and impacts. Such work can positively or negatively affect segments of the population and thereby the general public’s perceptions of, and reactions to, the federal government, including Members of Congress. Over the years, the Congress has developed a bulwark of protections to shield federal workers from reprisals that might result from their service as employees. Included among these has been the process by which federal employees’ salaries are annually adjusted as a result of the passage of, and signing into law, of the annual budget. The historical process relies on passage of legislation which includes an annual increase in pay to reflect increases in inflation and overall employment costs, followed by determinations by the President (and the Office of Personnel Management) to calculate the distribution of the legislative economic adjustments between an overall cost-of-living adjustment and locality-based increases to reflect differences in cities across the nation. The current mechanism for annual federal pay adjustments is found in Public Law 101-509, the Federal Employees Pay Comparability Act. The Comptroller General has expressed his concern about trends in the executive branch that make it highly likely that the current civil service pay system will be the subject of comprehensive reform within the next few years. Citing federal agencies that already have many of these flexibilities, such as the Federal Aviation Administration and the new Department of Homeland Security, as well as agencies currently seeking reform, such as the Department of Defense, he has stated his belief that GAO needs to be “ahead of the curve.” Under the proposal, rather than relying on the administration’s determination and the Congress’ mandate for an annual salary adjustment, GAO can develop and apply its own methodology for the annual cost-of- living adjustments and compensation differences by locality that the Comptroller General believes would be more representative of the nature, skills, and composition of GAO’s workforce. Some employees have expressed following concerns. Removing GAO from the traditional process significantly alters a key element of federal pay protection that led some employees to seek employment in the federal sector. Changing this protection could diminish the attractiveness of federal service and result in the need for higher salaries to attract top candidates. A portion of appropriations historically intended to provide all federal employees with increases to keep pace with inflation and the cost of living in particular localities should not be tied to individual performance. GAO-based annual economic adjustments are more likely to be less than, rather than more than, amounts annually provided by the Congress; thus employees performing at lower (but satisfactory) levels who may not receive an equal or greater amount in the form of a bonus or dividend may experience an effective pay cut from amounts traditionally provided. The flexibility for the Comptroller General to use funds appropriated for cost-of-living adjustments for pay-for-performance purposes could imperil future GAO budgets by making that portion of the annual budget discretionary where it was once mandatory. The wide latitude provided in the proposal gives the Comptroller General broad discretion and limited accountability for determining whether employees receive annual across-the-board economic adjustments, the amount of such adjustments, and the timing of adjustments could result in unfair financial harm for some employees if the broad authorities were improperly exercised. The Comptroller General has not made a compelling case regarding the need for these pay-related and other legislative changes, for example by showing that existing cost-of-living adjustment mechanisms are inaccurate or that the agency has had difficulty in attracting and retaining high-quality employees. On the other hand, some employees also recognize that the proposed pay provisions may offer some distinct advantages for some employees. Some employees commented in support of the provision indicating that the existing system for calculating inflation and local cost adjustments may not accurately reflect reality; most employees would not likely be harmed by a system that allocates a greater share of pay to performance-based compensation; the authorities would allow GAO managers to provide greater financial rewards to the agency’s top performers, as compared to the present pay- for-performance system; making a stronger link between pay and performance could facilitate GAO’s recruitment of top talent. In addition, the provision may, to a limited extent, address a concern of some field employees by providing alternatives to reductions in force in times when mandated pay increases are not fully funded or in other extraordinary circumstances. For example, from 1992 to 1997, GAO underwent budgetary cuts totaling 33 percent (in constant fiscal year 1992 dollars.) To achieve these budgetary reductions, GAO staff was reduced by 39 percent, primarily through field office closures and the associated elimination of field-based employees. While we hope the agency will never again have to manage budget reductions of this magnitude, this provides a painful example of the vulnerability of staffing levels, particularly in the field, to budgetary fluctuations. The proposed pay provisions would provide the Comptroller General with greater flexibility to manage any future budget crises by adjusting the annual pay increases of all employees without adversely and disproportionately impacting the careers and lives of field-based employees. In addition to the revised basis for calculating annual economic adjustments, employees are concerned about the provision that transforms a portion of the annual pay increases that have historically been granted to federal employees for cost-of-living and locality-pay adjustments into variable, performance-based pay increases and bonuses. Because the GAO workforce is comprised of a wide range of highly qualified and talented people performing a similarly wide range of tasks, employees recognize that it is likely that some employees at times have more productive years with greater contributions than others. Therefore, most agree with the underlying principle of the provision to provide larger financial rewards for employees determined to be performing at the highest level. However, in commenting on the proposal, some employees said that GAO management already has multiple options to reward high performers through bonuses, placement in top pay-for-performance categories, and promotions. Others expressed concern that increased emphasis on individual performance could result in diminished teamwork, collaboration, and morale because GAO work typically is conducted in teams, often comprised of employees who are peers. “The PFP (pay-for-performance) process involves managers making very fine distinctions in staff’s performance in order to place them in discrete performance management categories. These categories set artificial limits on the number of staff being recognized for their contributions with merit pay and bonuses.” Related to concerns about subjectivity in the performance assessment system, Council representatives and employees expressed concern about data indicating that as a group, minorities, veterans, and field-based employees have historically received lower ratings than the employee population as a whole. While the data indicate that the disparity is considerably improved or eliminated for employees who have been with the agency fewer than 5 years, some employees have serious reservations about providing even greater discretion in allocating pay based on the current performance management system. To a lesser extent, some employees expressed concerns about the elimination of traditional federal employment rules related to grade and pay retention for employees who are demoted due to such conditions as a workforce restructuring or reclassification. The proposed legislation will allow the Comptroller General to set the pay of employees downgraded as a result of workforce restructuring or reclassification at their current rates (i.e., no drop in current pay), but with no automatic annual increase to basic pay until their salaries are less than the maximum rates of their new grades or bands. Employee concern, particularly among some Band II analysts and mission support staff, focuses on the extent to which this provision may result in a substantial erosion in future pay, since there is a strong possibility that these two groups may be restructured in the near future. For example, one observation is that the salary range within pay bands is such that senior analysts who are demoted would likely wait several years for their next increase in pay or bonus. In this circumstance, employees would need to reconcile themselves to no permanent pay increases regardless of their performance. Some employees cited this potential negative impact on staff motivation and productivity and emphasized that to continue providing service at the level of excellence that the Congress and the American people expect from GAO, this agency needs the best contributions of all its midlevel and journeymen employees. However, the EAC recognizes that, absent this kind of authority and given some of the authorities already provided to the Comptroller General, some employees who may be demoted could otherwise face termination rather than diminished salary increases. Finally, employees had differing opinions regarding the provision to change GAO’s name to the Government Accountability Office. Some employees are concerned that the proposed change in GAO’s name to more accurately reflect the work that we do will damage GAO’s “brand recognition.” Most employees who oppose the name change do not see the current name as an impediment to doing our work or to attracting quality employees. Some employees expressed concern that the legacy of high-quality service to the Congress that is embedded in the name “United States General Accounting Office” might be lost by changing the name. Other employees support the name change and cited their own experiences in being recruited or recruiting others and in their interaction with other federal agencies. In their opinion, the title “General Accounting Office” reflects misunderstandings and incorrect assumptions about GAO’s role and function by those who are not familiar with our operations and may serve as a deterrent to attracting employees who are otherwise not interested in accounting. We appreciate the Comptroller General’s efforts to involve the Employee Advisory Council and to solicit employee input through discussions of the proposal. As a result of employee feedback and feedback from GAO managers and the EAC, the Comptroller General has made a number of revisions and clarifications to the legislative proposal along with commitments to address concerns relating to the annual pay adjustment by issuing formal GAO policy to formally establish his intent to retain employees’ earning power in implementing the authorities; by revising the performance management system; and by deferring implementation of pay changes until 2005. Key among the commitments made by the Comptroller General is his assurance to explicitly consider factors such as cost-of-living and locality- pay differentials among other factors, both items that were not in the preliminary proposal. In addition, the Comptroller General has said that employees who are performing adequately will be assured of some annual increase that maintains spending power. He outlined his assurance in GAO’s weekly newsletter for June 30th that successful employees will not witness erosion in earning power and will receive an annual adjustment commensurate with locality-specific costs and salaries. According to the Comptroller General, pay protection commitments that are not included in the statute will be incorporated in the GAO orders required to implement the new authorities. This is consistent with the approach followed when GAO made similar pay protection commitments during the conversion to broad bands in the 1980s. To the extent that these steps are taken, overall employee opinion of the changes should improve because much of the concern has focused on making sure that staff who are performing adequately do not witness economic erosion in their pay. In response to concerns regarding the performance management system and the related variable elements of annual pay increases raised by the EAC, employees, and senior managers, the Comptroller General has told employees that he will provide increased transparency in the area of ratings distributions, for example by releasing summary-level performance appraisal results. In addition, the Comptroller General has stated that he plans to take steps to improve the performance management system that could further reduce any disparities. Specifically, on June 26, the Comptroller General released a "Performance Management System Improvement Proposal for the FY 2003 Performance Cycle" that outlines proposed short-term improvements to the analyst performance management system that applies to the majority of GAO employees. These include additional training for staff and performance managers and a reduction in the number of pay categories from five to four. A number of longer-term improvements to the performance appraisal system requiring validation are also under consideration, including weighting competencies and modifying, adding, or eliminating competencies. For all employees to embrace any additional pay-for-performance efforts, it is vital that the Comptroller General take steps that will provide an increased level of confidence that the appraisal process is capable of accurately identifying high performers and fairly distinguishing between levels of performance. Finally, the Comptroller General has agreed to delay implementation of the pay-for-performance provisions of the proposal until October 1, 2005. This change should provide an opportunity to assess efforts to improve the annual assessment process and lessen any impact of changes in the permanent annual pay increase process for employees approaching retirement. It should also provide an opportunity to implement a number of measures designed to improve confidence in the annual assessment process. In summary, as GAO employees we are proud of our work assisting the Congress and federal agencies to make government operations more efficient and effective. Although all of us would agree that our agency is not perfect, the EAC believes GAO is making a concerted effort to become a more effective organization. We will continue to work closely with management to improve GAO, particularly in efforts to implement and monitor any additional authorities granted to the Comptroller General. We believe that it is vital that we help to develop and implement innovative approaches to human capital management that will enable GAO to continue to meet the needs of the Congress; further improve the work environment to maximize the potential of our highly skilled, diverse, and dedicated workforce; and serve as a model for the rest of the federal government. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

This testimony discusses how the Comptroller General formed the Employee Advisory Council (EAC) about 4 years ago to be fully representative of the GAO population and to advise him on issues pertaining to both management and employees. The members of the EAC represent a variety of employee groups and almost all employees outside of the senior executive service (more than 3,000 of GAO's 3,200 employees or 94 percent). The EAC operates as an umbrella organization that incorporates representatives of GAO's long-standing employee organizations including groups representing the disabled, Hispanics, Asian-Americans, African-Americans, gays and lesbians, veterans, and women, as well as employees in various pay bands, attorneys, and administrative and professional staff. The EAC serves as an advisory body to the Comptroller General and other senior executives by (1) seeking and conveying the views and concerns of the individual employee groups it represents while being sensitive to the mutual interests of all employees, regardless of their grade, band, or classification group, (2) proposing solutions to concerns raised by employees, as appropriate, (3) providing input by assessing and commenting on GAO policies, procedures, plans, and practices and (4) communicating issues and concerns of the Comptroller General and other senior managers to employees.

Medicaid, authorized under Title XIX of the Social Security Act, is a federal-state program providing medical assistance for low-income individuals who are aged, blind, disabled, members of families with dependent children, or who have one of a few specified medical conditions. The Balanced Budget Act of 1997 established SCHIP under a new Title XXI of the Social Security Act. SCHIP builds on Medicaid by providing health insurance to uninsured children in families with income above applicable Medicaid income standards. Section 1115 of the Social Security Act provides the Secretary of Health and Human Services (HHS) with broad authority to conduct research and demonstration projects under several programs authorized by the Social Security Act including Medicaid and SCHIP. Section 1115 also authorizes the Secretary to waive certain statutory requirements for conducting these projects without congressional approval. For this reason, the research and demonstration projects are often referred to as Section 1115 "waiver" projects. Under Section 1115, the Secretary may waive Medicaid requirements contained in Section 1902 (including but not limited to what is known as, freedom of choice of provider, comparability of services, and state-wide access). The Secretary may also use the Section 1115 waiver authority to provide Federal financial participation (FFP) for costs that are not otherwise matchable under Section 1903 of the Social Security Act. For SCHIP, no specific sections or requirements are cited as "waiveable." Section 2107(e)(2)(A) of the Social Security Act states that Section 1115 of the act, pertaining to research and demonstration waivers, applies to SCHIP. States must submit proposals outlining terms and conditions for proposed waivers to CMS for approval before implementing these programs. In recent years, there has been increased interest among states and the federal government in the Section 1115 waiver authority as a means to restructure coverage, control costs, and increase state flexibility. Under current law, states may obtain waivers that allow them to provide services to individuals not traditionally eligible for Medicaid (or SCHIP), cover non-Medicaid (or SCHIP) services, limit benefit packages for certain groups, among other purposes. Whether large or small reforms, Section 1115 waiver programs have resulted in significant changes for Medicaid and SCHIP recipients nationwide, and may serve as a precedent for federal and state officials who wish to make statutory changes to these healthcare safety net programs. While Section 1115 is explicit about provisions in Medicaid law that may be waived in conducting demonstration projects, a number of other provisions in Medicaid law and regulations specify limitations on how a state may operate a waiver program. For example, one provision restricts states from establishing waivers that fail to provide all mandatory services to the mandatory poverty-related groups of pregnant women and children; another provision specifies restrictions on cost-sharing under waivers. Other features of the Section 1115 waiver authority include: Federal Reimbursement for Section 1115 Demonstrations . Approved Section 1115 waivers are deemed to be part of a state's Medicaid (or SCHIP) state plan for purposes of federal reimbursement. Project costs associated with waiver programs are subject to that state's FMAP (or enhanced-FMAP) . Financing and Budget Neutrality . Unlike regular Medicaid, CMS waiver guidance specifies that waiver costs are budget neutral to the federal government over the life of the waiver program. To meet the budget neutrality test, estimated spending under the waiver cannot exceed the estimated cost of the state's existing Medicaid program under current law program requirements. For example, costs associated with an expanded population (e.g., those not otherwise eligible under Medicaid), must be offset by reductions elsewhere within the Medicaid program. Several methods are used by states to generate cost savings for the waiver component: (1) limiting benefit packages for certain eligibility groups; (2) providing targeted services to certain individuals so as to divert them from full Medicaid coverage; and (3) using enrollment caps and cost-sharing to reduce the amounts states must pay. Financing and Allotment Neutrality . Under the SCHIP program, a different budget neutrality standard applies. States must meet an "allotment neutrality test" where combined federal expenditures for the state's regular SCHIP program and for the state's SCHIP demonstration program are capped at the state's individual SCHIP allotment (i.e., original allotments and funds made available through the redistribution of unspent SCHIP funds). This policy limits federal spending to the capped allotment levels. Application and Approval Process. There is no standardized process to apply for a Section 1115 demonstration, but CMS has issued program guidance that impacts the approval process. States often work collaboratively with CMS to develop their proposals. Project proposals are subject to approval by CMS, the Office of Management and Budget (OMB), and the Department of Health and Human Services (DHHS), and may be subject to additional requirements such as site visits before the program may be implemented under the agreed upon terms and conditions. Duration. Waiver projects are generally approved for a five-year period, however, states may seek up to a three-year extension for their existing waiver program under the same special terms and conditions (STC), and an additional extension(s) under revised STC for the continuation of a waiver project operating under an initial three-year extension. Relationship of Medicaid/SCHIP Demonstration Waivers to Other Statutes . Section 1115 waiver projects may interact with other program rules outside of the Social Security Act; for example, employer-sponsored health insurance as described by the Employee Retirement Income Security Act (ERISA), or alien eligibility as contained in immigration law. In cases like these, the Secretary does not have the authority to waive provisions in these other statutes. Program Guidance. The Secretary can develop policies that influence the content of demonstration projects and prescribe approval criteria in three ways: (1) by promulgating program rules and regulations; (2) through the publication of program guidance (e.g., waivers must be budget neutral); and (3) waiver policy may also be implicitly shaped by the programs that have been approved (e.g., CMS approval of benefit specific waivers). Legislative action may be required if Congress chooses to further shape the Secretary's authority over the content of the demonstration programs, dictate specific Section 1115 waiver approval criteria, or otherwise limit the Secretary's waiver authority. As of July 1 2008, there were 94 operational Medicaid and SCHIP Section 1115 waivers in 43 states and the District of Columbia. In FY2006 (the most recent data available), Section 1115 waiver federal expenditures (for Medicaid and SCHIP) totaled approximately $42.4 billion. Section 1115 waiver programs represented approximately 24% of all federal Medicaid spending in the 50 states and the District of Columbia for FY2006 (19% for SCHIP), and provided coverage to approximately 11.5 million enrollees. Of the 11.5 million total Medicaid and SCHIP waiver enrollees, 2.5 million were only eligible for a targeted benefit package such as family planning benefits. There are several types of operational waiver programs including: Comprehensive demonstrations. These demonstrations provide a broad range of services that are generally offered statewide. Many of the comprehensive waivers operate under combined title XIX and title XXI authority and are financed with federal Medicaid and SCHIP matching funds. Several also include a family planning and/or Health Insurance Flexibility and Accountability (HIFA) component (see below). In FY2008, there were 32 operational comprehensive state reform waivers in 26 states. FY2006 state-reported enrollment estimates for these waivers totaled approximately 8.1 million, at a federal cost of approximately $38.4 billion. The SCHIP-financed portion of these waivers extended coverage to approximately 475,376 enrollees at a federal cost of $330 million. FY2006 enrollee estimates for the limited benefits offered under a FP component totaled approximately 104,990. Family planning demonstrations (FP) . In FY2008, there were 22 states with stand-alone FP waivers to provide a limited benefit package including family planning services and supplies for certain individuals of childbearing age. FY2006 enrollment estimates for stand-alone FP waivers totaled 2.4 million at a federal cost of approximately $1.4 billion. Just over 1,000 of FY2006 enrollees were SCHIP-eligible with care financed out of the SCHIP allotments. SCHIP and HIFA Waivers . Of the 20 states with SCHIP waivers in FY2008, 14 have SCHIP waivers that were granted under the HIFA initiative. HIFA demonstrations are designed to encourage states to extend Medicaid and SCHIP to the uninsured, with an emphasis on approaches that maximize private health insurance coverage and target populations with incomes below 200% of the federal poverty level (FPL). Under HIFA, states were encouraged to finance program expansions using unspent SCHIP funds to, for example, extend coverage to one or more categories of adults with children (typically parents of Medicaid/SCHIP children, caretaker relatives, or legal guardians), and/or pregnant women. Four states (i.e., Arizona, Michigan, New Mexico, and Oregon) have approval to cover childless adults under their HIFA waivers. The Deficit Reduction Act of 2005 prohibits new waivers that would use SCHIP funds to provide coverage to nonpregnant, childless adults. Recently the Administration has not renewed existing waivers that permitted coverage of adults through SCHIP. In addition to expanding coverage to new populations under SCHIP, some states use the SCHIP Section 1115 authority for other purposes including modifying cost-sharing rules (e.g., New Mexico), and requiring periods of no insurance prior to SCHIP enrollment (e.g., Alaska and New Mexico). As of FY2006, approximately 925,196 enrollees accessed services under SCHIP and HIFA demonstrations at a federal cost of $675 million. Specialty services and population demonstrations . These demonstrations generally include programs that provide cash to enrollees so that they may directly arrange and purchase services that best meet their needs. In addition, they include waivers to provide pharmacy benefits to persons with specific conditions, such as HIV/AIDS. As of FY2008, there were 20 such operational programs in 15 states and the District of Columbia. In FY2006, these demonstrations covered approximately 37,473 individuals at a federal cost of approximately $441 million. Federal costs for Pharmacy-only demonstrations totaled $1.5 billion in FY2006. Katrina/Multi - state Demonstrations. In response to the Hurricane Katrina disaster, CMS allowed states to provide temporary eligibility for specified Katrina evacuees so that such individuals could obtain state plan services in a host state (i.e., a state that has been granted an emergency Section 1115 waiver). Between September 2005 and March 2006 CMS approved 32 Katrina waivers that extended coverage to an estimated 118,602 individuals at a federal cost of $1.63 billion.

Section 1115 of the Social Security Act provides the Secretary of Health and Human Services (HHS) with broad authority to waive certain statutory requirements for states to conduct research and demonstration projects that further the goals of Titles XIX (Medicaid) and/or XXI (the State Children's Health Insurance Program; SCHIP). States use the Section 1115 waiver authority to cover non-Medicaid and SCHIP services, limit benefit packages, cap program enrollment, among other purposes. As of July 1 2008, there were 94 operational Medicaid and SCHIP Section 1115 waiver programs in 43 states and the District of Columbia. In FY2006 (the most recent data available), Section 1115 waiver federal expenditures (for Medicaid and SCHIP) totaled approximately $42.4 billion. Section 1115 waiver programs represented approximately 24% of all federal Medicaid spending in the 50 states and the District of Columbia for FY2006 (19% for SCHIP), and provided coverage to approximately 11.5 million enrollees—2.5 million of whom were eligible only for a targeted benefit package such as family planning or pharmacy benefits. FY2006 waiver expenditure and enrollment estimates from the Centers for Medicare and Medicaid Services (CMS) based on state-reported data, and are subject to change. Between FY2001 (the earliest year for which CRS has access to Section 1115 expenditure estimates) and FY2005, federal Medicaid waiver expenditures as a percentage of total Medicaid spending were steady at approximately12-14%. In FY2006, there was a substantial increase in federal waiver spending as a percentage of total Medicaid spending (i.e., almost 60% increase over the FY2005 totals). While there are several plausible explanations for this increase (e.g., ramp up of new and renegotiated waivers, prior period adjustments, etc.) because waiver financing arrangements are negotiated over a 5-year budget window it is hard to determine if the jump in federal expenditures represents a step increase in overall federal waiver spending, or a one-time increase that will be mitigated over the budget authority window. Analysis of future waiver expenditure trends will help to clarify this question. Estimates do not include state experience under the 5 month temporary Katrina waivers (described below).This report provides background information on the waiver authority, and will be updated when new data are available.

This report provides a brief outline of the FY2015 annual appropriations measure for the Department of Homeland Security (DHS) and its enactment by the 114 th Congress. It serves as a complement to CRS Report R43796, Department of Homeland Security: FY2015 Appropriations . The first portion of this report outlines the legislative chronology of major events in the 114 th Congress related to funding the department for FY2015. The second portion provides an overview of DHS appropriations sought by the Administration and proposed by Congress at various stages of the FY2015 process. Prior to the 114 th Congress, Congress had not enacted an FY2015 annual appropriations bill for DHS. As FY2014 drew to a close, senior appropriators indicated they would pursue an omnibus appropriations package in the lame duck session of the 113 th Congress, rather than stand-alone appropriations bills. The President signed an interim continuing resolution for FY2015 into law prior to the end of the fiscal year. After enactment of a second and third short-term continuing resolution, the Consolidated and Further Continuing Appropriations Act, 2015, was signed into law as P.L. 113-235 on December 16, 2014. Congress did not include full annual funding for DHS as part of the package, but Division L of P.L. 113-235 provided an extension of continuing appropriations for the department through February 27, 2015. The following descriptions reflect only the major actions taken on FY2015 homeland security appropriations in the 114 th Congress. For a more detailed description of the procedural actions taken, see CRS Report R43776, Congressional Action on FY2015 Appropriations Measures , by [author name scrubbed]. H.R. 240, an annual appropriations bill which would provide DHS $39.7 billion in adjusted net discretionary budget authority, was introduced by House Appropriations Committee Chairman Rogers on January 9, 2015. The bill was not reported out of committee prior to floor consideration, but an explanatory statement serving the same function as a committee report was posted on the House Appropriations Committee website the same day the bill was introduced and printed in the Congressional Record for January 13, 2015. The bill was considered under a structured rule on January 13 and 14, 2015. Under the structured rule, five amendments were made in order. Two were "Sense of Congress" amendments, expressing views on aspects of the Administration's immigration policy. Three would have affected the availability of funds for certain purposes that were provided by H.R. 240 , as well as in any other act in any fiscal year (these appeared as Sections 579, 580, and 581 in the House-passed bill). The first of these three was an amendment that added a general provision that would restrict the use of any federal funds for carrying out the Administration's immigration initiative of November 2014, or implementing the direction in several memoranda on prosecutorial discretion and immigration enforcement priorities that were issued in 2011 and 2012. This amendment went on to state that the prohibition would extend to future similar policies, expressed that such policies would have no legal effect and that no funds may be used to grant any federal benefit to any alien as a result of those policies. The second of these three was an amendment to prohibit any federal funds from being used to consider new, renewal, or previously denied applications for temporary relief for removal under the deferred action for childhood arrivals (DACA) program. The third amendment would have required, through a restriction on the use of funds, that DHS treat aliens convicted of any offense involving domestic violence, sexual abuse, child molestation, or child molestation as being among the group of aliens that are the highest priority for deportation. After adopting these five amendments, the bill passed the House on January 14, 2015, by a vote of 236-191. The Senate proceeded to consider H.R. 240 on February 25, 2015. On February 27, 2015, the Senate adopted an amendment that was functionally the same as H.R. 240 as introduced—without the legislative text added by the five House amendments—by a vote of 66-33, then passed the Senate-amended bill by a vote of 68-31. On February 27, 2015, a three-week extension of the continuing resolution funding DHS ( H.J.Res. 35 ) did not pass the House by a vote of 203-224. Roughly three hours later, the Senate amended a House bill ( H.R. 33 ) to extend the continuing resolution through March 6, 2015, and passed the amended version by a voice vote. The House agreed to the Senate amendment by a vote of 357-60, and the President signed the bill into law as P.L. 114-3 that night. On March 3, 2015, the House voted 257-167 to approve the Senate version of H.R. 240 . On March 4, 2015, H.R. 240 was signed into law as P.L. 114-4 . Generally, the homeland security appropriations bill includes all annual appropriations provided for DHS, providing resources to every departmental component. Table 2 includes a summary of funding included in the FY2014 regular DHS appropriations bill, the Administration's FY2015 appropriations request, the House- and Senate-reported FY2015 DHS appropriations bills, and P.L. 114-4 broken down by title. The various components of DHS vary widely in the size of their appropriated budgets. Table 3 and Figure 1 show DHS's new discretionary budget authority for FY2015 broken down by component, from largest to smallest appropriations request. Total discretionary appropriations in Table 3 do not include resources provided through adjustments under the Budget Control Act (BCA) in the individual component lines. These are accounted for separately from the total discretionary appropriations and are displayed at the bottom of the table. As the table and figure reflect new discretionary budget authority, neither appropriated mandatory spending nor rescissions of prior-year budget authority are reflected in the component totals. In Figure 1 , the first column of numbers shows budget authority provided in P.L. 113-76 , which included the FY2014 appropriations for DHS: resources available under the adjustments to the discretionary spending limits provided pursuant to the BCA are shown in black. The second column shows a similar breakdown for the FY2015 request, and the third and fourth columns show a similar breakdown of the FY2015 House- and Senate-reported bills. The fifth column shows the levels that provided under P.L. 114-4 .

This report provides a brief outline of the FY2015 annual appropriations measure for the Department of Homeland Security (DHS) and its enactment by the 114th Congress. It serves as a complement to CRS Report R43796, Department of Homeland Security: FY2015 Appropriations. The Administration requested $38.3 billion in adjusted net discretionary budget authority for DHS for FY2015. In the 113th Congress, the House Appropriations Committee reported an annual appropriations measure (H.R. 4903) that would have provided $39.2 billion in adjusted net discretionary budget authority, and the Senate Appropriations Committee reported a measure (S. 2534) that would have provided $39.0 billion. Neither bill received floor consideration in the 113th Congress. As no DHS annual appropriation had been enacted by the end of FY2014, the department operated under a continuing resolution for the first several months of FY2015. Annual appropriations for DHS were not included in P.L. 113-235, the Consolidated and Further Continuing Appropriations Act, 2015, which extended the continuing resolution—slated to expire December 17, 2014—through February 27, 2015. With the beginning of the 114th Congress, both House- and Senate-reported FY2015 annual homeland security appropriations bills were no longer available for action. H.R. 240, a new FY2015 annual homeland security appropriations bill, was introduced on January 9, 2015, and considered in the House the following week under a structured rule that allowed five immigration policy-related amendments. After adopting these five amendments, the bill passed the House on January 14, 2015. On February 27, the Senate passed an amended H.R. 240 without the legislative text added by the House amendments. After the House did not pass a three-week extension of the continuing resolution, the Senate and House passed a one week extension of the continuing resolution to avoid a lapse in annual appropriations for DHS. On March 3, 2015, the House voted to approve the Senate version of H.R. 240. The bill was signed into law on March 4, 2015, as P.L. 114-4. As enacted, the bill provided $39.7 billion in adjusted net discretionary budget authority. This report will not be updated.

OPS administers the national regulatory program to ensure the safe operation of nearly 2.2 million miles of natural gas and hazardous liquid pipelines in the United States. The agency develops, issues, and enforces pipeline safety regulations. These regulations contain minimum safety standards that the pipeline companies that transport natural gas or hazardous liquids must meet for the design, construction, inspection, testing, operation, and maintenance of their pipelines. In general, OPS retains full responsibility for inspecting pipelines and enforcing regulations on interstate pipelines, and certifies states to perform these functions for intrastate pipelines. In fiscal year 2000, OPS employed 97 people, 55 of whom were pipeline inspectors. Several federal statutes enacted since 1988 contain requirements designed to improve pipeline safety and enhance OPS’ ability to oversee the pipeline industry. In addition, the Safety Board makes recommendations designed to improve transportation safety to OPS and other federal agencies. These recommendations are based on the Safety Board’s investigations of transportation accidents, including significant pipeline accidents (such as those involving fatalities). Many of these recommendations address the same issues as the statutory requirements. OPS has made progress in implementing some of the 22 statutory requirements that it reported as open in our May 2000 report but has not fully implemented some significant, long-standing requirements. As of September 1, 2001, 6 of the 22 requirements have been closed as a result of OPS’ actions, 11 requirements are still open, and the remaining 5 have been closed because OPS now considers them to be superseded by or amendments to other requirements or because the agency does not believe it is required to take further action. The agency has fully implemented 6 of the 22 statutory requirements that it classified as open in May 2000. (See table 1.) Three of these six requirements were implemented in the last 16 months; OPS issued a final rule to define underwater abandoned pipeline facilities that present a hazard to navigation and specify how operators shall report these facilities, issued a report on its Risk Management Demonstration Program, and conducted activities to address population encroachment near pipelines. OPS had completed action on the other three requirements prior to May 2000, but did not report these actions to us at that time. (Appendix I provides the status of OPS’ actions to implement all 22 requirements as of September 1, 2001.) As of September 1, 2001, 11 requirements—including several from 1992 or earlier that could significantly improve pipeline safety—remain uncompleted. While OPS has made some progress on these requirements over the last year, the agency estimates that it will take from several months to more than a year to complete actions on them. For example, OPS is issuing a series of rules requiring pipeline operators to develop an integrity management program to assess and improve, where necessary, the safety of pipeline segments in areas where the consequences of a pipeline failure could be significant (called “high consequence areas.”) This series represents a broad-based, comprehensive effort designed to improve pipeline safety, as well as fulfill several specific statutory requirements such as requirements to inspect pipelines periodically and install valves to shut off the flow of product in the pipeline if a failure occurs. In December 2000, OPS issued a final integrity management rule for hazardous liquid pipelines that are at least 500 miles long. OPS still needs to issue similar integrity management rules for hazardous liquid pipelines that are less than 500 miles long, expected in late fall 2001, and for natural gas transmission pipelines. The agency expects to issue a proposed rule for transmission pipelines by the end of 2001 and a final rule in fall 2002. To facilitate the natural gas transmission rule, OPS officials have been meeting with representatives of the pipeline industry, research institutions, state pipeline safety agencies, and public interest groups to understand how integrity management principles can best be applied to improve the safety of gas pipelines. OPS also requested information and clarification in June 2001 and plans to hold a public meeting with its Natural Gas Technical Advisory Committee on this subject. According to OPS officials, they are close to reaching consensus with the pipeline industry and state agencies on safety standards for natural gas transmission pipelines. In addition, in response to a 1988 requirement to establish standards to complete and maintain a pipeline inventory, OPS is establishing multiple methods of collecting this information, such as annual reports, the integrity management process, and a national pipeline mapping system.According to OPS officials, they are collecting the necessary information for hazardous liquid and gas transmission pipelines, but still need to establish methods to collect additional information for gas distribution pipelines. OPS does not plan to complete forms that will allow it to collect such information until spring 2002—more than 13 years after the original requirement. Finally, in response to a 1992 requirement to define “gathering line” and “regulated gathering line,” OPS is still conducting studies to identify which lines should be regulated. OPS does not plan to issue a final rule before mid-2002. OPS officials estimate that it will take a year or more to implement 10 of the 11 open requirements. OPS does not plan to take action on the remaining open requirement to submit a report on underwater abandoned pipeline facilities, including a survey of where such facilities are located and an analysis of any safety hazards associated with them. According to OPS officials, the agency did not complete the report because there were insufficient data available, and it would be expensive to develop the needed data. OPS officials said they have analyzed to the extent possible all available data, and they do not plan to proceed further. We did not determine whether sufficient data exist or the cost to develop data to complete the report. OPS has closed the remaining five requirements that it reported as open in May 2000 because it now considers them to be superseded by or amendments to other requirements or because OPS believes it is no longer required to take action. Although OPS did not fulfill these requirements, we agree with OPS’ rationale for considering them closed. OPS closed one requirement because it was replaced by a later requirement. A 1988 statute required OPS to establish standards requiring that new and replacement pipelines accommodate the passage of “smart pigs”—mechanical devices that can travel through the pipeline to record flaws in the pipeline, such as dents or corrosion. Although OPS did not meet this requirement, the agency considers it closed because it was superseded by a similar requirement in a 1996 statute, which has not been completed. OPS closed three requirements from a 1996 statute that amended requirements from a 1992 statute that have not been completed: (1) defining “gathering lines” and “regulated gathering lines,” (2) requiring the periodic inspection of pipelines in high-density and environmentally sensitive areas, and (3) establishing criteria to identify all pipeline facilities located in areas that are densely populated and/or environmentally sensitive. In general, the amending provisions gave OPS more flexibility in fulfilling the requirements by adding language such as “where appropriate” or “if needed.” Although OPS considered these actions as open in our May 2000 report, OPS now believes that since these three provisions do not impose additional requirements they should not continue to be counted separately. OPS closed one requirement because it is no longer required to take action. A 1996 statute required OPS to issue biennial reports to the Congress on how the agency carried out its pipeline safety responsibilities for the preceding two calendar years. OPS issued the first report in August 1997 but did not issue a report in 1999. This reporting requirement was eliminated as of May 15, 2000, under the Federal Reports Elimination and Sunset Act of 1995, as amended. The Safety Board is encouraged by OPS’ recent efforts to improve its responsiveness, but it remains concerned about the amount of time OPS has been taking to implement recommendations. The Director of the Safety Board’s Office of Pipeline Investigations views OPS’ responsiveness as generally improving because OPS has recently initiated several activities to respond to recommendations and made efforts to communicate better with the Safety Board. To improve communications with the Safety Board, OPS has changed how it informs the Safety Board of progress made on recommendations by corresponding with the Safety Board as progress occurs on individual recommendations, rather than providing periodic updates that may cover a number of recommendations. While the Safety Board is encouraged by OPS’ recent efforts, it is reserving final judgment on OPS’ progress until the agency demonstrates that it can follow through with actions to fully implement the recommendations. OPS continues to have the lowest rate of any transportation agency for implementing recommendations from the Safety Board; and, in May 2000 we reported that the Safety Board was concerned that OPS had not followed through on promises to implement recommendations. According to the Director of the Safety Board’s Office of Pipeline Investigations, the Safety Board continues to be concerned about the amount of time OPS is taking to follow through with the recommendations. For example, the Safety Board initially recommended in 1987 that OPS require pipeline operators to periodically inspect pipelines. OPS is responding to this recommendation through its series of rules on integrity management that is expected to be completed in 2002—15 years after the Safety Board made the initial recommendation. According to the Safety Board’s records, OPS has completed action on only 1 of the 39 Safety Board recommendations that were open as of May 2000. Since then, the Safety Board has made 6 additional recommendations, resulting in 44 open recommendations on pipeline safety as of September 1, 2001. However, OPS officials believe that the agency’s progress is much greater than the Safety Board’s records indicate. The majority of the recommendations are related to damage prevention (damage from outside forces is the leading cause of pipeline accidents) and integrity management; OPS is in the process of implementing several broad-based, complementary efforts in these areas. According to OPS officials, the agency will have fulfilled 19 of the open recommendations by the end of 2001 and expects to complete action on 16 additional recommendations by the end of 2002. OPS has made some progress in implementing statutory requirements over the past 16 months and expects to implement most of the remaining requirements in the next year or so. OPS also believes that it will have completed action on most of the 44 open Safety Board recommendations over this same time period. Ultimately, however, it is the Safety Board’s decision on whether OPS’ actions fulfill the recommendations. While this progress represents an improvement over OPS’ previous performance, the agency has not fully implemented some important requirements and recommendations to improve pipeline safety that were imposed more than 10 years ago. The next 15 months are important to OPS because, among other actions, the agency intends to complete its series of integrity management rules within this time frame. These rules are expected to improve the safety of pipelines and allow OPS to fulfill a large portion of the outstanding statutory requirements and Safety Board recommendations. We are concerned that OPS does not plan to take action in response to the 1992 statutory requirement to report to the Congress on underwater abandoned pipeline facilities. While we did not assess OPS’ claims that it is not feasible to complete the report due to insufficient data and funding, OPS has made no response to this requirement, including advising the Congress that it is not possible to complete the study. If the department believes that it cannot complete a report to the Congress on underwater abandoned pipeline facilities, we recommend that the Secretary of Transportation direct OPS to advise the Congress of the reasons why it is unable to complete this study and, if appropriate, ask the Congress to relieve it of this responsibility. We provided a draft of this report to the Department of Transportation for its review and comment. We met with officials from the department, including OPS’ Associate Administrator, to obtain their comments. The officials generally agreed with the draft report and its recommendation. The officials stated that OPS is taking a long-term, strategic approach to address safety goals by improving pipeline integrity and preventing damage to pipelines. According to the officials, this approach is more beneficial than responding directly to individual requirements and recommendations as discrete actions. For example, OPS’ integrity management rules will require pipeline operators to comprehensively evaluate and respond to the entire range of risks to pipelines; the rules will include, but are not limited to, safety practices that have been required by the Congress or recommended by the Safety Board, such as internal inspections and safety valves. The officials stated that OPS has undertaken several broad-based, complementary efforts, particularly focused on pipeline integrity and damage prevention that, when completed, are expected to improve pipeline safety and fulfill many specific statutory requirements and Safety Board recommendations. They said that such a process requires OPS—working cooperatively with state and local officials and the pipeline industry—to thoroughly explore the safety risks faced by different types of pipelines, devise solutions that work for each unique pipeline, and carefully assess the costs and expected benefits of various methods of mitigating risks. The officials expect that, within a year, the results of these efforts will become apparent to the Congress and the public. In response to OPS’ comments, we provided more detailed information on specific actions OPS has taken to improve pipeline safety, where appropriate. To determine OPS’ progress in responding to statutory requirements, we asked OPS officials to identify actions the agency has taken to respond to requirements. We then collected and reviewed documentation on these actions, such as published rules and reports. To determine OPS’ progress in responding to recommendations from the Safety Board, we collected and analyzed information from the Safety Board on the status of pipeline safety recommendations. We also interviewed the Safety Board’s Director of the Office of Railroad, Pipeline, and Hazardous Materials Investigations to discuss OPS’ progress in responding to the Safety Board’s recommendations. Consistent with the approach used for our May 2000 report, we relied on OPS and the Safety Board to identify which actions were open and did not attempt to determine whether these open actions were, in actuality, completed. In addition, we did not assess the adequacy of OPS’ responses to statutory requirements or the Safety Board’s recommendations. We performed our work from July through September 2001 in accordance with generally accepted government auditing standards. As arranged with your office, unless you publicly announce its contents earlier, we plan no further distribution of this report until 7 days after the date of this letter. At that time, we will send copies of this report to congressional committees and subcommittees with responsibilities for transportation safety issues, the Secretary of Transportation, the Administrator of the Research and Special Programs Administration, the Director of the Office of Management and Budget, and the Acting Chairman of the National Transportation Safety Board. We will make copies available to others upon request and on our home page at http://www.gao.gov. If you or your staff have any questions about this report, please contact me at (202) 512-2834 or guerrerop@gao.gov. Key contributors to this report were Helen Desaulniers, Judy Guilliams-Tapia, James Ratzenberger, and Sara Vermillion. Appendix I: OPS’ Actions on Pipeline Safety Statutory Requirements Reported as Open in May 2000 (As of September 1, 2001) Citations included in table 5 are to the United States Code and to the Accountable Pipeline Safety and Partnership Act of 1996.

In a May 2000 report on the performance of the Department of Transportation's Office of Pipeline Safety (OPS), GAO found that the number of pipeline accidents rose four percent annually from 1989 to 1998--from 190 in 1989 to 280 in 1998. GAO also found that OPS did not implement 22 statutory requirements and 39 recommendations made by the National Transportation Safety Board. Since GAO's May report, OPS has fully implemented six of the 22 statutory requirements. However, 11 other requirements--including some that are significant and long-standing--have not been fully implemented. The agency does not plan to report on abandoned underwater pipeline facilities--a remaining open requirement--because it believes that insufficient data exists to conduct the study. The Safety Board is encouraged by OPS' recent efforts to improve its responsiveness, but the Board remains concerned about the amount of time OPS has taken to implement recommendations. OPS has the lowest rate of any transportation agency in implementing the Board's recommendations.

The Low Income Home Energy Assistance Program (LIHEAP) is a block grant program under which the federal government gives annual grants to states, the District of Columbia, U.S. territories and commonwealths, and Indian tribal organizations to operate multi-component home energy assistance programs for needy households. Established in 1981 by Title XXVI of the Omnibus Budget Reconciliation Act ( P.L. 97-35 ), LIHEAP has been reauthorized and amended several times, most recently in 2005, when the Energy Policy Act ( P.L. 109-58 ) reauthorized annual regular LIHEAP funds at $5.1 billion per year from FY2005 to FY2007. The total LIHEAP appropriation in the FY2008 Consolidated Appropriations Act ( P.L. 110-161 ) was approximately $2.57 billion. In FY2007 Congress appropriated $2.16 billion for the program ( P.L. 110-5 ), and in FY2006, $3.161 billion was appropriated for LIHEAP ( P.L. 109-149 and P.L. 109-204 ), the largest amount ever appropriated for the program. The LIHEAP statute provides for two types of program funding: regular funds and contingency funds. This report focuses on the distribution of regular funds, sometimes referred to as block grant funds, which are allotted to states according to methods prescribed by the LIHEAP statute. The allotment method may change depending on the amount of funds appropriated by Congress. In both FY2007 and FY2008, $1.98 billion was allocated to regular funds, and in FY2006, $2.48 billion of the LIHEAP appropriation was distributed as regular funds. The second type of LIHEAP funding, called contingency funds, may be released and allotted to one or more states at the discretion of the President and the Secretary of Health and Human Services (HHS). The contingency funds may be released at any point in the fiscal year to meet additional home energy assistance needs created by a natural disaster or other emergency. Of the total appropriated for LIHEAP in FY2008, approximately $590 million was for contingency funds. In the FY2008 Consolidated Appropriations Act ( P.L. 110-161 ), Congress appropriated $1.98 billion for the LIHEAP regular fund. P.L. 110-161 contained an across-the-board rescission of 1.747% that reduced the stated amounts appropriated for most Departments of Labor, Health and Human Services, and Education programs. The $1.98 billion appropriation for regular funds is the amount available after this rescission. The first distribution to the states of the regular funds appropriated in P.L. 110-161 occurred in December 2007. Then, on June 26, 2008, HHS announced that it would distribute funds that were thought to have been allocated to leveraging incentive and REACH grants in the FY2008 Appropriations Act as part of the regular fund formula grants. Since the early 1990s, leveraging incentive and REACH grants have been made to states and tribes on the basis of their ability to obtain non-LIHEAP resources for energy assistance (leveraging incentive grants) and for increasing energy efficiency of low-income households (REACH grants). In recent years, Congress has allocated around $27 million for these two funds. However, in FY2008, P.L. 110-161 did not appropriate funds for leveraging incentive and REACH grants. When HHS discovered that language to appropriate the funds was missing from the law, it released the $26.7 million that would otherwise have been distributed as leveraging incentive and REACH grants as part of the LIHEAP formula distribution. The addition of nearly $27 million to the formula grants caused the funds to be released under the "new" LIHEAP formula. For more information about how the LIHEAP formula distributes funds, see CRS Report RL33275, The LIHEAP Formula: Legislative History and Current Law , by [author name scrubbed]. Column (c) of Table 1 shows the amount of funds that were initially allocated to the states in FY2008 before HHS discovered that the leveraging incentive grants had not been appropriated in P.L. 110-161 . Column (d) shows the total distributed to the states on June 26, 2008, which includes the $26.7 million in leveraging incentive grants. Column (b) of Table 1 shows the amounts allocated to the states in FY2007. For FY2009, the President has requested a total of $2 billion for LIHEAP; of this amount, $1.7 billion would be allocated to regular funds. Column (e) of Table 1 shows estimated allocations to the states at an appropriation of $1.7 billion. Column (a) shows the amount allotted to each state in FY2006, when $2.48 billion was appropriated for LIHEAP regular funds. Following Table 1 , Table 2 shows estimated allocations to the states at various hypothetical appropriations levels. These amounts are $1.75 billion, $2.0 billion, $2.25 billion, $2.5 billion, $2.75 billion, $3.0 billion, $4.0 billion, and $5.1 billion (the amount at which LIHEAP regular funds were last authorized in P.L. 109-58 ).

The Low Income Home Energy Assistance Program (LIHEAP) is a block grant program under which the federal government gives annual grants to states, the District of Columbia, U.S. territories and commonwealths, and Indian tribal organizations to operate multi-component home energy assistance programs for needy households. This report contains two tables that show estimated LIHEAP allocations to the states. Table 1 shows state allocations at various levels: (1) the amount appropriated for FY2006, (2) the amount appropriated for FY2007, (3) the amount appropriated in FY2008, and (4) estimated state allocations based on the amount requested by the President for FY2009. Table 2 shows estimated state allocations at other hypothetical appropriations increments. For detailed information on how the LIHEAP formula allocates funds to the states, see CRS Report RL33275, The LIHEAP Formula: Legislative History and Current Law, by [author name scrubbed]. This report will be updated when proposed funding levels change.

Leading organizations engage in broad, integrated succession planning and management efforts that focus on strengthening both current and future organizational capacity. As part of this approach, these organizations identify, develop, and select successors who are the right people, with the right skills, at the right time for leadership and other key positions. We identified specific succession planning and management practices that agencies in Australia, Canada, New Zealand, and the United Kingdom are implementing that reflect this broader focus on building organizational capacity. Collectively, these agencies’ succession planning and management initiatives demonstrated the following six practices. 1. Receive Active Support of Top Leadership. Effective succession planning and management initiatives have the support and commitment of their organizations’ top leadership. In other governments and agencies, to demonstrate its support of succession planning and management, top leadership actively participates in the initiatives. For example, each year the Secretary of the Cabinet, Ontario Public Service’s (OPS) top civil servant, convenes and actively participates in a 2-day succession planning and management retreat with the heads of every government ministry. At this retreat, they discuss the anticipated leadership needs across the government as well as the individual status of about 200 high-potential executives who may be able to meet those needs over the next year or two. Top leadership also demonstrates its support of succession planning and management when it regularly uses these programs to develop, place, and promote individuals. The Royal Canadian Mounted Police’s (RCMP) senior executive committee regularly uses the agency’s succession planning and management programs when making decisions to develop, place, and promote its top 500-600 employees, both officers and civilians. The RCMP’s executive committee, consisting of the agency’s chief executive, the chief human capital officer, and six other top officials, meets quarterly to discuss the organization’s succession needs and to make the specific decisions concerning individual staff necessary to address those needs. Lastly, top leaders demonstrate support by ensuring that their agency’s succession planning and management initiatives receive sufficient funding and staff resources necessary to operate effectively and are maintained over time. Such commitment is critical since these initiatives can be expensive because of the emphasis they place on participant development. For example, a senior human capital manager told us that the Chief Executive of the Family Court of Australia (FCA) pledged to earmark funds when he established a multiyear succession planning and management program in 2002 despite predictions of possible budget cuts facing FCA. Similarly, at Statistics Canada—the Canadian federal government’s central statistics agency—the Chief Statistician of Canada has set aside a percentage, in this case over 3 percent, of the total agency budget to training and development, thus making resources available for the operation of the agency’s four leadership and management development programs. According to a human capital official, this strong support has enabled the level of funding to remain fairly consistent over the past 10 years. 2. Link to Strategic Planning. Leading organizations use succession planning and management as a strategic planning tool that focuses on current and future needs and develops pools of high-potential staff in order to meet the organization’s mission over the long term. Succession planning and management initiatives focus on long-term goals, are closely integrated with their strategic plans, and provide a broader perspective. For example, Statistics Canada considers the human capital required to achieve its strategic goals and objectives. During the 2001 strategic planning process, the agency’s planning committees received projections showing that a majority of the senior executives then in place would retire by 2010, and the number of qualified assistant directors in the executive development pool was insufficient to replace them. In response, the agency increased the size of the pool and introduced a development program of training, rotation, and mentoring to expedite the development of those already in the pool. For RCMP, succession planning and management is an integral part of the agency’s multiyear human capital plan and directly supports its strategic needs. It also provides the RCMP Commissioner and his executive committee with an organizationwide picture of current and developing leadership capacity across the organization’s many functional and geographic lines. To achieve this, RCMP constructed a “succession room”—a dedicated room with a graphic representation of current and potential job positions for the organization’s top 500-600 employees covering its walls—where the Commissioner and his top executives meet at least four times a year to discuss succession planning and management for the entire organization. 3. Identify Talent from Multiple Organizational Levels, Early in Careers, or with Critical Skills. Effective succession planning and management initiatives identify high-performing employees from multiple levels in the organization and still early in their careers. RCMP has three separate development programs that identify and develop high-potential employees at several organizational levels. For example, beginning at entry level, the Full Potential Program reaches as far down as the front-line constable and identifies and develops individuals, both civilians and officers, who demonstrate the potential to take on a future management role. For more experienced staff, RCMP’s Officer Candidate Development Program identifies and prepares individuals for increased leadership and managerial responsibilities and to successfully compete for admission to the officer candidate pool. Finally, RCMP’s Senior Executive Development Process helps to identify successors for the organization’s senior executive corps by selecting and developing promising officers for potential promotion to the senior executive levels. The United Kingdom’s Fast Stream program targets high-potential individuals early in their civil service careers as well as recent college graduates. The program places participants in a series of jobs designed to provide experiences, each of which is linked to strengthening specific competencies required for admission to the Senior Civil Service. According to a senior program official, program participants are typically promoted quickly, attaining midlevel management in an average of 3.5 years, and the Senior Civil Service in about 7 years after that. In addition, leading organizations use succession planning and management to identify and develop knowledge and skills that are critical in the workplace. For example, Transport Canada estimated that 69 percent of its safety and security regulatory employees, including inspectors, are eligible for retirement by 2008. Faced with the urgent need to capture and pass on the inspectors’ expertise, judgment, and insights before they retire, the agency embarked on a major knowledge management initiative in 1999 as part of its succession planning and management activities. To assist this knowledge transfer effort, Transport Canada encouraged these inspectors to use human capital flexibilities including preretirement transitional leave, which allows employees to substantially reduce their workweek without reducing pension and benefits payments. The Treasury Board of Canada Secretariat, a federal central management agency, found that besides providing easy access to highly specialized knowledge, this initiative ensures a smooth transition of knowledge from incumbents to successors. 4. Emphasize Developmental Assignments in Addition to Formal Training. Leading succession planning and management initiatives emphasize developmental or “stretch” assignments for high-potential employees in addition to more formal training components. These developmental assignments place staff in new roles or unfamiliar job environments in order to strengthen skills and competencies and broaden their experience. For example, in Canada’s Accelerated Executive Development Program (AEXDP), developmental assignments form the cornerstone of efforts to prepare senior executives for top leadership roles in the public service. These assignments help enhance executive competencies by having participants perform work in areas that are unfamiliar or challenging to them in any of a large number of agencies throughout the Canadian Public Service. For example, a participant with a background in policy could develop his or her managerial competencies through an assignment to manage a direct service delivery program in a different agency. One challenge sometimes encountered with developmental assignments in general is that executives and managers resist letting their high-potential staff leave their current positions to move to another organization. Agencies in other countries have developed several approaches to respond to this challenge. For example, once individuals are accepted into Canada’s AEXDP, they are employees of, and paid by, the Public Service Commission, a central agency. Officials affiliated with AEXDP told us that not having to pay participants’ salaries makes executives more willing to allow talented staff to leave for developmental assignments and fosters a governmentwide, rather than an agency-specific, culture among the AEXDP participants. 5. Address Specific Human Capital Challenges, Such as Diversity, Leadership Capacity, and Retention. Leading organizations stay alert to human capital challenges and respond accordingly. Government agencies around the world, including in the United States, are facing challenges in the demographic makeup and diversity of their senior executives. Achieve a More Diverse Workforce. Leading organizations recognize that diversity can be an organizational strength that contributes to achieving results. For example, the United Kingdom’s Cabinet Office created Pathways, a 2-year program that identifies and develops senior managers from ethnic minorities who have the potential to reach the Senior Civil Service within 3 to 5 years. This program is intended to achieve a governmentwide goal to double (from 1.6 percent to 3.2 percent) the representation of ethnic minorities in the Senior Civil Service by 2005. Pathways provides executive coaching, skills training, and the chance for participants to demonstrate their potential and talent through a variety of developmental activities such as projects and short-term work placements. Maintain Leadership Capacity. Both at home and abroad, a large percentage of senior executives will be eligible to retire over the next several years. Canada is using AEXDP to address impending retirements of assistant deputy ministers—one of the most senior executive-level positions in its civil service. As of February 2003, for example, 76 percent of this group are over 50, and approximately 75 percent are eligible to retire between now and 2008. A recent independent evaluation of AEXDP by an outside consulting firm found the program to be successful and concluded that AEXDP participants are promoted in greater numbers than, and at a significantly accelerated rate over, their nonprogram counterparts. Increase Retention of High-Potential Staff. Canada’s Office of the Auditor General (OAG) uses succession planning and management to provide an incentive for high-potential employees to stay with the organization and thus preserve future leadership capacity. Specifically, OAG identified increased retention rates of talented employees as one of the goals of the succession planning and management program it established in 2000. Over the program’s first 18 months, annualized turnover in OAG’s high-potential pool was 6.3 percent compared to 10.5 percent officewide. This official told us that the retention of members of this high-potential pool was key to OAG’s efforts to develop future leaders. 6. Facilitate Broader Transformation Efforts. Effective succession planning and management initiatives provide a potentially powerful tool for fostering broader governmentwide or agencywide transformation by selecting and developing leaders and managers who support and champion change. For example, in 1999, the United Kingdom launched a wide- ranging reform program known as Modernising Government, which focused on improving the quality, coordination, and accessibility of the services government offered to its citizens. Beginning in 2000, the United Kingdom’s Cabinet Office started on a process that continues today of restructuring the content of its leadership and management development programs to reflect this new emphasis on service delivery. For example, the Top Management Programme supports senior executives in developing behavior and skills for effective and responsive service delivery, and provides the opportunity to discuss and receive expert guidance in topics, tools, and issues associated with the delivery and reform agenda. These programs typically focus on specific areas that have traditionally not been emphasized for executives, such as partnerships with the private sector and risk assessment and management. Preparing future leaders who could help the organization successfully adapt to recent changes in how it delivers services is one of the objectives of the FCA’s Leadership, Excellence, Achievement, Progression program. Specifically, over the last few years FCA has placed an increased emphasis on the needs of external stakeholders. This new emphasis is reflected in the leadership capabilities FCA uses when selecting and developing program participants. The program provides participants with a combination of developmental assignments and formal training opportunities that place an emphasis on areas such as project and people management, leadership, and effective change management.

Leading public organizations here and abroad recognize that a more strategic approach to human capital management is essential for change initiatives that are intended to transform their cultures. To that end, organizations are looking for ways to identify and develop the leaders, managers, and workforce necessary to face the array of challenges that will confront government in the 21st century. The Subcommittee on Civil Service and Agency Organization, House Committee on Government Reform, requested GAO to identify how agencies in four countries--Australia, Canada, New Zealand, and the United Kingdom--are adopting a more strategic approach to managing the succession of senior executives and other public sector employees with critical skills. As part of a reexamination of what the federal government should do, how it should do it, and in some cases, who should be doing it, it is important for federal agencies to focus not just on the present but also on future trends and challenges. Succession planning and management can help an organization become what it needs to be, rather than simply to recreate the existing organization. Leading organizations go beyond a succession planning approach that focuses on simply replacing individuals and engage in broad, integrated succession planning and management efforts that focus on strengthening both current and future organizational capacity. As part of this broad approach, these organizations identify, develop, and select successors who are the right people, with the right skills, at the right time for leadership and other key positions. Governmental agencies around the world anticipate the need for leaders and other key employees with the necessary competencies to successfully meet the complex challenges of the 21st century. To this end, the experiences of agencies in Australia, Canada, New Zealand, and the United Kingdom can provide insights to federal agencies, many of which have yet to adopt succession planning and management initiatives that adequately prepare them for the future.

Morning hour debates have been a part of House floor procedure only since the 103 rd Congress. They began on February 23, 1994, for a 90-day trial period under procedures outlined in a joint leadership unanimous consent agreement (formally, "a standing order of the House"). Morning hour debates were created, in part, to offset the new restrictions on special order speeches that took effect the same day. These restrictions, such as a ban on special orders after midnight and a four-hour limitation on longer special orders, scaled back opportunities for non-legislative debate available through special orders. The 1994 agreement establishing morning hour debates for a 90-day trial period was later extended to cover the remainder of the 103 rd Congress. Morning hour debates continued in the 104 th Congress under a slightly modified unanimous consent agreement. The modification concerned the length and starting time of morning hour debates on Tuesdays "after the first Tuesday in May" (see the " Days and Meeting Times " section for more information). An identical unanimous consent agreement (agreed to on January 6, 2009) governs morning hour speeches in the 111 th Congress. Morning hour debates are not provided for in the rules of the House. Instead, they are a unanimous consent practice of the chamber. The House gives unanimous consent to holding morning hour debates when it agrees to the joint leadership unanimous consent agreement governing these debates. In the 111 th Congress, the chair refers to this agreement at the start of the morning hour debate period when he announces, "[p]ursuant to the order of the House of January 6, 2009, the Chair will now recognize ..." The unanimous consent agreement governs recognition for morning hour debates and establishes the days and meeting times for these debates (for more information, see later sections of this report). During morning hour debates, Members must abide not only by the unanimous consent agreement but also by the rules of the House, the chamber's precedents, and the Speaker's announced policies. Relevant House rules include those governing debate, decorum, and the Speaker's power of recognition. House precedents discuss how the chamber has interpreted and applied its rules. There is not an established body of precedents for morning hour debates because these debates are a relatively new feature of House floor procedure. The term "Speaker's announced policies" refers to the Speaker's policies on certain aspects of House procedure such as decorum in debate, the conduct of electronic votes, and recognition for one-minute and special order speeches. While the Speaker's announced policies do not govern recognition for morning hour debates (the unanimous consent agreement governs recognition), they do regulate television coverage of morning hour debates. The Speaker's policies prohibit House-controlled television cameras from panning the chamber during the morning hour debate period. Instead, a caption (also called a "crawl") appears at the bottom of the television screen indicating that the House is conducting morning hour debates. Morning hour debates are in order only on Mondays and Tuesdays. They take place infrequently on Mondays because the House is not always in session that day. The starting time and length of morning hour debates are established by the joint leadership unanimous consent agreement. The House convenes for Monday morning hour debates 90 minutes earlier than the time established for that day's session. For example, if the House is scheduled to meet at noon, the morning hour debate period begins at 10:30 a.m. The Monday morning hour debate period can last up to one hour, with a maximum of 30 minutes of debate on each side. The full hour is rarely used. Tuesday morning hour speeches on or before May 18, 2009, take place in the same manner as Monday morning hour debates. The agreement provides, however, that Tuesday morning hour debates after May 18, 2009, begin 60 minutes before the chamber's meeting hour for a maximum duration of 50 minutes, with 25 minutes allocated to each side. The different procedures for Tuesday morning debates after early May were first established in the joint leadership unanimous consent agreement of May 12, 1995. These procedures, which are included in the agreement for the 111 th Congress, are designed to accommodate the chamber's practice of convening earlier for legislative business after early May. In the 105 th Congress, the procedures were only on those Tuesdays after early May when the House was scheduled to meet at 10:00 a.m. On Tuesdays after early May when the chamber's appointed meeting hour was a later time (e.g., 12:00 noon), the Tuesday morning debates took place in the same manner as Monday morning hour debates. When Monday and Tuesday morning hour debates are completed, the House recesses until the meeting hour established for that day's session. The daily prayer, the pledge of allegiance, and approval of the previous day's Journal take place when the House meets after this recess. The joint leadership unanimous consent agreement requires that the majority and minority leaders give the Speaker a list showing how each party's time for morning hour debates will be allocated among its Members. The chair follows this list in recognizing Members for morning hour debates. A majority party Representative appointed as "Speaker pro tempore " often presides in the chair during morning hour debates. During each morning hour debate period, he alternates recognition between the majority and minority for both the initial morning hour speech (i.e., if a majority Member is recognized for the first speech on Monday, a minority Member is recognized for first speech on Tuesday) and subsequent ones. Individual Members must limit their morning hour debate speech to five minutes or less. Only the majority leader, minority leader, or the minority whip may deliver a morning hour debate speech longer than five minutes. Members reserve time for morning hour debates through their party leadership: Democratic Representatives reserve time through the Office of the Minority Leader, and Republican Members do so through the Republican cloakroom or the party leadership desk on the House floor. Reservations can be made no earlier than one week before the speech date. While most Members reserve five minutes for their morning hour speech, some Representatives reserve as little as one minute. Individual Members often use the morning hour debate period to deliver speeches on subjects unrelated to legislation before the House. They deliver eulogies and tributes to individuals and organizations from their congressional district. They also use the period to deliver speeches on broad policy issues and to present their views on local, national, and international events. Because morning hour debates take place early in the day, they are sometimes used by individual Members and the party leadership to share information relevant to that day's session. For example, Members deliver morning hour speeches to explain a bill they are introducing that day and to invite cosponsors. The chairman of the Rules Committee has spoken during morning hour debates to announce an emergency meeting of the committee. This use of morning hour debates to disseminate information among colleagues parallels how Members often employ one-minute speeches as a visual form of the "Dear Colleague" letter. On occasion, Members of the same party use the morning hour debate period to deliver a series of speeches about the party's views on a particular bill or policy issue. For example, on February 11, 1997, four minority party Members delivered morning hour debate speeches on campaign finance reform. This coordinated use of morning hour debates by party Members is similar to how the parties sometimes use "leadership special orders" (i.e., the first hour of longer special orders that is usually reserved for the party's leadership or a designee) to focus on a specific theme with participation from other party Members.

On Mondays and Tuesdays, the House of Representatives meets earlier than the hour established for that day's session for a period called "morning hour debates" (also known as "morning hour speeches"). This period provides a rare opportunity for non-legislative debate in the House; remarks in the House are usually limited to pending legislative business. During morning hour debates, individual Members deliver speeches on topics of their choice for up to five minutes. The majority and minority leaders give the Speaker a list showing how each party's time for morning hour debates will be allocated among its Members. The chair follows this list in recognizing Members for morning hour debates. At the conclusion of morning hour debates, the House recesses until the starting time for that day's session. This report examines current House practices for morning hour debates and how these debates are used. It will be updated if rules and procedures change.

Under IDEA, public schools are required to provide children with disabilities with a free appropriate public education (FAPE), including special education and related services according to each child's individualized education plan (IEP) or individualized family service plan (IFSP). States receive some federal aid under IDEA, but are otherwise responsible for the expense of special education and related services. One approach Congress has taken to ease the burden on states and school districts of fulfilling these IDEA requirements is to allow Medicaid to finance covered health services (e.g., physical, occupational and speech therapy, and diagnostic, preventive and rehabilitation services) delivered to low-income, Medicaid-eligible special education students. Prior to 1988, Medicaid did not pay for coverable services that were listed in a child's IEP/IFSP since special education funds were available to pay for these services, and because generally (with a few explicit exceptions), Medicaid is always the payer of last resort. Congress changed the financing relationship between IDEA and Medicaid in the Medicare Catastrophic Coverage Act of 1988 ( P.L. 100 - 360 ). However, there is some controversy about the exact nature of this legislative change. IDEA requires states to establish interagency agreements to ensure that IDEA-eligible students receive the services to which they are entitled. These agreements must include an identification of the financial responsibility of all relevant agencies. IDEA regulations further stipulate that the financial responsibility of Medicaid and other public insurers must precede the financial responsibility of the local education agency (LEA) or the state agency responsible for developing the child's IEP. In other words, Medicaid is deemed to be the first payer. In contrast, according to officials with the Centers for Medicare and Medicaid Services (CMS)—the federal agency that administers the Medicaid program—the 1988 law allows , but does not require, state Medicaid agencies to pay for services included in an IEP/IFSP. Thus, given CMS' interpretation of this law, the IDEA requirement that Medicaid be the first payer applies only to those states that have elected to pay for services listed in IEPs/IFSPs. According to CMS, most states do pay for these services. Since 1988, other complicated issues surrounding the relationship between IDEA, schools and Medicaid have arisen. While Congress made it clear that Medicaid funds can be used to pay for reimbursable school-based services rendered to IDEA children enrolled in Medicaid, at various points in time some Members have expressed concern that some of these Medicaid payments may be made improperly. In 1999 and 2000, the Senate Finance Committee asked the U.S. General Accounting Office (GAO; later renamed the Government Accountability Office) to examine Medicaid school-based services and held two hearings on this subject. Three main concerns were identified by GAO: Billing practices for school-based administrative services, coupled with uneven oversight of these practices by the Health Care Financing Administration (HCFA; now CMS), resulted in at least 2 of 17 states receiving improper payments. "Bundled" billing methods for school-based services used by seven states failed to account for variations in service needs among children and often lacked adequate documentation demonstrating that the benefits paid for were actually delivered in every case. However, both GAO and HCFA believed that bundled rates, if proper assurances can be built into the approach, are the preferred method for LEAs to bill Medicaid. In some states, school districts received little of the reimbursements claimed for school-based services because state agencies and private contractors, hired by schools to assist in billing Medicaid, retained significant portions of federal payments. For example, seven states retained from 50% to 85% of total federal reimbursements for both health services and administrative activities. Some school districts paid private contractors contingency fees as high as 25% of federal payments for school-based administrative activities. In the worse case reported, schools received as little as $7.50 for every $100 claimed for services and activities performed in support of Medicaid-eligible children. In order for LEAs providing IDEA-related services to qualify for reimbursement under Medicaid, four conditions must be met: (1) the child receiving the service must be enrolled in Medicaid, (2) the service must be covered in the state Medicaid plan or authorized in federal Medicaid statute, (3) the service must be listed in the child's IEP, and (4) the LEA (or school district) must be authorized by the state as a qualified Medicaid provider. To help schools obtain Medicaid reimbursement for health care services, and also related administrative activities, HCFA and later CMS issued two manuals, Medicaid and School Health: A Technical Assistance Guide (August 1997) and Medicaid School-Based Administrative Claiming Guide (May 2003). Prior to the release of the 2003 guide, on two occasions, Congress urged the Administration to revise early drafts. The 2003 guide represents a consolidation of existing requirements for administrative claiming, and drew on the input from education community on the two earlier draft versions released in 2000 and 2002. Some in the education field have questioned the usefulness of these guides. Nationwide, estimated Medicaid expenditures for school-based services were $2.7 billion in FY2006 (see Table 1 ). Roughly $1.9 billion or 69% of total expenditures was for Medicaid benefits provided in schools and about $849 million or 31% was for school-based administration/training activities. There was wide variation in spending patterns across states with respect to the proportion of expenditures for benefits versus administration and training. Among the 45 states reporting any school-based spending, 14 had expenditures for benefits only. At the other extreme, six states reported school-based spending for administration and training only. In the President's FY2008 budget proposal, the Bush Administration noted that Medicaid claims for services provided in school settings have been prone to abuse and overpayments, especially with respect to transportation and administrative activities. As of November 2007, the HHS Office of Inspector General (OIG) has published reviews of school-based claims in 22 states. Based on this and other research, both the HHS OIG and GAO have reached similar conclusions. For transportation services, examples of inappropriate Medicaid billing include (1) no verification that transportation was in fact provided, (2) a Medicaid-covered school health service other than transportation was not provided on the day that transportation was billed, and (3) child/family plans did not include a recommendation for transportation services, or there was no IEP or IFSP. School districts may perform administrative functions for Medicaid purposes, such as outreach, eligibility intake, information and referrals, health service monitoring, and interagency coordination. Examples of inappropriate Medicaid billing include (1) payments based on inaccurate time studies used to allocate the cost of these administrative activities across funding sources including Medicaid; (2) expenditures for school employees who do not perform Medicaid administrative activities; (3) expenditures for operating costs such as nursing supplies, non-Medicaid outreach supplies, and education-related expenditures; (4) expenditures for personnel funded by other federal programs; and (5) payments for personnel who render only direct medical services. On December 28, 2007, the Bush Administration published a final rule regarding Medicaid payments for school-based administration and transportation. First, the rule would restrict federal payments for school-based administrative activities (e.g., outreach, service coordination, referrals) that may be conducted on behalf of children dually eligible for Medicaid and IDEA, as well as those eligible for Medicaid only. Second, the rule would restrict federal payments for certain transportation services provided to children dually eligible for Medicaid and IDEA. This rule supercedes prior guidance from CMS on these issues, and was estimated to reduce federal Medicaid outlays by $635 million in FY2009 and by $3.6 billion over the period FY2009-FY2013. In early 2008, the Congressional Budget Office (CBO) estimated that this final rule would reduce federal Medicaid outlays by $4.2 billion over 5 years and by $10.2 billion over 10 years. A 2008 congressional report indicated that this rule would result in the loss of roughly $3.2 billion over five years in 34 states affected by the rule that could provide such estimates. CMS indicated that school budgets for the 2007-2008 school year would not be affected by the rule. According to CMS, federal Medicaid reimbursement would no longer be available for (1) administrative activities performed by school employees or contractors, or anyone under the control of a public or private educational institution, because of inconsistent application of Medicaid requirements by schools, or (2) transportation from home to school and back for school-aged children with an IEP or IFSP, because such transportation does not meet the definition of an optional medical transportation service, nor is it necessary for the proper and efficient administration of the Medicaid state plan. Many in the education and state Medicaid communities are opposed to these cuts. Opponents argue that the rule (1) will reduce the availability of, and access to, needed health care for children; (2) is inconsistent with decades of approved state plan amendments allowing federal funding of these administrative and transportation services; and (3) falsely assumes that health care administrative activities performed by school personnel are inconsistent with the proper and efficient administration of the state Medicaid plan because such activities improve children's health, reduce inappropriate medical care utilization, and thus ultimately save money. Moreover, additional federal funding for existing programs like IDEA or other new appropriations to offset these Medicaid cuts are unlikely to be on the horizon. While the final rule eliminates federal matching funds for certain school-based spending under Medicaid, other types of school-based expenditures remain reimbursable. States may still claim federal matching dollars when school-based administrative activities are conducted by employees of the state or local Medicaid agency for which proper oversight and allocation of costs to Medicaid is more reliable according to CMS. In addition, federal funding would still be available for administrative overhead costs (e.g., patient follow-up, assessment, counseling, education, parent consultations, and billing activities) that are integral to, or an extension of, a specified direct medical service to the extent that those costs are represented in the rate paid for such services and reimbursed at the applicable federal matching rate. Medicaid outreach and eligibility intake, conducted by local or state Medicaid employees, would also remain reimbursable. CMS would continue to reimburse states for the costs of school-based direct medical services under IDEA that are covered in approved state Medicaid plans, and for transportation of school-age children from school or home to a non-school-based direct medical service provider that participates in Medicaid, or from the non-school-based provider to school or home. CMS would also continue to reimburse states for transportation of children who are not yet school age from home to another setting (including school) and back to receive a direct medical service, as long as the visit does not include an educational component or activity unrelated to the direct medical service. P.L. 110 - 173 prohibited the Secretary of HHS from restricting coverage or payments for school-based administration and transportation under Medicaid, relative to policies in place on July 1, 2007. This moratorium was effective until June 30, 2008. On June 19, the House passed an amendment to the Senate-passed version of H.R. 2642 that would extend this moratorium to April 1, 2009. On June 26, the Senate passed this same bill. On June 30, this bill became P.L. 110 - 252 . (See CRS Report RS22849, Medicaid Financing , by [author name scrubbed], for more information on this legislation). This moratorium was further extended to July 1, 2009, via the American Recovery and Reinvestment Act of 2009 ( P.L. 111-5 ). The Congressional Budget Office and the Joint Committee on Taxation estimate that the moratorium on the school-based rule (and two other final rules regarding case management services and provider taxes), along with a new moratorium on a final rule for outpatient hospital services, and a Sense of the Congress that the Secretary should not promulgate final rules regarding cost limits for public providers, graduate medical education, and rehabilitative services will cost $105 million in FY2009. Separate cost estimates for the provisions affecting each individual regulation were not provided.

As a condition of accepting funds under the Individuals with Disabilities Education Act (IDEA), public schools must provide special education and related services necessary for children with disabilities to benefit from a public education. Generally, states can finance only a portion of these costs with federal IDEA funds. Medicaid, the federal-state program that finances medical and health services for the poor, can cover IDEA required health-related services for enrolled children as well as related administrative activities (e.g., outreach for Medicaid enrollment purposes, medical care coordination). Despite written federal guidance, schools have difficulty meeting the complex reimbursement rules under Medicaid. According to federal investigations and congressional hearings, Medicaid payments to schools have sometimes been improper. P.L. 110-173 included a moratorium on any administrative action restricting Medicaid coverage or payments for school-based administration and transportation services until June 30, 2008. P.L. 110-252 extended this moratorium until April 1, 2009. This moratorium was further extended to July 1, 2009, via the American Recovery and Reinvestment Act of 2009 (P.L. 111-5).

The disability insurance portion of the Old-Age, Survivors and Disability Insurance (OASDI) program was enacted in 1956 and provides benefits to disabled workers under the full retirement age (FRA) in amounts based on an individual's career-average earnings in covered employment. A statutory formula determines monthly payment levels for Social Security Disability Insurance (SSDI). In addition, the law also eliminates from benefit calculations one year of a SSDI beneficiary's lowest earnings for every five years of earnings (also known as the one-for-five rule), which equates to a maximum of five "disability dropout years" for an individual with 25 or more years of earnings. By statute, SSA also applies "childcare dropout years" (CDYs) for years in which a beneficiary has zero earnings due to leaving the workforce to care for an infant child. The application of CDYs is not common, affecting approximately 0.16% of SSDI beneficiaries between 2000 and 2013. This report describes how workers become insured for SSDI benefits, how SSDI benefits are calculated, and the use of dropout years in benefit calculations. SSDI benefits, like those of the Old-Age and Survivors Insurance (OASI) program, are meant to replace income from work that is lost by incurring one of the risks the social program insures against. The SSDI program is financed primarily through a payroll tax levied on workers, their employers, and self-employed individuals in jobs covered by Social Security. To be eligible for SSDI benefits, a worker must be (1) disability insured, and (2) unable to engage in substantial gainful activity (SGA) by reason of a medically determinable physical or mental impairment expected to result in death or last at least 12 months. Generally, the worker must be unable to do any kind of work that exists in the national economy, taking into account age, education, and work experience. Special rules for disability insured status apply to individuals under the age of 31. To be fully insured, a worker must have worked a minimum amount of time in employment covered by Social Security. Generally, an individual must have one quarter of coverage (also referred to as "credits") for each calendar year after the age of 21 up to the year before the individual (1) reaches the age of 62, (2) dies, or (3) becomes disabled. A minimum of six quarters is required to become fully insured. In 2014, each quarter of coverage requires $1,200 in earnings, which is indexed annually to average wage growth. Workers under the age of 31 need to have credit in one-half of the quarters during the period between when they attained age 21 and when they became disabled. In addition, a recency of work test requires the worker to have 20 quarters of coverage in the 40 quarters preceding the onset of disability (generally five years of work in the last 10). An exception applies to disabled workers under the age of 31; these individuals can meet the recency of work test by having credit in at least one-half of the calendar quarters during the period beginning with the quarter after the quarter the individual turned 21 and ending with the quarter that they became disabled. The recency of work test does not apply to individuals who are blind. To qualify for benefits, a disabled worker must also be unable to engage in "substantial gainful activity" (SGA). In 2014, SGA is the ability to earn $1,070 in a month. Since July 1999, the SGA amount has been adjusted annually to reflect the growth in average wages. The SSDI benefit payment is based on a disabled worker's average indexed monthly earnings (AIME), which is used in the computation of the individual's Primary Insurance Amount (PIA). For SSDI beneficiaries, the initial monthly benefit payment equals the PIA. The AIME is calculated as the sum of indexed earnings over the computation period, divided by the number of "computation years" (in months). The AIME is calculated based on an individual's earnings record by indexing—to national average wage growth—the worker's earnings during full calendar years after 1950 and up to the second year prior to the year (the "indexing year") of SSDI eligibility. Earnings in years after the indexing year are not indexed and are counted at their nominal value. This adjusts a beneficiary's earnings to be comparable to the earnings level in the year he or she became disabled. The number of computation years used in the AIME determination is equal to the number of "elapsed years," minus any dropout years as discussed below. By statute, the number of elapsed years equals the calendar years after an individual turns age 21 through the year before the individual first becomes eligible for SSDI benefits. The minimum number of computation years used is two. The individual's highest (indexed) earnings years are used as computation years for the AIME calculation. Computation years may include years of zero earnings when the number of computation years is greater than the number of years of earnings; it is these computation years of zero earnings for which CDYs may be applied for eligible individuals. Under current law, SSA will remove up to five of a disabled worker's elapsed years with the lowest earnings in calculating the AIME. Also known as the one-for-five (or one-fifth) rule , for every five elapsed years of earnings, the lowest year(s) of earnings will be dropped, up to a maximum of five total disability dropout years for a worker with 25 or more years of earnings. This provision reduces the effects of years of lower earnings on a disabled worker's benefit amount. For example, for a worker who becomes disabled with seven years of work history in covered employment, only the highest six years of earnings will be used for the purposes of AIME calculation (i.e., applying one disability dropout year). If the worker had 10 years in covered employment, SSA would use the highest eight years of earnings (i.e., applying two disability dropout years). In addition, in calculating the AIME, disabled workers who receive fewer than three disability dropout years under the one-for-five rule (as described above) may be credited with up to two additional dropout years based on the care of a child, for up to a total of three dropout years. Specifically, these "childcare dropout years" (CDYs; also referred to as caregiving years) may be credited under two conditions: (1) the SSDI claimant had a child (or the child of a spouse) under the age of three in his or her care for at least nine months throughout a given year, and (2) the SSDI claimant had no earnings in that year. In addition, the year selected as a CDY must also be a year that could be selected as a benefit computation year. The claimant must have a minimum of two computation years. Authorized by the Social Security Disability Amendments of 1980 ( P.L. 96-265 ), the CDY provision became effective July 1981. CDYs are offset by disability dropout years and can only be credited to eligible SSDI beneficiaries when the number of disability dropout years is less than three. As presented in Table A-1 , an eligible individual may be credited with one CDY at three elapsed years. Two CDYs may be credited at four elapsed years. At five elapsed years, a disability dropout year may be credited (in addition to the two CDYs) for three total dropout years. CDYs begin to phase out at 10 elapsed years, as one CDY is replaced with one disability dropout year. CDYs completely phase out at 15 elapsed years as both CDYs are replaced with disability dropout years. A disabled worker's PIA is determined by applying a formula to the AIME as shown in Table 1 . First, the AIME is sectioned into three brackets (or segments) of earnings, which are divided by dollar amounts known as bend points. For 2014, the bend points are $816 and $4,917. Three replacement factors—90%, 32%, and 15%—are applied to the three brackets of AIME. The three products derived from multiplying each replacement factor and bracket of AIME are added together. For a worker who becomes disabled in 2014, the PIA is determined as shown in the example in Table 1 . A disabled worker's benefit is equal to his or her PIA. In addition, a beneficiary's payment increases each year from the year of eligibility to the year of benefit receipt based on the Social Security cost-of-living adjustment (COLA). Some 861,396 disabled workers aged 25 to 36 at the time of disability-onset were awarded SSDI benefits between January 2000 and May 2013. CDYs were applied to 1,336 (0.16%) of these recipients. During this period, most of these individuals (991 or 74.2%) were credited with one CDY, whereas 339 (25.4%) were credited with two CDYs. As shown in Figure A-1 , the distribution of CDY credits is skewed toward beneficiaries with lower earnings. During this period, 84.5% of beneficiaries (1,129) who were credited with CDYs had a PIA of less than $1,000. Appendix A. CDY Computation Chart and Graph Appendix B. Acronyms Used in This CRS Report

Eligibility for Social Security Disability Insurance (SSDI) benefits are based on a worker's insured status, and payment levels are associated with the individual's career earnings under covered employment. Monthly payments are calculated using a formula that takes into account the period of employment, a worker's average earnings over that period, and the application of "dropout years." To be insured for SSDI benefits, a claimant must have worked a minimum amount of time in covered employment. First, a worker must be "fully insured," which requires one quarter of coverage for each calendar year after the age of 21, with a minimum of six quarters and a maximum of 40 quarters. In 2014, each quarter of coverage requires $1,200 in earnings. Second, a recency of work test requires 20 quarters of coverage in the 40 quarters preceding the onset of a disability; that is generally five years of work in the last 10, although fewer quarters are required for younger workers. In calculating the SSDI benefit level, up to five years of a worker's lowest years of earnings are eliminated or "dropped" to minimize the effect of lower years of earnings on monthly payments. An eligible worker who becomes disabled has one year of earnings dropped (via the disability dropout year provision) for every five years of earnings, known as the one-for-five rule. A separate childcare dropout year (CDY) provision also disregards from benefit calculations up to two years in which a beneficiary received no income during periods when he or she was caring for a young child. The number of CDYs applied to a benefit calculation may be offset by the number of disability dropout years applied and vice versa. The CDY provision largely benefits a small subset of SSDI recipients with lower career earnings. This report provides (1) an overview of the SSDI program and how workers become insured for SSDI benefits, (2) an explanation of how benefit payments are calculated, and (3) a description of how the dropout year provisions affect the calculation of disability benefit payments. The report concludes with a brief analysis of the earnings of disabled workers that have been credited with CDYs.

T he Senate takes up business under procedures set in Senate rules and by long-standing custom, thereby giving it flexibility in setting its floor agenda. This report first discusses those processes or customs most often used by the Senate and then discusses some procedures less often used to call up business. Under chamber rules, technically any Senator may offer the necessary agenda-setting motions "to proceed to the consideration" of a bill, resolution, or item of executive business. However, by long-established custom, in practice only the majority leader or his or her designee offer agenda-setting motions. (See CRS Report RS21255, Motions to Proceed to Consider Measures in the Senate: Who Offers Them? , by [author name scrubbed] and [author name scrubbed].) Items called up are often those on the Senate's legislative or executive calendars, either reported by committee or, in the case of bills and joint resolutions, placed on the legislative calendar directly under Rule XIV (see CRS Report RS22309, Senate Rule XIV Procedure for Placing Measures Directly on the Senate Calendar , by [author name scrubbed]). Holds, long recognized by custom, are notices from Senators to their party floor leaders that they intend to object to a unanimous consent request to bring a matter up for consideration on the Senate floor. Holds also serve to identify controversial bills or controversial items within a bill (s ee CRS Report R43563, "Holds" in the Senate , by [author name scrubbed]). Leaders also invite Senators to file "requests to be consulted" with the staff of the respective party secretaries. Through these requests, Senators join in talks about compromise versions of bills and potential amendments, the Senate's floor schedule, and conditions of floor action. When consulted Senators no longer report any concerns, a bill is said to have "cleared both sides of the aisle." Such bills are generally called up by unanimous consent, considered, and agreed to by voice vote with little or no actual floor debate. Through negotiations inherent in the hold and consultation process, floor leaders can often get Senators to agree to take up a bill despite the reservations some have about key provisions in it. Thus, usually, the majority leader or his or her designee will ask unanimous consent to proceed to the consideration of a measure pending on the Senate calendar. Alternatively, the majority leader may move to proceed to the consideration of the measure or matter. Normally, this motion is debatable. Debate on the motion can be ended only by unanimous consent or by invoking cloture. If the motion to proceed is agreed to, consideration of the bill begins without debate limits (unless also imposed by unanimous consent or cloture). There are few circumstances in which a motion to proceed is not debatable. Motions to take up certain privileged items of business (discussed in the next section) are not debatable. Although infrequently used, debate is also prohibited on motions to proceed offered on the beginning of a new legislative day during the "morning hour" after the completion of "morning business." Under Senate Rule VIII, a two-hour period known as the morning hour occurs automatically at the beginning of a new legislative day, and within this two-hour period, a period is reserved for the transaction of morning business, such as the filing of committee reports and the receipt of executive communications. Under this Rule VIII procedure, the motion to proceed is not debatable if offered during the morning hour. If the motion is agreed to, the measure becomes the pending business before the Senate. At the end of the morning hour, any unfinished legislative business pending on the previous day when the Senate adjourned will displace the measure just taken up. The non-debatable motion to proceed under Rule VIII poses many parliamentary difficulties and is, therefore, rarely used by the majority leader. In actual practice, the Senate almost always begins a new legislative day under procedures established by unanimous consent, rather than relying on the automatic procedures for a morning hour contained in Rule VIII. Such unanimous consent agreements commonly include a stipulation that the morning hour be "deemed to have expired." Motions to take up privileged items of business are not debatable and, hence, are usually taken up by unanimous consent. Among the items of privileged business are budget resolutions, reconciliation bills, conference reports, measures to resolve election contests, and measures to impose disciplinary sanctions against Senators. Motions to go into executive session to consider a nomination, treaty, or resolution on the Senate Executive Calendar are also privileged and non-debatable. On the motion of any Senator, a measure or matter can be made a special order of business at some future specified date. Such motions are very rarely used, because they are fully debatable and need a two-thirds vote for approval. If there is objection to considering a resolution when it is submitted, the resolution is said to "go over, under the rule," and is placed on a special section of the Calendar of Business reserved for this purpose. Such resolutions are to be laid before the Senate on the next legislative day during the morning business period (described above), which would occur automatically under Rule VIII. Items pending at the end of morning business return to the Calendar of Business and can be called up later by a debatable motion or unanimous consent. In current practice, however, few resolutions go "over, under the rule," and because (as noted above) the Senate almost never engages in morning business created by the beginning of a new legislative day as called for under Rule VIII, those resolutions that do are essentially placed in a kind of parliamentary limbo. They remain pending on the Calendar of Business, unreachable except by unanimous consent or by a rare morning hour created by operation of the rule. Executive resolutions that are placed on the Executive Calendar "over, under the rule" can be subsequently reached by unanimous consent or, as noted above, by non-debatable motion. Motions to discharge committees from the further consideration of any measure or matter (for example, a nomination or treaty) must lie over for one day, and debate on such a motion is not limited. As such, three-fifths of all Senators may need to vote for cloture in order for the chamber to reach a final vote on the motion. (For more information on nomination procedures, see CRS Report RL31980, Senate Consideration of Presidential Nominations: Committee and Floor Procedure , by [author name scrubbed].) If agreed to, a motion to discharge would place a measure or matter on the relevant chamber calendar.

The Senate takes up measures and matters under procedures set in Senate rules and by long-standing customs, thereby giving it flexibility in setting its floor agenda. This report first treats those processes or customs most often used by the Senate and then discusses some procedures less often used to call up business. This report will be revised as events warrant.

The U.S. Patent and Trademark Office (USPTO) examines and approves applications for patents on claimed inventi ons and administers the registration of trademarks. It also assists other federal departments and agencies to protect American intellectual property in the international marketplace. The USPTO is funded by user fees paid by customers that are designated as "offsetting collections" and subject to spending limits established by the Committee on Appropriations. Traditionally, the U.S. Patent and Trademark Office was funded primarily with taxpayer revenues through annual appropriations legislation. In 1980, P.L. 96-517 created within the U.S. Treasury a "Patent and Trademark Office Appropriations Account" and mandated that all fees collected be credited to this account. Subsequently, in 1982, Congress significantly increased the fees charged to customers for the application and maintenance of patents and trademarks to pay the costs associated with the administration of such activities. (Note that fee levels were established by Congress.) Funds generated by the fees were considered "offsetting collections" and made available to the USPTO on a dollar-for-dollar basis through the congressional appropriations process. Additional direct appropriations from taxpayer revenues, above the fees collected, were made to support other operating costs. The Patent and Trademark Office became fully fee funded as a result of P.L. 101-508 , the Omnibus Budget Reconciliation Act (OBRA) of 1990, as amended. The intent of the legislation was to reduce the deficit; one aspect of this effort was to increase the fees charged customers of the USPTO to cover the full operating needs of the institution. At the same time, a "surcharge" of approximately 69% was added to the fees the office had the statutory authority to collect. These additional receipts were deposited in a special fund in the Treasury established under the budget agreement. Through the appropriations process, the USPTO must be provided the budget authority to spend collected fees. Funds generated through the surcharge were considered "offsetting receipts" and were defined as offsets to mandatory spending. The use of these receipts was controlled by the appropriation acts; the receipts were considered discretionary funding, and counted against the caps under which the Appropriations Committee operated. The funds generated through the basic fee structure continued to be designated as "offsetting collections" and also subject to spending limits placed on the Appropriations Committee. The surcharge provision expired at the end of FY1998. While OBRA was in force, the ability of the USPTO to use all fees generated during any given fiscal year was limited by appropriation legislation that did not allocate these revenues on a dollar-for-dollar basis. Critics argued that those fees not appropriated to the USPTO were used to fund other, non-related programs under the purview of the appropriators. It has been estimated that during the eight years in which OBRA provisions were in effect, the USPTO collected $234 million more in fees than the budget authority afforded to the office. Another estimate suggested that between FY1991 and FY1998, the USPTO collected $338 million more in discretionary and mandatory receipts than the office had the authority to spend. Subsequent to the expiration of the surcharge, several times Congress increased the statutory level of the fees charged by the USPTO. Until FY2001, the budget authority provided to the USPTO came from a portion of the funds collected in the current fiscal year plus funds carried over from previous fiscal years. The carry-over was created when the annual appropriations legislation established a "ceiling" and limited the amount of current year collections the U.S. Patent and Trademark Office could spend. Additional funds were not to be expended until following fiscal years. However, in FY2001, this latter provision was eliminated. All funds raised by fees were considered "offsetting collections" and counted against caps placed upon the appropriators. If appropriators chose to provide the USPTO with the budget authority to spend less than the estimated fiscal year fee collection, the excess was permitted to be used to offset programs not related to the operations of the USPTO. Between FY1999 and FY2004, the budget authority provided the USPTO was less than the total amount of fees generated within each fiscal year. During this time period, it has been estimated that $406 million in fees collected were not available for use by the USPTO. Various calculations have been made of the total amount of fees generated that were withheld from use by the USPTO since the office became fully fee funded. One analysis argues that, in total, the USPTO was not permitted to use $680 million in fees generated between FY1990 and FY2004. An additional study found that during this time frame, $747.8 million in fees were "diverted" from the Patent and Trademark Office and used to fund unrelated programs. While the office was provided the budget authority to spend all fees collected between FY2005 and FY2009, the Intellectual Property Owners Association estimates that $260.7 million in fees collected were not made available to the USPTO in FY2010 and FY2011. For FY2016, the USPTO budget supported by patent fees is $3.231 billion. The Administration's request for a fee-based budget authority for FY2017 is $3.244 billion. P.L. 112-29 , the Leahy-Smith America Invents Act, makes several changes to the handling of fees generated by the USPTO. Under the new statute, the use of fees generated is still subject to the appropriations process whereby Congress provides the budget authority for the USPTO to spend these fees. However, to address the issue of fees withheld from the office in the past, the America Invents Act creates within the Treasury a "Patent and Trademark Fee Reserve Fund" into which fee collections above that "appropriated by the Office for that fiscal year" will be placed. These funds will be available to the USPTO "to the extent and in the amounts provided in appropriations Acts" and may only be used for the work of the USPTO. In addition, the new law grants the USPTO authority "to set or adjust by rule any fee established or charged by the Office" under certain provisions of the patent and trademark laws. This appears to provide the USPTO with greater flexibility to adjust its fee schedule absent congressional intervention. The act requires that "patent and trademark fee amounts are in the aggregate set to recover the estimated cost to the Office for processing, activities, services and materials relating to patents and trademarks, respectively, including proportionate shares of the administrative costs of the Office." Beginning in 1990, appropriations measures have, at times, limited the ability of the U.S. Patent and Trademark Office to use the full amount of fees collected in each fiscal year. Even when the office was given the budget authority to spend all fees, the issue remained an area of controversy. Proponents of the withholding approach to funding the USPTO claimed that despite the ability of the appropriators to impose limits on spending current year fee collections, the office was provided with sufficient financial support to operate. Advocates of this appropriations structure saw it as a means to provide necessary funding for other programs in the relevant budget category given budget scoring and the caps placed upon the Committee on Appropriations. However, many in the community that pay the fees to maintain and administer intellectual property disagreed with this assessment. Critics argued that, over time, a significant portion of the fees collected were not returned to the USPTO due to the ceilings established by the appropriations process and the inability of the office to use the fees on a dollar-for-dollar basis. They claimed that all fees were necessary to cover actual, time-dependent activities at the USPTO and that the ability of the appropriators to limit funds severely diminished the efficient and effective operation of the office. Under the America Invents Act, the budget authority to use fees collected by the USPTO remains within the congressional appropriations process. Fees generated above the amount provided in the appropriations legislation are to be put into a special fund and are restricted to use solely by the Patent and Trademark Office. However, the office must still obtain congressional authority to use these "excess" funds. It remains to be seen how this new approach addresses the issues associated with the operations of the USPTO and the use of those fees collected within a given fiscal year. An additional issue was raised in regard to the FY2013 sequestration of fees paid to the USPTO. According to the Office of Management and Budget (OMB), the fees collected are not considered "voluntary payments" and are therefore subject to sequestration. However, others disagree with this assessment. In a letter to the Director of OMB, the American Intellectual Property Law Association stated: we have serious doubts that the USPTO is lawfully subject to sequestration in the first place because it is funded through fee collections, not through government spending. Section 255 of the Balanced Budget and Emergency Deficit Control Act of 1985 ("BBEDCA") (2 U.S.C. 905) provides a list of exemptions from sequestration including "[a]ctivities financed by voluntary payments to the Government for goods or services to be provided for such payments." 2 U.S.C. 905(g)(1)(a). A plain reading of the statute suggests that this exemption should apply to the fees collected by the USPTO since they are from voluntary users in exchange for patent and trademark examination and review. Similar concerns have been expressed by other organizations, including the American Bar Association, which stated in another letter to the Director of OMB that the "unique funding mechanism for the USPTO" lends itself to the congressionally mandated exemptions from sequestration for "activities financed by voluntary payments to the Government for goods or services to be provided for such payments."

The U.S. Patent and Trademark Office (USPTO) examines and approves applications for patents on claimed inventions and administers the registration of trademarks. It also assists other federal departments and agencies protect American intellectual property in the international marketplace. The USPTO is funded by user fees paid by customers that are designated as "offsetting collections" and subject to spending limits established by the Committee on Appropriations. Until recently, appropriation measures limited USPTO use of all fees accumulated within a fiscal year. Critics of this approach argued that because agency operations are supported by payments for services, all fees were necessary to fund these services in the year they were provided. Some experts claimed that a portion of the patent and trademark collections were used to offset the cost of other, non-related programs. Proponents of limiting use of funds collected maintained that the fees appropriated back to the USPTO were sufficient to cover the agency's operating budget. On December 9, 2016, President Obama signed into law the Further Continuing and Security Assistance, Appropriations Act of 2017 (P.L. 114-254). This act, among other provisions, continues USPTO's budget supported by patent fees at $3.231 billion. For FY2017, the Administration's request for a fee-based budget authority was $3.244 billion. P.L. 112-29, the Leahy-Smith America Invents Act, keeps the use of fees collected within the congressional appropriations process, but requires that fees generated above the budget authority provided by the Committee on Appropriations be placed in a separate fund within the Department of the Treasury. While use of these "excess" funds still remains under the control of the appropriators, they may only be used for the work of the USPTO.

In health insurance, beneficiaries may face two types of out-of-pocket payments: (1) participation-related cost-sharing, typically in the form of monthly premiums, regardless of whether services are utilized, and (2) service-related cost-sharing, which consists of payments made directly to providers at the time of service delivery. Such beneficiary cost-sharing under Medicaid is described below. In order to obtain health insurance generally, enrollees may be required to pay monthly premiums and/or, less frequently, enrollment fees. Such charges are prohibited under traditional Medicaid for most eligibility groups. Nominal amounts set in regulations, ranging from $1 to $19 per month, depending on monthly family income and size, can be collected from (1) certain families moving from welfare to work who qualify for transitional assistance under Medicaid, and (2) pregnant women and infants with annual family income exceeding 150% of the federal poverty level (FPL), or, for example, about $19,800 for a family of two. Premiums and enrollment fees can exceed these nominal amounts for other specific groups. For example, for certain individuals who qualify for Medicaid due to high out-of-pocket medical expenses, states may implement a monthly fee as an alternative to meeting financial eligibility thresholds by deducting medical expenses from income (i.e., the "spend down" method). Cost-sharing is not capped for workers with disabilities and income up to 250% FPL. Premiums cannot exceed 7.5% of income for other workers with disabilities and income between 250% and 450% FPL. (If a state covers both groups, the same cost-sharing rules must apply.) Finally, some groups covered by Medicaid through certain waivers can be charged premiums that exceed nominal amounts. Under DRA authority, the general rules regarding applicable premiums are specified for three income ranges. For individuals with income under 100% FPL, and between 100% to 150% FPL, premiums are prohibited. Like traditional Medicaid, other specific groups (e.g., some children, pregnant women, individuals with special needs) are also exempt from paying premiums under the new DRA option. For persons with income above 150% FPL, DRA places no limits on the amount of premiums that may be charged. For the most part, premiums are not used under traditional Medicaid, except for workers with disabilities and waiver populations. Among the four states (Idaho, Kansas, Kentucky, and West Virginia) with approval for alternative DRA benefit packages, only Kentucky imposes monthly premiums: (1) $20/family with children with income over 150% FPL who are enrolled in the State Children's Health Insurance Program (SCHIP; additional details below), and (2) up to $30/family (not to exceed 3% of the adjusted, average monthly income) during the last six months of transitional Medicaid for working families with income over 100% FPL. Beneficiary out-of-pocket payments to providers at the time of service can take three forms. A deductible is a specified dollar amount paid for all services rendered during a specific time period (e.g., per month or year) before health insurance (e.g., Medicaid) begins to pay for care. Coinsurance is a specified percentage of the cost or charge for a specific service rendered. A copayment is a specified dollar amount for each item or service delivered. While deductibles and coinsurance are rarely used in traditional Medicaid, copayments are applied to some services and groups. The Appendix provides a comparison of the maximum charges allowed for service-related cost-sharing under traditional Medicaid, DRA, and SCHIP. SCHIP is a capped federal grant that allows states to cover low-income, uninsured children in families with income above Medicaid eligibility thresholds. Children may be enrolled in separate SCHIP programs for which SCHIP rules apply (shown in the Appendix ), or in Medicaid, for which traditional Medicaid or DRA rules apply. Some states (e.g., Kentucky) have both types of SCHIP programs (a Medicaid expansion and a separate SCHIP program), for which children with the highest income levels are enrolled in the separate program. Service-related cost-sharing under separate SCHIP programs generally parallels the rules under traditional Medicaid for lower-income subgroups; there are no limits specified for higher-income subgroups. Total SCHIP cost-sharing is capped at 5% of family income per eligibility period. Service-related cost-sharing under traditional Medicaid is prohibited for the following specific groups and services: (1) children under 18, (2) pregnant women for pregnancy-related services, (3) services provided to certain institutionalized individuals, (4) individuals receiving hospice care, (5) emergency services, and (6) family planning services and supplies. For most other groups and services, nominal amounts are allowed. For example, nominal copayments specified in regulations range from $0.50 to $3, depending on the payment for the item or service. These nominal amounts will be increased by medical inflation beginning in 2006 (regulations not yet released). Under the DRA option, certain groups and services are also exempt from the service-related cost-sharing provisions. These exemptions are nearly identical to those under traditional Medicaid. However, under traditional Medicaid, all children under 18 are exempt, while under DRA, only children covered under mandatory eligibility groups (the lowest income categories) and certain foster care/adoption assistance youth are exempt. Also, groups exempted from the general service-related cost-sharing provisions under DRA may nonetheless be subject to cost-sharing for non-emergency services provided in a hospital emergency room (ER), and/or for prescribed drugs (see the Appendix ). Under SCHIP, only American Indian and Alaskan Native children are exempt from cost-sharing, and cost-sharing is also prohibited for well-baby and well-child services. Among the four states with approval for alternative benefit packages via DRA, only Kentucky includes cost-sharing for participants, summarized in Table 1 . For many services across the four Kentucky plans, there is no cost-sharing for beneficiaries. When applicable, copayments for selected non-institutional services, acute inpatient hospital care, and for generic and preferred brand-name drugs are very similar to the maximums allowed under traditional Medicaid. For non-preferred brand-name drugs and for non-emergency care in an ER, a 5% coinsurance charge will be applicable in most cases. For all four Kentucky plans, the maximum annual out-of-pocket expense per member is $225 for health care services and $225 for prescriptions. Additionally, under DRA, the total aggregate amount of all cost-sharing (premiums plus service-related charges) cannot exceed 5% of family income applied on a monthly or quarterly basis as specified by the state. Under Kentucky's DRA SPA, this limit is applied on a quarterly basis. The rules governing consequences for failure to pay premiums differ somewhat under traditional Medicaid and DRA. Under traditional Medicaid, for certain groups of pregnant women and infants for whom monthly premiums may be charged, states cannot require prepayment, but may terminate Medicaid eligibility when failure to pay such premiums continues for at least 60 days. In contrast, under DRA, states may condition Medicaid coverage on the payment of premiums, but like traditional Medicaid, states may terminate Medicaid eligibility only when nonpayment continues for at least 60 days. States can apply this DRA provision to some or all applicable groups. Under both traditional Medicaid and DRA, states may waive premiums in cases of undue hardship. In Kentucky, benefits are terminated after two months of non-payment of premiums for children in the separate SCHIP program. Upon payment of a missed premium, re-enrollment is allowed. After 12 months of non-payment, payment of the missed premium is not required for re-enrollment. Also, working families with transitional Medicaid will lose coverage after two months of missed premiums unless good cause is established. There are more differences between traditional Medicaid and DRA with respect to rules for failure to pay service-related cost-sharing. Under traditional Medicaid, providers cannot deny care to beneficiaries due to an individual's inability to pay a cost-sharing charge. However, this requirement does not eliminate the beneficiary's liability for payment of such charges. In contrast, under DRA, states may allow providers to require payment of authorized cost-sharing as a condition of receiving services. Providers may be allowed to reduce or waive cost-sharing on a case-by-case basis. P.L. 109-432 exempts individuals in families with income below 100% FPL from the DRA failure to pay rules for both premiums and service-related cost-sharing. According to state regulations, Kentucky requires all providers to collect applicable cost-sharing from Medicaid beneficiaries at the time of service delivery or at a later date. No provider can waive cost-sharing, but only pharmacy providers can deny services for failure to pay (as per a state law). Finally, under SCHIP, states must specify consequences applicable to nonpayment of premiums and/or service-related cost-sharing, and must institute disenrollment protections (e.g., providing both reasonable notice and an opportunity to pay policies).

Under traditional Medicaid, states may require certain beneficiaries to share in the cost of Medicaid services, although there are limits on the amounts that states can impose, the beneficiary groups that can be required to pay, and the services for which cost-sharing can be charged. Prior to DRA, changes to these rules required a waiver. DRA provides states with new options for benefit packages and cost-sharing that may be implemented through Medicaid state plan amendments (SPAs) rather than waiver authority. These rules vary by beneficiary income level and for some types of service. The recently enacted P.L. 109-432 (Tax Relief and Health Care Act of 2006) modified the DRA cost-sharing rules. This report describes the new cost-sharing options and recent state actions to implement these provisions, and will be updated as additional activity warrants.

When selecting contractors, the FAR requires agencies to consider past performance as one evaluation factor in most competitive procurements. During the source selection process, contracting officials often rely on various sources of past performance information, such as the prospective contractor’s prior government or industry contracts for efforts similar to the government’s requirements, and the past performance information housed in the government-wide PPIRS database. Once a contract is awarded, the agency should monitor the contractor’s performance throughout the performance period. At the time the work is completed, the FAR requires agencies to prepare an assessment of the contractor’s performance for contracts or orders that exceed the simplified acquisition threshold. DOD has dollar thresholds that are generally higher than the simplified acquisition threshold for contractor assessments, which vary based on business sector. To document and manage contractor performance information internally, DOD has used CPARS since 2004. The system, which was developed by the Navy, incorporates processes and procedures for drafting and finalizing assessments, which are described in the CPARS Guide. The assessing official rates the contractor based on various elements such as quality of product or service, schedule, cost control, business relations, small business utilization, and management of key personnel. For each applicable rating element, the assessing official determines a rating based on definitions in the CPARS Guide that generally relates to how well the contractor met the contract requirements and responded to problems. In addition, for each rating element, a narrative is required to provide examples and support for the assessment. Once draft assessments are completed by the assessing official, the contractor is notified that the assessment is available for their review and comment through CPARS. The comment process includes the following: Contractors are allowed a minimum of 30 days to provide comments, rebuttals, or additional information. The assessing official has the discretion to extend the comment period. The contactor can request a meeting with the assessing official to discuss the assessment or request a review by the reviewing official. After receiving and reviewing a contractor’s comments and any additional information, the assessing official may revise the assessment and supporting narrative. If there is disagreement with the assessment, the reviewing official— generally a government official one level above the assessing official organizationally—will review and finalize the assessment. After contractor comments are considered, or if the contractor elects not to provide comments, the assessment is finalized and submitted to PPIRS, where it is available government-wide for source selection purposes for 3 years after the contract performance completion date. Section 806 of the NDAA for Fiscal Year 2012 required DOD to develop a strategy for improving contractor past performance information to include standards for timeliness and completeness, assigning responsibility and accountability for completing assessments, and ensuring assessments are consistent with award fee evaluations. In addition, the section requires the DFARS to be revised to require contractor assessments to be posted to databases used for making source selection decisions no later than 14 days after delivery of the draft assessment to the contractor. DOD’s strategy to improve reporting of contractor past performance information and respond to section 806 of the NDAA for Fiscal Year 2012 is to provide training on past performance to acquisition officials, develop tools and metrics to track compliance and enhance oversight, and continue to rely on the CPARS Guide. Some elements of this strategy are in place already, while others are still in progress. In order to improve compliance with past performance reporting requirements and the quality of assessments, the CPARS program office provides training opportunities and assessment tools for acquisition officials. As a result of increased emphasis on training, the number of contracting officials trained on contractor past performance more than doubled from fiscal year 2010 to fiscal year 2012, as shown in figure 1. Training included on-site classes; instructor-led, web-based training; and most recently, automated on-line training. Courses include overviews, and training on how to write quality narratives supporting contractor assessments. In addition, the CPARS program office provides tools to facilitate completing assessments, including a quality checklist which includes best practices and guidance for writing sufficiently detailed narratives. We did not assess the quality of assessment narratives in this review. To increase management oversight of contractor performance assessments, the CPARS program office in 2010, in conjunction with OFPP, developed system tools and metrics within PPIRS to track compliance with the reporting requirements. This allows managers to track compliance at the department, component, or contracting office level. For example, contracting managers can identify overall compliance for their office and identify specific non-compliant contracts with this new tracking tool. Officials at DOD components told us that having the ability to track completion of required assessments through PPIRS has greatly improved the ability to effectively oversee and manage compliance, and has also improved accountability for completing assessments. In an effort to increase accountability, the Director of Defense Procurement and Acquisition Policy issues quarterly compliance reports to senior procurement executives. Senior procurement executives at DOD components have required reporting of actions taken by individual contracting activities, set goals for compliance, and encouraged or required training. In addition, DOD officials told us contractor past performance is now discussed at senior level acquisition quarterly and monthly meetings. DOD plans to continue implementing existing policies contained in the CPARS Guide, which addresses most of the required elements specified in section 806. Specifically, the CPARS Guide aligns with section 806 through the following: Contractor performance assessment must be finalized within 120 days after the end of the evaluation period. For contracts and orders with performance exceeding one year, annual interim assessments are required and a final assessments is required when the work is completed. Roles and responsibilities for documenting contractor performance: The assessing official, usually the contracting officer, is responsible for preparing and finalizing the assessment. The reviewing official reconciles any disagreements between the assessing official and the contractor. The CPARS Focal Point provides overall support for the CPARS process for a particular organization and assigns key roles for each contract requiring an assessment based on information from the contracting officer, program, or project manager. Provides sources of data to consider, including earned incentive and award fee determinations. In addition, DOD provided additional guidance on translating award fee determinations into past performance assessments. Although the CPARS Guide does not currently specify standards for completeness, one of the elements specified in section 806, a recent proposed change to the FAR will address completeness by providing minimum government-wide standards for past performance rating elements. Specifically, the proposed rule requires that all assessments address, at a minimum, quality of product or service, timeliness, and management or business relations. PPIRS compliance metrics show the percentage of required assessments completed increased from 56 percent in 2011 to 74 percent in 2013. In addition, the number of assessments completed overall more than doubled from 2010 to 2012. DOD still faces challenges, however, in completing assessments on time. An increased focus on completing past performance assessments, both within the components and among individual contracting activities, has resulted in more required assessments being completed and submitted to PPIRS. As of April 2013, PPIRS’s metrics show compliance with the reporting requirement of about 74 percent—an increase of 18 percentage points since October 2011. Based on our review of government-wide PPIRS compliance metrics, DOD compliance with the reporting requirement is generally much higher than other federal agencies. For example, as of April 2013, more than half of federal agencies had no required contractor assessments in PPIRS. Among DOD’s major components, most showed significant improvement, as shown in table 1 below. Although compliance with the reporting requirements for performance assessments has increased, DOD still faces challenges with completing assessments on time. As shown in figure 2, the total number of assessments completed more than doubled from 2010 to 2012. In addition, the number of assessments completed on time also increased significantly—from about 5,600 to almost 14,000. However, the majority of assessments completed each year exceeded the 120-day standard for timeliness. In part, the number of assessments completed after the specified time frame may be the result of increased emphasis on working down the backlog of past-due assessments. For example, about 31,000 assessments became due during fiscal year 2012, but DOD completed over 33,000 during that year. DOD officials told us that department-wide acquisition workforce shortages and turnover, as well as difficulty obtaining contractor performance information remain as challenges to completing contractor performance assessments on time. For example, completing contractor assessments is considered a joint responsibility between the contracting and program office and, the assessing official often relies on others to provide information needed to complete the assessment, and in some cases may have difficulty obtaining the information. In addition, assessments are not finalized until the contractor has an opportunity to provide comments, and the 120-day standard for finalizing assessments includes the contractor comment period. The FAR currently requires that all federal contractors be given a minimum of 30 days to submit comments, rebutting statements, or additional information to performance assessments. As shown in Table 2, DOD received comments from contractors on over 80 percent of all assessments from fiscal years 2010 through 2012, and most were received within the current 30-day minimum requirement for responding. Section 806 would limit the comment period to 14 days before the assessment is submitted to PPIRS, which should help DOD meet the 120-day standard for submitting past performance assessments. DOD is currently working with the rest of the FAR Council to implement this change. We are not making recommendations in this report. We provided a draft of this report to DOD and OFPP for their review and comment. DOD informed us by email that it concurred with our findings and the information presented in this report and would not be providing written comments. DOD officials provided technical comments, which we incorporated as appropriate. OFPP informed us by email that the office had no comments. We are sending copies of this report to appropriate congressional committees, the Secretary of Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics, the Director of the Office of Management and Budget, and other interested parties. This report will also be available at no charge on the GAO website at http://www.gao.gov. If you or your staff have any questions about this report, please contact me at (202) 512-4841 or woodsw@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 I. In addition to the contact named above, LaTonya Miller, Assistant Director; John Neumann, Assistant Director; Dani Green; Julia Kennon; John Krump; and Bradley Terry made key contributions to this report.

DOD relies on contractors to perform a broad array of activities. Having complete, timely, and accurate information on contractor performance is critical so officials responsible for awarding new federal contracts can make informed decisions. Agencies are required to document contractor performance for contracts exceeding certain dollar thresholds. In 2009, GAO found that contractor past performance information was incomplete, citing low priority and lack of system tools and metrics to track compliance. In 2011, the Office of Federal Procurement Policy (OFPP) reported that DOD assessments often lacked sufficiently detailed narratives. Section 806 of the NDAA for 2012 required DOD to develop a strategy to ensure that contractor performance assessments are complete, timely, and accurate. Section 806 also required GAO to report on DOD's actions and their effectiveness. GAO (1) identified actions taken by DOD to improve the quality and timeliness of past performance information and implement provisions of the act, and (2) assessed the effectiveness of those actions. GAO reviewed DOD policy and guidance, and interviewed DOD and OFPP officials. GAO also reviewed available data on compliance with reporting requirements from 2011-2013 and timeliness data for fiscal years 2010-2012. GAO did not independently assess the quality of assessment narratives. GAO is not making any recommendations in this report. DOD concurred with GAO's findings and OFPP had no comments. The Department of Defense (DOD) strategy for improving the reporting of contractor past performance information consists of providing additional training to its acquisition workforce and developing tools and metrics to improve oversight. The number of personnel trained more than doubled since 2010 to more than 7,000, and DOD oversight officials now have the ability to track compliance with reporting requirements down to the level of individual contracting offices. DOD continues to utilize existing past performance guidance, which generally aligns with requirements specified in the National Defense Authorization Act (NDAA) for Fiscal Year 2012. Compliance metrics show that the submission of required assessments has increased. Specifically, the percentage of required assessments submitted increased from 56 to 74 percent from October 2011 to April 2013. Officials at DOD said the ability to track completion of assessments has greatly improved oversight and accountability. Despite this progress, DOD faces challenges completing assessments on time. DOD officials attribute the lack of timeliness to acquisition workforce shortages, turnover, and the difficulty in obtaining needed information. DOD is working with other agencies on a regulatory change, consistent with a requirement in the NDAA for 2012, that would reduce the time allowed for contractors to submit comments on draft assessments. This change should help officials submit final assessments on a more timely basis.

RS21558 -- Genetically Engineered Soybeans: Acceptance and Intellectual Property Rights Issues in SouthAmerica Updated October 17, 2003 The United States is the world's leading producer and exporter of soybeans. However, South American soybean production and tradehas expanded rapidly during the past 15 years, greatly increasing the competitiveness of international oilseedmarkets. Together, theUnited States, Argentina, and Brazil are expected to produce nearly 83% of the world's soybeans in 2002/03, andto account for over90% of all soybeans traded on international markets. (1) Given a highly competitive international soybean market and growinginternational debate over the nature of production and trade in genetically- engineered (GE) crops, controversy hasemerged in recentyears over the growing pirated use of Roundup Ready (RR) soybeans, a GE variety, by producers in Argentina andBrazil. (2) Thispractice appears to provide a competitive advantage to Argentine and Brazilian soybean exports, and to be aviolation of theintellectual property rights (IPR) of the RR technology producer, Monsanto. Roundup Ready (RR) soybeans are genetically engineered to be resistant to the herbicide glyphosate. Glyphosate also was developedby Monsanto and is marketed under the brand name Roundup. RR soybeans are patented in the United States byMonsanto. (3) Monsanto licenses the RR technology to seed companies, which incorporate it into their conventional soybeanvarieties and sell theGE seeds to farmers. Among other things, the patent gives Monsanto and those companies to whom it has licensedthe technologymore control in setting prices and restricting the product's use. For example, U.S. farmers pay a technology feeestimated at $7.44 oneach 50-pound bag of RR planting seed. (4) In addition,as part of a signed purchase agreement, U.S. farmers are prohibited fromsaving seed from harvest for future planting or for resale to other farmers. Despite the additional cost andrestrictions, RR soybeansare favored over traditional varieties because they significantly lower production costs, offer more flexibility in cropmanagement, andin many cases increase yields. According to USDA's March 31, 2003, Planting Intentions Report , 80%of the soybeans planted in theUnited States in 2003 will be RR varieties. The Monsanto company is based in St. Louis, Missouri, but has offices throughout the world where its seeks to market its technologyto agricultural producers. Since 1960, a total of 30 countries have approved Monsanto's RR soybean technologyfor import orplanting. (5) However, Monsanto has been unable toobtain patent protection in either Argentina or Brazil. In 1995, Monsanto'sapplication for a patent for RR soybeans in Argentina was rejected. Subsequent applications have not succeeded. (6) In Brazil, thecommercial status of GE soybeans (and GE crops in general) remains in dispute in the courts and no patents on RRtechnology havebeen issued. The status of GE soybeans in Brazil is particularly important to international oilseed markets sinceBrazil representsessentially the last potential major source for non-GE soybeans to world markets. Although RR soybean seeds are not patented in Argentina, Monsanto has agreements with other seed firms in Argentina allowingthem to use the RR technology in their seeds. As a result, Argentine farmers have access to and have increasinglyswitched to RRsoybean varieties. In 2001, about 90% of Argentina's soybean crop was planted to RR varieties. (7) The RR share of the 2003 crop isnearly 100%, according to news reports. An Argentine seed law (Act No. 20247; 1973) requires that all seeds must be certified for commercial use. However, Argentinefarmers have reportedly ignored this law and routinely save RR soybean seeds for planting or resale. Since thegovernment does notenforce this law, a large black market for RR soybeans in Argentina has developed that keeps seed prices low anddiscourages anyattempts by Monsanto or licensed companies to assess technology fees on RR soybeans. According to Monsanto,it is not feasible tocharge a technology fee on soybean seeds in Argentina without patent protection. (8) As a result, Argentine farmers save about $8 to $9per metric ton on the technology fee. (9) This is aconsiderable cost advantage over U.S. soybeans in a highly competitive internationalsoybean market. (10) In September 1998, the Brazilian Biosafety Commission (CTNBio), acting under government authority, approved the commercialplanting of RR soybeans. Two major groups opposed to the use of GE crops -- Greenpeace and the BrazilianConsumer DefenseInstitute -- immediately filed lawsuits in Brazilian courts challenging the CTNBio approval. In 1999 a lower courtissued aninjunction suspending the CTNBio approval of commercial planting of RR soybeans before any approvedcommercial plantingactually occurred. The case was appealed to a three-judge panel of the Brasilia Appeals Court, where it haslanguished. In February2002, the lead judge of the three-judge Appellate Court publicly announced in favor of commercial planting of RRsoybeans. However, a majority of the three-judge panel has yet to render a decision on the commercial use of RR soybeans. As a result, itremains illegal to plant GE soybeans in Brazil. However, Brazilian farmers are aware of the benefits of RRsoybeans and havereportedly smuggled seeds into Brazil from Argentina's black market. Despite the lack of government approval,80% of the crop inthe southernmost state of Rio Grande do Sul is estimated to be planted to RR soybean varieties. (11) USDA estimates that 10 to 20% ofBrazil's total soybean crop may be planted to RR soybean varieties (trade estimates range as high as 30%). (12) As in Argentina, notechnology fees are paid by RR soybean growers in Brazil. (13) The American Soybean Association (ASA) claims that the technologyfee savings for Brazilian growers ranges from $9.30 to $15.50 per acre depending on yields. (14) More recently, other international events have forced the Brazilian government to temporarily alter its official position on GEsoybeans. In June 2001, China -- the world's leading importer of soybeans -- issued controversial rules governingthe use, sale, andimportation of GE soybeans. Under the rulings, China will only accept GE soybeans that have been approved forexport by the sourcecountry, along with certain other conditions. On January 10, 2003, China rejected Brazil's initial application toexport GE soybeans,in part because Brazil does not officially recognize the domestic production and export of GE soybeans. In lateMarch 2003, underpressure from producer groups, the Brazilian government announced temporary Regulation 113 (R113) as an interimmeasureallowing official sales of RR soybeans from the 2002-03 (April-March) crop for both domestic uses and export. R113 expires inMarch 2004, after which Brazilian growers are expected to comply with the current law. Because Brazil's courts have been unable to resolve the crisis prior to this year's October-December planting period, the Lulagovernment has been forced to issue a second temporary reprieve from the GE planting ban. Temporary Regulation130 (R130),signed into law on September 25, 2003, approves the planting of GE soybeans for the 2003-04 growing season andextends thepossible sale period of RR soybeans through December 2004. In an attempt to curb black market trade in RRtechnology, farmersseeking to sell GE soybeans during this period must sign a document pledging not to buy seeds of untraced originin the future. (15) Inaddition, Brazilian soybean farmers are limited to planting GE seed stocks already on hand because R130 containsno provision forimporting or selling GE seeds in Brazil. Also, lack of any labeling protocol for GE crops is likely to complicatedomestic marketing. The Lula government states that it is preparing a comprehensive "bio-safety law" to address these regulatory gaps,but this legislationhas been slow to emerge. The Lula government remains split on this issue. The Minister of Agriculture favorsprompt legalization,while the Minister of Environment is opposed and has asked for an environmental impact study beforecommercialization isallowed. (16) Both ministers agree that rigidenforcement of existing regulations would mean the incineration of all GE crops and theimprisonment of growers for 1 to 3 years at great cost to the country's agricultural sector. Within Brazil, two principal camps argue against legalizing GE soybeans, but for very different reasons. Some consumer andenvironmental groups argue that, because the risks associated with GE crops are unknown, they should not belegalized. Peasantgroups such as the Landless Workers Movement (MST), on the other hand, are not against GE crops per se, butargue that legalizingGE crops will accelerate large-scale farming and give control over Brazil's agriculture to multinational corporationssuch asMonsanto. (17) Brazilian producer groups claim that lack of access to RR technology would place them at a competitive disadvantage in internationalmarkets. To date, no significant market premium for non-GE soybeans has emerged in either domestic orinternational marketssufficient to offset the cost advantages of adopting GE varieties. Given the rapid growth and widespread use of GEsoybeans,legalizing their commercial use may be the only viable solution for Brazil's government. GE Labeling in Brazil. Brazil's food labeling regulation for products containingGE ingredients took effect on December 31, 2001. (18) The law mandates the labeling of all foods for human consumption when morethan 4% of the ingredients are derived from GE commodities. R113, the first temporary regulation allowing GEsoybean planting, hasimposed stricter GE labeling conditions on Brazil's food marketing system. Under R113, non-GE soybeans are tobe segregated witha 0% tolerance level from GE soybeans. (19) Inaddition, labeling is required on all shipments into or out of Brazil with a GE soybeanpresence in excess of 1%. (20) Since improperlabeling is subject to a severe fine, and since Brazil's marketing system is not set up tohandle such strict segregation requirements, it is likely that all soybeans passing through Brazil's marketing systemwill have to belabeled as having GE content. It is reported that Brazil's National Agriculture Federation (NAF) estimates the costof testing thecurrent 2002/03 crop for GE content at about $277 million. The NAF says that passing this cost on to consumerswould make itimpossible for Brazil to remain competitive in the global soybean market. (21) International Market Implications. According to many market analysts, thedecision on the status of GE crops in Brazil will have significant market implications, especially for global soybeanmarkets. First, ifBrazil permanently legalizes GE soybeans, nearly all (about 90%) of the world's internationally traded soybeans willbe of GEvarieties. Second, a decision in favor of GE crops will be nearly irreversible because of mixing in the distributionand transportationsystems. Some analysts suggest that the current widespread planting of GE crops in Brazil is already irreversible. In short, a decisionin favor of GE soybeans by Brazil could do much to moot the debate about whether or not GE soybeans should belabeled or eventraded because there simply would not be any major international supplier of non-GE soybeans left. According to the U.S. Trade Representative, the U.S. is committed to a policy of promoting increased intellectual property protection,both through the negotiation of free trade agreements that strengthen existing international laws and through useof U.S. statutorytools as appropriate. (22) The U.S. Administration'sposition regarding GE crops is that, not only are food products made from GEcrops as safe as their conventional counterparts, but their production has the potential to spur agriculturalproductivity whilebenefitting the environment. (23) Congress hasgenerally supported this position. For example, both the Senate ( S.Res. 154 ) and the House ( H.Res. 252 ) have passed resolutions in support of the Administration's dispute settlementcase atthe World Trade Organization (WTO) brought against the European Union's ban on imports of GE crops. In hearings by the Senate Foreign Relations Subcommittee on Western Hemisphere, Peace Corps, and Narcotics Affairs on May 20,2003, to discuss opportunities for U.S. agriculture in agricultural trade negotiations in the Western Hemisphere, theIPR issue of RRsoybean piracy in Brazil was raised in testimony given by the ASA and Monsanto. (24) In the absence of patent protection in Argentinaor Brazil, accusations of IPR violation may be difficult to sustain in a court of law. However, both Argentina andBrazil are membersof the WTO and, as such, have agreed to abide by the WTO agreement on Trade-Related Aspects of IntellectualProperty Rights(TRIPS Agreement). As a result, if Monsanto were able to eventually obtain patent protection for the RRtechnology in eitherArgentina or Brazil, Monsanto could then seek recourse for IPR infringement via the legal systems of thosecountries perrequirements of the WTO TRIPS agreement.

U.S. soybean growers and trade officials charge that Argentina and Brazil -- the UnitedStates' two major export competitors in international soybean markets -- gain an unfair trade advantage by routinelysavinggenetically-engineered (GE), Roundup Ready (RR) soybean seeds from the previous harvest (a practice prohibitedin the UnitedStates) for planting in subsequent years. These groups also argue that South American farmers pay no royalty feeson the saved seed,unlike U.S. farmers who are subject to a technology fee when they purchase new seeds each year. The cost savingto South Americansoybean growers on the technology fee alone nets out to about $8 to $9 per metric ton -- a considerable costadvantage over U.S.soybeans in the highly competitive international soybean market. This practice also raises concerns about theintellectual propertyrights (IPR) of Monsanto (the developer of RR technology). Commercial use of RR soybeans in Brazil remains illegal despite apparent widespread planting. A 1998government approval of theircommercial use remains suspended by court injunction, and resolution over their commercial legality is beingconsidered by anappellate court. However, two recent Presidential decrees have given temporary reprieve to the ban on planting andmarketing GEsoybeans through December 2004. The eventual outcome on commercial legalization of GE crops in Brazil mayhave importantconsequences for intellectual property rights, as well as for international trade in GE crops. This report will beupdated as needed.

Congressional efforts to establish standards for House districts have a long history. Congress first passed federal redistricting standards in 1842, when it added a requirement to the apportionment act of that year that Representatives " should be elected by districts composed of contiguous territory equal in number to the number of Representatives to which each said state shall be entitled, no one district electing more than one Representative ." (5 Stat. 491.) The Apportionment Act of 1872 added another requirement to those first set out in 1842, stating that districts should contain " as nearly as practicable an equal number of inhabitants. " (17 Stat. 492.) A further requirement of "compact territory" was added when the Apportionment Act of 1901 was adopted stating that districts must be made up of " contiguous and compact territory and containing as nearly as practicable an equal number of inhabitants. " (26 Stat. 736.) Although these standards were never enforced if the states failed to meet them, this language was repeated in the 1911 Apportionment Act and remained in effect until 1929, with the adoption of the Permanent Apportionment Act, which did not include any districting standards. (46 Stat. 21.) After 1929, there were no congressionally imposed standards governing congressional districting; in 1941, however, Congress enacted a law providing for various districting contingencies if states failed to redistrict after a census—including at-large representation. (55 Stat 761.) In 1967, Congress reimposed the requirement that Representatives must run from single-member districts, rather than running at large. (81 Stat. 581.) Both the 1941 and 1967 laws are still in effect. The 1967 law, codified at 2 U.S.C. § 2c, requiring single-member districts, appears to conflict with the 1941 law, codified a 2 U.S.C § 2a(c), which provides options for at-large representation if a state fails to create new districts after the reapportionment of seats following a census. The apparent contradictions may be explained by the somewhat confusing legislative history of P.L. 90-196 (2 U.S.C. § 2c), prohibiting at-large elections. The legislative history of the 1967 law, mandating single-member districts (P.L. 90-196), is unusual. The portion of the bill that became 2 U.S.C. § 2c was a Senate amendment to a House-passed private immigration act—H.R. 2275, 90 th Congress, "an act for the relief of Dr. Ricardo Vallejo Samala, and to provide for congressional redistricting." No hearings were held or reports issued on the at-large election prohibition that became 2 U.S.C. § 2c, "Number of Congressional Districts; number of Representatives from each District": In each State entitled in the Ninety-first Congress or in any subsequent Congress thereafter to more than one Representative under an apportionment made pursuant to the provisions of section 2a(a) of this title, there shall be established by law a number of districts equal to the number of Representatives to which such State is so entitled, and Representatives shall be elected only from districts so established, no district to elect more than one Representative (except that a State which is entitled to more than one Representative and which has in all previous elections elected its Representatives at large may elect its Representatives at large to the Ninety-first Congress). H.R. 2275 was enacted after another bill (H.R. 2508, also 90 th Congress) that included similar language pertaining to at-large representation failed final passage after two conferences—the first was recommitted in the House and the second was defeated in the Senate. H.R. 2508 also included additional provisions regarding population equality plus geographical compactness and contiguousness. H.R. 2508 would have deleted subsection (c) of section 22 of the Apportionment Act of 1929, as amended, (codified as 2 U.S.C. §2a(c)) and substituted the bill's redistricting standards that also included a ban on at-large elections. Section 2a(c) of Title 2 currently provides: Until a State is redistricted in the manner provided by the law thereof after any apportionment, the Representatives to which such State is entitled under such apportionment shall be elected in the following manner: (1) If there is no change in the number of Representatives, they shall be elected from the districts then prescribed by the law of such State, and if any of them are elected from the State at large they shall continue to be so elected; (2) if there is an increase in the number of Representatives, such additional Representative or Representatives shall be elected from the State at large and the other Representatives from the districts then prescribed by the law of such State; (3) if there is a decrease in the number of Representatives but the number of districts in such State is equal to such decreased number of Representatives, they shall be elected from the districts then prescribed by the law of such State; (4) if there is a decrease in the number of Representatives but the number of districts in such State is less than such number of Representatives, the number of Representatives by which such number of districts is exceeded shall be elected from the State at large and the other Representatives from the districts then prescribed by the law of such State; or (5) if there is a decrease in the number of Representatives and the number of districts in such State exceeds such decreased number of Representatives, they shall be elected from the State at large. It is clear from committee report language and both the House- and Senate-passed versions of H.R. 2508 that 2 U.S.C. § 2a(c) would have been superseded by new language had it been enacted and approved by the President. H.R. 2275 ( P.L. 90-196), which was enacted after the second conference report on H.R. 2508 was defeated in the Senate, did not amend 2a(c). Thus, Public Law 90-196 was codified in a separate part of the U.S. Code (2 U.S.C. § 2c), rather than as replacement language for 2 U.S.C. § 2a(c). These apparently contradictory provisions raise questions about how Section 2(a)c, which provides for at-large House elections under certain circumstances, can be reconciled with Section 2c, which prohibits them. Section 2a(c) of Title 2 could be invoked if a state that had gained or lost Representatives after a census failed to complete the redistricting process before the first election following the reapportionment of seats among the states. One could argue, contrarily, that since Section 2a(c) was enacted in 1941 and Section 2c was enacted in 1967, the prohibition of at-large and multi-member districts in Section 2c implicitly repeals the contingencies for running at large provided in 2a(c), thus making Section 2a(c) a dead letter. Further buttressing the dead letter theory is the 40-year history of active court involvement in redistricting. When Section 2a(c) was enacted in 1941, courts were constrained by years of precedent limiting their entrance into the "political thicket" of redistricting. After the Supreme Court established the "one person, one vote" principle beginning with its 1962 landmark decision in Baker v. Carr , and Congress passed the Voting Rights Act of 1965, courts have intervened numerous times in the state redistricting process. In Branch v. Smith , decided on March 31, 2003, the Supreme Court addressed the issue of how these two statutory provisions can be reconciled. In the reapportionment following the 2000 census, Mississippi's delegation size was reduced from five Representatives to four. When it appeared that the legislature would not be able to pass a redistricting plan in time for candidates to file to run for office, both the Mississippi state court and a three-judge federal court drafted redistricting plans. The federal district court, however, decided that its plan would only be used if the Mississippi state court plan was not precleared by the U.S. Department of Justice, pursuant to the Voting Rights Act, in time for the March 1 filing deadline for state and federal candidates. As the Justice Department did not preclear the state court plan by the deadline, the district court plan was used for the 2002 elections. After finding that the federal district court had properly enjoined the enforcement of the state court plan, the Supreme Court turned to the issue of whether Section 2a(c) requires courts to order at-large elections if a state redistricting plan is not in place prior to court action. The original state plaintiffs and the United States as amicus curiae, had argued that the district court was required to draw single-member districts in crafting a congressional plan, while the original federal plaintiffs had contended that the district court was required to order at-large elections. Rejecting the original federal plaintiffs' argument, a majority of the Supreme Court held that the lower court was required to fashion a plan with single-member districts. However, writing two separate concurring opinions, a majority of the Court did not reach consensus as to the rationale behind its holding, thereby leaving the reconciliation of Sections 2a(c) and 2c unsettled. In the first concurrence (written by Justice Scalia, joined by the Chief Justice, Justices Kennedy and Ginsburg), a plurality of the Court interpreted the at-large option in Section 2a(c)(5) as merely a "last-resort remedy," being applicable only in those cases where time constraints prevent a single-member plan from being drawn in time for an election. According to the Scalia concurrence: §2a(c) is inapplicable unless the state legislature and state and federal courts, have all failed to redistrict pursuant to §2c. How long is a court to await that redistricting before determining that §2a(c) governs a forthcoming election? Until, we think, the election is so imminent that no entity competent to complete redistricting pursuant to state law (including the mandate of §2c) is able to do so without disrupting the election process. Only then may §2a(c)'s stopgap provisions be invoked. Thus, §2a(c) cannot be properly applied—neither by a legislature nor a court—as long as it is feasible for federal courts to effect the redistricting mandated by §2c. So interpreted §2a(c) continues to function as it always has, as a last-resort remedy to be applied when, on the eve of a congressional election, no constitutional redistricting plan exists and there is no time for either the State's legislature or the courts to develop one. On the other hand, in a second concurrence (written by Justice Stevens, joined by Justices Souter and Breyer), a separate plurality of the Court, while agreeing that the district court properly enjoined enforcement of the state court's plan and drew its own single-member plan under 2 U.S.C. § 2c, concluded that Section 2c "impliedly repealed" Section 2a(c). In a dissent, Justice O'Connor, (joined by Justice Thomas), found that when federal courts are asked to redistrict states that have lost representation after a reapportionment, and the existing plan has more districts than the new allocation permits and no new plan has been promulgated with the correct number of districts, the courts are required to order at-large elections in accordance with 2 U.S.C. § 2a(c). It could be argued that at-large elections will not be needed in the post-1960s era because the courts now intervene when the states reach impasse and fail to redistrict following the decennial census. Nevertheless, since the issue of whether federal law permits at-large congressional representation appears unsettled, if a House delegation were elected at large, it appears that their seating could be challenged in the House of Representatives on the grounds that their election violates Section 2c, which prohibits at-large elections. A challenged delegation might raise the defense that since Congress did not expressly repeal the contingencies enumerated in Section 2a(c) when it enacted Section 2c, it has therefore recognized the possibility of an at-large delegation, which should be seated, despite having been elected in violation of Section 2c. Perhaps the best argument that the single-member district requirement might be ignored by the House in certain circumstances stems from 19 th century House precedent. As noted in footnote 1 supra, at-large delegations were seated after they were prohibited in 1842. Moreover, a challenged delegation could argue that refusing to seat them would deprive an entire state of representation in the House. Thus, one would expect that the 19 th century precedent would be followed today, although such precedent might be less compelling if the organization of the House were at stake. One could also argue that the contingencies set forth in 2 U.S.C. § 2a(c) still serve as a useful insurance policy to provide representation for a state that cannot, following the release of census numbers, complete the post-census redistricting process in time for the first congressional election. In 1967 Congress could have repealed Section 2a(c), as provided in the more far-reaching redistricting standards bill (H.R. 2508). Instead, Congress adopted P.L. 90-196, codified at 2 U.S.C. § 2c, which prohibits multi-member districts, leaving Section 2a(c) in place, which permits them. On January 28, 2003, Representative Hastings introduced H.R. 415 (108 th Cong.), a bill to establish a commission to make recommendations on the appropriate size of membership of the House of Representatives and the method by which Members are elected. Section 3(2) of H.R. 415 requires the commission to "examine alternatives to the current method by which Representatives are elected (including cumulative voting and proportional representation) to determine if such alternatives would make the House of Representatives a more representative body." Such recommendations, if ultimately enacted, could affect current federal statutory provisions governing single-member and at-large representation in the House of Representatives. H.R. 415 was referred to the House Committee on the Judiciary and no further action has been taken to date.

Section 2c of Title 2 of the U.S. Code requires members of the House of Representatives to be elected from single-member districts, however, Section 2a(c) requires Representatives to be elected at large if a state fails to create new districts after the reapportionment of seats following a decennial census. These apparently contradictory provisions raise questions about whether and under what circumstances federal law permits at-large representation in the House of Representatives. The legislative history of 2 U.S.C. § 2c is sparse because it was adopted as a Senate floor amendment to a House-passed private bill. In 1967, the same year that Section 2c was adopted, Congress had contemplated, but failed to pass, a more comprehensive bill that would have repealed Section 2a(c), thereby removing the apparent statutory inconsistencies. Addressing the tension between Section 2a(c) and Section 2c, as applied to a Mississippi redistricting plan, the Supreme Court in Branch v. Smith held that a federal district court was required to craft single-member districts. Although the issue remains unsettled, it appears that Section 2a(c) could provide options to the House of Representatives to seat an at-large delegation. H.R. 415 (108th Cong.), would establish a commission to make recommendations on the method by which Members of the House are elected, including examining alternatives to the current method. Such recommendations, if ultimately enacted, could affect current federal statutory provisions governing single-member and at-large representation in the House of Representatives.

On March 4, 2015, the Supreme Court heard oral arguments in King v. Burwell . A final decision is expected by the end of June. The central issue in the case is whether the Affordable Care Act (ACA; P.L. 111-148 , as amended) gave authority to the U.S. Department of the Treasury to make premium tax credits available to eligible individuals in every state (including the District of Columbia) or just the states that chose to establish their own health insurance exchanges (state-based exchanges, or SBEs). While the direction and scope of the Court decision is not known, if the Court decides that tax credits may be made available only in SBEs, such a decision may lead to the loss of tax credits in a majority of states where the federal government established the exchanges (federally facilitated exchanges, or FFEs). Given that several million individuals currently receive tax credits through FFEs, the Court decision could have major implications for individual consumers, exchanges, insurers, and other stakeholders. Loss of premium tax credits would directly affect the affordability of health insurance for the consumers who no longer have the credits. Some individuals may choose to drop coverage as a consequence or seek more affordable insurance, if available. Others may be motivated to continue to purchase coverage, even without a subsidy, either because the credit amounts they received were minimal or they have serious health care needs. Insurers may decide to change plan offerings or discontinue offering individual health insurance policies in a given state in anticipation of a reduction in overall enrollment. Consumers and insurers that continue to participate in exchanges and the market outside of exchanges may see premiums increase in response to the changes to the insurance risk pool . These consumer and insurer actions may, in turn, motivate Congress, the Administration, and/or states to address perceived adverse effects of the Court decision and address other related issues, such as the tax credit program's interaction with the ACA's other coverage provisions. Given that a Court decision favoring the plantiffs would directly affect the health insurance options of millions of consumers, which, in turn, may motivate insurers, legislators, and policymakers to act, this report provides the time frame in which decisions concerning exchanges and health insurance more broadly may occur, given current regulations and guidance. To the extent that consumers and others (referred to as stakeholders in this report) may be motivated to respond to the Court decision (and respond to other stakeholder actions), this report provides a timeline that identifies selected 2015 dates related to exchange establishment and operation, legislative calendars, and regulation of the individual health insurance market, among other issues. The report concludes with a table that augments the 2015 timeline by identifying relevant sources of information, such as statutory or regulatory citations related to exchanges. While this information may be useful to set parameters around certain stakeholder actions, this report is not meant as a guide to decisionmaking, nor does it attempt to identify all possible stakeholder responses to the upcoming Court decision. While CRS does not predict a particular direction of the Court decision, certain underlying assumptions were made to simplify identification of important dates. Those assumptions include no retroactive effect of the decision and no delay for when the decision would go into effect. As indicated above, the direction and scope of the Court decision is not known. Implications of the decision beyond issues related to private health insurance are outside the scope of this report. Moreover, the Court decision may maintain the status quo. Nonetheless, legislators and policymakers may be interested in addressing other issues related to the credits or the ACA more broadly. The dates and potential stakeholder actions included in this report may still apply under such a scenario. The potential for the Court decision to affect a number of different stakeholders reflects the current structure of the private market for health insurance and the interplay among key participants in the overall market. At the most basic level, the health insurance "market" works like any other market: with sellers and buyers of products. In this case, insurers sell health insurance plans for purchase by consumers and employers. The market for health insurance, like other forms of insurance, is regulated primarily at the state level. However, the federal government has expanded its role in the regulation of this industry, most recently with the enactment and continuing implementation of the ACA. The ACA itself contains multiple provisions that impose requirements on most of these stakeholders, create new stakeholders (e.g., exchanges), and link requirements across stakeholders. The stakeholders are identified below, and their role in or potential to affect the private health insurance market is briefly described. To the extent any of the stakeholders respond to the Court's decision, their motivation and ability to do so is subject to a variety of parameters, including requirements and flexibilities under current law and the actions taken by other stakeholders. For example, if a state wanted to change its exchange type (i.e., from an SBE to an FFE or vice versa), it must follow a set process. The process includes submitting required documents to the Department of Health and Human Services (HHS) by certain dates and, in some cases, enacting a state law indicating that the activity is allowed by the state. Congress may be motivated to respond to the Court's decision through legislation. Consumers are expected to comply with the terms of their health insurance coverage, such as paying premiums. Changes to the conditions under which the consumer obtains health insurance may result in changes in how and whether consumers obtain coverage. Employers that are considered large are expected to comply with the ACA's employer mandate. The penalty associated with noncompliance is triggered only if an employee receives a premium tax credit. HHS , as the entity primarily responsible for issuing exchange-related regulations and guidance, defines the parameters under which all exchanges operate. For example, HHS is responsible for determining the process by which a state can elect to operate a state-based exchange. Additionally, HHS administers the federally facilitated exchanges. Health i nsurance e xchanges (also referred to as marketplaces), whether state-based or federally facilitated, are expected to operate within the parameters established under the ACA and its implementing regulations, such as adhering to the annual and special open enrollment periods set in regulations. However, the ACA and its implementing regulations give exchanges some discretion over certain operational decisions, particularly with respect to how exchanges interact with insurers. Private h ealth i nsurers offering coverage through exchanges must ensure that the coverage they offer complies with state and federal regulations and all exchange-related requirements, whether set by HHS or the exchange. States , in general, have the authority to regulate their private health insurance markets. Depending on the state, the authority may be more or less under the control of the state legislature. With respect to exchanges, a state that elects to operate an exchange must do so within established exchange parameters. These parameters are included in statute and described in regulations and guidance issued by HHS. The Supreme Court is expected to issue a decision in King v. Burwell by the end of its term in June 2015. Figure 1 and Table 1 show selected activities currently required to be carried out by one or more of the stakeholders and the time frame in which the activities are expected to occur. These activities are not dependent on the Court decision ; instead, they represent the current status of regulations, guidance, and other time-sensitive rules that stakeholders may consider if and when they decide to respond to the decision.

The Supreme Court is expected to issue a decision in King v. Burwell by the end of June. The central issue in the case is whether the Affordable Care Act (ACA; P.L. 111-148, as amended) gives authority to the U.S. Department of the Treasury to make premium tax credits available to eligible individuals in every state (including the District of Columbia) or just the states that choose to establish their own health insurance exchanges (state-based exchanges, or SBEs). As of the date of this report, the direction and scope of the Court decision is unknown. However, it is generally agreed that a Court decision favoring the plaintiffs would affect the health insurance options of millions of consumers, as loss of premium tax credits would affect the affordability of health insurance for the consumers who no longer have the credits. Such a decision and its effects may motivate insurers, consumers, legislators, and others (referred to as stakeholders in this report) to act. To the extent stakeholders are motivated to respond to the Court's decision, this report provides a timeline that identifies selected 2015 dates related to exchange establishment and operation, legislative calendars, and regulation of the individual health insurance market, among other issues. This information may be useful for setting parameters around potential stakeholder actions.

A streetcar is a type of light rail public transportation that operates mostly in mixed traffic on rail lines embedded in streets and highways. Streetcar service is typically provided by single cars with electric power delivered by overhead wires known as catenaries, although streetcars can also draw power from underground cables or from batteries. Compared with non-streetcar light rail, streetcar lines tend to be shorter and the stops more frequent. Because of the short distance between stops and the overall operating environment, streetcars are slow compared with non-streetcar light rail and other types of rail public transportation, such as commuter rail and heavy rail. Streetcar systems can be categorized into four different types: 1. legacy systems, lines that have been in operation for many years, but are the remnants of more extensive past systems (e.g., New Orleans); 2. heritage systems, new or revived systems using historical equipment (e.g., Memphis); 3. replica systems, new or revived systems using equipment built to replicate historical systems, but sometimes with modern amenities such as air conditioning (e.g., Tampa); 4. modern systems, new systems using modern equipment (e.g., Portland, OR). In early 2014, there were 12 operating streetcar systems, 7 new systems under construction, and approximately 21 new systems in the planning stages ( Figure 1 ). Not included in these figures are several short streetcar lines associated with museums (e.g., Issaquah, WA) or primarily oriented to tourists (e.g., San Pedro, CA). Additionally, a few systems already in operation have extensions in construction or being planned. Because they are often controversial, streetcar systems that are being planned may not be built. The streetcars systems with the largest ridership include those in Philadelphia; New Orleans; San Francisco; Portland, OR; Tacoma; Memphis; and Seattle. Streetcars are intended to provide high-quality transit service for traveling short distances in urban environments. As part of this service, streetcars can link to other transportation modes as part of the "last mile" of a trip, as in Salt Lake City, where a new streetcar line links to light rail and bus lines. Streetcars are often promoted as a means of increasing transit ridership by offering a better quality of service than buses, including such things as frequency of service, predictability of trip time, passenger capacity, and comfort. Additionally, streetcars can more easily accommodate wheelchairs and bicycles. Service quality, however, is not better in all cases: streetcars can be delayed by problems that would not affect buses, such as fallen catenaries or vehicles double-parked on the tracks. Greater capacity in modern streetcars may in part come at the expense of seating. Overall, there is no clear evidence as to whether streetcars attract new riders to transit. In some circumstances, streetcars can help attract and focus development by providing a more permanent transportation investment than buses and by promoting a walkable environment. For example, the greater permanence of a streetcar may improve the coherence of the urban environment, and may reduce the risk for developers of offices, residences, and retail, spurring job creation. The proximity of a streetcar may also reduce some costs that would otherwise confront private developers, such as the need for a large numbers of parking spaces. According to one study, the area within a quarter-mile of the Little Rock streetcar system, opened in 2004, has had a capital investment of $800 million in new businesses, residences, and other activities between 2000 and 2012. In addition, during construction, streetcars tend to be less disruptive of existing activities than other forms of rail systems. However, it is possible that development spurred by streetcar lines is merely shifted from other parts of the urban area. This is a concern in analyzing the effects of rail transit in general, but there is little empirical research on this question for streetcars specifically. In addition to the expense of the streetcar itself, development along streetcar lines has sometimes benefited from other subsidies. Not all streetcar lines have succeeded in stimulating property development. The city planning literature suggests that if a streetcar is to spur development, the host locality needs to at least provide supportive land use laws, such as permitting higher-density, mixed-use developments along a corridor. One study found that government support in the form of such things as incentives, zoning changes, and marketing is the leading factor determining whether or not development occurs around investment in public transportation. The same study found that both light rail transit, including streetcars, and bus rapid transit (BRT) led to development, but that BRT leveraged much more private investment per dollar of transit expenditure. Streetcar systems can be much less costly to build than light rail systems, and may be particularly attractive in small and medium-size cities where a larger and more expensive rail system is not appropriate. Capital costs per mile can vary dramatically, however, depending on the specific circumstances of projects, including the need for major new infrastructure. A study of 21 light rail, streetcar, and BRT lines found that streetcars were middling in terms of capital cost per mile. While the 21 projects ranged from below $10 million per mile to over $80 million per mile, the two streetcar projects analyzed, Portland, OR, and Seattle, cost about $30 million per mile and $60 million per mile to build, respectively (in 2010 dollars). Although conventional buses do not provide some of the advantages of BRT and rail transit, including streetcars, regular bus service improvements are likely to be the least costly of all measures to increase transit capacity. Operating costs, including such things as drivers' salaries, fuel, and track and vehicle maintenance, are difficult to compare among modes because of differing service characteristics. A Government Accountability Office (GAO) analysis of operational costs, for example, showed no consistent advantage for BRT or light rail. A comparison of operating costs of streetcar and bus service in seven cities found that costs per trip were higher for streetcars in only two cities. But measured by cost per passenger mile, streetcar operating costs were significantly higher than bus operating costs. There are currently three main sources of funding available for the construction of streetcar systems: (1) the TIGER grant program; (2) the New Starts and Small Starts program; and (3) flexible federal-aid highway program funds, including funding from the Surface Transportation Program and the Congestion Mitigation and Air Quality Improvement (CMAQ) program. The predominant form of federal support for the construction of streetcars over the past few years has been the Transportation Investment Generating Economic Recovery (TIGER) program. This is likely because TIGER provides moderate sums of discretionary funding, streetcars are favored by the Obama Administration as so-called "livability" projects, and, until passage of the Moving Ahead for Progress in the 21 st Century Act (MAP-21; P.L. 112-141 ) in 2012, streetcar projects did not score well in the evaluation of projects funded by the New Starts and Small Starts program. Initially enacted as part of the American Recovery and Reinvestment Act (ARRA; P.L. 111-5 ), the TIGER program has been funded in five subsequent appropriations bills. TIGER funding was $1.5 billion in FY2009, $600 million in FY2010, $527 million in FY2011, $500 million in FY2012, $474 million in FY2013, and $600 million in FY2014. Funds are drawn from the general fund of the U.S. Treasury. Nine streetcar projects have been awarded a total of $279 million from the TIGER program (see Table 1 ). To date, FY2014 funding has not been awarded. According to a notice of funding availability, applications for FY2014 funding must be submitted by April 28, 2014. The New Starts and Small Starts program provides federal funds to public transportation agencies on a largely competitive basis for the construction of new fixed guideway transit systems and the expansion of existing systems (49 U.S.C. §5309). The New Starts and Small Starts program is one of six major funding programs administered by FTA, accounting for about 18% of FTA's budget. Unlike the other major federal transit programs, which are funded from the mass transit account of the highway trust fund, funding for the New Starts and Small Starts program comes from the general fund of the U.S. Treasury. MAP-21 authorized $1.9 billion for FY2013 and FY2014. Funding appropriated for the program was $1.855 billion in FY2013 and $1.943 billion in FY2014. In addition, the FY2014 appropriations act provided $93 million in unobligated funds from the former discretionary bus and bus facilities program for bus rapid transit projects, and an unspecified amount of unobligated funds from the former alternatives analysis program for any type of New Start and Small Start project. Streetcar projects typically fall into the Small Starts category, defined as projects requesting $75 million or less in federal assistance and costing $250 million or less in total. To go with the smaller amount of federal funds being committed, the approval process for Small Starts projects is simpler than for larger and more expensive New Starts projects. Few streetcar projects have received New Starts and Small Starts program funding over the past two decades, but changes in the way projects are evaluated by FTA may make it easier in the future. GAO found that of the 57 projects approved for funding under the New Starts and Small Starts program between October 2004 and June 2012, only one was a streetcar project (Portland, OR). This was likely due to the use of cost of time savings as part of the evaluation of projects prior to MAP-21, as that measure tended to favor projects supporting faster long-distance trips, like those on commuter rail, rather than slower, shorter trips like those on streetcars. As required by MAP-21, the cost of time savings measure has now been dropped in favor of cost per rider. In December 2013, two streetcar projects, those in Tempe, AZ, and Ft. Lauderdale, FL, were in the project development phase of the Small Starts process. In its study, GAO did not include projects receiving less than $25 million in New Starts and Small Starts program funding, which were exempt from the normal New Starts and Small Starts evaluation process. In FY2010, five streetcar projects were awarded $25 million or less. Streetcar projects in Fort Worth, St. Louis, Charlotte, and Cincinnati were awarded $24.99 million each, and Dallas received $4.9 million. These funds distributed by FTA were from $130 million in unallocated New Starts and Small Starts program funds. The Obama Administration decided that it would use them for what it termed "urban circulator" projects, mainly streetcar and bus rapid transit projects. Instead of the New Starts and Small Starts selection criteria, the Urban Circulator grant program evaluated projects based on livability, including providing additional transportation options, sustainability, and economic development. MAP-21 continues to allow certain federal-aid highway funds to be used for public transportation projects at the discretion of state and local officials. Most of the "flexed" funds have come from two programs, the Surface Transportation Program (STP) and the Congestion Mitigation and Air Quality Improvement Program (CMAQ). Several streetcar projects have used or are proposing to use flexed funding. For example, the streetcar project in Tempe, AZ, is proposing to use $32.1 million dollar of CMAQ funding in addition to $56 million from the New Starts and Small Starts program and $41.24 million in local funding. The costs of operating transit service include such functions as vehicle operation and maintenance, maintenance of stations and other facilities, general administration, and purchase of transportation from private operators. In general, federal law prohibits transit operators in urbanized areas of 200,000 or more residents from using federal transit funds for operating expenditures, including annual distributions of federal public transportation funds by formula. Federal support in urbanized areas of this size is limited to capital expenditures. However, the definition of transit capital expenses includes some items traditionally considered to be operating expenses, such as preventive maintenance. In some circumstances, CMAQ funds can be used to support the operating expenses of streetcars. As the Federal Highway Administration (FHWA) notes, "projects designed to attract new riders, typically by providing new transit facilities or services, are eligible for CMAQ funds ... Projects can include both constructing and operating new facilities." Among other things, CMAQ funds may be used to provide fare subsides. However, FHWA also notes that CMAQ funds typically provide short-term help to launch new or expanded service. Relatively recent changes in federal programs, should they be maintained, are likely to lead to greater support for streetcars in the coming years. These changes include the creation of the TIGER program in FY2009 and its continued funding through FY2014, and reforms to the evaluation of projects in the New Starts and Small Starts program that favor streetcars. Increased funding of these programs may lead to even greater federal support for building new streetcar lines, although this would depend on the competition for funds from other types of projects. Another way to increase federal support for streetcar construction would be to direct more existing funding to these types of projects. One way for Congress to accomplish this would be to reinstitute the set-aside of New Starts and Small Starts funding for Small Starts projects, those requesting $75 million or less in federal assistance and costing $250 million or less in total. Prior to MAP-21, $200 million of the program's funding was reserved for Small Starts projects. This again would not guarantee the funding of streetcars because Small Starts grants also go to other types of projects, such as BRT, but it would limit the competition for these funds. Congress might also consider supporting streetcar systems by allowing the use of federal transit funds to pay for operating costs. The federal government generally prohibits the use of federal transit funds for operating expenses in urbanized areas over 200,000. However, small bus operators in these larger urbanized areas were provided support in MAP-21. Operators of small fixed-guideway systems, such as streetcars, might be afforded the same opportunity. Alternatively, Congress might decide to reduce or eliminate the use of federal funds for streetcar construction and operation. This could be accomplished by reducing or eliminating funding for the TIGER program, the New Starts and Small Starts program, and flexible highway programs, or by prohibiting the use of program funds for streetcars. In the case of the New Starts and Small Starts program it might be easier to reinstitute evaluation criteria that are unfavorable to streetcar projects. This might entail requiring the use of time savings or passenger miles, not passenger trips, as a measure of mobility benefits.

Streetcars, a type of rail public transportation, are experiencing a revival in the United States. Also known as trolleys, streetcars were widespread in the early decades of the 20th century, but almost extinct by the 1960s. Several new streetcar systems have been built over the past 20 years, and many more are being planned. In early 2014, there were 12 operating streetcar systems, 7 new systems under construction, and approximately 21 new systems in the planning stages. Many streetcars systems, though not all, have been built or are being built with the support of federal funds. This report answers some frequently asked questions about streetcars and federal involvement in their construction and operation. It concludes by laying out policy options for Congress in dealing with streetcars.

The Military Health Services System (MHSS), with an annual cost of over $15 billion, has the dual mission of providing medical care to the military forces during war or conflict and to military dependents and retirees. The MHSS consists of over 90 deployable combat hospitals that are solely devoted to the wartime mission. In addition, over 600 medical treatment facilities, such as medical centers, community hospitals, and clinics, are available worldwide to care for wartime casualties, but also provide peacetime care to active duty dependents and retirees. The system employs over 184,000 military personnel and civilians with an additional 91,000 medical personnel in the National Guard and Selected Reserves. In the post-Cold War era, personnel downsizing and constrained budgets focused attention on DOD’s need to determine the appropriate size and mix of its medical force. In 1991, the Congress required DOD to reassess its medical personnel requirements based on a post-Cold War scenario. Specifically, section 733 of the National Defense Authorization Act for Fiscal Years 1992 and 1993 (P. L. 102-190, December 5, 1991) required, among other things, that DOD determine the size and composition of the military medical system needed to support U.S. forces during a war or other conflict and identify ways of improving the cost-effectiveness of medical care delivered during peacetime. In April 1994, DOD completed the required study, known as the “733 study.” Although the study included all types of medical personnel, it used physicians to illustrate key points. It estimated that about 50 percent of the 12,600 active duty physicians projected for fiscal year 1999 were needed to treat casualties emanating from two nearly simultaneous major regional conflicts (MRC). When reserve forces were included, the study showed that the 19,100 physicians projected for fiscal year 1999 could be reduced by 24 percent. In March 1995, we testified that the 733 study results were credible and that its methodology was reasonable. However, we noted that the study’s results differed from the war plans prepared by the commanders in chief (CINC) for the two anticipated conflicts, due mainly to different warfighting and casualty assumptions. Following the 733 study, each service used its own model to determine wartime medical personnel requirements. Using these models, the services estimated that their wartime medical personnel requirements were almost as much as those projected for fiscal year 1999—offsetting most of the reductions suggested in the 733 study. Over the past several years, the services have maintained essentially the same number of active duty physicians, even though active duty end strengths have dropped considerably. The Navy developed a model known as the Total Health Care Support Readiness Requirement to correct what it viewed as inaccuracies in the 733 study. The Air Force also developed a model patterned closely after the Navy’s. In their models, the Navy and the Air Force used the medical personnel levels from the 733 study as their wartime baseline and then identified adjustments which, in their view, were needed to more accurately represent personnel required to treat combat casualties and to maintain operational readiness and training. Using these models, the Navy and the Air Force, in the summer of 1995, identified wartime active duty medical personnel requirements that supported 99 percent and 86 percent, respectively, of their fiscal year 1999 projections. The Army also developed a model called Total Army Medical Department Personnel Structure Model (TAPSM) to determine medical personnel required to meet the medical demands of the two-MRC strategy. TAPSM differed from the Navy’s and the Air Force’s models in that the Army continued using its Total Army Analysis (TAA) process to estimate the baseline wartime requirements, whereas the Navy and the Air Force used the 733 estimates as their baseline. Building on the baseline obtained from TAA, the Army used TAPSM to determine additional medical personnel needed for medical readiness, such as rotation and training. In the summer of 1995, the Army’s process identified wartime active duty medical personnel requirements that were 104 percent of the Army’s fiscal year 1999 projections. Major differences between the results of the service models and the 733 study occurred because the services made different assumptions about the personnel needed for medical readiness. These readiness requirements are intended to ensure that, at any point in time, DOD has enough personnel to care for deployed forces. Specifically, these readiness-related requirements support continuous training of medical personnel and a medical cadre in the United States that can replace or relieve deployed personnel as needed. While the 733 study made some provision for such requirements, the services’ estimates assume that a much higher number of medical personnel are needed for such training and rotation. The services’ estimates of wartime requirements support a medical force projection that does not decrease nearly as much as the active duty force. Responding to changes in the national military strategy, DOD projects that by 1999 the active duty force will be reduced by one-third from the 1987 levels. At the same time, the services are projecting reductions of 16 percent in total active duty medical personnel and 4 percent in active duty physicians. The services’ modeling techniques for estimating medical personnel requirements appear reasonable. While we found some differences between the models, each determined requirements for similar categories of personnel. However, the models’ results depend largely on the values of the input data and assumptions. We assessed the services’ modeling techniques by comparing the attributes of each model to the methodology used in the 733 study, which we had previously concluded was reasonable. We found that the services’ modeling techniques were consistent with the 733 study in that they used (1) current defense planning guidance for two MRCs, (2) DOD-approved policies for evacuating casualties from the theater, and (3) casualty projections. Also like the 733 study, the services’ techniques included active duty and reserve personnel working in hospital and nonhospital functions, those working in graduate medical education programs, and those needed for rotation to overseas installations. However, as described previously, the services assumed more medical personnel would be needed for training and rotation associated with medical readiness. These assumptions, not the modeling techniques, accounted for a major difference between the results of the 733 study and the services’ models. The 733 study concluded that about 50 percent of the active duty physicians projected for fiscal year 1999 were not needed to meet wartime medical readiness requirements, while the services’ models supported a need for 96 percent of the fiscal year 1999 active duty physicians. DOD’s current study of wartime medical personnel requirements, when completed, will present another analysis to compare with the services’ modeling techniques. This analysis could reveal methodological or other differences not currently identified. In the services’ medical personnel requirements processes, the demand for care emanating from the two-MRC strategy is translated into the number of hospital beds required. This demand is based on the number of anticipated casualties without regard to whether the beds will be staffed by active duty or reserve component medical personnel. The allocation between active and reserve components is made by analyzing when casualties are projected to occur during the conflicts and comparing that requirement to information on how soon active and reserve medical units can arrive in the theater. If high numbers of casualties in a theater are anticipated to occur early in a conflict, more active duty medical personnel will likely be required to provide medical care because active duty medical units generally can deploy more quickly than reserve units. Conversely, if high numbers of casualties do not occur until later in the conflict, the need for active duty medical personnel diminishes and more requirements can be met by reserve forces. DOD’s current study of medical requirements will examine the appropriateness of the mix between active duty and reserve medical forces. The outcome of this study will have important ramifications for sizing the medical components of each service and the number of medical personnel to remain on active duty status. If, for example, the study assumes that medical forces will be needed sooner than assumed in the 733 study, most, if not all, of the reductions in active duty medical personnel estimated in the original study could be nullified. On the other hand, if medical forces are assumed to deploy later, more reductions in active duty medical personnel could be made. DOD is currently updating its 733 study using a process intended to replace the individual service models for determining wartime medical personnel requirements. The update was directed by the Deputy Secretary of Defense, in August 1995, to respond to the continuing debate over the estimates for wartime medical personnel. The update is being led by the Director of DOD’s Office of Program Analysis and Evaluation, which also conducted the original 733 study, under the general direction of a steering group of representatives from several offices. The update will result in a new estimate of wartime medical demands derived from updated planning scenarios and force deployment projections. In an effort to arrive at one set of DOD requirements, the 733 update working groups have been attempting to reach agreement on the underlying assumptions with the key parties within DOD. However, the March 1996 completion has been delayed because of disagreements over some assumptions, such as the population-at-risk and casualty rates. DOD officials have not provided a firm date for completing the study, but they believe they are making progress in reaching agreement on input assumptions. They also believe such an agreement will establish a unified process for determining DOD-wide wartime medical demands. After the wartime demand is established, the 733 update is expected to use a model to estimate medical personnel needed to meet the demand. DOD officials believe that, in the future, this model—the DOD Medical Sizing Model—will be used to determine total wartime medical personnel levels. According to DOD officials, if agreement is reached on the model and the assumptions to be used, wartime medical requirements will no longer be determined by the individual service models. We reviewed documents, reports, and legislation relevant to military medical staffing trends; each service’s medical staffing model; the DOD Medical Sizing Model; and the 733 update study. We interviewed officials from the Office of the Assistant Secretary of Defense for Health Affairs; DOD’s Office of Program Analysis and Evaluation; the Joint Staff; the Offices of the Surgeons General of the Army, the Navy, and the Air Force; the Office of Reserve Affairs; and the U.S. Army Concepts Analysis Agency in the Washington, D.C., area. We also interviewed officials from the U.S. Central Command, Tampa, Florida; the U.S. Transportation Command, Scott Air Force Base, Illinois; and the Army Medical Command, San Antonio, Texas. In assessing the reasonableness of the services’ modeling techniques, we compared the attributes of each model with the 733 study. We obtained information from each service on the model formats, the underlying assumptions, and the types and sources of information used in developing the models. We met with the service representatives responsible for developing and using the models to gain an understanding of how each model worked. We did not attempt an in-depth validation of the accuracy of each model, rather, we reviewed the models to see if their methodologies were generally consistent with the 733 study. We initially concentrated on looking at how each model developed the active duty medical personnel requirements from the total wartime bed requirements. We also compared the services’ modeling techniques with each other. We intended to compare each service’s input values (rates) for such factors as wounded-in-action, conflict intensities, conflict durations, and disease and non-battle injuries with similar rates depicted in the CINC war plans and with the updated casualty rates being developed subsequent to the 733 study. However, before we started this phase, DOD decided to develop, as part of the 733 update, a single DOD-wide model for determining medical staffing requirements. Since the update is still ongoing, we are at this time unable to fully assess the reasonableness of the data inputs and assumptions, the appropriateness of the active/reserve component split, and the degree to which DOD integrates the medical requirements of the three services. We conducted our review from June 1995 to June 1996 in accordance with generally accepted government auditing standards. In oral comments, DOD fully concurred with this report’s findings and conclusions. We are sending copies of this report to other interested congressional committees; the Secretaries of Defense, the Army, the Navy, and the Air Force; the Commandant, U.S. Marine Corps; and the Director, Office of Management and Budget. We will also send copies to others on request. If you or your staff have any questions about this report, please call me on (202) 512-5140. Major contributors to this report are listed in appendix I. Jeffrey A. Kans Cary B. Russell The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and MasterCard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent. U.S. General Accounting Office P.O. Box 6015 Gaithersburg, MD 20884-6015 Room 1100 700 4th St. NW (corner of 4th and G Sts. NW) U.S. General Accounting Office Washington, DC Orders may also be placed by calling (202) 512-6000 or by using fax number (301) 258-4066, or TDD (301) 413-0006. Each day, GAO issues a list of newly available reports and testimony. To receive facsimile copies of the daily list or any list from the past 30 days, please call (202) 512-6000 using a touchtone phone. A recorded menu will provide information on how to obtain these lists.

Pursuant to a legislative requirement, GAO studied the reasonableness of the models each military service uses to determine appropriate wartime medical personnel force levels, focusing on the models' results, their methodologies, and their inclusion of active duty and reserve medical personnel. GAO found that: (1) in 1995, each service used its own model to determine wartime medical personnel requirements instead of adopting the results of the Department of Defense's (DOD) "733 study," which, among other things, sought to determine the size and composition of the military medical system needed to support U.S. forces during a war or other conflict; (2) taken together, the services' models offset nearly all of the reductions estimated in the 733 study, supporting instead, a need for about 96 percent of the active duty physicians projected for fiscal year (FY) 1999; (3) much of this difference resulted because the services assumed that significantly more people were needed for training and maintaining personnel to relieve deployed medical forces; (4) given these results, DOD has not planned significant reductions in future medical forces; (5) by comparison, the overall DOD active duty end strengths are expected to decline by twice the rate of decline in medical forces from FY 1987 to FY 1999; (6) the modeling techniques the services used to determine medical requirements appear reasonable; (7) however, the results of the models depend largely on the values of the input data and assumptions used; (8) although their techniques differed in some ways, the services appropriately considered factors, such as current defense planning guidance, DOD policies for evacuating patients from the theater, and casualty projections; (9) the service models also included requirements for both active duty and reserve medical personnel; (10) at the time of GAO's review, the services had done more detailed analyses of the active duty requirements than the reserve portion; (11) given the dichotomy between the results of the service models and the 733 study, in August 1995, the Deputy Secretary of Defense directed that the 733 study be updated and improved; (12) this ongoing study is intended to form the basis for a single DOD position on wartime medical demands and associated personnel; (13) as such, it is to resolve differences in the key assumptions that drive medical force requirements; (14) while the study was to be completed by March 1996, DOD has encountered difficulty in reaching agreement over some assumptions, such as the population-at-risk and casualty rates, and thus, the study has been delayed; and (15) the 733 update is using a unified DOD sizing model, which will supplant individual service models.

The United States remains the only major industrialized country in which a nonmetric measurement system is predominantly employed. Thus, while miles, pounds, and degrees Fahrenheit (i.e., the English system of measurement) are widely used in the United States, kilometers, grams, and degrees Celsius are favored throughout the rest of the industrialized world. Voluntary use of the metric system, also known as the International System of Units or SI, has been legal in the United States since 1866, and certain segments of society (particularly scientists and industries involved in international trade) have embraced metric units for many years. Calls for widespread metric conversion intensified during the mid-1960s, particularly after the United Kingdom began its conversion from the English system to metric. In 1968, Congress passed the Metric Study Act of 1968 (P.L. 90-472) which authorized a three-year Department of Commerce study on the feasibility of metric conversion in the United States. The study concluded that conversion to the metric system was in the best interests of the Nation, particularly in view of the increasing importance of technology and international trade to the U.S. economy. In 1975, the Metric Conversion Act ( P.L. 94-168 ) was passed by Congress. The Act established a U.S. Metric Board whose purpose was to coordinate and plan a process of voluntary metric conversion throughout the Nation. However, there appeared to be widespread public antipathy to conversion to the metric system and the Metric Board's efforts were largely ignored (and in some instances, vociferously opposed) by the American public. In 1982, the Metric Board was abolished by the Reagan Administration. By the late 1980s, however, concern over U.S. industrial competitiveness in world markets led Congress to again encourage metric conversion, this time by requiring federal agencies to go metric in their respective activities. Section 5164 of the Omnibus Trade and Competitiveness Act of 1988 ( P.L. 100-418 ) amended the Metric Conversion Act of 1975 to designate the metric system as the "preferred system of weights and measures for United States trade and commerce." The amended Act required all federal agencies to begin using the metric system in procurements, grants, and other business-related activities, except when such use is impractical or is likely to cause significant inefficiencies or loss of markets to U.S. firms. Agencies were also required to report annually to Congress on actions taken to implement fully the metric system of measurement. As follow-up to P.L. 100-418 , Executive Order 12770 ("Metric Usage in Federal Government Programs"), issued in 1991 by President Bush, further required federal agencies to formulate and implement metric conversion plans. Federal agencies were initially slow in responding to the metric conversion mandate. A March 1990 General Accounting Office (GAO) report found that most federal agencies had not shown a commitment to metric conversion. After Executive Order 12770 was issued, agency compliance measurably improved. A Committee Print issued December 1993 by the House Committee on Science, Space and Technology, reported that 29 out of 36 federal agencies had reported their metric activities to Congress (as required by P.L. 100-418 ). The study concluded that a "general commitment toward converting to the metric system by each federal government agency reporting appears clearly evident." Meanwhile, a January 1994 GAO report on metric conversion found that while federal preparations for metric conversion were well underway, basic problems limited federal metric procurement; grants and other business activities showed mixed progress; and federal agencies indicated a need for greater support from the private sector and the public. The Metric Program at the Department of Commerce's National Institute of Standards and Technology (NIST) is responsible for coordinating the metric transition activities of all federal agencies. NIST chairs the Interagency Committee on Metric Policy (ICMP) and is required by Executive Order 12770 to report to the President annually regarding metric conversion progress made by individual federal agencies. The most recent report, the 1993 Metric Progress Report, concluded that metric conversion progress among agencies is widely variable, and depends upon the metric readiness of the industries a particular agency's programs affect, budget limitations, and the amount of visible high level leadership within the agency. Notable examples of metric conversion activities in the federal government include: the proposed metric conversion of federal highways (discussed below), a requirement that all new federal building construction projects be conducted in metric units, and a Federal Trade Commission (FTC) rule requiring consumer product packaging to be labeled with dual (English and metric) units. Other agencies, however, have determined it unfeasible or unpractical to convert particular activities to metric at this time. The GAO found that "[metric conversion] problems encountered by federal agencies frequently involve opposition from the private sector or the public. Generally speaking, the more directly a proposed conversion affects the private sector or the public, the greater the resistance." Thus, for example, the Secretary of Agriculture has granted a general exemption from metric conversion for projects or programs that directly affect individual farmers or farm programs. The National Weather Service in the Department of Commerce, while gathering all of its data in metric units, converts back to the inch-pound system before providing its data to the public. An issue that has received much attention from congressional policy makers and the public is the proposed metric conversion of the federal highway system. On June 11, 1992, the Federal Highway Administration (FHWA) announced its metric conversion policy, which stipulated that all highway construction plans, specifications, and estimates be prepared in metric units of measurement by September 30, 1996. After that date, Federal Aid Highway Program funds would not be authorized for nonmetric projects, unless a specific exception was issued by FHWA. Many state highway agencies have been working with FHWA and the American Association of State Highway & Transportation Officials (AASHTO) to meet the September 30, 1996, deadline for metric conversion. However, on November 28, 1995, the President signed the National Highway System Designation Act of 1995 ( P.L. 104-59 ), which provides that before September 30, 2000, the Secretary of Transportation shall not require any state to use or plan to use the metric system with respect to designing or advertising, or preparing plans, specifications, estimates or other documents for a federal-aid highway project. Legislation introduced into the 104 th Congress by Representative Duncan ( H.R. 3617 ), and reintroduced into the 105 th Congress by Representative Bachus ( H.R. 813 ) and Senator Baucus ( S. 532 ) would indefinitely remove the federal mandate for metric conversion in federal highway projects (see discussion in next section of this report). The issue of highway sign conversion was considered separately from FHWA's overall metric conversion policy, and was not subject to the September 30, 1996 deadline. On August 31, 1993, the FHWA announced in the Federal Register a solicitation of public comments on options it was considering for "coordinating an orderly transition of distance, weight, and speed traffic control sign legends from English to metric units." In response to the FHWA notice, a series of bills were introduced in Congress which sought to prohibit the use of federal funds for metric conversion of highway signs. Additionally, Department of Transportation Appropriation bills for FY1994 ( P.L. 103-122 ), FY1995 ( P.L. 103-331 ), and FY1996 ( P.L. 104-50 ) specifically prohibited use of appropriated funds for metric conversion of highway signs. On June 27, 1994, the FHWA announced its decision in the Federal Register not to require the implementation of metric signs until "at least after 1996, or until further indication of the intention of Congress on this subject is received." The FHWA stated that one of the factors in its decision was "a possible future congressional restriction on using Federal funds for metric signs." Accordingly, the National Highway System Designation Act of 1995 ( P.L. 104-59 ) prohibits FHWA from requiring the states to expend any federal or state funds for metric conversion of highway signs. Meanwhile, an April 1996 Battelle study commissioned by FHWA has estimated that the cost of metric highway sign conversion could range from $15.6 million for routine replacement, to $826 million for dual posting. Similar to the metric provisions of the National Highway System Designation Act, much of the metric-related legislation introduced in the 104 th Congress sought to limit metric conversion activities in the federal government, particularly in cases where the federal government is seen to be imposing metric conversion mandates on the States. Section 302 of the Unfunded Mandate Reform Act of 1995 ( P.L. 104-4 ), signed into law on March 22, 1995, directed the Advisory Commission on Intergovernmental Relations (ACIR) to study specific federal mandates, including "requirements of the departments, agencies, and other entities of the federal government that state, local, and tribal governments utilize metric systems of measurement." On January 24, 1996, the ACIR issued its preliminary report on federal mandates. The Commission identified FHWA metric conversion requirements for federal highway construction as a federal mandate, and recommended the repeal of "requirements that state and local governments convert to metric on a Federal timetable as a condition of receiving Federal aid." Metric proponents have objected to the ACIR findings, asserting that metric conversion has already been implemented by most states, that the metric system is becoming increasingly accepted by the construction community, and that metric conversion costs constitute a tiny percentage of total federal highway funds received. Other legislation in the 104 th Congress sought to amend the Metric Conversion Act. The Federal Reports Elimination and Sunset Act of 1995 ( P.L. 104-66 ), which was signed into law on December 21, 1995, repeals section 12 of the Metric Conversion Act requiring federal agencies to report to the Congress on their metric conversion activities. A further amendment to the Metric Conversion Act was included in Department of Commerce dismantling legislation, which was attached to the House version of the debt limit extension bill ( H.R. 2586 , subsequently vetoed by the President). This provision would have repealed the provision of the Metric Conversion Act which requires federal agencies to use the metric system in their procurements, grants, and other business-related activities. Additionally, the Metric Program at NIST would have been abolished. Finally, a bill passed by the 104 th Congress ( P.L. 104-289 ) sought to curb some federal agency requirements that businesses convert their modular construction products to a hard metric specification in order to supply federal construction contracts. While the vast majority of products procured for federal construction are soft converted (which means that an existing product is relabeled in metric units but does not change size), some modular products are required in hard metric sizes in order to be dimensionally coordinated with other building components. A hard metric conversion requires, in addition to the expression of the dimensions of a product in metric units, a physical change in the dimension of that product in order to conform to a rounded metric unit. Certain construction materials industries (primarily makers of concrete masonry block and recessed lighting fixtures) objected to hard metric requirements, arguing instead for soft metric conversion. The Savings in Construction Act of 1996 ( P.L. 104-289 ), signed into law on October 11, 1996, applies only to concrete masonry units and recessed lighting fixtures. The law prohibits federal agencies from specifying hard metric dimensions for concrete block and lighting fixtures, unless certain criteria are met, including a determination by the agency that the costs of the modular metric components are estimated to be equal to or less than the total installed price of using non-hard metric products. Additionally, P.L. 104-289 directs each executive agency awarding construction contracts to designate a metrication ombudsman who will respond to industry complaints and concerns regarding construction metrication issues. In the 105 th Congress, metric related legislation remains focused on the federal highway construction issue. H.R. 813 (introduced by Representative Bachus) would remove the extended deadline of September 30, 2000 from the National Highway System Designation Act ( P.L. 104-59 ), thereby indefinitely prohibiting FHWA from requiring the states to convert their federal highway projects to metric units. Section 303 of the Surface Transportation Authorization and Regulatory Streamlining Act ( S. 532 , introduced by Senator Baucus), contains identical language. Similarly, there are plans in the House to attach such language to legislation reauthorizing the Intermodal Surface Transportation Efficiency Act (ISTEA). Proponents of removing the federal mandate for metric conversion cite the costs of conversion experienced by highway contractors, and maintain that metric conversion decisions should be left to the states. Opponents of H.R. 813 , including the Department of Transportation, point out that over 40 states are already surveying and designing their new projects in metric units, and that states have spent nearly $71 million to convert standard plans, specifications, and computer programs. Removing the federal mandate, they argue, would create confusion in the highway construction industry, and reverse progress that most states have already made in converting to the metric system.

The United States remains the only major industrialized country in which a nonmetric measurement system is predominantly employed. Section 5164 of the Omnibus Trade and Competitiveness Act of 1988 (P.L. 100-418) amended the Metric Conversion Act to require federal agencies to use the metric system in their activities. Legislation in the 104th and 105th Congress limits federal metric conversion activities, particularly in instances where states, local governments, and the private sector may be required to convert to the metric system in order to participate in federally funded programs.

The Financial Services and General Government (FSGG) appropriations bill includes funding for the Department of the Treasury, the Executive Office of the President (EOP), the judiciary, the District of Columbia, and more than two dozen independent agencies. For each title of the regular FSGG appropriations bill, Table 1 lists the enacted amounts for FY2010, FY2011, and FY2012, as well as amounts requested by the President for FY2013. Title I of the FSGG appropriations bill provides funding for the Department of the Treasury and its bureaus, including the Internal Revenue Service (IRS). The President requested $13.24 billion for the Treasury Department for FY2013, an increase of $1.03 billion above FY2012 enacted amounts. The President's request includes a proposal to create a new bureau, the Fiscal Service, which would result from the merger of the Financial Management Service and the Bureau of the Public Debt. According to the budget request, the new bureau would reduce duplicative functions. Table 2 lists the enacted amounts for FY2010, FY2011, and FY2012, as well as amounts requested by the President for FY2013. Title II of the FSGG appropriations bill provides funding for all but three offices under the Executive Office of the President (EOP). The President requested $649 million for the EOP for FY2013, a decrease of $10 million below FY2012 enacted amounts. Table 3 lists the enacted amounts or FY2010, FY2011, and FY2012, as well as amounts requested by the President for FY2013. Title III of the FSGG appropriations bill provides funding for the judicial branch of the federal government, including the Supreme Court. As a co-equal branch of government, the judiciary presents its budget to the President, who transmits it to Congress unaltered. The President's FY2013 budget request for the judiciary is $7.19 billion, which is $219 million more than appropriated for FY2012. Table 4 lists the enacted amounts for FY2010, FY2011, and FY2012, as well as amounts requested by the President for FY2013. Title IV of the FSGG appropriations bill provides funding for the District of Columbia. The President's FY2013 budget request includes $680 million for special federal payments to the District, an increase of $15 million above FY2012 enacted amounts. Table 5 lists the enacted amounts for FY2010, FY2011, and FY2012, as well as amounts requested by the President for FY2013. Title V provides funding for more than two dozen independent agencies which perform a wide range of functions, including the management of federal real property (GSA), the regulation of financial institutions (SEC), and mail delivery (USPS). The President's FY2013 budget request includes $24.05 billion for independent agencies that receive their funding through the FSGG appropriations bill, an increase of $159 million over FY2012 funding levels. Table 6 lists the enacted amounts for FY2010, FY2011, and FY2012, as well as amounts requested by the President for FY2013.

The Financial Services and General Government (FSGG) appropriations bill includes funding for the Department of the Treasury, the Executive Office of the President (EOP), the judiciary, the District of Columbia, and more than two dozen independent agencies. Among those independent agencies are the General Services Administration (GSA), the Office of Personnel Management (OPM), the Small Business Administration (SBA), the Securities and Exchange Commission (SEC), and the United States Postal Service (USPS). The Commodity Futures Trading Commission (CFTC) is funded in the House through the Agriculture appropriations bill and in the Senate through the Financial Services and General Government bill. CFTC funding is included in all FSGG funding tables in this report. For FY2013, the President has requested $45.83 billion for agencies funded through FSGG appropriations, an increase of $1.41 billion above amounts enacted for FY2012.

Our April 2014 report noted that VA has experienced substantial delays in executing new outpatient-clinic lease projects; nearly all of the delays occurred in the planning stages prior to entering into a lease agreement with the developer. Specifically, we found that 39 of the 41 outpatient- clinic projects for which a prospectus was submitted experienced schedule delays, ranging from 6 months to 13.3 years, with an average delay of 3.3 years, while 2 projects experienced schedule time decreases. Our data analysis showed that 94 percent of these delays occurred in the planning stages prior to entering into the lease agreement. For all but one of the projects that experienced a delay, the delay occurred during the pre-lease agreement stage. We also compared the length of delays that occurred during the pre-lease agreement stage to the length of delays that occurred once a lease agreement was entered into with the development firm. We found that the average delay during the pre-lease agreement stages for all 41 projects totaled nearly 3.1 years. Conversely, the average project delay once a lease agreement was finalized totaled approximately 2.5 months, and 11 outpatient-clinic projects actually experienced schedule decreases during this stage. VA officials at 6 of the 11 outpatient-clinic projects selected for detailed review mentioned that the large majority of schedule delays occur during the planning stages prior to entering into a lease agreement. For the 41 lease projects we reviewed, we found that several factors contributed to delays: VHA’s late or changing requirements: According to data we analyzed and VA officials we interviewed, late or changing VHA requirements were the most common reasons for delays. Requirements can pertain to facility size, types of treatment rooms, types of medical equipment, electrical voltage needs, and other details. We found in many instances, either that CFM either did not receive VHA’s requirements on time or that VHA changed its requirements during the solicitation of offers, necessitating a re-design that affected the schedule. In evaluating VA data, we found that 23 of the 41 leasing projects (56 percent) experienced delays because VHA was late in submitting space requirements to CFM, or VHA changed space requirements and thus the scope of the project. For example, the size of the Jacksonville outpatient clinic had increased by 29 percent, and the Austin outpatient-clinic site we visited had increased by 36 percent from the time the prospectuses for these projects were submitted to Congress to the time they were completed. Site Selection Challenges: In analyzing VA data, we found that 20 of the 41 outpatient-clinic projects we reviewed (49 percent) experienced delays due to difficulties in locating or securing a suitable site. For example, an increase in scope to the Jacksonville project resulted in a larger building design that then required more land. To accommodate these changes, the landowner worked to acquire additional properties around the already selected site. Although the developer was ultimately successful in obtaining additional land for the project, this process led to delays. According to VA officials, prior to entering into the lease agreement, there were delays associated with difficult negotiations with the developer. However, the officials said that the negotiations resulted in keeping project costs lower. In addition, there were significant environmental clean-up requirements at the site, requirements that needed to be satisfied before construction began. The original site’s location was obtained in December 2002, but the larger site was not obtained until December 2009, a delay of 7 years. Outdated Guidance: At the sites we reviewed, we found that outdated policy and guidelines resulted in challenges for VA staff to complete leasing projects on time. For example, officials from the four Las Vegas outpatient sites we visited stated that VA’s policies for managing leases seem to change for each project, creating uncertainty regarding CFM job responsibilities. In addition to substantial delays, our April 2014 report noted that VA also experienced cost increases to its outpatient-clinic projects when compared to the costs in the projects’ prospectuses. VA provided cost data for its outpatient-clinic lease projects in January 2014. For the 31 projects with complete cost data, we found that “total first-year costs,” when compared to the prospectus costs, increased from $153.4 million to $172.2 million, an increase of nearly $19 million (12 percent). However, for the 31 projects, the total “prospectus first-year rent” was estimated at $58.2 million, but the total awarded first-year rent for these projects equaled $92.7 million as of January 2014, an increase of $34.5 million (59 percent).because the department must pay the higher rent over the lifetime of the lease agreement. For example, all 31 VA lease projects included in this cost analysis have lease terms of 20 years, and the increase in rent must be paid for the duration of the contract. Although first year’s rents increased for the 31 projects—increasing overall total costs—VA’s total “build-out” costs were lower than reported in the projects’ prospectuses. Build-out costs are one-time, lump-sum payments VA makes to developers for special purpose, medically related improvements to buildings when VA accepts the projects as completed. VA officials said the decrease in build-out costs from those originally estimated in the prospectuses was due to the national downturn in the commercial real estate market starting in 2008. The downturn created more competition among developers and helped VA realize more competitive pricing on its medical build-out requirements than was anticipated in the prospectuses. Such increases in rent have long- term implications for VA, The causes of the total cost increase can be attributed primarily to increases in the projects’ awarded first-year rent due to the schedule delays and changes to the design or scope of a project that we discussed previously. Schedule delays can increase costs because of changes in the local leasing market during the period of the delay. Therefore, when VA estimates costs as part of the prospectuses submitted to Congress in the annual budget request, an automatic annual escalation is applied to each project to account for rising costs and market forces that make construction and leased space more expensive over time. VA officials said the escalation ensures that the authorized cost of the project is in line with the realities of the real estate and construction markets. Because VA annually adjusts a project’s cost by an increase of 4 percent for each year the project is delayed, project delays directly result in cost increases. Additionally, we found that projects we reviewed increased in total size by 203,000 square feet. Changes in a project’s size expand the scope of the project, requiring design changes, which can result in schedule delays, further adding to costs. Our April 2014 report found that VA has made some progress in addressing issues with its major medical-facilities leasing program. Specifically, in April 2012, VA formed a high level council, the Construction Review Council, to oversee the department’s capital asset program, including leasing. Based on the findings of the council and our work for the April 2012 report on VA’s major leased outpatient clinics, VA is planning the following improvements to the major medical-facilities- leasing program: requiring detailed design requirements earlier in the design process to help avoid the delays, scope changes, and cost increases. However, these improvements were in the early stages, and their success will depend on how quickly and effectively VA implements them. Requiring detailed design requirements earlier in the facility-leasing process. VA issued a guidance memorandum in January 2014 directing that beginning with fiscal year 2016, VA should develop detailed space and design requirements before submitting the prospectus to Congress: Developing a process for handling scope changes. In August 2013, VA approved a new concept to better address scope changes to both major construction and congressionally authorized lease projects. According to VA officials, among other improvements, this process ensures a systematic review of the impact of any ad-hoc changes to projects in scope, schedule, and cost; Plans to provide Congress with clearer information on the limitations associated with costs of proposed projects. VA’s 2014 budget submission did not clarify that its estimates for future lease projects included only one year’s rent, which does not reflect the total costs over the life of the leases, costs that VA states cannot be accurately determined in early estimates. VA officials clarified this estimate beginning with VA’s 2015 budget submission. However, we also found that while VA has updated and refined some guidance for specific aspects of lease projects—including design guidance for the construction of outpatient clinics—to better support VA’s leasing staff and prevent project delays, it has not updated its VHA guidance for clinic leasing (used by staff involved with projects) since 2004. We reviewed VHA’s 2004 Handbook 1006.1, Planning and Activating Community-Based Outpatient Clinics, VHA’s overall guidance for leasing outpatient clinics. This Planning Handbook is intended to establish consistent planning criteria and standardized expectations. The Planning Handbook is widely used by VA officials and provides important guidance, in particular, clarifying the differing responsibilities of officials and departments and the legal authorities of the leasing process. However, this guidance is out of date and no longer adequately reflects the roles and responsibilities of the various VA organizations involved in major medical-facilities-leasing projects. According to VA officials, the close collaboration of these organizations is necessary for a successful lease project. As of November 2013, VHA’s leasing program has a long-term liability of $5.5 billion, but its guidance on outpatient clinics is a decade old and no longer relevant. Standards for Internal Control in the Federal Government calls for federal agencies to develop and maintain internal control activities, which include policies and procedures, to enforce management’s directives and help ensure that actions are taken to address risks. Such activities are an integral part of an entity’s planning, implementing, reviewing, and accountability for stewardship of government resources and for achieving effective results. The lack of updated guidance can affect coordination among stakeholders and could contribute to schedule delays and cost increases. Using outdated guidance can lead to miscommunications and errors in the planning and implementing of veterans’ leased clinics. Furthermore, the policy, planning criteria, and business plan format in the Planning Handbook were developed based on an old planning methodology that VA no longer uses; thus, the guidance does not reflect VA’s current process. In our April 2014 report, we recommended that the Secretary of Veterans Affairs update VHA’s guidance for leasing outpatient clinics to better reflect the roles and responsibilities of all VA staff involved in leasing projects. VA concurred with our recommendation and reported that it had created a VHA Lease Handbook that was in the concurrence process to address the roles and responsibilities of staff involving in leasing projects. In October 2014, VA reported that it had revised its clinic leasing guidance in response to GAO’s recommendation and that its leasing authority was now under the General Services Administration (GSA) and the handbook was undergoing further revisions to incorporate GSA leasing processes. Chairman DeSantis and Ranking Member Lynch, and Members of the Subcommittee, this completes my prepared statement. I would be pleased to respond to any questions that you may have at this time. If you have any questions about matters discussed in this testimony, please contact Dave Wise, (202) 512-2834 or WiseD@gao.gov. Other key contributors to this testimony include Ed Laughlin, Assistant Director; Nelsie Alcoser; George Depaoli; Jessica Du; Raymond Griffith; Amy Rosewarne; and Crystal Wesco. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

VA operates one of the nation's largest health-care delivery systems. To help meet the changing medical needs of the veteran population, VA has increasingly leased medical facilities to provide health care to veterans. In April 2014, GAO reported that VHA's leasing program had long-term liability of $5.5 billion and was growing. This statement discusses VA outpatient clinic lease issues, specifically, (1) the extent to which schedule and costs changed for selected VA outpatient clinics' leased projects since they were first submitted to Congress and factors contributing to the changes and (2) actions VA has taken to improve its leasing practices for outpatient clinics and any opportunities for VA to improve its project management. It is based on GAO's April 2014 report ( GAO-14-300 ) along with selected updates conducted in August and October 2014 to obtain information from VA on actions it has taken to address GAO's prior recommendation. For that report, GAO reviewed all 41 major medical leases that were associated with outpatient clinic projects for which a prospectus had been submitted to Congress, as required by law. In its April 2014 report, GAO found that schedules were delayed and costs increased for the majority of the Department of Veterans Affairs' (VA) leased outpatient projects reviewed. As of January 2014, GAO found that 39 of the 41 projects reviewed—with a contract value of about $2.5 billion—experienced schedule delays, ranging from 6 months to 13.3 years, with an average delay of 3.3 years. The large majority of delays occurred prior to entering into a lease agreement, in part due to VA's Veterans Health Administration (VHA): 1) providing project requirements late or changing them or 2) using outdated guidance. Costs also increased for all 31 lease projects for which VA had complete cost data, primarily due to delays and changes to the scope of a project. For example, first-year rents increased a total of $34.5 million—an annual cost which will extend for 20 years (the life of these leases). GAO's report also found that VA had taken some actions to address problems managing clinic-leased projects. First, it established the Construction Review Council in April 2012 to oversee the department's capital asset programs, including the leasing program. Second, consistent with the council's findings and previous GAO work, VA was planning the following improvements: Requiring detailed design requirements earlier in the facility-leasing process . VA issued a guidance memorandum in January 2014 directing that beginning with fiscal year 2016, VA should develop detailed space and design requirements before submitting the prospectus to Congress. Developing a process for handling scope changes. In August 2013, VA approved a new concept to better address scope changes to both major construction and congressionally authorized lease projects. According to VA officials, among other improvements, this process ensures a systematic review of the impact of any ad-hoc changes to projects in scope, schedule, and cost. Plans to provide Congress with clearer information on the limitations associated with costs of proposed projects. VA's 2014 budget submission did not clarify that its estimates for future lease projects included only one year's rent, which does not reflect the total costs over the life of the leases, costs that VA states cannot be accurately determined in early estimates. VA officials clarified this estimate beginning with VA's 2015 budget submission. However, these improvements were in the early stages, and their success will depend on how quickly and effectively VA implements them. Finally, GAO reported that VA was also taking steps to refine and update guidance on some aspects of the leasing process, for example the VA's design guides, but VHA has not updated the overall guidance for clinic leasing (used by staff involved with projects) since 2004. In October 2014, VA reported that it was in the process of revising its clinic leasing guidance in response to GAO's recommendation and that its leasing authority was now under the General Services Administration (GSA) and the handbook was undergoing further revisions to incorporate GSA leasing processes. In its April 2014 report, GAO recommended that VA update VHA's guidance for the leasing of outpatient clinics. VA concurred with GAO's recommendation and is taking actions to implement the recommendation.

The average spot market price for West Texas Intermediate (WTI), a reference grade of U.S. crude oil, was up 9.5% in 2007 compared to 2006, while the New York Mercantile Exchange (NYMEX) futures price for WTI approached $100 per barrel (p/b) in December 2007. Refinery capacity utilization rates approached 90% or more for much of the year, while oil supply disruptions from Nigeria, Venezuela, and the Persian Gulf remained both a threat and a sometime reality. As the strength of product demand began to weaken in the latter stages of the year, responding to high petroleum product prices as well as a possible slow down of economic growth, refinery margins began to narrow, suggesting that the companies were less able to pass through the increased cost of crude oil to consumers. However, even in the face of uncertainty and weakening markets, the oil industry enjoyed record revenues and profits in 2007. In 2007, the oil industry recorded revenues of approximately $1.9 trillion, of which 78% was accounted for by the five major integrated oil companies. Profits for the industry totaled over $155 billion, 75% of which were earned by the five major oil companies, with the largest, ExxonMobil, earning over 25% of the total profit. Although the financial results for the industry were at record levels, the performance of different sectors of the industry varied, as did the performance of individual companies within those sectors, leaving some firms as relative under-performers compared to the industry leaders. This report analyzes the industry's profit performance in 2007. While recent profit levels in the oil industry are of interest to policy makers, investors, and analysts, among others, the financial results of 2007 should be put in a longer term perspective to understand the performance of the industry. For example, as recently as 2002, the financial picture in the oil industry was far different, with declining earnings in key sectors, such as refining. The oil industry historically has been cyclic, with periods of high earnings often followed by sharp declines, driven by movements in the world price of crude oil. For this reason, projections of future industry performance, based on current performance, are unlikely to be reliable. Integrated oil companies operate in both the upstream (exploration and production) and the downstream (refining and marketing) segments of the industry. Among the integrated oil companies listed in Table 1 , the five largest companies are usually identified as the major oil companies, or the super-majors. ExxonMobil is the largest such company; its profits in 2007 were over 90% of the profits earned by both of its largest international competitors, Royal Dutch Shell and BP. Revenue growth among the integrated oil companies in 2007 was driven by increases in the price of crude oil, especially in the last two quarters of the year. Even though five of the nine companies experienced a decline in oil production, and one of the nine experienced a decline in natural gas production, as shown in Table 2 , their revenues increased on average by 7.1% in 2007. With output declining, it is likely that revenue growth was based on increasing prices. Two profit rates, return on sales and return on equity, are presented in Table 1 . In a report that appears periodically, most recently after the oil companies announced their third quarter earnings in 2007, the American Petroleum Institute (API) compared the returns earned in the oil industry to other American industries. The API comparisons are based on returns on revenue. They found that the oil and natural gas industries earned 7.6 percent on revenues, compared to 5.8 percent for all U.S. manufacturing industries. Although this result implies a 31 percent margin over the returns earned by all U.S. manufacturing industries, it is less than the 9.2 percent earned by all U.S. manufacturing industries excluding the automobile and auto parts industries, that had a negative 26 percent return for the third quarter of 2007. Calculating return on revenues dilutes the effect of growing total profits of the oil industry due to higher prices and growing revenues, another standard percentage measure of profitability, return on equity, is presented in Table 1 . This measure indicates the success of the companies, and industry, in earning profit by utilizing the invested capital of the owners, i.e., the shareholders of the company. This measure is widely used by investors and financial analysts in evaluating the performance of firms seeking access to capital markets. By this measure, the integrated oil companies returned 22.7% in 2007, over twice the return on revenue. The industry leader, ExxonMobil, earned 33.4%. These rates of return are likely to assure these firms', and the industry's, position as a desirable investment as long as the price of oil remains high. Table 2 and Table 3 separate the upstream and downstream performance of the integrated oil companies in 2007. Table 1 and Table 2 show that upstream net income growth led overall corporate net income growth for most of the companies, and they earned almost 80% of their total net income from upstream activities. Oil and gas production declined for each product, almost 3% in oil, and less than one half of one percent in natural gas. Four of the five largest oil producers had declining output. In natural gas, only BP and Shell experienced declining output in 2007. Table 3 presents financial results for the downstream activities of the integrated oil companies for 2007. Net incomes declined by more than twice as much as product sales, suggesting that profit margins per barrel of crude oil refined had declined. In the fourth quarter of 2007, only ExxonMobil and ConocoPhillips were able to produce positive net income growth, with all the other firms showing negative net income growth, or in the case of BP, financial losses from downstream activities. Crude oil prices increased rapidly during the second half of 2007, and reached over $110 per barrel in March 2008. During this period gasoline price increases were thought by many to have lagged behind crude oil price increases. A potential weakening of the demand for gasoline in the United States was thought to be responsible for the lag. With a perception of weakening demand, passing through cost increases to consumers was not thought to be economically feasible. The result was a decline in refining margins. Table 4 presents data for 2007 for the independent oil and gas producers. Although they are large companies, with revenues of more than $10 billion in 2007 for the industry leaders, their total revenues are only about 5% of the integrated oil companies. Their net incomes, however, were approximately 15% of the net incomes of the integrated companies. Although all of the companies in this category experienced increases in revenue, six out of ten experienced negative net income growth. All of the companies, except Andarko and Newfield experienced increases in production of oil and natural gas, or both. With prices for both oil and natural gas rising late in 2007, these companies seemingly should have performed better with respect to net income growth. A possible explanation for the declining net income experienced by some companies might be the large outlays the companies made investing in unconventional oil asset exploration and development. Many of these companies are involved in shale oil work in Texas, Arkansas, and South Dakota. Valero is the leading firm among the group of independent refiners and marketers. Valero accounted for over one half of the sector's revenue, and two thirds of its net income. Valero is the largest refiner in the United States, with a total capacity of over 2.2 million barrels per day, approximately 13% of the total U.S. capacity. Independent refiners experienced the same pressure on refining margins as the integrated oil companies. The difference was that these companies produce no crude oil and therefore were not positioned to take advantage of the increases in the price of crude oil during the second half of 2007. The severity of the economic pressure on refiners in the fourth quarter of 2007 is shown in Table 6 . Although revenues for the group grew by 53.4%, net incomes declined by two thirds. Four of the seven companies in the group not only had negative growth in net income in the fourth quarter of 2007, but generated losses from business operations. Valero, the sector's leading firm, earned 53% of the revenue, but fully 97% of the earned net income. Not only was the cost of crude oil rising for the independent refiners, but relatively weaker demand conditions made it harder for the firms to quickly pass cost increases on to consumers. Valero was able to remain profitable because it was able to purchase and utilize lower cost heavy, sour crude oil at its refineries. Crude oil prices spot prices reached $110 per barrel in the first quarter of 2008. Should the price of crude oil remain at, or above, $100 per barrel for large portions of the year, the profits of oil producing firms should be high. However, the economic conditions will likely be difficult for firms that refine crude oil, but do not have their own supplies. It is likely that a greater effort will be made by refiners to adapt technologies that allow them to use heavy, sour, oil stocks. These lower quality crude oils are more readily available than high quality oils and sell at a price discount relative to the reference oils, West Texas Intermediate, for example. Another key factor in the industry's profitability is whether demand for petroleum products continues to grow in the United States and the rest of the world. U.S. gasoline demand is arguably beginning to weaken as a result of high prices. Some projections see $4 per gallon gasoline in the second and third quarters of 2008. While prices at that level might allow refiners to recover the cost of crude oil, they might also reduce demand, putting downward pressure on price. Demand for petroleum products outside the United States remains strong, and will likely remain strong as consumers in developing nations use their higher incomes to fuel additional consumption. A world-wide economic slowdown is the most likely factor that would lead to slower demand growth. The oil industry, in general, continued to generate high profits, as it has since 2004. However, it might be that the first sign of problems, in at least part of the industry, have arisen. Weakening demand for petroleum products, specifically the U.S. demand for gasoline, has put pressure on the downstream side of the industry. While demand growth, political uncertainty, the weak U.S. dollar, tight spare capacity, and other factors make it likely that the price of crude oil will remain high in 2008, the weakening U.S. economy, coupled with the demand reducing effects of higher prices, may make it more difficult to raise petroleum product prices. New capacity investments in refineries, one possible source of gasoline price relief for consumers, are likely to be slowed by the poor profit performance of the refining sector. If new capacity does not come on line the need for imported gasoline will remain a key factor in avoiding shortages in the U.S. market.

Increases in the price of crude oil that began in 2004 pushed the spot price of West Texas Intermediate (WTI), a key oil in determining market prices, to nearly $100 per barrel in the third quarter of 2007. Tight market conditions persisted through the remainder of 2007, with demand growth in China, India, and other parts of the developing world continuing. Uncertain supply related to political unrest in Nigeria, Venezuela, Iraq, and other places continued to threaten the market and contribute to a psychology that pushed up prices. The decline of the value of the U.S. dollar on world currency markets, as well as the investment strategies of financial firms on the oil futures markets, has also been identified by some as factors in the high price of oil. The profits of the five major integrated oil companies remained high in 2007, as they generally accounted for approximately 75% of both revenues and net incomes. For this group of firms, oil production led the way as the most profitable segment of the market, even though oil and gas production growth was not strong. The refining segment of the market performed relatively poorly. Independent oil and natural gas producers are small relative to the integrated oil companies, and their financial performance was weaker, with more than half of the firms reporting declines in net income. Independent refiners and marketers also experienced a difficult year that was reflected in profits in 2007. The combination of high crude oil prices that raised their costs and the inability to quickly pass cost increases on to consumers lowered refining margins, resulting in generally declining profits. The potential volatility of the world oil and financial markets, coupled with the weakness of the U.S. and other economies, makes any profit forecast for 2008 highly speculative. While continued high oil prices are likely—the price of oil reached $110 per barrel in the first quarter of 2008—the ability of the industry to pass those prices on to consumers of gasoline and other products during 2008 is uncertain due to possibly weakening demand.

T he 2014 farm bill (the Agricultural Act of 2014, P.L. 113-79 ) authorized $489 billion of mandatory spending over FY2014-FY2018. It generally expires at the end of FY2018. From a budgetary perspective, many of these programs are assumed to continue beyond their authorization; in fact, such continuing programs were estimated in 2014 to cost $468 billion for the extended FY2019-FY2023 period. That is, they have a "baseline" beyond the end of the farm bill that may be used to pay to continue those programs. However, a subset of programs that received mandatory funding does not have a baseline beyond the end of the farm bill. These are referred to as "farm bill programs without a baseline." The 2014 farm bill contains 39 programs that received mandatory funding that do not have a baseline beyond FY2018. These programs received $2.8 billion during FY2014-FY2018. For these programs to continue, they would need to be allocated new budgetary authority. Funding for farm bill programs is provided in two ways: 1. By the authorization in the farm bill ( ma ndatory spending ). A bill pays for this spending with multiyear budget estimates when the law is enacted. 2. By subsequent appropriations ( d iscretionary spending ). These programs are authorized for their scope but are not funded in the farm bill. Mandatory programs often dominate farm bill policy and the debate over the farm bill budget. The Congressional Budget Office (CBO) baseline is a projection at a particular point in time of what future federal spending on mandatory programs would be under current law. This baseline is the benchmark against which proposed changes in law are measured. When a new bill is proposed that would affect mandatory spending, the impact ( score ) is measured in relation to the baseline. Changes that increase spending relative to the baseline have a positive score; those that decrease spending relative to the baseline have a negative score. Having a baseline essentially gives programs built-in future funding if policymakers decide that the programs should continue; straightforward reauthorization would not have a scoring effect. However, programs without a continuing baseline beyond the end of a farm bill do not have assured future funding; reauthorization would have a positive score that increases the bill's cost. This funding issue—and the difficult budget dynamics that it can cause for writing a new farm bill—was identified at least as early as 2009 by the former chief economist of the House Agriculture Committee. It was raised in Agriculture Committee hearings as early as 2010, was an issue when writing the 2014 farm bill, and continues to be mentioned. CBO develops the budget baseline under various laws and following the supervision of the House and Senate Budget Committees. Generally, a program with estimated mandatory spending in the last year of its authorization will be assumed to continue in the baseline as if there were no change in policy and it did not expire. This is the situation for most of the major, long-standing farm bill provisions such as the farm commodity programs or supplemental nutrition assistance. However, some programs may not be assumed to continue in the budget baseline beyond the end of a farm bill because they are either programs with estimated mandatory spending less than a minimum $50 million scoring threshold in the last year of the farm bill, or new programs established after 1997 for which the Budget Committees determined that the mandatory spending shall not extend beyond expiration. This decision may be made in consultation with the Agriculture Committees, perhaps either to reduce the program's 10-year cost when the farm bill was written or to prevent it from having a continuing baseline. CBO projects future government spending via its budget baselines and evaluates proposed bills via scoring estimates. But it has not specifically published a list of expiring farm bill programs without a continuing baseline. To compile this list, CRS analyzed the CBO score of the 2014 farm bill in conjunction with the statutory text of the law and current CBO baseline projections that were made under the rules listed above. Our criteria are that programs have estimated mandatory funding in the 2014 farm bill (as indicated by the 2014 CBO score and in the text of the law) but do not have a baseline beyond FY2018 (indicated either in the 2014 CBO score or in the current CBO baseline). Based on this analysis, 39 programs across 10 of the 12 titles of the farm bill do not have a continuing baseline after FY2018. These programs had estimated mandatory spending totaling $2.824 billion over the five-year window of the farm bill ( Table 1 ). Any extended authorization of these programs would be scored as new mandatory spending, which may require either offsets from existing baseline for other programs or an increase in net spending. As a share of the $489 billion five-year mandatory cost of the farm bill in 2014, programs without a baseline beyond FY2018 are relatively small: 0.6% of the total projected farm bill spending, or 2.5% of the total excluding the nutrition programs ( Table 1 ). However, the impact of programs without a baseline varies by title of the farm bill. For the rural development title, 100% of the mandatory spending in the 2014 farm bill was by programs that do not have baseline beyond FY2018. For the bioenergy and research titles, the share was at least one-half. At the other extreme, nutrition programs and the farm safety net—including crop insurance and the commodity programs—have less than 1% in programs without a continuing baseline. The 2014 farm bill has less exposure to programs without baseline than did the 2008 farm bill, which had 37 programs without baseline totaling an estimated $9 billion to $14 billion. The 2014 farm bill provided 29 of those 37 programs with $6.2 billion of mandatory funding over FY2014-FY2018. Some of those programs reappear on the current list of 2014 farm bill programs without baseline, while others either received a continuing baseline or were not reauthorized. Figure 1 and Table 2 present the 39 individual programs in the 2014 farm bill that do not have a budget baseline beyond FY2018. Figure 1 is grouped and sorted by title of the farm bill based on the amount of mandatory spending by programs without a baseline within each title. Table 2 is organized by the section number in the 2014 farm bill and grouped by title.

The 2014 farm bill (the Agricultural Act of 2014, P.L. 113-79) provided mandatory funding for many programs. Some of these programs have a budget baseline beyond the end of the farm bill in FY2018, while others do not. The Congressional Budget Office (CBO) baseline is a projection at a particular point in time of what future federal spending on mandatory programs would be under current law. This baseline is the benchmark against which proposed changes in law are measured. This report identifies mandatory programs in the 2014 farm bill that lack a budget baseline and explains the significance of this for enacting a successor to the current farm bill. Generally, a program with estimated mandatory spending in the last year of its authorization will be assumed to continue in the baseline as if there were no change in policy and it did not expire. However, some programs may not be assumed to continue in the budget baseline, because the program had estimated mandatory spending less than a minimum $50 million scoring threshold in the last year of the farm bill, or the Budget Committees and/or Agriculture Committees determined that mandatory spending shall not extend beyond expiration. Having a baseline essentially gives programs built-in future funding if policymakers decide that the programs should continue. Programs without a continuing baseline beyond the end of farm bill do not have assured future funding. As such, any extended authorization of these latter programs would be scored as new mandatory spending. The 2014 farm bill contains 39 programs that received mandatory funding that do not have baseline beyond FY2018. These programs had estimated mandatory spending totaling $2.824 billion over the five-year farm bill. While this total may be a relatively small fraction of total farm bill spending (0.6% of the $489 billion five-year total projection), the effect may be particularly important to specific farm bill titles and to the programs' beneficiaries. Notable programs among this group include certain conservation programs; most of the bioenergy, rural development, and research title programs; various nutrition title pilot programs and studies; organic agriculture and farmers' market programs; trade promotion programs; and outreach to socially disadvantaged and military veteran farmers. If policymakers want to continue these programs in the next farm bill, they may need to find budgetary offsets to pay for the costs.

Since 1965, Head Start’s primary goal has been to improve the social competence of children in low-income families, that is, their everyday ability to deal with both their current environment and later responsibilities in school and life. This considers the relationships between cognitive and intellectual development, physical and mental health, nutritional needs, and other factors. Head Start delivers, or provides access to, a wide range of services—educational, medical, dental, nutrition, mental health, and social services. HHS administers the Head Start program through its Head Start Bureau within the Administration for Children and Families (ACF). coordinate with public health agencies to obtain health services, while others contract with local physicians. Although all grantees operate under one set of performance standards, they have a great deal of discretion in implementing those standards, resulting in programs that vary. In addition to providing services to children and families, Head Start sees one of its roles as a national laboratory for child development. Consequently, Head Start uses much of its discretionary research funding for demonstrations and studies of program innovations. The amount of funds allocated to research, demonstration, and evaluation has represented about 2 percent of the Head Start budget over the years. About $12 million (about 0.3 percent of the Head Start budget) was so allocated for fiscal year 1997. The main focus of the program’s research, according to Head Start Bureau officials, has been to improve the program by exploring ways to maximize and sustain Head Start benefits. In addition, Head Start funds studies designed to answer questions on the effectiveness of new or innovative service delivery strategies. Such studies typically involve special program efforts and demonstration projects conducted on a trial basis at a few Head Start sites that focus on practices or services not typically found in regular Head Start programs. The passage of the Results Act in 1993 has heightened the importance of the type and direction of this research. The Results Act is designed to hold federal agencies accountable for achieving program results. The act specifically requires that agencies clearly define their missions, establish long-term strategic goals as well as annual goals linked to them, measure their performance according to their performance goals, and report on their progress. Agencies are also expected to perform discrete program evaluations and to use information from these evaluations to improve their programs. impact as differences in outcomes caused by Head Start participation. Essentially, impact evaluations are the only way to answer the question, “Is this program making a difference?” Impact evaluation is a form of program evaluation that assesses the net impact of a program by comparing its outcomes with an estimate of what would have happened without the program. This form of program evaluation is used when external factors are known to influence the program’s outcomes; it isolates program contributions from other factors that may affect the achievement of program objectives. The most reliable way to determine program impact is to compare a group of Head Start participants with an equivalent group of nonparticipants. The preferred method for establishing that the groups are equivalent at the outset is to randomly assign participants to either a Head Start group or a comparison group, although other methods are valuable for estimating a program’s net impact. In 1997, we reported the results of our work on identifying what existing studies suggest about Head Start’s impact. To conclude that impact has been demonstrated, one would expect to see either (1) a sufficient number of reasonably well-designed individual studies whose findings could appropriately be combined to provide information on national impact or (2) at least one large-scale evaluation using a nationally representative sample. After locating and screening 600 studies and consulting with many early childhood researchers and officials at the Head Start Bureau, we identified only 22 studies that met the criteria for inclusion in our analysis. other early childhood programs for low-income families has been growing. Thus, the Congress needs to know with some certainty whether the federal investment in Head Start is making a difference. In commenting on our earlier report, HHS said that the existing research on Head Start’s impact was substantial and that the Department’s strategy to expand this research was appropriate for determining both the program’s impact and its quality. HHS also indicated plans to evaluate the feasibility of conducting impact studies such as we recommended. HHS supported its claim that the existing research was substantial by noting the findings from a 1985 research synthesis of studies conducted in the 1960s and 1970s and two more recent studies. We disagreed, however, that findings drawn from studies more than 20 years old adequately support claims about the current program’s impact. As noted, the current Head Start program operates in an environment that has changed in the last 20 years, when other, non-Head Start comprehensive early childhood services were not as available. Similarly, the findings from the two more recent studies did not support conclusions about program impact that can be generalized to the national program. Even though these two studies were larger than others we had found, both had significant methodological limitations. HHS’ current initiatives reflect its opinion that a randomized control group is not necessary to measure Head Start’s impact. The current initiatives HHS describes as assessing impact include (1) the development of new performance measures, (2) a longitudinal study called FACES, and (3) a collaborative effort with NCES. assess the net impact of the Head Start program. It will allow Head Start to define and assess program outcomes, such as improved language skills, that it could then use to compare Head Start participants’ outcome results with those of a control group to determine impact. Another HHS initiative, FACES, is a study of a representative sample of Head Start children and their families intended to show whether Head Start is reaching its goal of improving children’s social competence. According to HHS, for the spring 1997 pilot, data were collected from a sample of 2,400 families with children enrolled in 160 randomly selected centers in 40 Head Start programs nationwide. The full study will collect data from 3,200 families at program entry, exit, and at the end of kindergarten. HHS will conduct a more comprehensive validation substudy of 120 families. Researchers will use well-established and widely used scales, assessments, and observational protocols and specially tailored questionnaires to collect data on children’s vocabulary, emergent literacy and mathematical skill, perceptual-motor development, and social and communicative competence before and after Head Start participation. Head Start officials describe FACES as a way to draw conclusions about Head Start’s impact in part because it will use nationally normed instruments. In addition, some of the FACES data elements will be the same as those in a Department of Education national household education survey. This will allow for comparing certain FACES results with a nationally representative sample of low-income children. It is not clear from our work so far how HHS will use the nationally normed data. According to HHS officials, the study will not compare Head Start children and their families with a randomly assigned control group of other children and families or with any other group. collect data from parents and children, including descriptions of children’s preschool experience and standardized tests in areas such as achievement and psychomotor development. This database will be available as a public-use tape for Head Start as well as other researchers. Head Start could use this database to compare groups of children in non-Head Start preschool programs with those in Head Start programs to assess program impact. Head Start’s initiatives are headed in the right direction because of their increased focus on outcomes and research that could be expanded to compare outcomes for children in Head Start with those for similar children and families not served by the program. It is not clear how or whether Head Start will make these comparisons, however, using nationally normed tests or comparison group data from NCES. In addition, either of those research designs provides a much weaker basis for drawing conclusions about impact than a study with randomized assignment. For example, if Head Start uses NCES data for comparisons, the results could provide some indication of program impact. Some question will always remain, however, about the degree to which preexisting differences in the groups may have affected study results. True experimental designs, also called randomized trials, eliminate such questions. Randomized trials are comparison group studies that randomly assign study participants to either a treatment or control group. In the case of Head Start, these studies would require recruiting more eligible children than the program can serve. From these recruits, some would be randomly assigned to Head Start; the rest, the unserved children, would constitute the control group. HHS officials cited ethical considerations of assigning children to an unserved control group as one of the difficulties in conducting randomized trials. suggested that Head Start conduct randomized trials to study regular Head Start programs because this type of study provides the most conclusive information on program impact. In fact, the evaluation of the Early Head Start program, now under way, has randomly assigned potential participants to Early Head Start or a control group that has not received Early Head Start services. Control groups of randomly assigned participants are important to determining impact because they prevent mistakenly attributing outcomes to program effects when these outcomes are really caused by other factors. For instance, a recent evaluation of the Comprehensive Child Development Program, a demonstration project involving comprehensive early childhood services like those of Head Start, found positive changes in the families participating. The study had a control group, however, and researchers discovered that the control group families also had similar positive changes. They concluded therefore that the positive changes could not be attributed to the program. Although impact research can be costly and time consuming, the federal government has made a considerable financial investment in the Head Start program; therefore, Head Start warrants a close examination to determine what the public is getting for its investment. Head Start has devoted substantial resources to research and evaluation activities, including some long-term studies and studies involving comparison groups. Although these have been worthwhile efforts, they have not sufficiently focused on evaluating results. HHS is taking steps that may help lay the groundwork for efforts to evaluate the net impact of Head Start program services. Identifying performance measures is an important first step in building a research and impact evaluation base for Head Start. In addition, this effort could yield a set of common measures upon which a body of research, including impact research, could be built. Similarly, the information gained in FACES should be extremely useful, especially to the extent that it is nationally representative. HHS efforts, however, do not include plans for a research study or set of studies that will definitively compare the outcomes achieved by Head Start children and their families with those achieved by similar non-Head Start children and families. Although definitive results could take years to obtain, questions about Head Start’s impact will remain unanswered unless these plans are expanded. Messrs. Chairmen, this concludes my statement. I would be happy to answer any questions you or members of the Subcommittees may have. The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and MasterCard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent. U.S. General Accounting Office P.O. 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GAO discussed Head Start's impact on children and their families, and the adequacy of the Department of Health and Human Services' (HHS) current research plans to provide additional information on Head Start's impact. GAO noted that: (1) the Head Start program has provided comprehensive services to millions of low-income children and their families; (2) little is known, however, about whether the program has achieved its goals; (3) although an extensive body of literature exists on Head Start, only a small part of that involves program impact research; (4) because of these research studies' individual and collective limitations, this body of research is insufficient for use in drawing conclusions about the impact of the national program; (5) HHS has the following initiatives it describes as impact assessments: (a) development of performance measures focusing on program outcomes, rather than just processes; (b) a national longitudinal study of a representative sample of Head Start children and their families; and (c) a collaborative effort with the National Center for Educational Statistics; (6) these efforts are headed in the right direction for Head Start to evaluate the impact of its program; and (7) it is unclear, however, whether these efforts will meaningfully compare the outcomes achieved by Head Start children and their families with those achieved by non-Head Start children and families, leaving unanswered questions about Head Start's impact.

In June 2009, the Supreme Court issued its decision in Gross v. FBL Financial Services, Inc. , a case in which the Court evaluated a mixed-motive claim under the Age Discrimination in Employment Act (ADEA), which prohibits employment discrimination against individuals over the age of 40. In Gross , the plaintiff alleged that his employer's decision to reassign him was motivated at least in part by his age, while the employer claimed that its decision was based on other legitimate factors. The question at trial was what types of evidence the parties must present and who bears the burden of proof in such mixed-motive cases, which generally involve employment actions that are based on both permissible and impermissible reasons. Sidestepping the evidentiary question presented, the Court determined that an employer never bears the burden of persuasion because the traditional mixed-motive burden-shifting framework is not applicable to the ADEA. Finding instead that the ADEA does not authorize the type of mixed-motive claims that are available under a similar employment discrimination law, the Court, in a 5-4 ruling, held that an employee in a mixed-motive case bears the burden of establishing that "age was the 'but-for' cause of the challenged adverse employment action," meaning that the employee must show that age was the deciding factor, rather than just one of several motivating factors, behind the employer's action. This standard is likely to make it more difficult for plaintiffs to succeed in age discrimination cases in which age is only one of several factors behind the adverse employment decision. In 1971, Jack Gross began working for FBL Financial Group, Inc. as a claims adjustor. In 2003, after several promotions, Gross was reassigned to a new position, while some of his job responsibilities were transferred to a newly created position that was given to a younger employee. Believing his reassignment to be a demotion, Gross sued his employer, claiming the company had intentionally discriminated against him on the basis of age. Although FBL denied that its decision was based on age, the company argued that even if it had considered age, its reassignment of Gross was based on other reasons that were lawful. At trial, the district court instructed the jury that if Gross proved by a preponderance of the evidence—direct or circumstantial—that age was a "motivating factor" in the company's decision to demote him, then the burden of persuasion would shift to FBL to prove it would have taken the same action even if the company had not considered Gross's age. Finding for Gross, the jury awarded him $46,945 in lost compensation. FBL, however, challenged the district court's jury instruction, and the Court of Appeals for the Eight Circuit reversed. In its decision, the Court of Appeals for the Eighth Circuit held that the jury instructions were flawed and that the precedent established by the Supreme Court's decision in Price Waterhouse v. Hopkins allows "a shift in the burden of persuasion only upon a demonstration by direct evidence that an illegitimate factor played a substantial role in an adverse employment decision." The Supreme Court granted review in order to determine "whether a plaintiff must present direct evidence of discrimination in order to obtain a mixed-motive instruction in a non-Title VII discrimination case," or whether the burden of proof in a mixed-motive ADEA case shifts to the employer regardless of whether the evidence of bias presented by the employee is direct or circumstantial. When bringing a civil case alleging employment discrimination, there are two types of claims that a plaintiff can make: disparate treatment and disparate impact. Disparate treatment, which was at issue in Gross , occurs when an employer intentionally discriminates against an employee or enacts a policy with the intent to treat or affect the employee differently from others because of the employee's age. Such disparate treatment claims require proof that the employer intended to discriminate against the complaining party when it took the challenged employment action. Intent, the critical element of a disparate treatment claim, may be shown directly (e.g., by discriminatory statements or behavior of a supervisor towards a subordinate) or, perhaps more likely, by circumstantial evidence. Over the years, the courts have developed a complicated set of rules and procedures that govern how disparate treatment claims are adjudicated. Many of the cases in which these rules have emerged are cases involving Title VII of the Civil Rights Act of 1964, which prohibits discrimination in employment "because of ... race, color, religion, sex, or national origin." Since the ADEA is largely patterned on Title VII, the reasoning in these cases frequently applies in the ADEA context as well. In general, plaintiffs may establish their individual disparate treatment claims under the ADEA in one of two ways, sometimes referred to as the indirect method and the direct method. When evidence of discrimination is lacking, plaintiffs generally use an indirect method that involves the burden-shifting framework established by the Supreme Court in McDonnell Douglas v. Green and Texas Dept. of Community Affairs v. Burdine . When the plaintiff can directly present evidence of age discrimination, use of the McDonnell Douglas burden-shifting model is unnecessary, and the plaintiff can usually present either direct or circumstantial evidence that would enable a jury to conclude that discrimination occurred. Much of the confusion regarding the types of evidence plaintiffs are required to produce in mixed-motive cases, which are a variation on disparate treatment cases, can be traced to the Court's opinion in Price Waterhouse v. Hopkins . Prior to the decision, it was unclear whether Title VII prohibited employment actions that were partly based on discriminatory reasons or whether the statute only covered actions that were wholly motivated by discrimination. In Price Waterhouse , the Court addressed these so-called "mixed-motive" cases and held, in part, that once a "plaintiff shows that an impermissible motive played a motivating part in an adverse employment decision," the burden shifts to the employer "to show that it would have made the same decision in the absence of the unlawful motive." This is the framework that currently applies to Title VII mixed-motive claims. However, the Court also held that employers could avoid liability if they made this showing. Subsequently, Congress enacted the Civil Rights Act of 1991, which formally established mixed-motive claims under Title VII by clarifying that "an unlawful employment practice is established when the complaining party demonstrates that race, color, religion, sex, or national origin was a motivating factor for any employment practice, even though other factors also motivated the practice." The 1991 amendments also partially overruled Price Waterhouse by altering the rules regarding employer liability in mixed-motive cases. Despite making these amendments to Title VII, Congress did not add similar language to the ADEA recognizing mixed-motive claims, nor did Congress address another apparent holding of the divided Price Waterhouse Court, as expressed in Justice O'Connor's concurring opinion, that plaintiffs must present "direct evidence" of discrimination in order to pursue a mixed-motive claim. Further adding to the confusion, the Court later held in Desert Palace, Inc. v. Costa that plaintiffs are not required to present direct evidence of discrimination in order to obtain a mixed-motive jury instruction under Title VII. Ultimately, the Court granted review in Gross in order to determine what types of evidence plaintiffs were required to present in order to receive a burden-shifting jury instruction in an ADEA mixed-motive case. Citing Desert Palace , Gross argued that plaintiffs in mixed-motive cases should be entitled to present both circumstantial and direct evidence. Rather than focusing on the question presented, FBL argued that Price Waterhouse should be overruled and that the burden of proof in ADEA mixed-motive cases should fall on the employee. In a highly unusual move, the Court's ruling focused on the issue raised in FBL's merit brief rather than on the question presented, thus meaning that interested parties were not given a full opportunity to address the issue in the briefs they submitted to the Court. In Gross , the Court ultimately ruled 5-4 in favor of FBL. According to the Court, the ADEA does not authorize the type of mixed-motive claims that are available under Title VII. As a result, even though an employee may still bring a claim whenever an employer has mixed motives for the adverse employment action, the Court held that an employee must show that "age was the 'but-for' cause of the challenged adverse employment action." Because the Court found that the burden never shifts to an employer in such a case, there was no reason to determine what types of evidence a plaintiff must present in order to receive a burden-shifting jury instruction, thus rendering moot the question presented. In contrast to the Court's decision, the appellate courts that had previously considered the issue had unanimously applied the Price Waterhouse mixed-motive framework to the ADEA. In reaching its decision, the Court focused on the textual differences between Title VII and the ADEA. Unlike Title VII, the ADEA does not contain a provision allowing a plaintiff to establish discrimination by showing that age was a motivating factor. Indeed, the Court found it significant that Congress amended Title VII to add such a provision but did not choose to make a corresponding change to the ADEA. As a result, the Court held that because "Title VII is materially different with respect to the relevant burden of persuasion," the Price Waterhouse burden-shifting framework, in which an employer bears the burden of proof once an employee establishes that his membership in a protected class played a motivating part in an employment decision, does not apply to ADEA claims. Turning to the language of the ADEA, the Court examined the statutory text and determined that the ADEA does not authorize the traditional type of mixed-motive claim available under Title VII. Instead, the ADEA prohibits an employer from taking an adverse employment action against an individual "because of such individual's age." Reasoning that "because of" age must mean that age is the reason behind the employer's action, the Court concluded that an employee seeking to establish a disparate treatment claim under the ADEA must establish that age is the "but-for" cause of the employer's action. Thus, the plaintiff, not the employer, bears the burden of persuasion. According to the Court: Hence, the burden of persuasion necessary to establish employer liability is the same in alleged mixed-motive cases as in any other ADEA disparate-treatment action. A plaintiff must prove by a preponderance of the evidence (which may be direct or circumstantial), that age was the "but-for" cause of the challenged employer decision. In other words, employees can still bring mixed-motive ADEA claims in the sense that they can sue if an employer cites both permissible and impermissible reasons for their actions. However, now the employee has to prove that the impermissible reason—age—was the decisive factor, whereas under traditional Title VII mixed-motive claims, an employee must simply demonstrate that the impermissible reason was only one of several motivating factors, at which point the burden shifts to the employer to prove it would have made the same decision in the absence of the discriminatory motive. Based on its decision, the Court remanded the case for a new trial. Meanwhile, two separate dissents were filed in the Gross case. In the first dissent, Justice Stevens argued that the "because of" age language in the ADEA should be interpreted to prohibit employment actions motivated either in whole or in part by age. Specifically, the dissenting opinion noted that prior to the 1991 amendments that added the "motivating factor" language to Title VII, the Court in Price Waterhouse had interpreted identical "because of" language in that statute to encompass claims based on both permissible and impermissible reasons and should therefore apply the same interpretation to the ADEA. Moreover, Justice Stevens was highly critical of the Court's decision to issue an opinion based on a question that had not been presented or briefed by the parties. Therefore, he would have based his decision on the question presented and would have held that a plaintiff was not required to present direct evidence of age discrimination in order to obtain a mixed-motive jury instruction. In the second dissent, Justice Breyer, who also joined the first dissenting opinion, wrote separately to highlight potential problems with extrapolating a "but-for" causation standard from tort law and applying that standard to the discrimination context. Ultimately, the Gross decision makes it harder for an employee to successfully prove an ADEA claim whenever an employer has both legitimate and illegitimate reasons for an employment action. There are two primary reasons for this. First, the new "but-for" causation standard established in Gross means that an employee now has to show that age was the deciding factor in an employment decision, not just one of several motivating factors. Second, after Gross , the employee always retains the burden of persuasion with respect to proving discrimination because the burden no longer shifts to the employer to prove that nondiscriminatory motives led to the employment decision, as it does under the Price Waterhouse burden-shifting mixed-motive framework that exists for Title VII. It is also important to note that the Gross decision could potentially affect claims brought under statutes other than the ADEA. For example, several other employment discrimination statutes are patterned on Title VII, including the Americans with Disabilities Act and the Rehabilitation Act of 1973. Like the ADEA, these two statutes, which, among other things, prohibit employment discrimination on the basis of disability, were not amended as Title VII was to include language authorizing mixed-motive claims. Therefore, these statutes appear to be susceptible to the same interpretation that the Court applied to the ADEA. Although it is unclear how far the logic of Gross may extend, it is also conceivable that such an analysis could be applied to other non-discrimination statutes in which employees may sue employers, such as labor or whistleblower laws. In addition, the Gross decision may spur congressional efforts to overturn the ruling. Since Gross was decided on statutory grounds, several legislators who disagree with the Court's interpretation have introduced legislation that would amend the ADEA to clarify that a plaintiff establishes an unlawful employment practice under the ADEA or any other federal law prohibiting employment discrimination if the plaintiff demonstrates that the employment action was motivated by an impermissible factor. Under this legislation ( H.R. 3721 / S. 1756 ), which would apply retroactively to all claims that were pending on or after the date of the Gross decision, a plaintiff would be able rely on any form of circumstantial or direct evidence to establish such a claim, at which point the burden would shift to the employer to demonstrate that it would have taken the same action in the absence of the impermissible motivating factor. Such congressional action is not uncommon. For example, in the wake of the Supreme Court's decision in Ledbetter v. Goodyear Tire & Rubber Co., Inc. , Congress enacted the Lilly Ledbetter Fair Pay Act of 2009, which superseded the Ledbetter decision by amending Title VII to clarify that the time limit for suing employers for pay discrimination begins each time they issue a paycheck.

This report discusses Gross v. FBL Financial Services, Inc., a recent case in which the Supreme Court evaluated a mixed-motive claim under the Age Discrimination in Employment Act (ADEA), which prohibits employment discrimination against individuals over the age of 40. In Gross, the plaintiff alleged that his employer's decision to reassign him was motivated at least in part by his age, while the employer claimed that its decision was based on other legitimate factors. The question at trial was what types of evidence the parties must present and who bears the burden of proof in such mixed-motive cases, which generally involve employment actions that are based on both permissible and impermissible reasons. Sidestepping the evidentiary question presented, the Court determined that an employer never bears the burden of persuasion because the traditional mixed-motive burden-shifting framework is not applicable to the ADEA. Instead, based on its conclusion that the ADEA does not authorize the type of mixed-motive claims that are available under a similar employment discrimination law, the Court held that an employee bears the burden of establishing that age is the decisive cause of the challenged employment action. This standard is likely to make it more difficult for plaintiffs to succeed in age discrimination cases in which age is only one of several factors behind the adverse employment decision. Currently, several bills that would supersede the Gross decision by amending the ADEA have been introduced in the 111th Congress, including H.R. 3721 and S. 1756.

Fidel Castro ceded provisional control of the government and the Cuban Communist Party (PCC) to his brother Raúl on July 31, 2006, because of poor health. While initially many observers forecast Raúl's assumption of power as temporary, it soon became clear that a permanent succession of political power had occurred. Fidel's health improved in 2007, but his condition remained weak, and most observers believed that he would not resume his role as head of the Cuban government. That proved true when on February 19, 2008, Fidel announced that he would not accept the position of President of the Council of State when Cuba's legislature, the National Assembly of People's Power, was scheduled to meet on February 24, 2008, to select from among its ranks the members of the 31-member Council. Many observers expected Raúl to be selected by the legislature to be the next President, a role that he held provisionally for the previous 19 months. Even before Fidel provisionally stepped down from power in July 2006, a communist successor government under Raúl was viewed as the most likely political scenario. As First Vice President of the Council of State, Raúl had been the officially designated successor pursuant to Article 94 of the Cuban Constitution, and in the past, Fidel publicly endorsed Raúl as his successor as head of the PCC. Moreover, Raúl's position as head of the Revolutionary Armed Forces (FAR), which essentially controls Cuba's security apparatus, made him the most likely candidate to succeed Fidel. So while it was not a surprise to observers for Raúl to succeed his brother officially on February 24, 2008, what was surprising was the selection of José Ramón Machado Ventura as the Council of State's First Vice President. A physician by training, Machado is 77 years old, and is part of the older generation of so-called históricos of the 1959 Cuban revolution. He has been described as a hard-line communist party ideologue, and reportedly has been a close friend and confident of Raúl's for many years. Machado's position is significant because it makes him the official successor to Raúl, according to the Cuban Constitution. Many observers had expected that Carlos Lage, one of five other Vice Presidents on the Council of State, would have been chosen as First Vice President. He was responsible for Cuba's economic reforms in the 1990s, and at 56 years of age, represents a younger generation of Cuban leaders. While not rising to First Vice President, Lage nevertheless retained his position as a Vice President on the Council of State, and also will continue to serve as the Council's Secretary. Several key military officers and confidants of Raúl also became members of the Council, increasing the role of the military in the government. General Julio Casas Regueiro, 72 years of age, who already was on the Council, became one of its five vice presidents. Most significantly, Casas, who had been first vice minister in the FAR, was selected by Raúl as the country's new Minister of the FAR, officially replacing Raúl in that position. Casas also is chairman of GAESA (Grupo de Administracion Empresarial, S.A.), the Cuban military's holding company for its extensive businesses. Two other military appointments to the Council were Gen. Alvaro López Miera, the army's chief of staff, and Gen. Leopoldo Cintra Frías, who commanded the Western army, one of Cuba's three military regions. What is notable about Cuba's political succession from Fidel to Raúl is that it has been characterized by political stability. There has been no apparent evidence of rivalry or schisms within the ruling elite that have posed a threat to Raúl's new position. In the aftermath of Fidel initially stepping down in 2006, Raúl mobilized thousands of reservists and military troops to quell a potential U.S. invasion. He also reportedly dispatched undercover security to likely trouble spots in the capital to deal with any unrest, but the streets remained calm with a sense of normalcy in day-to-day Cuba. As Raúl stepped into his new role as head of government, a number of observers predicted that he would be more open to economic reform than Fidel, pointing to his past support for opening up farmers' markets in Cuba and the role of the Cuban military in successfully operating economic enterprises. Many have speculated that Cuba under Raúl might follow a Chinese or Vietnamese economic model. To date, however, there have not been any significant economic changes to indicate that Cuba is moving in the direction of a Chinese model. Nevertheless, with several minor economic policy changes undertaken by Raúl, there are some signs that more substantial economic changes could be coming. Under Raúl, the Cuban government has paid off its debts to small farmers and raised prices that the state pays producers for milk and meat; customs regulations have been relaxed to allow the importation of home appliances, DVD players, VCRs, game consoles, auto parts, and televisions; and private taxis have been allowed to operate without police interference. In a speech on Cuba's July 26, 2007 revolutionary anniversary, Raúl acknowledged that Cuban salaries were insufficient to satisfy basic needs, and maintained that structural and conceptual changes were necessary in order to increase efficiency and production. He also called for increased foreign investment. For some, Raúl's call for structural changes was significant, and could foreshadow future economic reforms such as allowing more private enterprise and a shift away from state ownership in some sectors. In his first speech as President in February 2008, Raúl promised to make the government smaller and more efficient, to review the potential reevaluation of the Cuban peso, and to eliminate excessive bans and regulations that curb productivity. Cuban public expectations for economic reform have increased. In the aftermath of Raúl's July 2007 speech, thousands of officially-sanctioned meetings were held in workplaces and local Communist Party branches around the country where Cubans were encouraged to air their views and discuss the future direction of the country. Complaints focused on low salaries and housing and transportation problems, and some participants advocated legalization of more private businesses. Raised expectations for economic change in Cuba could increase the chance that government actually will adopt some policy changes. Doing nothing would run the risk of increased public frustration and a potential for social unrest. Increased public frustration was evident in a clandestine video, widely circulated on the Internet in early February, of a meeting between Ricardo Alarcón, the head of Cuba's legislature, and university students in which a student was questioning why Cuban wages are so low and why Cubans are prohibited from visiting tourist hotels or traveling abroad. The video demonstrates the disillusionment of many Cuban youth with the dismal economic situation and repressive environment. Several factors, however, could restrain the magnitude of economic policy change in Cuba. A number of observers believe that as long as Fidel Castro is around, it will be difficult for the government to move forward with any major initiatives that are viewed as deviating from Fidel's orthodox policies. Other observers point to the significant oil subsidies and investment that Cuba now receives from Venezuela that have helped spur Cuba's high economic growth levels over the past several years, and maintain that such support lessens the government's impetus for economic reforms. Another factor that bodes against rapid economic policy reform is the fear that it could spur the momentum for political change. Given that one of the highest priorities for Cuba's government has been maintaining social and political stability, any economic policy changes are likely to be smaller changes introduced over time that do not threaten the state's control. While some degree of economic change under Raúl Castro is likely over the next year, few expect there will be any change to the government's tight control over the political system, which is backed up by a strong security apparatus. Some observers point to the reduced number of political prisoners, from 283 at the end of 2006 to 230 as of mid-February 2008, as evidence of a lessening of repression, but dissidents maintain that the overall situation has not improved. For example, the government arbitrarily detained more than 300 people for short periods in 2007. Of the 75 activists imprisoned in March 2003, 55 remain jailed; four were released on February 16, 2008, but sent into forced exile to Spain. Some observers contend that as the new government of Raúl Castro becomes more confident of ensuring social stability and does not feel threatened, it could move to soften its hard repression, but for now the government is continuing its harsh treatment of the opposition. The selection of José Ramón Machado as First Vice President also appears to be a clear indication that the Cuban government has no intention of easing tight control over the political system. Cuba's peaceful political succession from one communist leader to another raises questions about the future direction of U.S. policy. Current U.S. policy can be described as a dual-track policy of isolating Cuba through comprehensive economic sanctions, including restrictions on trade and financial transactions, while providing support to the Cuban people through such measures as funding for democracy and human rights projects and U.S.-government sponsored broadcasting to Cuba. The Cuban Liberty and Democratic Solidarity Act of 1996 ( P.L. 104-114 ) sets forth a number of conditions for the suspension of the embargo, including that a transition Cuban government: does not include Fidel or Raúl Castro; has legalized all political activity; has released all political prisoners; and is making progress in establishing an independent judiciary and in respecting internationally recognized human rights. The actual termination of the embargo would require additional conditions, including that an elected civilian government is in power. The dilemma for U.S. policy is that the legislative conditions could keep the United States from having any leverage or influence as events unfold in a post-Fidel Cuba and as Cuba moves toward a post-Raúl Cuba. The Bush Administration has made substantial efforts to prepare for a political transition in Cuba. In 2004 and 2006, the Administration's Commission for Assistance to a Free Cuba prepared two reports detailing how the United States could provide support to a Cuban transition government to help it respond to humanitarian needs, conduct free and fair elections, and move toward a market-based economy. A criticism of the reports, however, has been that they presuppose that Cuba will undergo a rapid democratic transition, and do not entertain the possibility of reform or economic change under a communist government. On the basis of these reports, critics maintain that the United States may be unprepared to deal with alternative scenarios of Cuba's political transition. Over the past several years Congress has often debated policy toward Cuba, with one or both houses at times approving legislative provisions that would ease U.S. sanctions on Cuba. President Bush has regularly threatened to veto various appropriations bills if they contained provisions weakening the embargo, and ultimately these provisions have been stripped out of final enacted measures. In 2007, the lack of any significant policy changes in Cuba under Raúl appeared to diminish the impetus in Congress for any major change in policy toward Cuba, although Raúl's official installation as President could alter that. Since assuming power, Raúl Castro has made several public offers to engage in dialogue with the United States that have been rebuffed by U.S. officials who maintain that change in Cuba must precede a change in U.S. policy. In an August 2006 interview, Raúl asserted that Cuba has "always been disposed to normalize relations on an equal plane," but at the same time he expressed strong opposition to current U.S. policy toward Cuba, which he described as "arrogant and interventionist." In response, Assistant Secretary of State for Western Hemisphere Affairs Thomas Shannon reiterated a U.S. offer to Cuba, first articulated by President Bush in May 2002, that the Administration was willing to work with Congress to lift U.S. economic sanctions if Cuba were to begin a political opening and a transition to democracy. According to Shannon, the Bush Administration remains prepared to work with Congress for ways to lift the embargo if Cuba is prepared to free political prisoners, respect human rights, permit the creation of independent organizations, and create a mechanism and pathway toward free and fair elections. Raúl Castro reiterated an offer to negotiate with the United States in a December 2006 speech. He said that "we are willing to resolve at the negotiating table the longstanding dispute between the United States and Cuba, of course, provided they accept, as we have previously said, our condition as a country that will not tolerate any blemishes on its independence, and as long as said resolution is based on the principles of equality, reciprocity, non-interference, and mutual respect." More recently, in his July 26, 2007 speech, Raúl reiterated for the third time an offer to engage in dialogue with the United States, and strongly criticized U.S. economic sanctions on Cuba. This time, Raúl pointed to the future of relations with the next U.S. Administration, and stated that "the new administration will have to decide whether it will keep the absurd, illegal, and failed policies against Cuba, or accept the olive branch that we extended." He asserted that "if the new U.S. authorities put aside arrogance and decide to talk in a civilized manner, they will be welcome. If not, we are willing to deal with their hostile policies, even for another 50 years if necessary." A U.S. State Department spokesman responded that "the only real dialogue that's needed is with the Cuban people." In the aftermath of Fidel's announcement that he would step down as head of government, U.S. officials maintained there would be no change in U.S. policy. In the context of Raúl Castro's succession, there are two broad policy approaches to contend with political change in Cuba: a stay the course or status-quo approach that would maintain the policy of isolating the Cuban government with economic sanctions; and an approach aimed at influencing Cuban government and society through an easing of sanctions and increased contact and engagement. Advocates of continued sanctions argue that the Cuban government under Raúl Castro has not demonstrated any willingness to ease repression or initiate any political or economic openings. Secretary of Commerce Carlos Gutierrez asserts that "the succession from Fidel to Raúl is a preservation of dictatorship" and that "the regime needs to have a dialogue with the Cuban people before it has one with the United States." Other supporters of current policy maintain that easing economic sanctions would prolong the communist regime by increasing money flowing into its state-controlled enterprises, while continued sanctions would keep up the pressure to enact deeper economic reforms. Those advocating an easing of sanctions argue that the United States needs to take advantage of Cuba's political succession to abandon its long-standing sanctions-based policy that they maintain has had no practical effect in changing the policies of the Cuban government. They argue that continuing the status quo would only serve to guarantee many more years of hostility between Cuba and the United States, and reduce the chances for positive change in Cuba by slowing the pace of liberalization and reform. Others argue that the United States should work toward engaging and negotiating with Cuba in order to bring incremental change because even the smallest reforms can help spur popular expectations for additional change.

Cuba's political succession from Fidel Castro to his brother Raúl has been characterized by a remarkable degree of stability. On February 24, 2008, Cuba's legislature selected Raúl as President of the 31-member Council of State, a position that officially made him Cuba's head of government and state. Most observers expected this since Raúl already had been heading the Cuban government on a provisional basis since July 2006 when Fidel stepped down as President because of poor health. On February 19, 2008, Fidel had announced that he would not accept the position of President of the Council of State. Cuba's stable political succession from one communist leader to another raises questions about the future direction of U.S. policy, which currently can be described as a sanctions-based policy that ties the easing of sanctions to democratic change in Cuba. For developments in U.S. policy toward Cuba, see CRS Report RL33819, Cuba: Issues for the 110th Congress; and CRS Report RL31139, Cuba: U.S. Restrictions on Travel and Remittances. For background and analysis in the aftermath of Fidel Castro's stepping down from power in July 2006, see CRS Report RL33622, Cuba's Future Political Scenarios and U.S. Policy Approaches.

Under the ADA, individuals with disabilities may not "be excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any such entity." In the context of public transportation, the statute requires transportation entities to offer supplemental "paratransit" service for people with disabilities. The statute provides, it shall be considered discrimination . . . for a public entity which operates a fixed route system . . . to fail to provide . . . paratransit [services] . . . that are sufficient to provide to such individuals a level of service (1) which is comparable to the level of designated public transportation services provided to individuals without disabilities using such system; or (2) in the case of response time, which is comparable, to the extent practicable, to the level of designated public transportation services provided to individuals without disabilities using such system. All public entities operating a "fixed-route system" are subject to the ADA's complementary paratransit requirements. The ADA defines "fixed-route system" as "a system of providing designated public transportation on which a vehicle is operated along a prescribed route according to a fixed schedule." A public entity is any state or local government, any department or instrumentality of a state or local government, the National Railroad Passenger Corporation, and certain commuter authorities. Also, the subcontractors of such public entities are subject to these obligations, even if the subcontractors are private entities. The Department of Transportation first promulgated regulations to implement the ADA's public transportation provisions on September 6, 1991. Under these regulations, "each public entity operating a fixed route system" (excluding commuter bus, commuter rail, and intercity rail systems) must provide "comparable" paratransit service for individuals with disabilities. Paratransit service, generally defined, is responsive, accessible origin-to-destination transportation service that is an alternative to a fixed-route system. It is important to note that paratransit requirements do not authorize public entities to supercede the ADA's other non-discrimination provisions. Although the regulations obligate entities to offer paratransit service, the regulations also forbid entities from requiring their customers with disabilities to utilize the paratransit services instead of the services available to the general public. Specifically, transportation entities "shall not, on the basis of disability, deny to any individual with a disability the opportunity to use the entity's transportation service for the general public, if the individual is capable of using that service." Furthermore, entities shall not require that individuals with disabilities sit in specific seats or be accompanied by an attendant. The statutory language provides little guidance regarding the required scope of paratransit service. It merely requires entities to offer a level of service that is "comparable" to the level of service offered to the general public. The ADA therefore required the Department of Transportation to develop minimum service criteria to "determine the level of services" sufficient to be "comparable" with services offered to individuals without disabilities. Note that the regulations do not prohibit public entities from offering paratransit services that exceed these minimum service requirements. The regulations require entities to provide paratransit service to all "paratransit-eligible" individuals, including non-resident visitors "who present documentation that they are ADA paratransit eligible." An individual is paratransit-eligible if he or she is an individual with a disability who meets the requirements for one of three categories. The first eligibility category includes individuals who are unable, as a result of a physical or mental impairment, to board and ride accessible fixed-route transit systems. Department commentary accompanying the final rule shows that the department intended this first category to especially target individuals who are unable to "navigate the system." The second eligibility category includes individuals who are able to use accessible vehicles but whose fixed-route system lacks accessible vehicles. Finally, the third eligibility category includes individuals "who ... [have] specific impairment-related condition[s] which ... prevent[s] such individual[s] from traveling to a boarding location or from a disembarking location on such system." The regulations also require entities to provide paratransit service to one individual accompanying each paratransit-eligible individual. This accompanying-individual allowance does not address assistance by personal care attendants; rather, it enables individuals with disabilities to travel with a friend or family member for pleasure. Thus, if the individual with a disability requires a personal care attendant, an accompanying individual shall also be provided service. The regulation regarding minimum service times implements the ADA's "comparable" requirement in a straightforward manner. It provides that public entities must offer paratransit services for the same time frame for which they offer fixed-route transportation service to the general public. The regulations allow entities to charge a higher fare to paratransit riders than they charge to general riders; however, the fare charged to paratransit riders cannot exceed twice the amount charged to an individual for a similar trip on the general, fixed-route transportation service. Likewise, the entity cannot charge "premiums" above this amount unless the premium is charged for services that exceed the minimum service requirements mandated by the regulations. Under the regulations, entities must provide paratransit service in all areas within three quarters of a mile of the fixed-route service. For bus systems, this requirement refers to three-quarters of a mile on either side of the fixed-route corridor and includes "small areas not inside any of the corridors but which are surrounded by corridors." For rail systems, this requirement refers to a three-quarter-mile radius surrounding each rail station. The regulations require that all paratransit service be "origin-to-destination" service. The department intentionally left ambiguous whether "origin-to-destination" service means door-to-door or curb-to-curb service, preferring to leave that specific "operational decision" to local-level decision-makers. However, in later guidance documents, the department has clarified that it would be inappropriate for an entity to "establish an inflexible policy that refuses to provide service to eligible passengers beyond the curb in all circumstances." Multiple regulations govern entities' obligations regarding the time it takes to respond to an individual's request for paratransit service. One response-time regulation, the next-day service requirement, provides a bright-line rule: it requires transportation entities to provide paratransit services for the day after a paratransit-eligible person has requested them. That regulation further states that, although entities can negotiate pick-up times, they cannot move the requested time by more than one hour. A second Department of Transportation regulation, which governs "capacity constraints," seems to allow for flexibility in the next-day service provision requirement. It provides an exclusive list of ways in which entities cannot limit the availability of complementary paratransit service, thereby suggesting that other manners of limiting the service are acceptable. Specifically, this "capacity constraints" regulation prohibits limiting paratransit service in any of the following ways: "(1) [r]estrictions on the number of trips an individual will be provided; (2) [w]aiting lists for access to the service; or (3) [a]ny operational pattern or practice that significantly limits the availability of service to ADA paratransit eligible persons." This regulation also provides examples of discriminatory "patterns or practices," including "(A) [s]ubstantial numbers of significantly untimely pickups for initial or return trips; (B) [s]ubstantial numbers of trip denials or missed trips; [and] (C) [s]ubstantial numbers of trips with excessive trip lengths." At least one court has interpreted the department's multiple regulations regarding paratransit response times as being somewhat in tension. In Anderson v. Rochester-Genesee Regional Transportation Authority , the Second Circuit—relying on Department of Transportation commentary accompanying these regulations, an agency opinion letter addressed to the court, and opinion letters issued by the Federal Transit Administration's Office of Civil Rights—interpreted the next-day service requirement (49 C.F.R. §37.131(b)) as imposing an affirmative obligation on public entities to plan, design, and implement a paratransit service that meets 100% of demand and accounts for fluctuations in demand over time. Additionally, it interpreted the more flexible "capacity constraints" regulation as functioning to give entities practical flexibility when situations arise for which advance planning is difficult. Therefore, the court held that a transportation provider cannot be held liable for failing to meet 100% of demand for paratransit services unless the failure results in denying a number of paratransit-eligible riders "sufficient to constitute a pattern or practice." In Anderson , plaintiffs argued that the Rochester Genesee Regional Transportation Authority (RGRTA), a public entity for purposes of the ADA, violated the ADA when it denied them and other disabled riders paratransit services scheduled a day or more in advance. RGRTA admitted denying rides requested a day or more in advance by paratransit-eligible riders but claimed that it denied the rides because it encountered "not unusual" constraints on capacity. The court held that RGRTA had violated the ADA because RGRTA's organizational records showed that RGRTA had anticipated an increased demand for paratransit services and yet failed to plan or change its operations in order to meet that demand. Similarly, in Martin v Metropolitan Atlanta Rapid Transit Authority , plaintiffs sued the Metropolitan Atlanta Mass Transit Authority (MARTA), alleging in part that MARTA discriminated against riders with disabilities by failing to provide adequate paratransit service. The Martin court held that the plaintiffs had a substantial likelihood on the success of the merits for their paratransit claim, because "operational patterns and practices in MARTA's paratransit service [had] significantly limited the availability of service to paratransit eligible persons in violation of the ADA." According to the court, MARTA's troubling practices included changing "ready times" without properly notifying riders and charging riders for paratransit service even when the driver arrived more than thirty minutes after the scheduled "ready time." In sum, the available case law interpreting the paratransit response time regulations appears to suggest that under the next-day service requirement entities must plan to meet 100% of demand for next-day service to paratransit riders. However, the case law also suggests that under the capacity constraints regulation entities can be held liable for failing to provide next-day service only if such a failure results in one of the three situations—waiting lists, restricting rides for an individual person, or a discriminatory "pattern or practice"—as enumerated in 49 C.F.R. §37.131(f). The ADA limits its paratransit requirement by waiving the obligation in cases where providing such a service would impose an "undue financial burden" on an entity. The regulations delineate 10 factors for the Federal Transit Administration to consider when determining whether an entity is entitled to an "undue burden" waiver. These include (1) "[e]ffects on current fixed route service," (2) average number of per capita trips made by the general population as compared with the average number of per capita trips made by paratransit riders, (3) "[r]eductions in other services," (4) "[i]ncreases in fares," (5) "[r]esources available to implement complementary paratransit service," (6) "[p]ercentage of budget needed to implement the plan," (7) "current level of accessible service," (8) "[c]ooperation/coordination among area transportation providers," (9) "[e]vidence of increased efficiencies," and (10) unique circumstances in the area.

The Americans with Disabilities Act (ADA), 42 U.S.C. §§ 12101 et seq., is a broad non-discrimination statute that includes a prohibition of discrimination in public transportation. To prevent such discrimination, the ADA imposes several affirmative obligations on transportation providers, including a requirement that providers offer separate "paratransit" service, or accessible origin-to-destination service, for eligible individuals with disabilities. Under the statute, the level of such service must be "comparable" to the level of service offered on fixed route systems to individuals without disabilities. Department of Transportation regulations implement this "comparable" standard with specific requirements regarding the scope and manner of paratransit service. Regarding the time taken by providers to respond to individuals' requests for paratransit service, recent case law suggests that providers' legal obligation under the ADA and accompanying regulations is to avoid discriminatory "patterns or practices" of service. For more information on the ADA, see CRS Report 98-921, The Americans with Disabilities Act (ADA): Statutory Language and Recent Issues, by [author name scrubbed].

Early childhood is a key period of development in a child’s life and an emphasized age group for which services are likely to have long-term benefits. Recent research has underscored the need to focus on this period to improve children’s intellectual development, language development, and school readiness. Early childhood programs serve children from infancy through age 5. The range of services includes education and child development, child care, referral for health care or social services, and speech or hearing assessment as well as many other kinds of services or activities. $4 billion), administered by HHS, and Special Education programs (approximately $1 billion), administered by Education. Head Start provides education and developmental services to young children, and the Special Education-Preschool Grants and Infants and Families program provides preschool education and services to young children with disabilities. Although these programs target different populations, use different eligibility criteria, and provide a different mix of services to children and families, there are many similarities in the services they provide. Figure 1 illustrates the federal agencies responsible for federal early childhood funding. Early childhood programs were included in the list of more than 30 programs our governmentwide performance and accountability report cited to illustrate the problem of fragmentation and program overlap.Virtually all the results that the government strives to achieve require the concerted and coordinated efforts of two or more agencies. However, mission fragmentation and program overlap are widespread, and programs are not always well coordinated. This wastes scarce funds, frustrates taxpayers, and limits overall program effectiveness. The Results Act is intended to improve the management of federal programs by shifting the focus of decision-making and accountability from the number of grants and inspection made to the results of federal programs. The act requires executive agencies, in consultation with the Congress and other stakeholders, to prepare strategic plans that include mission statements and goals. Each strategic plan covers a period of at least 5 years forward from the fiscal year in which the plan is submitted. It must include the following six key elements: a comprehensive mission statement covering the major functions and operations of the agency, a description of general goals and objectives for the major functions and operations of the agency, a discussion of how these goals and objectives will be achieved and the resources that will be needed, a description of the relationship between performance goals in the annual performance plan and general goals and objectives in the strategic plan, a discussion of key factors external to the agency that could affect significantly the achievement of the general goals and objectives, and a description of program evaluations used to develop the plan and a schedule for future evaluations. describe the means the agency will use to verify and validate its performance data. The act also requires that each agency report annually on the extent to which it is meeting its annual performance goals and the actions needed to achieve or modify goals that have not been met. The first report, due by March 31, 2000, will describe the agencies’ fiscal year 1999 performance. The Results Act provides a valuable tool to address mission fragmentation and program overlap. The act’s emphasis on results implies that federal programs contributing to the same or similar outcomes are expected to be closely coordinated, consolidated, or streamlined, as appropriate, to ensure that goals are consistent and that program efforts are mutually reinforcing. As noted in OMB guidance and in our recent reports on the act, agencies should identify multiple programs within or outside the agency that contribute to the same or similar goals and describe their efforts to coordinate. Just as importantly, the Results Act’s requirement that agencies define their mission and desired outcomes, measure performance, and use performance information provides multiple opportunities for the Congress to intervene in ways that could address mission fragmentation. As missions and desired outcomes are determined, instances of fragmentation and overlap can be identified and appropriate responses can be defined. For example, by emphasizing the intended outcomes of related federal programs, the plans might allow identification of legislative changes needed to clarify congressional intent and expectations or to address changing conditions. As performance measures are developed, the extent to which agency goals are complementary and the need for common performance measures to allow for crossagency evaluations can be considered. For example, common measures of outcomes from job training programs could permit comparisons of programs’ results and the tools used to achieve those results. As continued budget pressures prompt decisionmakers to weigh trade-offs inherent in resource allocation and restructuring decisions, the Results Act can provide the framework to integrate and compare the performance of related programs to better inform choices among competing budgetary claims. The outcome of using the Results Act in these ways might be consolidation that would reduce the number of multiple programs, but it might also be a streamlining of program delivery or improved coordination among existing programs. Where multiple programs remain, coordination and streamlining would be especially important. Multiple programs might be appropriate because a certain amount of redundancy in providing services and targeting recipients is understandable and can be beneficial if it occurs by design as part of a management strategy. Such a strategy might be chosen, for example, because it fosters competition, provides better service delivery to customer groups, or provides emergency backup. Education and HHS’s ACF—the two agencies that are responsible for the majority of early childhood program funds—addressed early childhood programs in their strategic and 1999 performance plans. Although both agencies’ plans generally addressed the required elements for strategic and performance plans, Education’s plans provided more detailed information about performance measures and coordination strategies. The agencies in their 2000 plans similarly addressed the required elements for performance plans. However, strategies and activities that relate to coordination were not well defined. Although agencies state that some coordination occurs, they have not yet fully described how they will coordinate their efforts. The Education plan provided a more detailed description of coordination strategies and activities for early childhood programs than the ACF plan, including some performance measures that may cut across programs. The ACF plan described in general terms the agency’s plans to coordinate with external and internal programs dealing with early childhood goals. Yet the information presented in the plans did not provide the level of detail, definition, and identification of complementary measures that would facilitate comparisons of early childhood programs. research on early brain development reveals that if some learning experiences are not introduced to children at an early age, the children will find learning more difficult later; children who enter school ready to learn are more likely to achieve high standards than children who are inadequately prepared; and high-quality preschool and child care are integral in preparing children adequately for school. Early childhood issues were discussed in the plan’s goal to “build a solid foundation for learning for all children” and in one objective and two performance indicators (see table 1). The 1999 performance plan, Education’s first performance plan, followed from the strategic plan. It clearly identified programs contributing to Education’s early childhood objective and set individual performance goals for each of its programs. Paralleling the strategic plan, the performance plan specified the core strategies Education intended to use to achieve its early childhood goal and objective. Among these were interagency coordination, particularly with HHS’s Head Start program. According to Education’s strategic plan, this coordination was intended to ensure that children’s needs are met and that the burden on families and schools working with multiple providers is reduced. The performance plan also said that Education would work with HHS and other organizations to incorporate some common indicators of young children’s school readiness into their programs. It would also work with HHS more closely to align indicators of progress and quality between HHS’s Head Start program and its Even Start Family Literacy program—which has as part of its goal the integration of early childhood education, adult literacy or adult basic education, and parenting education. other federal agencies enables it to better serve program participants and reduce inefficiencies in service delivery. We said that although this first plan included a great deal of valuable information, it did not provide sufficient details, such as a more complete picture of intended performance across the department, a fuller portrayal of how its strategies and resources would help achieve the plan’s performance goals, and better identification of significant data limitations and their implications for assessing the achievement of performance goals. These observations apply to the early childhood programs as well. Without this additional detail, policymakers are limited in their ability to make decisions about programs and resource allocation within the department and across agencies. Education’s 2000 performance plan continues to demonstrate the department’s commitment to the coordination of its early childhood programs. Like the 1999 performance plan, the sections on early childhood programs clearly identified programs contributing to its childhood program objectives. It also contained new material highlighting the importance of the coordination of early childhood programs as a crosscutting issue, particularly with HHS. To facilitate collaboration, the department added a strategy to work with the states to encourage interagency agreements at the state level. It also added using the Federal Interagency Coordinating Council to coordinate strategies for children with disabilities and their families. At the same time, the department still needs to better define its objectives and performance measures for crosscutting issues. Unless the purpose of coordination activities is clearly defined and results in measurable outcomes, it will be difficult to make progress in the coordination of programs across agencies. development, safety, and well-being of children and youth”—and three objectives (see table 2). The ACF plan, however, did not always give a clear picture of intended performance of its programs and often failed to identify the strategies the agency would use to achieve its performance goals. ACF programs that contribute to each early childhood objective were identified, and several of these programs had individual performance goals. However, without a clear picture of intended program goals and performance measures for crosscutting early childhood programs, it will be difficult to compare programs across agencies and assess the federal government’s overall efficacy in fostering early childhood development. and external stakeholders in this area. However, it did not define how this coordination will be accomplished or the means by which the crosscutting results will be measured. Agency officials are able to describe numerous activities that demonstrate collaboration within the agency and with Education. The absence of that discussion in the plan, however, limits the value the Results Act could have to both improving agency management and assisting the Congress in its oversight role. Progress in coordinating crosscutting programs is still in its infancy, although agencies are recognizing its importance. Agency performance plans provide the building blocks for recognizing crosscutting efforts. Because of the iterative nature of performance-based management, however, more than one cycle of performance plans will probably be required in the difficult process of resolving program fragmentation and overlap. Mr. Chairman, this concludes my prepared statement. We would be happy to answer any questions that you or Members of the Subcommittee may have. Government Management: Addressing High Risks and Improving Performance and Accountability (GAO/T-OCG-99-23, Feb. 10, 1999). Head Start: Challenges Faced in Demonstrating Program Results and Responding to Societal Changes (GAO/T-HEHS-98-183, June 9, 1998). The Results Act: Observations on the Department of Education’s Fiscal Year 1999 Annual Performance Plan (GAO/HEHS-98-172R, June 8, 1998). The Results Act: An Evaluator’s Guide to Assessing Agency Annual Performance Plans (GAO/GGD-10.1.20, Apr. 1, 1998). Managing for Results: Observations on Agencies’ Strategic Plans (GAO/T-GGD-98-66, Feb. 12, 1998). Managing for Results: Agencies’ Annual Performance Plans Can Help Address Strategic Planning Challenges (GAO/GGD-98-44, Jan. 30, 1998). Child Care: Federal Funding for Fiscal Year 1997 (GAO/HEHS-98-70R, Jan. 23, 1998). Federal Education Funding: Multiple Programs and Lack of Data Raise Efficiency and Effectiveness Concerns (GAO/T-HEHS-98-46, Nov. 6, 1997). At-Risk and Delinquent Youth: Multiple Programs Lack Coordinated Federal Effort (GAO/T-HEHS-98-38, Nov. 5, 1997). Managing for Results: Using the Results Act to Address Mission Fragmentation and Program Overlap (GAO/AIMD-97-146, Aug. 29, 1997). The Results Act: Observations on the Department of Education’s June 1997 Draft Strategic Plan (GAO/HEHS-97-176R, July 18, 1997). The Government Performance and Results Act: 1997 Governmentwide Implementation Will Be Uneven (GAO/GGD-97-109, June 2, 1997). Early Childhood Programs: Multiple Programs and Overlapping Target Groups (GAO/HEHS-95-4FS, Oct. 31, 1994). The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and MasterCard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent. U.S. General Accounting Office P.O. Box 37050 Washington, DC 20013 Room 1100 700 4th St. NW (corner of 4th and G Sts. 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Pursuant to a congressional request, GAO discussed how Congress can use the Government Performance and Results Act to facilitate agency performance plans to oversee early childhood programs, focusing on: (1) how the Results Act can assist in management and congressional oversight, especially in areas where there are multiple programs; (2) how the Departments of Education and Health and Human Services (HHS)--which together administer more than half of the federal early childhood program funds--addressed early childhood programs in their strategic and fiscal year 1999 and 2000 performance plans and the extent to which recent plans show progress in coordinating early childhood programs. GAO noted that: (1) Congress can use the Results Act to improve its oversight of crosscutting issues because the act requires agencies to develop strategic and annual performance plans that clearly specify goals, objectives, and measures for their programs; (2) the Office of Management and Budget has issued guidance saying that for crosscutting issues, agencies should describe efforts to coordinate federal programs contributing to the same or similar outcomes so that goals are consistent and program efforts are mutually reinforcing; (3) when GAO looked at the Education and HHS plans, it found that the plans are not living up to their potential as expected from the Results Act; (4) more specifically, while the fiscal year 1999 and 2000 plans to some extent addressed coordination, the departments have not yet described in detail how they will coordinate or consolidate their efforts; and (5) therefore, the potential for addressing fragmentation and duplication has not been realized, and GAO cannot assess whether the agencies are effectively working together on crosscutting issues.

In an effort to promote and achieve various U.S. foreign policy objectives, Congress has expanded trade preference programs in number and scope over the past 3 decades. The purpose of these programs is to foster economic development through increased trade with qualified beneficiary countries while not harming U.S. domestic producers. Trade preference programs extend unilateral tariff reductions to over 130 developing countries. Currently, the United States offers the Generalized System of Preferences (GSP) and three regional programs, the Caribbean Basin Initiative (CBI), the Andean Trade Preference Act (ATPA), and the African Growth and Opportunity Act (AGOA). Special preferences for Haiti became part of CBI with enactment of the Haitian Hemispheric Opportunity through Partnership Encouragement (HOPE) Act in December 2006. The regional programs cover additional products but have more extensive criteria for participation than the GSP program. Eight agencies have key roles in administering U.S. trade preference programs. Led by the United States Trade Representative (USTR), they include the Departments of Agriculture, Commerce, Homeland Security, Labor, State, and Treasury, as well as the U.S. International Trade Commission (ITC). U.S. imports from countries benefiting from U.S. preference programs have increased significantly over the past decade. Total U.S. preference imports grew from $20 billion in 1992 to $110 billion in 2008. Most of this growth in U.S. imports from preference countries has taken place since 2000. This accelerated growth suggests an expansionary effect of increased product coverage and liberalized rules of origin for least- developed countries (LDC) under GSP in 1996 and for African countries under AGOA in 2000. In particular, much of the growth since 2000 is due to imports of petroleum from certain oil producing nations in Africa, accounting for 79.5 percent of total imports from Sub-Saharan Africa in 2008. For example, in that same year, U.S. imports from the oil producing countries of Nigeria grew by 16.2 percent, Angola by 51.2 percent, and the Republic of Congo by 65.2 percent. There is also evidence that leading suppliers under U.S. preference programs have “arrived” as global exporters. For example, based on a World Trade Organization (WTO) study in 2007, the three leading non-fuel suppliers of U.S. preference imports—India, Thailand, and Brazil—were among the top 20 exporters in the world, and were also major suppliers to the U.S. market. Exports from these three countries also grew faster than world exports as a whole. However, these countries have not reached World Bank “high income” level criteria, as they range from “low” to “upper middle” levels of income. GSP—the longest standing U.S. preference program—expires December 31, 2009, as do ATPA benefits. At the same time, legislative proposals to provide additional, targeted benefits for the poorest countries are pending. Preference programs entail a number of difficult policy trade-offs. For example, the programs are designed to offer duty-free access to the U.S. market to increase beneficiary trade, but only to the extent that access does not harm U.S. industries. U.S. preference programs provide duty-free treatment for over half of the 10,500 U.S. tariff lines, in addition to those that are already duty-free on a most favored nation basis. But they also exclude many other products from duty-free status, including some that developing countries are capable of producing and exporting. GAO’s analysis showed that notable gaps in preference program coverage remain, particularly in agricultural and apparel products. For 48 GSP-eligible countries, more than three-fourths of the value of U.S. imports that are subject to duties (i.e., are dutiable) are not included in the programs. For example, just 1 percent of Bangladesh’s dutiable exports to the United States and 4 percent of Pakistan’s are eligible for GSP. Although regional preference programs tend to have more generous coverage, they sometimes feature “caps” on the amount of imports that can enter duty- free, which may significantly limit market access. Imports subject to caps under AGOA include certain meat products, a large number of dairy products, many sugar products, chocolate, a range of prepared food products, certain tobacco products, and groundnuts (peanuts), the latter being of particular importance to some African countries. A second, related, trade-off involves deciding which developing countries can enjoy particular preferential benefits. A few LDCs in Asia are not included in the U.S. regional preference programs, although they are eligible for GSP-LDC benefits. Two of these countries—Bangladesh and Cambodia—have become major exporters of apparel to the United States and have complained about the lack of duty-free access for their goods. African private-sector representatives have raised concerns that giving preferential access to Bangladesh and Cambodia for apparel might endanger the nascent African apparel export industry that has grown up under AGOA. Certain U.S. industries have joined African nations in opposing the idea of extending duty-free access for apparel from these countries, arguing these nations are already so competitive in exporting to the United States that in combination they surpass U.S. free trade agreement partners Mexico and those in CAFTA, as well as those in the Andean/AGOA regions. This trade-off concerning what countries to include also involves decisions regarding the graduation of countries or products from the programs. The original intention of preference programs was to provide temporary trade advantages to particular developing countries, which would eventually become unnecessary as countries became more competitive. Specifically, the GSP program has mechanisms to limit duty-free benefits by “graduating” countries that are no longer considered to need preferential treatment, based on income and competitiveness criteria. Since 1989, at least 28 countries have been graduated from GSP, mainly as a result of “mandatory” graduation criteria such as high income status or joining the European Union. Five countries in the Central American and Caribbean region were recently removed from GSP and CBI/CBTPA when they entered into free trade agreements with the United States. In addition to country graduation, the United States GSP program also includes a process for ending duty-free access for individual products from a given country by means of import ceilings—Competitive Needs Limitations (CNL). These ceilings are reached when eligible products from GSP beneficiaries exceed specified value and import market share thresholds (LDCs and AGOA beneficiaries are exempt). Amendments to the GSP in 1984 gave the President the power to issue (or revoke) waivers for CNL thresholds under certain circumstances, for example through a petition from an interested party, or when total U.S. imports from all countries of a product are small or “de minimis.” In 2006 Congress passed legislation affecting when the President should revoke certain CNL waivers for so called “super competitive” products. In 2007, the President revoked eight CNL waivers. Policymakers face a third trade-off in setting the duration of preferential benefits in authorizing legislation. Preference beneficiaries and U.S. businesses that import from them agree that longer and more predictable renewal periods for program benefits are desirable. Private-sector and foreign government representatives have stated that short program renewal periods discourage longer-term productive investments that might be made to take advantage of preferences, such as factories or agribusiness ventures. Members of Congress have recognized this argument with respect to Africa and, in December 2006, Congress renewed AGOA’s third-country fabric provisions until 2012 and AGOA’s general provisions until 2015. However, some U.S. officials believe that periodic program expirations can be useful as leverage to encourage countries to act in accordance with U.S. interests such as global and bilateral trade liberalization. Furthermore, making preferences permanent may deepen resistance to U.S. calls for developing country recipients to lower barriers to trade in their own markets. Global and bilateral trade liberalization is a primary U.S. trade policy objective, based on the premise that increased trade flows will support economic growth for the United States and other countries. Spokesmen for countries that benefit from trade preferences have told us that any agreement reached under the Doha round of global trade talks at the WTO must, at a minimum, provide a significant transition period to allow beneficiary countries to adjust to the loss of preferences. GAO found that preference programs have proliferated over time and have become increasingly complex, which has contributed to a lack of systematic review. In response to differing statutory requirements, agencies involved in implementing trade preferences pursue different approaches to monitoring the various criteria set for these programs. We observed advantages to each approach but individual program reviews appeared disconnected and resulted in gaps. For example, some countries that passed review under regional preference programs were later subject to GSP complaints. Moreover, we found that there was little to no reporting on the impact of these programs. To address these issues, GAO recommended that USTR periodically review beneficiary countries, in particular those that have not been considered under GSP or regional programs. Additionally, we recommended that USTR should periodically convene relevant agencies to discuss the programs jointly. In our March 2008 report, we also noted that even though there is overlap in various aspects of trade preference programs, Congress generally considers these programs separately, partly because they have disparate termination dates. As a result, we suggested that Congress should consider whether trade preference programs’ review and reporting requirements may be better integrated to facilitate evaluating progress in meeting shared economic development goals. In response to the recommendations discussed above, USTR officials told us that the relevant agencies will meet at least annually to consider ways to improve program administration, to evaluate the programs’ effectiveness jointly, and to identify any lessons learned. USTR has also changed the format of its annual report to discuss the preference programs in one place. In addition, we believe that Congressional hearings in 2007 and 2008 and again today are responsive to the need to consider these programs in an integrated fashion. In addition to the recommendations based on GAO analysis, we also solicited options from a panel of experts convened by GAO in June 2009 to discuss ways to improve the competitiveness of the textile and apparel sector in AGOA beneficiary countries. While the options were developed in the context of AGOA, many of these may be applicable to trade preferences programs in general. Align Trade Capacity Building with Trade Preferences Programs: Many developing countries have expressed concern about their inability to take advantage of trade preferences because they lack the capacity to participate in international trade. AGOA is the only preference program for which authorizing legislation refers to trade capacity building assistance; however, funding for this type of assistance is not provided under the Act. In the course of our research on the textile and apparel inputs industry in Sub-Saharan African countries, many experts we consulted considered trade capacity building a key component for improving the competitiveness of this sector. Modify Rules of Origin among Trade Preference Program Beneficiaries and Free Trade Partners: Some African governments and industry representatives of the textile and apparel inputs industry in Sub-Saharan African countries suggested modifying rules of origin provisions under other U.S. trade preference programs or free trade agreements to provide duty-free access for products that use AGOA textile and apparel inputs. Similarly, they suggested simplifying AGOA rules of origin to allow duty-free access for certain partially assembled apparel products with components originating outside the region. Create Non-Punitive and Voluntary Incentives: Some of the experts we consulted believe that the creation of non-punitive and voluntary incentives to encourage the use of inputs from the United States or its trade preference partners could stimulate investment in beneficiary countries. One example of the incentives discussed was the earned import allowance programs currently in use for Haiti and the Dominican Republic. Such an incentive program allows producers to export certain amounts of apparel to the U.S., duty free, made from third-country fabric, provided they import specified volumes of U.S. fabric. Another proposal put forth by industry representatives was for a similar “duty credit” program for AGOA beneficiaries. A simplified duty credit program would create a non-punitive incentive for use of African regional fabric. For example, a U.S. firm that imports jeans made with African origin denim would earn a credit to import a certain amount of jeans from Bangladesh, duty free. However, some experts indicated that the application of these types of incentives should be considered in the context of each trade preference program, as they have specific differences that may not make them applicable across preference programs. While these options were suggested by experts in the context of a discussion on the African Growth and Opportunity Act, many of these options may be helpful in considering ways to further improve the full range of preference programs as many GSP LDCs face many of the same challenges as the poorer African nations. Some of the options presented would require legislative action while others could be implemented administratively. Mr. Chairman, thank you for the opportunity to summarize the work GAO has done on the subject of preference programs. I would be happy to answer any questions that you or other members of the subcommittee may have. For further information on this testimony, please contact Loren Yager at (202) 512-4347, or by e-mail at yagerl@gao.gov. Juan Gobel, Assistant Director; Gezahegne Bekele; Ken Bombara; Karen Deans; Francisco Enriquez; R. Gifford Howland; Ernie Jackson; and Brian Tremblay made key contributions to this statement. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

U.S. trade preference programs promote economic development in poorer nations by providing duty-free export opportunities in the United States. The Generalized System of Preferences, Caribbean Basin Initiative, Andean Trade Preference Act, and African Growth and Opportunity Act unilaterally reduce U.S. tariffs for many products from over 130 countries. However, two of these programs expire partially or in full this year, and Congress is exploring options as it considers renewal. This testimony describes the growth in preference program imports, identifies policy trade-offs, and summarizes the Government Accountability Office (GAO) recommendations and options suggested by a panel of experts on the African Growth and Opportunity Act (AGOA). The testimony is based on studies issued in September 2007, March 2008, and August 2009. For those studies, GAO analyzed trade data, reviewed trade literature and program documents, interviewed U.S. officials, did fieldwork in nine countries, and convened a panel of experts. Total U.S. preference imports grew from $20 billion in 1992 to $110 billion in 2008, with most of this growth taking place since 2000. The increases from preference program countries primarily reflect the addition of new eligible products, increased petroleum imports from some African countries, and the rapid growth of exports from countries such as India, Thailand, and Brazil. Preference programs give rise to three critical policy trade-offs. First, opportunities for beneficiary countries to export products duty free must be balanced against U.S. industry interests. Some products of importance to developing countries, notably agriculture and apparel, are ineligible by statute as a result. Second, some developing countries, such as Bangladesh and Cambodia, are not included in U.S. regional preference programs; however, there is concern that they are already competitive in marketing apparel to the United States and that giving them greater duty-free access could harm the apparel industry in Africa and elsewhere. Third, Congress faces a trade-off between longer preference program renewals, which may encourage investment, and shorter renewals, which may provide leverage to encourage countries to act in accordance with U.S. interests such as trade liberalization. GAO reported in March 2008 that preference programs have proliferated and become increasingly complex, which has contributed to a lack of systematic review. Moreover, we found that there was little to no reporting on the impact of these programs. In addition, GAO solicited options from a panel of experts in June 2009 for improving the competitiveness of the textile and apparel sector in AGOA countries. Options they suggested included aligning trade capacity building with trade preference programs, modifying rules of origin to facilitate joint production among trade preference program beneficiaries and free trade partners, and creating non-punitive and voluntary incentives to encourage the use of inputs from the United States or its trade preference partners to stimulate investment in beneficiary countries.

The Paris Club is the major forum where creditor countries renegotiate official sector debts. Official sector debts are those that have been issued, insured, or guaranteed by creditor governments. A Paris Club 'treatment' refers to either a reduction and/or renegotiation of a developing country's Paris Club debts. The Paris Club includes the United States and 21 other permanent members, the major international creditor governments. Besides the United States, the permanent membership is composed of Australia, Austria, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, Ireland, Israel, Italy, Japan, Netherlands, Norway, Russia, South Korea, Spain, Sweden, Switzerland, and the United Kingdom. Other creditors are allowed to participate in negotiations on an ad-hoc basis. The entry of Brazil into the Paris Club is notable since they are the first developing country to join in two decades. By contrast, the London Club, a parallel, informal group of private firms, meets in London to renegotiate commercial bank debt. Unlike the Paris Club, there is no permanent London Club membership. At a debtor nation's request, a London Club meeting of its creditors may be formed, and the Club is subsequently dissolved after a restructuring is in place. The Paris Club does not exist as a formal institution. It is rather a set of rules and principles for debt relief that have been agreed on by its members. To facilitate Paris Club operations, the French Treasury provides a small secretariat, and a senior official of the French Treasury is appointed chairman. The current Paris Club chairman is Jean-Pierre Jouyet, Under-Secretary of the French Treasury. In addition to representatives from the creditor and debtor nations, officials from the international financial institutions (IFIs) and the regional development banks are represented at Paris Club discussions. The IFIs present their assessment of the debtor country's economic situation to the Paris Club. To date (July 2017), the Paris Club has reached 433 agreements with 90 debtor countries. The total amount of debt covered in Paris Club agreements—rescheduled or reduced—is approximately $583 billion. Since the first debt restructuring took place in 1956, the terms, rules, and principles of the Paris Club have evolved to their current shape. This evolution occurred primarily through the G7/8 Summits. Five 'principles' and four 'rules' currently govern Paris Club treatments. Any country that accepts the rules and principles may, in principle, become a member of the Paris Club. Yet since the Paris Club permanent members are the major international creditor countries, they determine its practices. The five Paris Club 'principles' stipulate the general terms of all Paris Club treatments. They are (1) Paris Club decisions are made on a case-by-case basis; (2) all decisions are reached by full consensus among creditor nations; (3) debt renegotiations are applied only for countries that clearly need debt relief, as evidenced by implementing an International Monetary Fund (IMF) program and its requisite economic policy conditionality ; (4) solidarity is required in that all creditors will implement the terms agreed in the context of the renegotiations; and (5) the Paris Club preserves the comparability of treatment between different creditors. This means that a creditor country cannot grant to a debtor country a treatment on more favorable terms than the consensus reached by Paris Club members. While Paris Club 'principles' are general in nature, its 'rules' specify the technical details of Paris Club treatments. The 'rules' detail (1) the types of debt covered - Paris Club arrangements cover only medium and long-term public sector debt and credits issued prior to a specified "cut-off" date; (2) the flow and stock treatment; (3) the payment terms resulting from Paris Club agreements; and (4) provisions for debt swaps. Since the Paris Club is an informal institution, the outcome of a Paris Club meeting is not a legal agreement between the debtor and the individual creditor countries. Creditor countries that participate in the negotiation sign a so-called 'Agreed Minute.' The Agreed Minute recommends that creditor nations collectively sign bilateral agreements with the debtor nation, giving effect to the multilateral Paris Club agreement. By recommending that the United States renegotiate or reduce debts owed to it, congressional involvement is necessary to implement any Paris Club agreement. There are four types of Paris Club treatments depending on the economic circumstances of the distressed country. They are, in increasing degree of concessionality: Classic Terms , the standard terms available to any country eligible for Paris Club relief; Houston Terms , for highly-indebted lower to middle-income countries; Naples Terms , for highly-indebted poor countries; and Cologne Terms , for countries eligible for the IMF and World Bank's Highly Indebted Poor Countries Initiative (HIPC). Classic and Houston terms offer debt rescheduling while Naples and Cologne terms provide debt reduction. Classic terms are the standard terms for countries seeking Paris Club assistance. They are the least concessional of all Paris Club terms. Debts are rescheduled at an appropriate market rate. Houston terms were created at the 1990 G-7 meeting in Houston, Texas so the Paris Club could better accommodate the needs of lower middle-income countries. Houston terms offer longer grace and repayment periods on development assistance than do Classic terms. Naples Terms, designed at the December 1994 G-7 meeting in Naples, Italy, are the Paris Club's terms for cancelling and rescheduling the debts of very poor countries. Countries may receive Naples terms treatment if they are eligible to receive loans from the World Bank's concessional facility, the International Development Agency (IDA). A country is eligible for IDA loans if it has a per-capita GDP of less than $755. According to Naples Terms, between 50% and 67% of eligible debt may be cancelled. The Paris Club offers two methods for countries to implement the debt reduction. Countries can either completely cancel the eligible amount, and reschedule the remaining debts at appropriate market rates (with up to 23-year repayment period and a six-year grace period); or they can reschedule their total eligible debt at a reduced interest rate and with longer repayment terms (33 years). Cologne terms were created at the June 1999, G-8 Summit in Cologne, Germany. Cologne terms were created for countries that are eligible for the World Bank and IMF 1996 Highly Indebted Poor Countries Initiative (HIPC). They allow for higher levels of debt cancellation than Naples Terms. Under Cologne terms, 90% of eligible debts can be cancelled. On October 8, 2003, Paris Club members announced a new approach that would allow the Paris Club to provide debt cancellation to a broader group of countries. The new approach, named the "Evian Approach" introduces a new strategy for determining Paris Club debt relief levels that is more flexible and can provide debt cancellation to a greater number of countries than was available under prior Paris Club rules. Prior to the Evian Approach's introduction, debt cancellation was restricted to countries eligible for IDA loans from the World Bank under Naples Terms or HIPC countries under Cologne terms. Many observers believe that strong U.S. support for Iraq debt relief was an impetus for the creation of the new approach. Instead of using economic indicators to determine eligibility for debt relief, all potential debt relief cases are now divided into two groups: HIPC and non-HIPC countries. HIPC countries will continue to receive assistance under Cologne terms, which sanction up to 90% debt cancellation. (The United States and several other countries routinely provide 100% bilateral debt cancellation.) Non-HIPC countries are assessed on a case-by-case basis. Non-HIPC countries seeking debt relief first undergo an IMF debt sustainability analysis. This analysis determines whether the country suffers from a liquidity problem, a debt sustainability problem, or both. If the IMF determines that the country suffers from a temporary liquidity problem, its debts are rescheduled until a later date. If the country is also determined to suffer from debt sustainability problems, where it lacks the long-term resources to meet its debt obligations and the amount of debt adversely affects its future ability to pay, the country is eligible for debt cancellation. The United States began participating in Paris Club debt forgiveness in 1994, under authority granted by Congress in 1993 (Foreign Operations Appropriations, §570, P.L. 103-87 ). Annually reenacted since 1993, this authority allows the Administration to cancel various loans made by the United States. These can include U.S. Agency for International Development (USAID) loans, military aid loans, Export-Import Bank loans and guarantees, and agricultural credits guaranteed by the Commodity Credit Corporation. The procedure for budgeting and accounting for any U.S. debt relief is based on the method used to value U.S. loans and guarantees provided in the Federal Credit Reform Act of 1990. The act, among other things, provides for new budgetary treatment of and establishes new budgetary requirements for direct loan obligations. Since passage of the act, U.S. government agencies are required to value U.S. loans, such as bilateral debt owed to the United States, on a net present value basis rather than at their face value, and an appropriation by Congress of the estimated amount of debt relief is required in advance of any debt relief taking place. Prior to the passage of the act, neither budget authority nor appropriations were required for official debt relief and bilateral debt (and other federal commitments) were accounted for on a cash-flow basis, which credits income as it is received and expenses as they are paid. Determining the net present value is a complex calculation involving several factors, including the terms of loan (whether it is concessional or at market rates), as well as the financial solvency of the debtor and their likelihood of repayment. Following the passage of the act, a working group of executive branch agencies, the Inter-Agency Country Risk Assessment System (ICRAS), was created to maintain consistent assessments of country risk across the many U.S. agencies that make foreign loans. ICRAS operates as a working group. The Office of Management and Budget chairs ICRAS. The U.S. Export-Import Bank provides country risk assessments and risk rating recommendations, which must be agreed on by all the ICRAS agencies. OMB is then responsible for determining the expected loss rates associated with each ICRAS risk rating and maturity level. Each sovereign borrower or guarantor is rated on an 11-category scale, ranging from A to F-. Some analysts, including the Government Accountability Office (GAO), raise concerns about the official process for estimating the cost of foreign loans to the United States, and thus the cost needed to forgive U.S. debt. OMB's current methodology uses rating agency corporate default data and interest rate spreads in a model it developed to estimate default probabilities and makes assumptions about recoveries after default to estimate expected loss rates. According to GAO, the method that OMB employs may calculate lower loss rates than may be justified for the sovereign debt of emerging economies. In 2004, GAO recommended that the Director of OMB provide affected U.S. agencies and Congress with technical descriptions of its current expected loss methodology and update this information when there are changes. GAO also recommended that the OMB Director arrange for independent review of the methodology and ask U.S. international credit agencies for their most complete, reliable data on default and repayment histories, so that the validity of the data on which the methodology is based can be assessed over time. In their response, OMB made no commitment to increase transparency or engage the private sector rating community.

The Paris Club is a voluntary, informal group of creditor nations who meet approximately 10 times per year to provide debt relief to developing countries. Members of the Paris Club agree to renegotiate and/or reduce official debt owed to them on a case-by-case basis. The United States is a key Paris Club Member and Congress has an active role in both Paris Club operations and U.S. policy regarding debt relief overall. The Federal Credit Reform Act of 1990 stipulates that Congress must be involved in any official foreign country debt relief and notified of any debt reduction and debt renegotiation.

As of March 26, 2007, a total of 25,320 military personnel had been classified as Wounded in Action (WIA) in Operation Iraqi Freedom (OIF) and Operation Enduring Freedom (OEF). Of these, 13,870 (54.8%) were treated locally and returned to their military duties within 72 hours. The remaining 11,450 (45.2%) required longer treatment in the area of conflict or were evacuated to regional military hospital facilities in Kuwait, Spain, or Germany. If treatment, recovery and rehabilitation required more than 30 days, the wounded soldiers were further evacuated to the United States, initially to the Army's Walter Reed Medical Center, the National Naval Medical Center, or to Brooke Army Medical Center. When operating in a combat environment and a service member is seriously injured or wounded, immediate life-saving care is provided by medically trained individuals assigned to the unit (not physicians) to stabilize and evacuate the casualty to a Forward Surgical Team (FST). These FSTs, each with four surgeons, have been deployed further forward than in past conflicts in order to directly support combat forces and to provide emergency surgical intervention and evacuation to a Combat Support Hospital (CSH). Two CSHs with four sites now exist in Iraq. These are 248-bed hospitals with six operating tables, some specialty surgery services, and radiology and laboratory facilities. After three days at a CSH, patients may be evacuated to one of three regional military hospitals in Kuwait, Spain, or Germany. Those requiring more than 30 days of treatment will be initially evacuated to major medical centers in the United States. Typically, seriously injured military personnel are evacuated to the Army's Walter Reed Medical Center in Washington, DC, the National Naval Medical Center in Bethesda, MD, or to Brooke Army Medical Center in San Antonio, TX, which specializes in burn treatment. These centers offer a full range of medical specialization, follow-on surgery, and rehabilitative support programs. Upon arrival in the United States, the recently established service programs to support the traumatically injured and severely disabled begin to assist. The Department of Defense (DOD) established the Military Severely Injured (MSI) Center on February 1, 2005. The center, located in Arlington, VA, operates under the direction of DOD's Office of Military Community and Family Policy and is intended to augment, not oversee, the service specific programs that are described below. Although the Center will attempt to provide some degree of assistance to any severely injured service member who contacts them, the primary focus is on those returning from OEF and OIF with brain injuries, paralysis, amputation, severe burns or blindness. The MSI Center is available 24 hours a day, 7 days a week for service members and their families. It provides a "safety net" for information referral and tracking, advocacy for financial problems, education and training, job placement, accommodations, and personal/family counseling. The Center is currently staffed with approximately 10 "care managers" who are registered nurses, licensed clinical social workers, or other master's level health care specialists, all with experience in issues relating to disabled personnel. This core staff is augmented with representatives from the military services, Veterans Administration, Department of Labor and the Transportation Security Administration. An additional 19 "counselor-advocates" are available regionally at or near military medical treatment facilities and military installations to provide local support by helping connect families to resources in the hospital or the surrounding community. It is anticipated that final staffing will include 16 case managers and nearly 40 counselor-advocates with a ratio of one staff member per 30 disabled service members. The Center staff is currently working with nearly 1,200 service members and their families. The MSI Center has established an Employment Career Center online at http://www.military.com/support to provide customized job counseling that will lead to education, training, or job placement for service members and their family members. The MSI Center has also hosted job fairs under the "Hire a Hero" program. Additionally, the Center has established a "Heroes to Hometowns" program to advise local communities on reintegrating disabled service members into their hometowns. The Military Severely Injured Center can be contacted (24 hours a day/ 7 days a week) at 1-888-774-1361 and maintains a website at http://www.militaryhomefront.dod.mil/troops/injuredsupport . On April 30, 2004, the Army, at the direction of the Acting Secretary of the Army, introduced the Disabled Soldier Support System, colloquially called "DS3" and later renamed it the U.S. Army Wounded Warrior or AW2, to serve as a program advocate for severely disabled soldiers and their families. AW2 is available to all active and reserve component soldiers who have been classified as a Special Category as a result of war-related injuries or illness incurred after September 10, 2001, and who have been awarded an Army disability rating of 30% or greater. The AW2 program office in Alexandria, VA, is staffed by specialists who each support up to 30 soldiers, advocating their interests within the Army and with local, state, and other federal agencies and organizations. These advocates include several regional AW2 coordinators having expert knowledge of benefits, potential problem areas (pay, promotion, family travel), the Medical Evaluation Board (MEB) and Physical Evaluation Board (PEB) processes as well as of necessary contacts in the Department of Veterans Affairs, the Department of Labor and Veteran's Service Organizations. AW2 also provides transition assistance through the Army Career and Alumni Program, to include options for continuation on active duty. AW2 is designed to track, monitor, and support soldiers and their families for at least five years following medical retirement. There are currently 748 soldiers enrolled in this program. The AW2 office can be contacted at 1-800-833-6622 (8:00 a.m. to 4:30 p.m., Monday through Friday) or via e-mail at [ [email address scrubbed] ]. In addition, the Army has established a Wounded Soldier and Family Hotline at 1-800-984-8523 which is available from 7:00 a.m. to 7:00 p.m., Monday through Friday. The Marine for Life program began several years ago with an original focus on transition assistance for retiring and separating Marines. The additional requirement to support traumatically injured and disabled Marines was directed by the Commandant of the Marine Corps in late 2004. As a result, the M4L-IS program was established in early 2005 and located in Quantico, VA. It is currently staffed with mobilized Marine Corps Reserve personnel. As the program matures, staffing will include approximately 28 active duty Marines and several civilian employees. The program staff, similar to the other service programs, is responsible for coordinating and facilitating the full range of benefits, support, and transition assistance for Marines and their families. To date, the M4L-IS office has contacted over 1,000 previously separated or medically retired Marines and is providing ongoing support to over 300 of them. The M4L-IS staff also makes frequent visits to the Walter Reed Medical Center in Washington, DC, and the National Naval Medical Center in Bethesda, MD. These visits have extended support to over 600 wounded or injured Marines and follow-on support to over 200 is continuing. M4L-IS is augmented by a telephone hotline and regional outreach support that is provided by the Military Severely Injured (MSI) Center. The Marine for Life-Injured Support office can be contacted at 1-866-645-8762 (8:00 a.m. to 4:30 p.m., Monday through Friday) and maintains a website at https://www.m4l.usmc.mil . The Air Force's Palace HART (Helping Airmen Recover Together) program is an extension of an existing program to include support and advocacy for those returning from OEF/OIF with traumatic injures or severe illnesses. The Air Force uses Family Liaison Officers (FLO), generally active duty airmen in medical treatment facilities or U.S.-based squadrons, for initial contact and support. These FLOs receive "just in time" training on processes, procedures, and support methodology. As the disabled airmen continue to progress medically, they are assigned to a Case Management Team that will guide them through the MEB/PEB process. If medically retired or separated, follow-on services will be provided by the Air Force Personnel Center at Randolf AFB, TX. The Center tracks the service members for a minimum of five years via twice monthly phone calls. The Air Force program emphasizes retention on active duty. As of March 2005, 172 airmen had been wounded in action: 165 of them have been returned to active duty; two were placed on the temporary disability retired list (TDRL), and five were receiving ongoing medical care. For program support, injured airmen or their families should call 1-800-616-3775 (8:00 a.m. to 4:30 p.m., Monday through Friday) or contact the Military Severely Injured Center at 1-888-774-1361 (24 hours a day/ 7 days a week). There is currently no website dedicated to this program. The Navy's SAFE HARBOR (Sailors And Families are Extended a Hand and Assisted in Recovery, Benefits, Opportunity and Readjustment) program was officially started in August 2005 at the Navy Annex, Washington, DC. The program provides one-on-one support and advocacy for disabled sailors, marines, and their family members. A database has been established of more than 160 personnel who have been medically separated or retired since the start of OIF/OEF. To date, nearly all have been contacted and offered assistance; additional support is ongoing for nearly 30 of these. The program is closely coordinated with the National Naval Medical Center in Bethesda, MD, and with the casualty assistance officers. SAFE HARBOR can be contacted at [phone number scrubbed] (8:00 a.m. to 4:30 p.m., Monday through Friday) or through the Military Severely Injured Center at 1-888-774-1361 (24 hours a day/7 days a week). There is currently no website dedicated to this program. DOD and individual military service support programs provide a focal point for disabled service members and their families to resolve pay and promotion problems; receive assistance through the medical evaluation and retirement process; and aid in the seamless transition to the Department of Veterans Affairs. The FY2006 National Defense Authorization Act further requires DOD to prescribe comprehensive policies and procedures for these programs that will be uniform across the services to the extent practicable. Although each program appears successful, there may be some aspects of these programs that could benefit from further refinement: These support programs appear to be a reflection of the genuine concern by civilian and military leaders who place high priority on caring for wounded military personnel. However, these programs were established independently, by different authorities, and at different times during 2004 and 2005. There is no DOD-coordinated directive or instruction that established complementary service roles, delineated responsibilities, set eligibility criteria, or mandated standardized metrics for program evaluation. This lack of coordinated guidance could result in inefficient or inequitable care among the various services. DOD and each of the services established their own program eligibility criteria so there is little consistency across the programs. For example, DOD's MSI program will assist anyone who contacts them, while the Army is relatively rigid and requires participants to be classified as "Special Category" and hold a 30% Army disability rating to be eligible. A potential duplication of effort also exists because the DOD program will assist any service member, while the other programs are service-specific. Standardized program metrics to measure effectiveness have not been established across all programs, but there has been an effort to establish databases. This may make it difficult to identify strengths, weaknesses, and potential new directions as these programs mature and become permanent. The FY2006 National Defense Authorization Act (NDAA) requires the Secretary of Defense, by June 1, 2006, to prescribe a comprehensive policy on the provision of assistance to members of the Armed Forces who incur severe wounds or injuries in the line of duty. To the extent practicable, these procedures and standards should be uniform across the services and integrated into service regulations by September 1, 2006. While not required by the NDAA, DOD might report to Congress on its efforts to implement this legislation. (At the time this report was updated, DOD had not finalized the submitted the required comprehensive policy.)

Ongoing military operations in Iraq and Afghanistan have caused serious injuries to some military personnel. Many have been returned to medical facilities in the U.S., especially Walter Reed Army Medical Center, the National Naval Medical Center, and Brooke Army Medical Center. These severe and traumatic injuries—including amputations, burns, blindness, brain injury, and paralysis—often create significant hardships for the affected individuals that make independent living difficult or impossible. For example, an injured service member may need extensive physical therapy, transportation assistance, and job retraining in order to make the transition back to civilian life. In 2003 and 2004, some pointed out inadequacies in the military's ability to provide these services to its seriously injured personnel. Members of Congress have frequently expressed concern about the level of care for these wounded warriors and their family members. The Department of Defense (DOD) and each of the military services have established new programs to care for the severely disabled, ensuring rehabilitative assistance and easing the transition back to civilian life. Congress has followed these initiatives with interest and recently directed DOD to develop policies and procedures to standardize these programs. This report examines the background for the new initiatives and provides a status of each program, including contact information. This report will be updated as these programs continue to evolve and mature.

RS20717 -- Vietnam Trade Agreement: Approval and Implementing Procedure Updated December 17, 2001 After protracted negotiations and a one-year delay after its adoption in principle, the United States and Vietnam signed, on July 13, 2000, a comprehensivebilateral trade agreement. The key statutory purpose of the agreement is the restoration of nondiscriminatory tarifftreatment (2) ("normal-trade-relations" (NTR),formerly "most-favored-nation" treatment) to U.S. imports from Vietnam, suspended since 1951. Hence, theagreement contains a provision reciprocallyextending the NTR treatment and certain other provisions required by law for trade agreements with nonmarketeconomy (NME) countries. In addition, it containscomprehensive specific commitments by Vietnam in matters of market access (e.g., reduced tariff rates on importsfrom the United States), intellectual propertyrights, trade in services, and investment, such as the United States already has in force as a matter of general tradepolicy. To enter into force, the agreement mustbe approved by the enactment of a joint resolution of Congress. Restoration of NTR treatment to Vietnam as an NME country is also contingent on Vietnam's compliance with the freedom-of-emigration requirement of theJackson-Vanik amendment (Section 402) of the Trade Act of 1974. (3) In the case of Vietnam, such compliance is achieved by an annual Presidential waiver of fullcompliance under specified statutory conditions; such waiver may be disapproved by the enactment of a jointresolution of Congress. The President has issuedsuch waivers for Vietnam since mid-1998, but in no instance has a disapproval resolution, if introduced, been passedby Congress, allowing the waiver to continuein force. The statutory requirements and legislative procedure leading to the enactment and entry into force of a trade agreement with a nonmarket economy (NME)country, including Vietnam, are set out in detail in Sections 151, 404, 405, and 407 of the Trade Act of 1974 ( P.L.93-618 ), as amended. Section 151 has beenenacted as an exercise of the rulemaking power of either house and supersedes its other rules to the extent that theyare inconsistent with it. Its provisions can bechanged by either house with respect to its own procedure at any time, in the same manner and to the same extentas any other rule of that house (Section 151(a);19 U.S.C. 2191(a)). All alphanumerical statutory references cited in this report are to sections of the Trade Act of 1974. While care has been taken to reflect accurately the meaning ofthe statutes, consulting the actual language of any statute is recommended in case of any ambiguity. Functionally, the consideration and enactment of the approval resolution and the implementation of the agreement follow a specific expedited ("fast-track")procedure explained below. Additional information, based on past practice of implementing trade agreements withNME countries in general, but applicable alsoto Vietnam, is provided in footnotes (1) Enactment necessary. The agreement can take effect only if approved by enactment of a joint resolution (Section 405(c)); 19U.S.C.2435(c)). (2) Transmittal of the agreement by the President to Congress. The text of the bilateral trade agreement with Vietnam must be transmitted by the President to both houses ofCongress, together with a proclamation (4) extendingnondiscriminatory treatment to Vietnam and stating his reasons for it (Section 407(a); 19 U.S.C. 2437). While thereis no statutory deadline for the transmittal ofthe proclamation and the agreement to Congress after its signing, the law requires that the transmittal take place"promptly" after the proclamation is issued. (5) (3) Mandatory introduction of approval resolution. On the day the trade agreement is transmitted to the Congress (or, if the respective house is not in session onthat day, the first subsequent day on which it is insession), a joint resolution of approval (Sec. 151(b)(3); 19 U.S.C. 2191(b)(3)) must be introduced (by request) ineach house by its majority leader for himself andthe minority leader, or by their designees (Sec. 151(c)(2); 19 U.S.C. 2191(c)(2)). (6) (4) Language of approval resolution . The language of the resolution is prescribed by law (Sec. 151(b)(3); 19 U.S.C. 2191(b)(3)) to read, in thisparticular instance, after the resolving clause: "That the Congress approves the extension of nondiscriminatory treatment with respect to the products ofVietnam transmitted by the President to the Congress onJune 8, 2001". (7) (5) Committee referral . The resolution is referred in the House to the Committee on Ways and Means and in the Senate to theCommittee on Finance (Sec. 151(c)(2); 19 U.S.C.2191(c)(2)). (6) Amendments prohibited . No amendment to the resolution, and no motion, or unanimous-consent request, to suspend the no-amendmentrule, is in order in either house (Sec. 151(d); 19U.S.C. 2191(d)). (7) Committee consideration in the House . (8) If the Ways and Means Committee has not reported the resolution within 45 days (9) after its introduction, the Committee is automatically discharged from furtherconsideration of the resolution, and the resolution is placed on the appropriate calendar (Sec. 151(e)(1); 19 U.S.C.2191(e)(1)). (8) Floor consideration in the House. (a) A motion to proceed to the consideration of the approval resolution is highly privileged and nondebatable;an amendment to the motion, or a motion toreconsider the vote whereby the motion is agreed or disagreed to, is not in order (Sec. 151(f)(1); 19 U.S.C.2191(f)(1)). (b) Debate on the resolution is limited to 20 hours (10) , divided equally between the supporters and opponents of the resolution; a motion further to limitdebate isnot debatable; a motion to recommit the resolution, or to reconsider the vote whereby the resolution is agreed ordisagreed to, is not in order (Sec. 151(f)(2); 19U.S.C. 2191(f)(2)). (c) Motions to postpone the consideration of the resolution and motions to proceed to the consideration of otherbusiness are decided without debate (Sec.151(f)(3); 19 U.S.C. 2191(f)(3)). (d) All appeals from the decisions of the Chair relating to the application of the rules of the House ofRepresentatives to the approval resolution are decidedwithout debate (Sec. 151(f)(4); 19 U.S.C. 2191(f)(4)). (e) In all other respects, consideration of the approval resolution is governed by the rules of the House ofRepresentatives applicable to other measures in similarcircumstances (Sec. 151(f)(5); 19 U.S.C. 2191(f)(5)). (f) The vote (by simple majority) on the final passage of the approval resolution must be taken on or before the15th day (11) after the Ways and MeansCommitteehas reported the resolution, or has been discharged from its further consideration (Sec. 151(e)(1); 19 U.S.C.2191(e)(1)). (9) Committee consideration in the Senate (12) An approval resolution adopted by the House of Representatives and received in the Senate is referred to theFinance Committee (Sec. 151(c)(2) and (e)(2); 19U.S.C. 2191(c)(2) and (e)(2)). (13) If the FinanceCommittee has not reported the resolution within 15 days after its receipt from the House or 45 days (14) after theintroduction of its own corresponding resolution (whichever is later), the Committee is automatically dischargedfrom further consideration of the resolution, andthe resolution is placed on the appropriate calendar (Sec. 151(e)(1); 19 U.S.C. 2191(e)(1)). (10) Floor consideration in the Senate. (a) A motion to proceed to the consideration of the approval resolution is privileged and nondebatable; anamendment to the motion, or a motion to reconsider thevote whereby the motion is agreed or disagreed to, is not in order (Sec. 151(g)(1); 19 U.S.C. 2191(g)(1)). (b) Debate on the approval resolution and on all debatable motions and appeals connected with it is limited to20 hours, equally divided between, and controlledby, the majority leader and the minority leader, or their designees (Sec. 151(g)(2); 19 U.S.C. 2191(g)(2)). (c) Debate on any debatable motion or appeal is limited to one hour, equally divided between, and controlledby, the mover and the manager of the resolution,except that if the manager of the resolution is in favor of any such motion or appeal, the time in opposition iscontrolled by the minority leader or his designee;such leaders may, from time under their control on the passage of the resolution, allot additional time to any Senatorduring the consideration of any debatablemotion or appeal (Sec. 151(g)(3); 19 U.S.C. 2191(g)(3)). (d) A motion further to limit debate on the approval resolution is not debatable; a motion to recommit it is notin order (Sec. 151(g)(4); 19 U.S.C. 2191(g)(4)). (e) The vote (by simple majority) on the final passage of the approval resolution must be taken on or before the15th day (15) after the FinanceCommittee hasreported the resolution, or has been discharged from its further consideration (Sec. 151(e)(2); 19 U.S.C. 2191(e)(2)). (f) Although, unlike in the case of the House procedure (16) , this is not specifically mentioned in Section 151, the Rules of the Senate govern the considerationofthe approval resolution in the Senate in all aspects not specifically addressed in Section 151. (g) If prior to the passage of its own approval resolution, the Senate receives the approval resolution alreadypassed by the House, it continues the legislativeprocedure on its own resolution, but the vote on the final passage is on the House resolution. (11) President's implementing authority. (a) After the joint resolution approving the trade agreement with Vietnam is passed by both houses and signed by the President, it becomes public law, in effect, authorizing the President to putinto effect the already issued proclamation (17) implementing the agreement extending nondiscriminatory treatment to Vietnam (Secs. 404(a) and 405(c); 19 U.S.C.2434(a) and 2435(c)). (b) Application of nondiscriminatory treatment is limited to the term during which the agreement remainsin force (Sec. 404(b); 19 U.S.C. 2434(b)) (see alsofootnote 19 and text which it accompanies). (c) The President may at any time suspend or withdraw nondiscriminatory treatment of Vietnam (Sec. 404(c);19 U.S.C. 2434(c)) and thereby subject all importsfrom that country to column 2 tariff rates (i.e., full rather than NTR rates). (12) Approval by Vietnam. The agreement also must be approved by Vietnam. (18) (13) Entry into force. After the joint resolution of approval is enacted and the agreement is approved by Vietnam, the proclamation(see item (2) becomes effective, the agreemententers into force, and nondiscriminatory treatment is extended to Vietnam on the date of exchange of written noticesof acceptance of the agreement by the UnitedStates and Vietnam. A notice of the effective date of the agreement is published by the U.S. Trade Representativein the Federal Register . (19) (14) Maintenance in force . According to its own terms (Article 8 of Chapter VII - General Articles), the agreement with Vietnam remainsin force for a period of three years and isautomatically renewable for successive three-year terms unless either party to it, at least 30 days before theexpiration of the then current term, gives notice of itsintent to terminate the agreement. If either party ceases to have domestic legal authority to carry out its obligationsunder the agreement, it may suspend theapplication of the agreement, or, with the agreement of the other party, any part of the agreement. (20) In addition, Section 405(b)(1) (19 U.S.C. 2435(b)(1)) limits the life of trade agreements restoring nondiscriminatory treatment to NME countries to an initial termof three years. Agreements may be renewable for additional three-year terms if a satisfactory balance of tradeconcessions has been maintained during the life ofthe agreement and the President determines that actual or foreseeable U.S. reductions of trade barriers resulting frommultilateral negotiations are satisfactorilyreciprocated by the other country. (21)

The procedure leading to the entry into force of the U.S. trade agreement with Vietnam, including a reciprocalextension of nondiscriminatory treatment. calls for its approval by the enactment of a joint resolution of Congress,considered under a specific fast-track procedurewith deadlines for its various stages, with mandatory language and no amendments. After favorable reports on thelegislation in both houses, H.J.Res. 51,approving the nondiscriminatory treatment, was enacted on October 16, 2001; the agreement also was ratified byVietnam on December 4, 2001, and entered intoforce by exchange of notices of acceptance between the two parties on December 10, 2001. The functional sequenceof the legislative and executive steps involvedin the implementation of the agreement is described in this report.

DHS, DOE and FERC have taken various actions to address electromagnetic risks to the electric grid, and these actions generally fall into four categories: (1) standards, guidelines, tools and demonstration projects; (2) research reports; (3) strategy development and planning; and (4) training and outreach. Additionally, some of the actions DHS and DOE have taken generally aligned with recommendations made by the EMP Commission. Because federal agencies generally do not own electric grid infrastructure, federal actions to address GMD risks are more indirect through such things as developing standards and guidelines, and conducting research that could benefit electric grid owners and operators. Federal agencies have also been involved in strategy development and planning, as well as training and outreach efforts, as a means of preparing federal officials and others to respond to both EMP and GMD events, and enhancing knowledge about electromagnetic risks. For example, DHS’s Science and Technology Directorate (S&T) led the design and development of a prototype transformer that can be more easily transported to another location to help restore electric power in a timelier manner. DHS has also participated in various training and outreach events to enhance understanding of EMP and GMD events. DOE’s primary efforts include supporting research to enhance the understanding of the potential impacts to the electric grid from electromagnetic events. More detailed information on key federal agencies’ actions taken since 2008 to address electromagnetic risks can be found in Appendix II of our March 2016 report. Although DHS and DOE did not report that any of their actions were taken in response to the EMP Commission recommendations, some actions taken by both agencies have aligned with some of the recommendations. Specifically, of the seven recommendations made by the EMP Commission related to the electric grid, some of the actions that DHS and DOE took aligned with four of them: conducting research to better understand the interdependencies of critical infrastructures, addressing the vulnerability of control systems to an EMP attack; identifying responsibilities for responding to an EMP attack; and utilizing industry and other governmental institutions to assure the most cost-effective outcomes. For example, with respect to the recommendation on conducting research to better understand interdependencies of critical infrastructures, DHS’s Sector Resilience Report: Electric Power Delivery includes some assessment of how various critical infrastructures— including the energy, communications, and transportation sectors, among others—are interdependent in maintaining operations. For more detailed information regarding how identified federal actions align with these seven EMP Commission recommendations, see Appendix III of our March 2016 report. In our March 2016 report, we found that DHS had not clearly identified internal roles and responsibilities for addressing electromagnetic risks to the electric grid or communicated these to external federal and industry partners. While multiple DHS components and offices, including the National Protection and Programs Directorate (NPPD), the Federal Emergency Management Agency (FEMA), and S&T, had each conducted independent activities addressing electromagnetic risks to the electric grid, none had been tasked with lead responsibility for coordinating related activities within the department or with federal and industry stakeholders. As a result, during the course of our review for our March 2016 report, we experienced ongoing challenges in identifying applicable DHS personnel and related departmental actions. For example, NPPD officials had difficulty identifying their specific roles and activities addressing electromagnetic risks to the electric grid, including efforts to collect or synthesize available risk information to provide input into department-wide risk assessments. Furthermore, industry representatives and other federal officials told us it is not clear who within DHS is responsible for addressing electromagnetic risks. The 2008 EMP Commission report recommended that DHS make clear its authority and responsibilities, as well as delineate the functioning interfaces with other governmental institutions, regarding EMP response efforts. We concluded that designating internal roles and responsibilities within DHS regarding electromagnetic risks and communicating these to federal and industry partners could provide additional awareness of related activities and help ensure more effective and coordinated engagement with other federal agencies and industry stakeholders, and could help reduce the risk of potential duplication, overlap, or fragmentation within the department or across federal agencies. In our March 2016 report, we recommended DHS designate roles and responsibilities within the department for addressing electromagnetic risks and communicate these to federal and industry partners. DHS concurred with our recommendation and reported that their Office of Policy is coordinating across the department to identify and document applicable roles and responsibilities regarding electromagnetic issues to ensure full mission coverage while minimizing potential overlap or redundancy and expects to complete this effort by December 2016. These actions, if implemented effectively, should address the intent of our recommendation. In our March 2016 report, we found that DHS and DOE had not taken actions to identify key electrical infrastructure assets as required given their respective critical infrastructure responsibilities under the NIPP. The NIPP explicitly states that to manage critical infrastructure risk effectively, partners must identify the assets, systems, and networks that are essential to their continued operation, considering associated dependencies and interdependencies of other infrastructure sectors. The 2008 EMP Commission report also recommended that DHS and DOE prioritize nodes that are critical for the rapid recovery of other key sectors that rely upon electricity to function, including those assets that must remain in service or be restored within hours of an EMP attack. Neither DHS nor DOE reported any specific actions taken to identify critical electrical infrastructure as part of risk management efforts for the energy sector, including any systematic review of a 2013 FERC analysis of critical substations, or any further collaboration to determine the key elements of criticality that they believe should be considered when evaluating the vast array of infrastructure assets constituting the U.S. electric grid. The extensive size and scope of the electric power system necessitates collaboration among partners to ensure all individual expertise is effectively leveraged. As a result, we recommended in our March 2016 report that DHS and DOE direct responsible officials to review FERC’s electrical infrastructure analysis and collaborate to determine whether further assessment is needed to adequately identify critical electric infrastructure assets. DHS and DOE each concurred with our recommendation. DHS reported that NPPD is to collaborate with FERC to identify critical electrical infrastructure assets beginning with the evaluation of critical substations identified by FERC, and will explore elements of criticality that might not have been considered by FERC, in coordination with DOE. DOE stated that its Office of Electricity Delivery and Energy Reliability will review FERC’s electrical infrastructure analysis and will work with FERC and DHS to identify any additional elements of criticality and determine if further assessment is needed. Both DHS and DOE expect to complete these efforts by March 2017. These actions should address the intent of our recommendation. We found in March 2016 that although DHS components had independently conducted some efforts to assess electromagnetic risks, the department had not fully leveraged available risk information or conducted a comprehensive analysis of these risks. Within the Office of Policy, there is recognition that “space weather” and “power grid failure” are significant risk events, which DHS officials have determined pose great risk to the security of the nation. However, DHS officials were unable to provide detailed information about the specific risk inputs— namely threat, vulnerability, and consequence information—that were used to assess how electromagnetic events compared to other risk events, or how these inputs were used to inform DHS’s applicable risk- management priorities. Further, officials within NPPD were unable to identify any specific actions taken or plans to systematically collect or analyze risk information regarding electromagnetic impacts to the electric grid as part of department-wide risk assessment efforts. According to the NIPP, to assess risk effectively, critical infrastructure partners—including owners and operators, sector councils, and government agencies—need timely, reliable, and actionable information regarding threats, vulnerabilities, and consequences. Additionally, the electric grid remains vulnerable to other potential threats, such as physical and cyberattacks. We concluded that better collection of threat, vulnerability, and consequence information through existing DHS programs and strengthened collaboration with federal partners could help DHS better assess the relative risk ranking of electromagnetic events versus other risks and help inform asset protection priorities. Moreover, according to subject-matter experts, the impact to the electric grid from electromagnetic threats may vary substantially by location, network and operating characteristics, and other factors. For example, key reports on GMD indicate that high-voltage transformers located at higher latitudes in the United States are likely subject to increased potential for adverse impacts from GMD events than those at lower latitudes. Further collection of information on sector interdependencies could also help DHS to assess the potential economic consequences associated with long-term power outages and provide information to help assess the cost- effectiveness of various mitigation strategies. In our March 2016 report, we recommended that DHS’s NPPD and Office of Infrastructure Protection (IP) work with other federal and industry partners to collect and analyze key inputs on threat, vulnerability, and consequences related to electromagnetic risks. DHS concurred with our recommendation and reported that the department has initiated efforts to assess electromagnetic risk and help determine priorities. For example, DHS stated the Department has a joint study with DOE underway that will analyze the hazard environments, impacts, and consequences of different sources of EMP and GMD on the electric grid to determine events of concern and potential means of mitigation. DHS expects to implement these efforts by December 2016 and if implemented effectively, should address the intent of our recommendation. We also found in March 2016 that key federal agencies, including DHS and DOE, as well as industry partners had not established a fully coordinated approach to identifying and implementing risk management activities to address EMP risks. According to the NIPP Risk Management Framework, such activities include identifying and prioritizing research and development efforts, and evaluating potential mitigation options, including the cost-effectiveness of specific protective equipment. The publication of the National Space Weather Action Plan in October 2015 identified many key federal activities in these areas regarding the GMD risk; however, no similar efforts had been proposed regarding EMP risks to the electric grid. DHS officials stated an EMP attack generally remains a lower risk priority compared to other risk events with higher probability such as natural disasters or cyberattacks. DOE officials also noted resource limitations and competing priorities as the key driver for not pursuing additional risk management activities specifically related to EMP events. However, we found that even if an EMP attack is not determined to be among the highest resource priorities for DHS and DOE relative to other risk events, there are opportunities for enhanced collaboration among federal agencies and industry stakeholders to address identified gaps and help ensure that limited resources are more effectively coordinated and prioritized. For example, recent reports issued by DOE and a leading research organization for the electric industry identified gaps in the information available regarding likely EMP impacts to modern grid technologies and electronic control systems. They noted that such information remains important for developing applicable protective guidelines and equipment design specifications. In our March 2016 report, we recommended that DHS and DOE engage with federal partners and industry stakeholders to identify and implement key EMP research and development priorities, including opportunities for further testing and evaluation of potential EMP protection and mitigation options. DHS and DOE concurred with our recommendation and each identified actions to convene applicable stakeholders to jointly determine mitigation options and conduct further testing and evaluation. DHS stated S&T will work with DOE and the Electricity Subsector Coordinating Council to develop a joint government and industry approach to identify options for mitigating the consequences of an EMP event. DHS expects to implement this effort by September 2016. In addition, DOE stated it is working with the Electric Power Research Institute to develop an EMP Strategy that is scheduled for completion by August 31, 2016, and the strategy is to be followed by a more detailed action plan identifying research and development priorities and specific opportunities to test and evaluate EMP mitigation and protection measures. If implemented effectively, DHS and DOE’s actions should address the intent of our recommendation. We will continue to monitor DHS and DOE actions taken to address our March 2016 recommendations and have also recently initiated two additional reviews. One is evaluating the electromagnetic event preparedness of U.S. electricity providers and the other is a technical assessment of protective equipment designed to mitigate the potential impacts of a GMD on electrical infrastructure. We expect these projects to be completed by mid-2017. Chairman Perry, Ranking Member Watson Coleman, and Members of the Subcommittee, this completes my prepared statement. I would be pleased to respond to any questions that you may have at this time. If you or your staff members have any questions concerning this testimony, please contact Chris Currie, Director, Homeland Security and Justice at (404) 679-1875 or CurrieC@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this statement. GAO staff who made key contributions include Dawn Hoff, Assistant Director; Chuck Bausell, Kendall Childers, Josh Diosomito, Ryan Lambert, Tom Lombardi, Steven Putansu, John Rastler, and Cody Raysinger. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

This testimony summarizes the information contained in GAO's March 2016 report, entitled Critical Infrastructure Protection: Federal Agencies Have Taken Actions to Address Electromagnetic Risks, but Opportunities Exist to Further Assess Risks and Strengthen Collaboration , GAO-16-243 . Key federal agencies have taken various actions to address electromagnetic risks to the electric grid, and some actions align with the recommendations made in 2008 by the Commission to Assess the Threat to the United States from Electromagnetic Pulse Attack (EMP Commission). Since 2008, the Department of Homeland Security (DHS), the Department of Energy (DOE), and the Federal Energy Regulatory Commission (FERC) have taken actions such as establishing industry standards and federal guidelines, and completing EMP-related research reports. GAO found that their actions aligned with some of the EMP Commission recommendations related to the electric grid. For example, DHS developed EMP protection guidelines to help federal agencies and industry identify options for safeguarding critical communication equipment and control systems from an EMP attack. Further, agency actions and EMP Commission recommendations generally align with DHS and DOE critical infrastructure responsibilities, such as assessing risks and identifying key assets. Additional opportunities exist to enhance federal efforts to address electromagnetic risks to the electric grid. Specifically, DHS has not identified internal roles and responsibilities for addressing electromagnetic risks, which has led to limited awareness of related activities within the department and reduced opportunity for coordination with external partners. Doing so could provide additional awareness of related activities and help ensure more effective collaboration with other federal agencies and industry stakeholders. Moreover, although DHS components have independently conducted some efforts to assess electromagnetic risks, DHS has not fully leveraged opportunities to collect key risk inputs—namely threat, vulnerability, and consequence information—to inform comprehensive risk assessments of electromagnetic events. Within DHS, there is recognition that space weather and power grid failure are significant risk events, which DHS officials have determined pose great risk to the security of the nation. Better collection of risk inputs, including additional leveraging of information available from stakeholders, could help to further inform DHS assessment of these risks. DHS and DOE also did not report taking any actions to identify critical electrical infrastructure assets, as called for in the National Infrastructure Protection Plan. Although FERC conducted a related effort in 2013, DHS and DOE were not involved and have unique knowledge and expertise that could be utilized to better ensure that key assets are adequately identified and all applicable elements of criticality are considered. Finally, DHS and DOE, in conjunction with industry, have not established a coordinated approach to identifying and implementing key risk management activities to address EMP risks. Such activities include identifying and prioritizing key research and development efforts, and evaluating potential mitigation options, including the cost-effectiveness of specific protective equipment. Enhanced coordination to determine key research priorities could help address some identified research gaps and may help alleviate concerns voiced by industry regarding the costs and potential adverse consequences on grid reliability that may be caused by implementation of such equipment.

We found that Indian Affairs does not have complete and accurate information on safety and health conditions at all BIE schools because of key weaknesses in its inspection program. In particular, Indian Affairs does not inspect all BIE schools annually as required by Indian Affairs’ policy, limiting information on school safety and health. We found that 69 out of 180 BIE school locations were not inspected in fiscal year 2015, an increase from 55 locations in fiscal year 2012 (see fig. 2). Further, we determined that 54 school locations received no inspections during the past 4 fiscal years. At the regional level, Indian Affairs did not conduct any annual school safety and health inspections in 4 of BIA’s 10 regions with school facility responsibilities—the Northwest, Southern Plains, Southwest, and Western regions—in fiscal year 2015, accounting for 52 of the 180 school locations (see fig. 3). Further, the same four regions did not conduct any school inspections during the previous 3 fiscal years. In the Western region, we found three schools that had not been inspected since fiscal year 2008 and three more that had not been inspected since fiscal year 2009. Indian Affairs’ safety office considers the lack of inspections a key risk to its safety and health program. BIA regional safety officers that we spoke with cited three key factors affecting their ability to conduct required annual safety and health inspections: (1) extended vacancies among BIA regional safety staff, (2) uneven workload distribution among BIA regions, and (3) limited travel budgets. Officials told us that one BIA region’s only safety position was vacant for about 10 years due to funding constraints. As an example of uneven workload distribution, one BIA region had two schools with one safety inspector position, while another region had 32 schools with one safety inspector position. Currently, Indian Affairs has not taken actions to ensure all schools are annually inspected. Without conducting annual inspections at all school locations, Indian Affairs does not have complete information on the frequency and severity of safety and health deficiencies at all BIE school locations and cannot ensure these facilities are safe for students and staff and currently meet safety and health requirements. We also found that Indian Affairs does not have complete and accurate information for the two-thirds of schools that it did inspect in fiscal year 2015 because it has not provided BIA inspectors with updated and comprehensive inspection guidance and tools. In particular, we found that Indian Affairs’ inspection guidance lacks comprehensive procedures on how inspections should be conducted, which Indian Affairs’ safety office acknowledged. For example, BIA’s Safety and Health Handbook—last updated in 2004—provides an overview of the safety and health inspection program but does not specify the steps inspectors should take to conduct an inspection. Further, according to some regional safety staff, Indian Affairs does not compile and provide inspectors with a reference guide for all relevant current safety and health standards. At the same time, BIA inspectors use inconsistent inspection practices, which may limit the completeness and accuracy of Indian Affairs’ information on school safety and health. For example, at one school we visited, school officials told us that the regional safety inspector conducted an inspection from his car and did not inspect the interior of the school’s facilities, which include 34 buildings. The inspector’s report comprised a single page and identified no deficiencies inside buildings. Concerned about the lack of completeness of the inspection, school officials said they arranged with the Indian Health Service (IHS) within the Department of Health and Human Services to inspect their facilities. IHS identified multiple serious safety and health problems, including electrical shock hazards, emergency lighting and fire alarms that did not work, and fire doors that were difficult to open or close. Currently, Indian Affairs does not systematically evaluate the thoroughness of school safety and health inspections and monitor the extent to which inspection procedures vary within and across regions. According to federal internal control standards, internal control monitoring should be ongoing and assess program performance, among other aspects of an agency’s operations. Without monitoring whether safety inspectors across BIA regions are consistently following inspection procedures and guidance, inspections in different regions may continue to vary in completeness and miss important safety and health deficiencies at schools that could pose dangers to students and staff. To support the collection of complete and accurate safety and health information on the condition of BIE school facilities nationally, we recommended that Interior (1) ensure all BIE schools are annually inspected for safety and health, as required by its policy, and that inspection information is complete and accurate and (2) revise its inspection guidance and tools, require that regional safety inspectors use them, and monitor safety inspectors’ use of procedures and tools across regions to ensure they are consistently adopted. Interior agreed with these recommendations. We also found that Indian Affairs is not providing schools with needed support in addressing deficiencies or consistently monitoring whether they have established safety committees, which are required by Indian Affairs. In particular, according to Indian Affairs information, one-third or less of the 113 schools inspected in fiscal year 2014 had abatement plans in place, as of June 2015. Interior requires that schools put in place such plans for any deficiencies inspectors identify. Because such plans are required to include time frames, steps, and priorities for abatement, they are an initial step in demonstrating how schools will address deficiencies identified in both annual safety and health and boiler inspection reports. Among the 16 schools we visited, several schools had not abated high- risk deficiencies within the time frames required by Indian Affairs. Indian Affairs requires schools to abate high-risk deficiencies within 1 to 15 days, but we found that inspections of some schools identified serious unabated deficiencies that repeated from one year to the next year. For example, we reviewed inspection documents for two schools and found numerous examples of serious “repeat” deficiencies—those that were identified in the prior year’s inspection and should have been corrected soon afterward but were not. One school’s report identified 12 repeat deficiencies that were assigned Interior’s highest risk assessment category, which represents an immediate threat to students’ and staff safety and health and require correction within a day. Examples include fire doors that did not close properly; fire alarm systems that were turned off; and obstructions that hindered access/egress to building corridors, exits, and elevators. Another school’s inspection report showed over 160 serious hazards that should have been corrected within 15 days, including missing fire extinguishers, and exit signs and emergency lights that did not work. Besides these repeat deficiencies, we also found that some schools we visited took significantly longer than Indian Affairs’ required time frames to abate high-risk deficiencies. For example, at one school, 7 of the school’s 11 boilers failed inspection in 2015 due to various high-risk deficiencies, including elevated levels of carbon monoxide and a natural gas leak (see fig. 4). Four of the 7 boilers that failed inspection were located in a student dormitory. The inspection report designated most of these boiler deficiencies as critical hazards that posed an imminent danger to life and health, which required the school to address them within a day. School officials told us they continued to operate the boilers and use the dormitory after the inspection because there was no backup system or other building available to house the students. Despite the serious risks to students and staff, most repairs were not completed for about 8 months after the boiler inspection. Indian Affairs and school officials could not provide an explanation for why repairs took significantly longer than Indian Affairs’ required time frames. Limited capacity among school staff, challenges recording abatement information in the data system, and limited funding have hindered schools’ development and implementation of abatement plans, according to school and Indian Affairs officials. Additionally, Indian Affairs has not taken needed steps to build the capacity of school staff to abate safety and health deficiencies, such as by offering basic training for staff in how to maintain and conduct repairs to school facilities. While some regional officials told us that they may provide limited assistance to schools when asked, such ad hoc assistance is not likely to build schools’ capacity to abate deficiencies because it does not address the larger challenges faced by schools. Several officials at Indian Affairs’ safety office and BIA regional offices acknowledged they do not have a plan to build schools’ capacity to address safety and health deficiencies. Absent such a plan, schools will continue to face difficulties in addressing unsafe and unhealthy conditions in school buildings. Finally, we found that Indian Affairs has not consistently monitored whether schools have established safety committees, despite policy requirements for BIA regions to ensure all schools do so. Safety committees, which are composed of school staff and students, are vital in preventing injuries and eliminating hazards, according to Indian Affairs guidance. Examples of committee activities may include reviewing inspection reports or identifying problems and making recommendations to abate unhealthy or unsafe conditions. However, BIA safety officials we interviewed in three regions estimated that about half or fewer of BIE schools had created safety committees in their respective regions, though they were unable to confirm this because they do not actively track safety committees. Without more systemic monitoring, Indian Affairs is not in a position to know whether schools have fulfilled this important requirement. To ensure that all BIE schools are positioned to address safety and health problems with their facilities and provide student environments that are free from hazards, we recommended that Interior (1) develop a plan to build schools’ capacity to promptly address safety and health problems with facilities and (2) consistently monitor whether schools have established required safety committees. Interior agreed with these recommendations. In conclusion, because Indian Affairs has neither conducted required annual inspections for BIE schools nationwide nor provided updated guidance and tools to its safety inspectors, it lacks complete and accurate safety and health information on school facilities. As a result, Indian Affairs cannot effectively determine the magnitude and severity of safety and health deficiencies at schools and is thus unable to prioritize deficiencies that pose the greatest danger to students and staff. Further, Indian Affairs has not developed a plan to build schools’ capacity to promptly address deficiencies or consistently monitored whether schools have established required safety committees. Without taking steps to improve oversight and support for BIE schools in these key areas, Indian Affairs cannot ensure that the learning and work environments at BIE schools are safe, and it risks causing harm to the very children that it is charged with educating and protecting. Interior agreed with our recommendations to address these issues and noted several actions it plans to take. Chairman Calvert, Ranking Member McCollum, and Members of the Subcommittee, this concludes my prepared remarks. I will be happy to answer any questions you may have. If you or your staff have any questions about this testimony or the related report, please contact Melissa Emrey-Arras at (617) 788-0534 or emreyarrasm@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this statement. Key contributors to this statement and the related report include Elizabeth Sirois (Assistant Director), Edward Bodine (Analyst-in- Charge), Lara Laufer, Jon Melhus, Liam O’Laughlin, Matthew Saradjian, and Ashanta Williams. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

This testimony summarizes the information contained in GAO's March 2016 report, entitled Indian Affairs: Key Actions Needed to Ensure Safety and Health at Indian School Facilities , GAO-16-313 . The Department of the Interior's (Interior) Office of the Assistant Secretary-Indian Affairs (Indian Affairs) lacks sound information on safety and health conditions of all Bureau of Indian Education (BIE) school facilities. Specifically, GAO found that Indian Affairs' national information on safety and health deficiencies at schools is not complete and accurate because of key weaknesses in its inspection program, which prevented GAO from conducting a broader analysis of schools' safety and health conditions. Indian Affairs' policy requires its regional safety inspectors to conduct inspections of all BIE schools annually to identify facility deficiencies that may pose a threat to the safety and health of students and staff. However, GAO found that 69 out of 180 BIE school locations were not inspected in fiscal year 2015, an increase from 55 locations in fiscal year 2012. Agency officials told GAO that vacancies among regional staff contributed to this trend. As a result, Indian Affairs lacks complete information on the frequency and severity of health and safety deficiencies at BIE schools nationwide and cannot be certain all school facilities are currently meeting safety requirements. Number of Bureau of Indian Education School Locations That Were Inspected for Safety and Health, Fiscal Years 2012-2015 Indian Affairs is responsible for assisting schools on safety issues, but it is not taking needed steps to support schools in addressing safety and health deficiencies. While national information is not available, officials at several schools GAO visited said they faced significant difficulties addressing deficiencies identified in annual safety and health and boiler inspections. Inspection documents for two schools GAO visited showed numerous high-risk safety and health deficiencies—such as missing fire extinguishers—that were identified in the prior year's inspection report, but had not been addressed. At another school, four aging boilers in a dormitory failed inspection due to elevated levels of carbon monoxide, which can cause poisoning where there is exposure, and a natural gas leak, which can pose an explosion hazard. Interior's policy in this case calls for action within days of the inspection to protect students and staff, but the school continued to use the dormitory, and repairs were not made for about 8 months. Indian Affairs and school officials across several regions said that limited staff capacity, among other factors, impedes schools' ability to address safety deficiencies. Interior issued an order in 2014 that emphasizes building tribes' capacity to operate schools. However, it has not developed a plan to build BIE school staff capacity to promptly address deficiencies. Without Indian Affairs' support of BIE schools to address these deficiencies, unsafe conditions at schools will persist and may endanger students and staff.

Members of Congress have more choices and options available to communicate with constituents than they did 20 years ago. In addition to traditional modes of communication such as townhall meetings, telephone calls, and postal mail, Members can now engage their constituents via email, websites, tele-townhalls, online videos, social networking sites, and other electronic-based communications applications. The rise of electronic communications has altered the traditional patterns of communication between Members and constituents. Although virtually all Members continue to use traditional communications tools, the use of new technology is increasing. For example, past research on the adoption of Twitter has shown that by August 2009, 29% of Members had adopted it. The percentages of Members who adopted had increased to 38% by September 2009, 57% by December 2010, and 79% by January 2012. By January 2013, 100% of Senators and 90% of Representatives had adopted Twitter. More recently, Members have begun to adopt video and picture sharing social media services. This report examines Members' use of one of these new electronic communications platforms: Vine. After providing an overview of Vine, the report analyzes patterns of Members' use of Vine. Finally, the report offers a discussion of the implications of the rise of video sharing services like Vine, and of social media more generally. Vine is a social media video sharing service, owned by Twitter, which allows users to create six-second videos that can be short snippets of conversation, a series of still shots, or a moving panorama that automatically repeats in a loop. These videos (Vines) can be shared with Vine followers and on Twitter and Facebook. Vine is primarily designed for use on mobile devices such as iPhone, Android, and Windows supported devices. Vine combines many features of Twitter—short posts and hashtags—with the ability to share short, looping videos or compilations of pictures. It also allows users to reach followers with both text and video images. Up to 140 characters of text can accompany a Vine post. This report analyses the following questions related to Members' use of Vine: What proportion of Members use Vine? How often do Members use Vine? What do Members Vine about? In June 2014, the Congressional Research Service (CRS) collected data on the adoption and use of Vine. To collect the data, CRS first determined which Representatives and Senators had registered with Vine. Using the Vine search engine, CRS searched for each Representative and Senator by name. The adoption data were the basis for analyzing Members' use of Vine. CRS examined all Vines for all registered Representatives and Senators to create a second dataset capturing Members' use of Vine. The unit of analysis of this second dataset was individual Vines. This dataset includes a total of 487 Vines. To categorize each Vine, CRS devised a comprehensive set of coding categories. The researchers then examined each Vine and recorded the appropriate coding results. Several caveats accompany the results presented. First, the analysis treats all Member Vines as structurally identical, because each individual Vine reveals no information about who physically took the video. In some cases, Members might personally appear in a Vine, whereas other Members might choose to highlight constituents, staff, or other items. CRS draws no distinction between the two. Second, as with any new technology, the number of Members using Vine and the patterns of use may change rapidly in short periods of time. Thus, the conclusions drawn from these data cannot be easily generalized. Finally, these results cannot be used to predict future behavior. As of June 25, 2014, 141 of all 541 Members of Congress (26.1%) had an account registered with Vine. This represents an increase from 105 Members (19.4%) who, according to a January 2014 CRS report, had adopted Vine. When examined by chamber, 21% of registered Members were found to be Senators and 79% Representatives. When examined by party, 57% of Vine-registered Members were found to be Republicans and 43% Democrats. The proportion of adoption by party is consistent with previous research on the adoption of other social media platforms—such as Twitter and Facebook. Figure 1 shows the percentage of Member adoption of Vine by political party and chamber. Earlier studies of social media adoption found that House Republicans were the most likely early adopters of Twitter. That finding also appears to be true for Vine; House Republicans had the most adoptions—with a total of 69 Members on Vine. Adoptions for House Democrats (42), Senate Democrats (19), and Senate Republicans (11), were lower. By percentage, the majority party in each chamber—the House Republicans and the Senate Democrats—had the highest proportion of Members adopt Vine. On February 6, 2013, the first Member Vine was posted. Between that date and June 25, 2014, a total of 487 Vines were posted by Representatives and Senators, for an average of 29 Vines per month. Representatives posted an average of 74 Vines per month. Senators posted an average of seven per month. Figure 2 shows the total number of Vines posted per month, divided by chamber. House Republicans posted a majority of the Vines (51%). Next were House Democrats (24%), then Senate Democrats (18%), and Senate Republicans (8%). Figure 3 shows the proportion of Vines by chamber and party. CRS created six major message categories for classifying Members' Vines: position taking, homestyle, official action, personal/family, information, and other. Each observed Member Vine post was coded as belonging in one category based on the primary contents of the message. Following are definitions of the categories: In these Vines, a Representative or Senator took a position on a policy or political issue. The expressed position could concern a specific bill under consideration or a general policy issue. The Member might or might not have appeared. These Vines featured a Representative or Senator highlighting the district in an official capacity. The Member could be discussing a trip, visit, or event in the district or state; highlighting a factory or district or state feature; or engaging in some other non-Washington official action, such as travel to or from the district. In these Vines, a Representative or Senator described, showed, or recounted an official action. Examples included signing letters, voting on the floor or in committee, and introducing legislation. These were Vines in which a Representative or Senator discussed events in his or her personal life or provided opinions concerning matters that were explicitly unrelated to the Member's work in Congress. In this category of Vines, a Representative or Senator gave factual information on a variety of topics, such as historical events, holidays, Congressional staff, or interns. The Member might or might not have appeared. Vines that did not fit into other categories were classified as "other." Figure 4 shows the percentages of total Vines posted by Representatives and Senators that were in the each of the six categories. Overall, position-taking Vines were the most common (33.5%). This category was followed by information (29.6%), then homestyle (16%), personal/family (11.7%), official action (7.1%), and other (2.3%). When Members were examined by chamber, Senators were found to have Vined most often about information (9%), followed by homestyle (7%), and personal/family and position taking (roughly 4% each). Representatives Vined most often about position taking (30%), followed by information (20%), and homestyle (9%). At this early stage of the Vine adoption and use process, Member posts are similar to early use of Twitter, when Members primarily used the platform to provide information, often in the form of press releases. Further, Members were visible in 53% of Vines overall, and 61% of Vines appear to have been recorded in the District of Columbia, judging from images of Members' offices, DC landmarks, and Members' tagging posts to indicate their locations. Vine provides an opportunity for Members to be seen directly by followers in a way that is not possible on Twitter—where it can be difficult to know whether the Member is personally tweeting or has delegated that action to a staff member. After coding each Vine for contents, CRS recorded the issue area that was mentioned in each of the position-taking Vines. Some Vines covered more than one issue. A total of 38 issue areas received mention in 163 Vines. Six issues were mentioned most frequently. They were: Patient Protection and Affordable Care Act (19 Vines—12%); immigration (19 Vines—12%); unemployment benefits (17 Vines—10%); better wage or minimum wage (17 Vines—10%); 2013 government shutdown (14 Vines—9%); and jobs (10 Vines—6%). The remaining 32 issues were each mentioned in six Vines or fewer. Overall, Members are using Vine to take positions on specific policy issues (see Figure 4 ). The most common issue areas generally reflect the contents of congressional media coverage; the Patient Protection and Affordable Care Act, immigration, jobs, and the government shutdown have dominated media coverage of the 113 th Congress (2013-2014). The use of Vine by Members of Congress is an evolving phenomenon. As Members continue to embrace new technologies, their use of social media applications, like Vine and other platforms, may increase. Vine allows Members to communicate directly with constituents (and others) in a potentially interactive way that is not always possible using more traditional modes of communication. For Members and their staff, the ability to transmit real time information through videos and pictures, and observe how that information is shared across the Internet, could be influential for issue prioritization, policy decisions, and voting behavior. Unlike other forms of social media such as Twitter, Vine's emphasis is on visual instead of written communication. Whereas Twitter's focus is on communicating short bursts of information in 140 characters or fewer, Vine has the ability to translate those written thoughts into short series of pictures or videos that could potentially allow Members of Congress to disseminate their messages more effectively. One strength of social media, including Vine, is the potential for posts to go "viral," which would allow Members to communicate policy ideas, stake out positions, or announce events to an audience potentially far wider than just their followers. Further, Vine allows for a clear distinction between Member and staff postings. Twitter, and other text-centric social media platforms, can obscure whether posts are coming directly from a Representative or Senator or from a staff member. To combat this problem, some offices have the Member sign his or her tweets, often with initials, to indicate that the post came directly from the Member. For Vine, this process can be straightforward because a Member can appear on camera to deliver his or her message directly. If the Member does not appear in the Vine, then the public may assume that staff posted the message. Even with the ability to provide short video contents, Vine is currently not nearly as popular as Twitter or many other social media sites. While specific analysis on the percentage of adults using Vine is not currently available, the Pew Internet Research Project conducted a study on the use of Vine-like applications to watch videos on smartphones and the web. The Pew Project found that "... apps such as Vine are emerging which allow users to easily record and share short videos. Among online video consumers, 17% say they watch videos using a cell phone app like Vine. And among online video posters, 23% say that they have posted a video using this kind of app." The use of video sharing applications is becoming more popular. Consequently, the opportunities for Members of Congress to use these applications and websites to disseminate public policy positions and constituent services information are also increasing. How Members use social media continues to evolve. Some reports have suggested that Members are dedicating additional staff (or hiring new staff) to handle social media as part of their messaging and communications strategy. In the current budget climate, how Members allocate staff—especially in the House of Representatives, which limits the number of full time staff that a Member can hire—is crucial. If Members spend more resources on social media, the priorities of other representational functions possibly could change. Further research on the adoption and use of social media platforms—such as Vine—could provide insight into the changing approaches to representation, messaging to constituents and non-constituents, internal congressional communications (i.e., Members interacting with other Members through social media), and potential regulations. Also, while official Member communications cannot include campaign rhetoric, what Members say on official House or Senate social media accounts arguably can be used in elections. The impact of a video sharing service like Vine, as compared to a text-based service like Twitter, is unknown. Potential challengers could possibly use a Member's appearance in a Vine more directly than a Member's Twitter statement. The potential use of a Vine as part of a campaign commercial, for example, could alter a Member's decision on the type of contents included in future Vines. Electronic communications have also raised some concerns. While a complete discussion of this topic is beyond the scope of this report, a few observations warrant mentioning. First, existing law and chamber regulations on the use of communications media such as the franking privilege have proven difficult to adapt to new electronic technologies. Currently, House regulations largely treat social media communications as similar to franked mail. Several key differences, however, exist between electronic communications and franked mail—most notably the lack of marginal cost for sending electronic communications, the inability to differentiate between constituents and non-constituents, the opt-in nature of social media, and the ability of campaign challengers to adopt and utilize identical applications. These factors raise questions about both the suitability and necessity of applying the franking model to social media communications. Second, the use of social media communications is rapidly changing. In 2012, Vine did not exist. Going forward, there is no way to predict whether Vine, or other similar video-sharing services, will continue to enjoy popularity. Policy makers thus may choose to seek general rather than specific structures when considering social media regulation, to avoid the need to revisit policies as new technologies are developed. Similarly, Members of Congress may choose to adopt social media platforms that provide similar user experiences in order to simplify messaging and the impact on staff time.

In the past 10 years, the rise of social media has expanded the number of options available for communication between Members of Congress and their constituents. Virtually all Members, including all 100 Senators, use Twitter as a tool to communicate legislative, policy, and official actions to interested parties; and the use of other forms of social media, including Facebook, has also proliferated. The adoption of these technologies has enhanced the ability of Members of Congress to fulfill their representational duties by providing greater opportunities for constituents to communicate with Members and their staff. Electronic communications have also raised some concerns. Existing law and chamber regulations on the use of communications media such as the franking privilege have proven difficult to adapt to new technologies. More recently, Members have begun to adopt video and picture sharing social media services. This report examines Members' use of one of these new electronic communications platforms: Vine. After providing an overview of Vine, the report analyzes patterns of Members' use of Vine. This report is inherently a snapshot of a dynamic process. As with any new technology, the number of Members using Vine and the patterns of use may change rapidly. Thus, the conclusions drawn from these data cannot be easily generalized, nor can these results be used to predict future behavior. For more information on the adoption and use of social media by Members of Congress, see CRS Report R43018, Social Networking and Constituent Communications: Members' Use of Twitter and Facebook During a Two-Month Period in the 112th Congress, by [author name scrubbed], [author name scrubbed], and [author name scrubbed] and CRS Report R43477, Social Media in the House of Representatives: Frequently Asked Questions, by [author name scrubbed] and [author name scrubbed].

During the Obama Administration, the two federal agencies primarily responsible for administering the private health insurance provisions in the Affordable Care Act (ACA)—the Centers for Medicare & Medicaid Services (CMS) within the Department of Health and Human Services (HHS), and the Internal Revenue Service (IRS) within the Treasury Department—took a series of actions to delay, extend, or otherwise modify the law's implementation. This report discusses selected administrative actions taken by CMS and the IRS through February 2015 to address ACA implementation. The report is no longer being updated and is available primarily for reference purposes. Table 1 summarizes the more significant administrative actions taken, all of which focused on implementation of the ACA's complex set of interconnected provisions to expand private insurance coverage for the medically uninsured and underinsured. These actions were not the result of a single policy decision. Instead, they represented many separate decisions taken by the Obama Administration to address a variety of factors affecting the implementation of specific provisions of the law. The Administration announced a series of delays and other changes before and during the first (i.e., 2014) open enrollment period and the problematic launch of the federal—and some state-run—exchanges. The second (i.e., 2015) open enrollment period that closed on February 15, 2015, experienced far fewer administrative and technical problems. Other administrative actions largely focused on the ACA's tax provisions. The 2014 tax filing season (deadline April 15, 2015) was the first one in which individuals were required to indicate on their tax return whether they had health insurance coverage that meets the ACA's standards. Those without coverage risked being penalized unless they could claim an exemption. In addition, everyone who enrolled in coverage for 2014 through an exchange and received advance payments of the premium tax credit had to file a federal tax return in which they reconciled those payments with the actual tax credit to which they were entitled. In compiling the table, CRS made decisions about which administrative actions to include, and which ones to leave out. Generally, CRS included the more significant actions that had been the subject of debate among health policy analysts and, in many instances, the target of criticism by opponents of the ACA. It is important to keep in mind that the table is not—nor was it intended to be—a comprehensive list of ACA-related administrative actions. The table entries, which are grouped under general topic headings, are not organized in any particular priority order. Each entry includes a brief summary of the action and some accompanying explanatory material and comments to help provide additional context. Where available, links are provided to relevant regulatory and guidance documents online. Readers are encouraged to review these documents for more details about each action, including the motivation and legal authority for taking it. A companion CRS report summarizes all the legislative actions taken by the 112 th , 113 th , and 114 th Congresses to repeal, defund, delay, or otherwise amend the ACA. Perhaps the most controversial administrative action taken by the Administration was its decision to delay enforcement of the ACA's "employer mandate." On July 9, 2013, the IRS announced that it would not take any enforcement action against employers who fail to comply with the law's employer mandate until the beginning of 2015 (see Table 1 ). This ACA provision, which took effect on January 1, 2014, requires employers with 50 or more full-time equivalent employees (FTEs) to offer their full-time workers health coverage that meets certain standards of affordability and minimum value. Those employers who do not provide such coverage risk having to pay a penalty if one or more of their employees obtain subsidized coverage through an exchange. The IRS subsequently announced that employers with at least 50 but fewer than 100 FTEs will have an additional year to comply with the employer mandate (see Table 1 ). According to the Administration, these actions were taken after it was concluded that the ACA's employer mandate could not be enforced until the related requirement that employers report the coverage they offer to their employees had been fully implemented. The IRS indicated that it would work with stakeholders to simplify the reporting process consistent with effective implementation of the law. Other controversial administrative actions include those taken in response to the decision by insurers to cancel individual and small-group health plans that do not meet the ACA's new standards for health insurance coverage, which also took effect on January 1, 2014. On November 14, 2013, the Administration notified state insurance commissioners of the option to delay enforcement of certain health insurance reforms under the ACA. It encouraged state officials to permit insurers to renew noncompliant policies in the individual and small-group market for policy years starting between January 1, 2014, and October 1, 2014. The Administration subsequently extended this policy for two years. Thus, at the option of state regulators, insurers could continue to renew noncompliant policies at any time through October 1, 2016 (see Table 1 ). The Administration was criticized for creating numerous special enrollment periods that enable individuals to enroll in an exchange plan outside the annual open enrollment period. Individuals can qualify for a special enrollment period as a result of a variety of events that affect their ability to obtain or maintain health insurance coverage (e.g., moving, losing job-based coverage, gaining legal U.S. residency). Special enrollment periods were also established for individuals unable to begin or complete the process of enrolling in an exchange plan before the end of the open enrollment period because of technical problems or other circumstances. State-run exchanges were encouraged to adopt special enrollment periods similar to the ones established for federally facilitated exchanges. In addition, the Administration established numerous hardship exemptions from the ACA's "individual mandate" penalty. Under the law, most U.S. citizens and legal residents are required to maintain ACA-compliant health coverage beginning in 2014. Those without coverage for three or more consecutive months are subject to a penalty unless they meet one of the statutory exemptions, or qualify for one of the health coverage-related or hardship exemptions established by CMS. In some instances the hardship exemption is tied to qualifying for a special enrollment period. For example, individuals who qualified for a special enrollment period to finish enrolling in an exchange plan after the 2014 open enrollment period closed on March 31, 2014, were granted a hardship exemption so that they would not be penalized for being uninsured for the first four months of the year (see Table 1 ). Opponents of the ACA, who believe that the law is fundamentally flawed, argued that some of the Obama Administration's actions were effectively rewriting the ACA in an effort to make it work and add to the public's confusion about the law. The ACA's critics asserted that the actions taken by the Administration to delay enforcement of the employer mandate were illegal and raised concerns that the President was not upholding his constitutional duty to faithfully execute federal law. The Administration countered that its actions were not a refusal to implement and enforce the ACA as written. Instead, they represented temporary corrections necessary to ensure the effective implementation of a very large and complex law. Agency officials pointed to a number of factors that made it difficult to meet various ACA deadlines. Those factors included a lack of appropriations to help fund implementation activities, technological problems including the poorly managed launch of the websites for the federally facilitated exchanges and some state-run exchanges, and the need to phase in the various interconnected parts of the law so as to avoid unnecessary disruption of employment and insurance markets. Regarding the delay of the employer mandate, the Administration said that its actions were no different from those taken by previous administrations faced with the challenges of implementing a complicated law. The Administration noted that its decision to grant employers "transition relief," taken pursuant to administrative authority under the Internal Revenue Code to "prescribe all needful rules and regulations" to administer tax laws, was part of an established practice to provide relief to taxpayers who might otherwise struggle to comply with new tax law. Notwithstanding the Administration's arguments, critics question whether some of the recent delays of ACA provisions exceed the executive's traditional discretion in enforcing law to the point that they represent a blatant disregard of the law. For example, they argue that the decision to encourage states to allow insurers to renew noncompliant policies for people who want to keep their current plans directly contravenes provisions of the ACA that had become politically inconvenient. On July 30, 2014, the House voted 225-201 to approve a resolution ( H.Res. 676 ) authorizing Speaker John Boehner, on behalf of the House, to sue the President or other executive branch officials for failing to "to act in a manner consistent with [their] duties under the Constitution and laws of the United States with respect to implementation of the [ACA]." The Speaker indicated that any such lawsuit would specifically challenge the Administration's delay of the ACA employer mandate. "In 2013, the President changed the health care law without a vote of Congress, effectively creating his own law by literally waiving the employer mandate and the penalties for failing to comply with it," said Mr. Boehner. A lawsuit was filed on November 21, 2014, consisting of two counts. First, it claimed that the Administration had violated the Constitution by delaying the ACA employer mandate. Second, the lawsuit challenged the ACA's cost-sharing subsidies. These are paid to insurance companies to reduce the out-of-pocket health care costs of certain individuals and their families receiving premium tax credits. Unlike the premium tax credits, for which the ACA provided a permanent appropriation, the lawsuit argues that the law did not appropriate any funding for the cost-sharing subsidies.

During the Obama Administration, the two federal agencies primarily responsible for administering the private health insurance provisions in the Affordable Care Act (ACA)—the Centers for Medicare & Medicaid Services (CMS) within the Department of Health and Human Services (HHS), and the Internal Revenue Service (IRS) within the Treasury Department—took a series of actions to delay, extend, or otherwise modify the law's implementation. This report summarizes selected administrative actions taken by CMS and the IRS through February 2015 to address ACA implementation. The report is no longer being updated and is available primarily for reference purposes. A companion product—CRS Report R43289—summarizes all the legislative actions taken by the 112th, 113th, and 114th Congresses to repeal, defund, delay, or otherwise amend the ACA. The most significant administrative action was the decision by the IRS to delay implementation of the law's "employer mandate." This ACA provision, which took effect on January 1, 2014, requires employers with 50 or more full-time equivalent employees (FTEs) to offer their full-time workers health coverage that meets certain standards of affordability and minimum value. Those employers who do not provide such coverage risk having to pay a penalty if one or more of their employees obtain subsidized coverage through an exchange. The IRS announced that it would not take any enforcement action against employers who fail to comply with the law's employer mandate until the beginning of 2015. Subsequently, the agency announced that employers with at least 50 but fewer than 100 FTEs would have an additional year to comply with the employer mandate. Other controversial administrative actions include those taken in response to the decision by insurers to cancel individual and small-group health plans that do not meet the ACA's standards for health insurance coverage, which also took effect on January 1, 2014. Opponents of the ACA argued that these administrative actions were an attempt to rewrite the law in order to make it work. They asserted that some of the Administration's actions were illegal and raised concerns that the President was not upholding his constitutional duty to faithfully execute federal law. The Administration countered that its actions were authorized by federal law and represented temporary corrections necessary to ensure the effective implementation of a very large and complex act. On July 30, 2014, the House approved a resolution (H.Res. 676) authorizing Speaker John Boehner, on behalf of the House, to sue the President or other executive branch officials for failing to "to act in a manner consistent with [their] duties under the Constitution and laws of the United States with respect to implementation of the [ACA]." A lawsuit was filed on November 21, 2014, consisting of two counts. First, it claimed that the Administration had violated the Constitution by delaying the ACA employer mandate. Second, the lawsuit challenged the Administration's authority to pay cost-sharing subsidies, arguing that the law had not appropriated any funding for them.

The Federal Election Commission (FEC) is a six-member independent regulatory agency. Congress created the FEC in 1974, after controversial fundraising during 1960s presidential campaigns and the early 1970s Watergate scandal. The commission is responsible for administering federal campaign finance law and for civil enforcement of the Federal Election Campaign Act (FECA). The FEC also discloses campaign finance data to the public, conducts compliance training, and administers public financing for participating presidential campaigns. FECA establishes six-year terms for commission members. Commissioners may continue in "holdover" status after those terms end. Commissioners are appointed by the President and are subject to Senate confirmation. FECA requires that at least four of the six commissioners vote to make decisions on substantive actions. This includes deciding on enforcement actions, advisory opinions, and rulemaking matters. Because FECA also requires bipartisan commission membership, achieving at least four agreeing votes is sometimes difficult, even with six members present. Vacancies make the task harder by reducing opportunities for a coalition of at least four votes. In 2008, the FEC lost its policymaking quorum for six months. As of this writing, the commission again faces a potential loss of its policymaking quorum because only four commissioners remain in office. One nomination is pending, and the status of future departures remains unclear. These developments notwithstanding, it is unclear whether the agency will lose more commissioners. This report provides a brief overview of the FEC's policymaking powers without at least four commissioners in office. The topic may be relevant for congressional oversight of the agency, particularly if it loses its policymaking quorum, and for Senate consideration of nominations to the agency. Other CRS products provide additional information about campaign finance policy, the FEC, and procedural issues. As of this writing, the FEC is operating with four commissioners instead of six, as shown in Table 1 below. The current vacancies developed as follows: Effective February 28, 2017, Democratic Commissioner Ann M. Ravel resigned, leaving the agency with five members. Ravel's term would have expired on April 30, 2017. As of this writing, no nominee for the Ravel seat has been announced. On February 7, 2018, Republican Commissioner Lee Goodman announced his intention to resign, effective February 16, 2018. As of this writing, no nominee for the Goodman seat has been announced. Once Goodman left the agency, the FEC had four remaining members. In addition to the current two vacancies, others are possible in the future, as noted below. Recent developments suggest that Republican Commissioner Matthew S. Petersen could leave the commission. On September 11, 2017, President Trump nominated Petersen for a federal judgeship. Petersen subsequently withdrew from consideration for the judgeship, reportedly writing, "until the time is otherwise appropriate, I look forward to returning to my duties at the Federal Election Commission." Petersen remains on the commission in holdover status after his term expired in 2011. The status of a nomination intended to replace Commissioner Petersen is unclear. After Petersen was nominated to the federal judgeship, but before he withdrew from consideration for that position, President Trump nominated a replacement for Petersen at the FEC. On September 14, 2017, President Trump nominated James E. "Trey" Trainor III to the Petersen seat. This nomination was returned to the President at the end of the first session. The White House resubmitted the nomination on January 8, 2018, at the start of the second session of the 115 th Congress. It is unclear whether any other commissioners currently plan to leave. For several years, periodic reports have suggested that one or more other commissioners also plan to depart. If any of the four remaining commissioners departed, the agency would be without a policymaking quorum. Congress originally designed eight positions for the FEC: six commissioners and two nonvoting ex officio members (the Clerk of the House and Secretary of the Senate). Under that structure, two commissioners were appointed by the President, two by the President pro tempore of the Senate, and two by the Speaker of the House. Two federal court decisions altered the FEC's original design. First and most significantly, in Buckley v. Valeo (1976) the Supreme Court of the United States invalidated the original appointments method, holding that congressional appointments violated the Constitution's Appointments Clause. Almost 20 years later, a federal court again found fault with the FEC's appointment structure. In 1993, the U.S. Court of Appeals for the District of Columbia held in FEC v. NRA Political Victory Fund that the presence of the two congressional ex officio members violated constitutional separation of powers. Congress did not amend FECA responding to this decision, although the ex officio members are no longer appointed. In a broad revision of FECA in 1976, undertaken in response to the Buckley decision, Congress adopted the current appointment method. Today, all commissioners are presidentially appointed subject to Senate advice and consent. Members of the congressional leadership or committees of jurisdiction (the House Committee on House Administration and Senate Rules and Administration Committee) apparently continue to influence the appointment process. FECA specifies few qualifications for FEC commissioners, noting simply that they "shall be chosen on the basis of their experience, integrity, impartiality, and good judgment." As one former general counsel notes, although many commissioners are lawyers, "a commissioner does not have to be a lawyer and the commission has a long history of having non-lawyers serve as members." Commissioners typically have experience as congressional staffers, political professionals, election lawyers, or some combination thereof. No more than three commissioners may be affiliated with the same political party. In practice, the commission has been divided equally among Democrats and Republicans, although one current commissioner identifies as an independent. FECA staggers commissioner terms so that two expire every other April 30 during odd-numbered years (e.g., 2019, 2021, etc.). This arrangement means that, at least as designed, two new commissioners would assume office biennially. However, the President is under no obligation to make biennial nominations. Currently, FEC commissioners may serve a single six-year term. As another CRS report explains, for some federal boards and commissions, including the FEC, "[a]n individual may be nominated and confirmed for a seat for the remainder of an unexpired term in order to replace an appointee who has resigned (or died). Alternatively, an individual might be nominated for an upcoming term with the expectation that the new term will be underway by the time of confirmation." Some FEC commissioners have assumed office when the term for which they were nominated was well underway. For example, on June 24, 2008, the Senate confirmed Donald F. McGahn and Steven T. Walther to terms that expired just 10 months later, on April 30, 2009. Both continued serving in their seats past the expiration of their terms, although they could have been replaced through subsequent appointments. These and other commissioners could remain in office because FECA permits FEC members to serve in "holdover" status, exercising full powers of the office, after their terms expire "until his or her successor has taken office as a Commissioner." As Table 1 above shows, as of this writing, all current commissioners are serving in holdover status. FECA requires affirmative votes from at least four commissioners to authorize most policymaking activity. In particular, this includes holding hearings; making, amending, or repealing rules; initiating litigation or defending the commission in litigation, including appeals; issuing advisory opinions; conducting investigations, and making referrals to other enforcement agencies; approving enforcement actions and audits; and issuing and amending forms (e.g., those used in the disclosure process). Matters without at least four votes for or against an action can have the effect of leaving questions of law, regulation, or enforcement unresolved, as some view the issues in question as having been neither approved nor rejected. With fewer than four commissioners, existing campaign law and regulation would remain in effect. Agency staff and remaining commissioners could continue to provide general information, and to prepare for a repopulated commission. In addition, as explained below, the commission revised its internal procedures before it last lost a policymaking quorum to clarify functions that could continue. The significance of the four-vote threshold became particularly evident in 2008. Following expired recess appointments and amid ongoing Senate consideration of FEC nominations, the agency had just two commissioners for the first six months of the year. In late 2007, in anticipation of only two commissioners remaining in office in 2008, commissioners amended the FEC's rules of internal procedure to permit executing some duties if the agency lost its four-member policymaking quorum. These revisions to the FEC's Directive 10 permit the commission to continue meeting with fewer than four members to approve general public information, such as educational guides; appoint certain staff; and approve other basic administrative and employment matters. During the loss of the commission's policymaking quorum in 2008, the two remaining commissioners (David Mason (R) and Ellen Weintraub (D)) met publicly to discuss advisory opinions, but could not vote to issue those opinions. At the time, the commissioners explained that although they recognized that the commission lacked a quorum, they were attempting to provide general feedback, particularly given the ongoing 2008 election cycle. That practice generated some controversy, however, as some practitioners contended that remaining commissioners did not have the authority to meet and provide guidance. It is unclear whether commissioners would continue the practice in the future with fewer than four members. After the Senate confirmed nominees in June 2008, the new commissioners faced a backlog of enforcement matters, litigation, advisory opinions, and rulemakings to implement portions of the Honest Leadership and Open Government Act (HLOGA). The agency returned to normal operations during the rest of 2008 and throughout 2009. The FEC has maintained a full policymaking quorum since then. The FEC currently retains its policymaking quorum. Media reports suggest that additional commissioners may be considering leaving the agency, although such reports are relatively common and do not necessarily foreshadow actual departures. If there are any departures before additional confirmations, it would be impossible for the FEC to reach a policymaking quorum. As explained previously, this means that even if all remaining commissioners agreed on an outcome, the agency would have too few votes to execute its most consequential duties. Among others, current matters before the FEC include a proposed rulemaking on disclosure requirements for certain online political advertising, as well as responding to developments during the 2016 election cycle and preparing for 2018. Particularly during election years, advisory opinion requests are common.

The Federal Election Commission (FEC) is the nation's civil campaign finance regulator. The agency ensures that campaign fundraising and spending is publicly reported; that those regulated by the Federal Election Campaign Act (FECA) and by commission regulations comply and have access to guidance; and that publicly financed presidential campaigns receive funding. FECA requires that at least four of six commissioners agree to undertake many of the agency's key policymaking duties. As of this writing, the FEC is operating with four commissioners instead of six. Others reportedly are considering leaving the agency. One nomination to the FEC has been resubmitted during the 115th Congress; no committee or floor action has been taken on it to date. It is entirely possible that the FEC will retain at least four commissioners and that the agency will remain able to carry out all its duties. If, however, the FEC loses its policymaking quorum—as happened for six months in 2008—the agency would be unable to hold hearings, issue rules, and enforce campaign finance law and regulation. This CRS report briefly explains the kinds of actions that FECA would preclude if the commission lost its policymaking quorum. This report will be updated in the event of significant changes in the agency's policymaking quorum or the status of agency nominations.

Former Prime Minister of Australia John Howard and President George W. Bush signed the U.S.-Australia Treaty on Defense Trade Cooperation in Sydney on September 5, 2007, immediately before the Asia-Pacific Economic Cooperation (APEC) summit. Proponents view the treaty as bringing what are already very close allies even closer together by facilitating defense trade between the two states and members of their respective defense industries. However, some are concerned that a treaty approach is not the best way to deal with perceived problems with arms and defense technology export controls. The treaty would ease restrictions associated with the International Trade in Arms Regulations (ITAR) by creating a comprehensive framework within which most defense trade can be carried out without prior government approval. The trade must support combined U.S.-Australian counterterror operations, U.S.-Australia "research and development, production and support programs," and Australia and U.S. government-only end-uses in order to be eligible. Exports of defense articles outside the community consisting of the two governments and approved companies of the two nations would require U.S. and Australian government approval. Supporters state that the treaty will help the two nations strengthen interoperability between their military forces, help sustain them, and use defense industries in direct support of the armed forces. Many of the details of how the treaty will operate have yet to be worked out. According to press releases, "under the implementing arrangements that are contemplated by the treaty, our industries will move from the licensing regime under the U.S. International Traffic in Arms Regulations, to the more streamlined procedures that will be set forth in these implementing arrangements." The treaty, which was negotiated under the former Liberal [right of center] Government that took office in 1996, would provide Australia with streamlined access to U.S. defense trade. This treaty would simplify U.S. export controls on defense articles to Australia that reportedly, along with U.S. defense industry, has been frustrated with existing restrictions. Australia and the U.S. reportedly approved 2,361 licenses and concluded 312 agreements in 2006. The treaty would also provide Australia with: operational benefits from greater access to U.S. support; improvements to military capability development due to earlier access to U.S. data and technology; cost and time savings from significant reductions in the number of licenses required for export of defense equipment; and improved access for Australian companies involved in bidding on U.S. defense requirements, or in supporting U.S. equipment in the Australian Defence Force (ADF) inventory. If passed, the treaty will likely require the enactment of enabling legislation in Australia and as a result will need the support of the newly elected government of Kevin Rudd to come into force. Key legislation that may require amendment are the Customs Act of 1901, Customs Regulations 1958, and Weapons of Mass Destruction(Prevention of Proliferation) Act of 1995. Rudd's Labor Party's sweeping victory in the November 24, 2007 election has given him a strong mandate. The Labor Party has denied election year accusations in Australia that it would in some way downgrade the Australia-U.S. alliance and stated "Labor will enhance our strategic relationship and seek to make an already special friendship even stronger and more effective." The defense trade treaty is expected to be supported by the new Prime Minister due to the large bipartisan support for the Australia-New Zealand-United States (ANZUS) alliance in Australia. While Prime Minister Rudd views the United States and the ANZUS alliance as central to Australia's security he has indicated that Australia would begin a staged withdrawal of troops from Iraq. He has also stated that under his leadership Australia would consider increasing the number of troops stationed in Afghanistan. Prime Minister Rudd has stressed that the history of the alliance is a bipartisan one that was instigated in World War II by President Roosevelt and Australian Labor Party Prime Minster John Curtin. He has also stated that "for Labor the U.S. alliance sits squarely in the centre of our strategic vision. Intelligence sharing, access to advanced technologies, systems and equipment, together with combined military exercises and training enhances Australia's national security." Rudd has been described as believing that a strong American presence in the region is crucial to regional stability and that U.S. strategic engagement in Asia is central to Australia's security. The treaty would further draw Australia into a very small circle of closely trusted allies that have stood with the United States not only in past conflicts but also in recent conflicts in Afghanistan and Iraq. It would do this at a time when the United States is increasingly unpopular in the world. In May 2007, Secretary of State Condoleezza Rice described the alliance as "... one that reflects the deep bond of enduring ideals and shared history, colonial origins, democratic development, and shared political and cultural values ... ours is an alliance that remains strong...." During his September 2007 visit to Australia, Pacific Commander Admiral Timothy Keating stated, "Every war we fought for the last century, the Australians have been with us, and we have been with them ... they are members of the coalition of the committed, not just the coalition of the willing." The treaty could improve the image of the United States in Australia by demonstrating the benefits of the alliance. Australian attitudes towards the United States have changed significantly in recent years. Only 48% of Australians polled thought that the United States would be a "very close" economic partner of Australia in five to ten years as opposed to 53% that thought China would be. This is quite remarkable given that Australia is a longstanding treaty ally that has fought alongside the United States in most of America's wars and established a Free Trade Agreement (FTA) with the United States in 2005. Several factors have contributed to the decline in U.S. popularity in Australia. These include Bush Administration policies; the view that the United States is a self proclaimed world watch dog; the war in Iraq; and U.S. foreign policies. Dissatisfaction with the bilateral FTA and with the United States' position on global warming also appear to be key factors. In a recent poll sixty seven percent of Australians polled had an "unfavorable" opinion of President Bush despite former Prime Minister John Howard's close relationship with the President. Some 48% of those polled in 2007 felt that it would be better for Australia's national interest to "act more independently of the U.S." Despite these negative polling results, some 92% of Australians believe that the U.S. will be a very close or close security partner over the next decade and some 79% still believe that the U.S. alliance under ANZUS is "very important" (37%) or "fairly important" (42%) to Australia's security. It is striking that despite the decreasing popularity of U.S. foreign policy since 2001, some 74% of Australians polled still trust that the United States would come to Australia's assistance were it to be threatened by some other country. Thus, it appears that Australians draw a distinction between the current U.S. government and its policies and the long term value of the ANZUS alliance. Some have expressed concern that the treaty as proposed with Australia could lead to reduced congressional oversight. Many of those concerned with the treaty are concerned not primarily because they believe Australia would transfer military technologies to unfriendly states or entities but out of concern that the treaty could undermine existing congressional oversight as defined in ITAR. The lack of supporting implementing arrangements to accompany the treaty document is also of concern to some. In September 2007, the Australian Embassy reportedly stated that details of the implementing agreements for the treaty would be worked out in the coming months. The arrangements will: define precisely how the treaty will operate in both Australia and the United States, and how its obligations will be implemented to the mutual satisfaction of both countries. These arrangements include identifying the changes that might be needed to our legal and regulatory regimes, and putting these changes into effect. Until such time as the implementing arrangements are made known it will be difficult to comprehend the full scope of the treaty. By using a treaty, which must be ratified by the Senate, to redefine defense trade cooperation with Australia, the Administration appears to some to be putting in place an arrangement that avoids the existing regulatory structure. Proponents argue that the benefits of streamlining defense cooperation with this close ally far outweigh separation of powers concerns as well as the potential that Australia would be the source of technologies or weapons falling into unfriendly hands. The potential that third party transfers could result in the re-export of U.S. technology to potential enemies is reportedly addressed in the treaty by allowing the United States to vet such transfers. The treaty has been welcomed by representatives of the U.S. defense industry as most of Australia's key weapons systems are American-made by companies such as Boeing, Northrop, and Raytheon. Australia's defense budget has experienced a 47% real growth rate over the past 11 years. (See Table 1 with U.S. arms sales agreements and deliveries with Australia for further information.)

The United States and Australia signed a Treaty on Defense Trade Cooperation in September 2007 that would facilitate defense trade and cooperation between the two nations. On the strategic level, the treaty would further develop ties between two very close allies who have fought together in most of America's conflicts, including most recently in Iraq and in Afghanistan. This treaty is proposed at a time when the United States has found few friends that have been willing to work as closely with the United States in its efforts to contain militant anti-Western Islamists as Australia has proven to be. The treaty with Australia needs to be ratified by the U. S. Senate to come into force.

The Every Student Succeeds Act (ESSA), signed into law on December 10, 2015 ( P.L. 114-95 ), comprehensively reauthorized the Elementary and Secondary Education Act of 1965 (ESEA). Among other changes, the ESSA amended federal K-12 educational accountability requirements for states and local educational agencies (LEAs) receiving ESEA funds, including those regarding the identification, support, and improvement of high schools with low graduation rates. Under the ESSA, states seeking Title I-A funds are required to submit accountability plans to the Department of Education (ED) that must address, among other things, their approaches toward dealing with low high school graduation rates. In implementing these plans, states must identify for support and improvement all public schools failing to graduate one-third or more of their students. LEAs that serve schools identified for support and improvement are required to develop a plan to improve graduation rates. If a school does not improve within a state-determined number of years, the school is subject to more rigorous state-determined actions. The national graduation rate for the Class of 2016 was 84.1%—the highest rate recorded since 2010-2011, when most states and LEAs began consistently reporting under 2008 federal guidelines. Improvement in the national rate has been accompanied by improvements in nearly every state and across all reported groups of students, including all racial and ethnic subgroups, low-income students, English learners, and students with disabilities. However, graduation rate gaps persist among the several student subgroups. Moreover, the graduation rate varies enormously among individual high schools across the country, with a large number of schools doing poorly on this measure. Importantly for ESSA accountability implementation, CRS analysis of school-level data reveals that as many as 16% of high schools may fail to graduate at least one-third of their students. Thus, there are potentially thousands of high schools nationwide that may be identified for intervention in the coming years. Implementation of the accountability rule occurs in school year 2017-2018 and relies on additional criteria that would undoubtedly impact this estimate. In addition to new accountability rules, the ESSA provided the first definition of the high school graduation rate in federal education law. This was the culmination of years of effort at the national, state, and local levels to achieve national uniformity of measurement and establish statewide longitudinal data systems. Put simply, the ESSA defines the Four-Year Adjusted Cohort Graduation Rate (ACGR) as the number of students who graduate in four years with a regular high school diploma divided by the number of students who form the adjusted cohort for the graduating class. From the beginning of 9 th grade, students entering that grade for the first time form a cohort that is adjusted by adding students who subsequently transfer into the cohort and subtracting students who subsequently transfer out, emigrate to another country, or die. The following formula provides an example of how the ACGR is calculated for the class of 2016: As Figure 1 shows, the rate of high school completion in the United States increased dramatically after World War II. The rate displayed in this figure is not the ACGR; rather, it represents the number of persons ages 25 to 29 whose highest level of educational attainment was at least a high school diploma (or its equivalent). It is based on responses to the Current Population Survey (CPS). After 10-15 percentage-point increases every decade, this measure plateaued at about 85% in 1980 and stood at 92.5% in 2017. Although the overall rate of high school completion has reached an historically high level, inequities persist among racial and ethnic groups. In general, these groups have made progress similar to the overall trend with one exception: Hispanics have seen a rapid increase in high school completion in recent years. Even with this increase, the attainment gap between white, non-Hispanics and Hispanics remains wide—13 percentage points in 2017. Black attainment also continues to lag behind that of Asians and non-Hispanic whites—maintaining a roughly five percentage point gap below the latter since the early 1990s. The CPS educational attainment rate is presented here (in Figure 1 ) because it is useful for tracking long-term trends. It is important to note the differences between the ACGR and the CPS educational attainment rate. The CPS is a cross-sectional measure (i.e., taken at a single point in time) of those included in the survey sample. The ACGR is a longitudinal measure that tracks an entire cohort of students from entry into high school to graduation. Another distinction between the two measures is that the CPS includes diploma equivalencies (such as the General Educational Development (GED) test) in its rate, while the ACGR only includes "regular" diplomas. The inclusion of equivalencies may partly explain why the CPS rate is higher than the ACGR. Additionally, the CPS rate shown in Figure 1 is for people ages 25 to 29—giving them more time to complete high school or receive a GED compared to the four years allotted to cohorts in the ACGR. More broadly, while the ACGR is confined to those engaged in the school system, the CPS captures a wider population of persons in society, generally. Even with these differences, the overall ACGR collected since 2010-2011 shows similar trends. As Table 1 shows, the overall graduation rate increased five percentage points between 2011 and 2016—a rate similar to the three percentage point increase in the overall CPS educational attainment rate estimate for the same time period. The two high school completion measures show somewhat different trends among racial/ethnic groups. In the CPS data, the white, non-Hispanic rate increased less than 1% between 2011 and 2016, while it increased over 4% in the ACGR data. During the same period, the CPS rate for blacks increased less than 3%, while the ACGR for blacks increased over 9%. The CPS rate grew just over 1% for Asians while the ACGR grew almost 4%. Both measures had similar changes for Hispanics. Because the ESSA accountability requirements apply to both the total student body within schools as well as specified subgroups, states must report the ACGR for several subgroups including low-income students, English language learners, students with disabilities, and various racial/ethnic categories. The data spanning 2011-2016 indicate progress among all three of these subgroups: graduation rates among low-income students increased more than seven percentage points, English language learners increased nearly ten percentage points, and students with disabilities increased six and a half percentage points. The rate of on-time high school completion varies widely across the country. For the Class of 2016, the ACGR in 27 states was above the national average (84.1%) and below the national average in 23 states. New Mexico had the lowest ACGR (71%) and Iowa had the highest (91.3%). Figure 2 displays the ACGR for the Class of 2016 by state. Four states graduated fewer than 76.1% of their students, nineteen states graduated 76.2%-84.1%, seventeen states graduated 84.1%-87.7%, and ten states graduated 87.8% or more. As shown in Table 2 , graduation rates have increased or remained the same in every state between the graduating classes of 2011 and 2016. The largest increase occurred in Alabama, which saw an increase from 72% (which was below the national average), to 87.1% (which was above the national average). Four states—Alaska, Georgia, Nevada, and West Virginia—had increases of more than ten percentage-points. Three states—Indiana, South Dakota, and Vermont—saw increases of less than one percentage point over this same period. ESSA provisions require that, beginning with the 2017-2018 school year, each state must use the ACGR as an indicator in their accountability systems and in calculating long-term and interim goals. Analysis of school-level data for the Class of 2015 reveals 2,512 high schools—16% of schools nationwide—had an ACGR of less than 70% ( Table 3 ). [Note that, due to privacy protections imposed on publically available data, this analysis uses 70% (instead of 66.7%) as the cutoff for schools to be identified for intervention. These limitations only apply to published data; states would not face such constraints as they have access to the complete data of actual rates reported for every school.] Because this analysis uses 70% instead of 66.7%, it likely overestimates the number of schools that may be identified for intervention due to low graduation rates. This analysis may further overestimate the number of schools that may be identified for intervention because the accountability provisions do not take effect until the 2017-2018 school year and graduation rates have been improving. Even with these caveats, this analysis suggests that there are potentially thousands of high schools that may be identified for improvement due to failure to graduate more than one-third of their students. Whether or not these schools would be uniquely identified for intervention based upon graduation rates (or identified for other reasons as well) is unknown. That is, it is unclear how much overlap may exist among schools identified by graduation rate and those identified for other reasons (i.e., the lowest-performing 5% of Title I schools and those with chronically underperforming subgroups). Nonetheless, the number of schools identified as being in need of comprehensive support for this reason may be large in some states. The Department of Education (ED) collects the Adjusted Cohort Graduation Rate (ACGR) from states through its EDFacts Initiative. These data are made public on ED's website. Disclosure avoidance techniques are applied to comply with privacy protections required by the Family Educational Rights and Privacy Act. These steps result in complete suppression of the ACGR for schools with cohorts of fewer than 6 students, reporting of ACGR ranges for cohorts between 6 and 200 students, and reporting of exact rates for cohorts over 200 students. The widths of the ACGR ranges are determined by cohort size and get progressively wider as a cohort size decreases. The actual ACGR reported by states lies somewhere within the published range. ACGR ranges reported by EDFacts are shown in Table A-1 .

The Every Student Succeeds Act (ESSA) comprehensively reauthorized the Elementary and Secondary Education Act of 1965 (ESEA). Among other changes, the ESSA amended federal K-12 educational accountability requirements for states and local educational agencies (LEAs) receiving ESEA funds, including those regarding the identification, support, and improvement of high schools with low graduation rates. In addition to new accountability rules, the ESSA provided the first definition of the high school graduation rate in federal education law. States and LEAs have been reporting their rates using the same definition, originally laid out in 2008 regulations, since the 2010-2011 school year. The national graduation rate for the Class of 2016 was 84.1%—the highest rate recorded using the new methodology. The graduation rate for the Class of 2011 was 79.0%. This national-level improvement has been accompanied by improvements in nearly every state and across all reported groups of students, including all racial and ethnic subgroups, low-income students, English learners, and students with disabilities. Still, graduation rate gaps persist among several student subgroups. At the state level, 27 states were above the national average in 2016 and 23 were below. Three states graduated fewer than 75% of their students, nine states graduated 75%-79.9%, eleven states graduated 80%-84.9%, seventeen states graduated 85%-87.9%, and ten states graduated 88% or more. Importantly for ESSA accountability implementation, analysis of 2014-2015 school-level data reveals that as many as 16% of high schools may fail to graduate at least one-third of their students. Thus, there are potentially thousands of high schools nationwide that may be identified for intervention in the coming years.

The Census Bureau's release of the first figures from the 2010 Census on December 21, 2010, shifted 12 seats among 18 states for the 113 th Congress (beginning in January 2013). Illinois, Iowa, Louisiana, Massachusetts, Michigan, Missouri, New Jersey, and Pennsylvania each lost one seat; New York and Ohio each lost two seats. Arizona, Georgia, Nevada, South Carolina, Utah, and Washington each gained one seat; Florida gained two seats, and Texas gained four seats. The reapportionment of House seats in 2010 was based on an apportionment population that is different from the actual resident population of each state. For apportionment purposes since 1970 (with the exception of 1980), the Census Bureau has added to each state's resident population the foreign-based, overseas military and federal employees and their dependents, who are from the state but not residing therein at the time of the census. In 2010, these additional persons increased the census count for the 50 states by 1,042,523, a little less than twice the number in 2000. If the foreign-based military and federal employees had not been included in the counts, there would have been no change in the 2010 apportionment of seats, although the order of seat assignment would have changed. The reapportionment process for the House relies on rounding principles, but the actual procedure involves computing a "priority list" of seat assignments for the states. The Constitution allocates the first 50 seats because each state must have at least one Representative. A priority list assigns the remaining 385 seats for a total of 435. Table 2 displays the end of the "priority list" that would be used to allocate Representatives based on the 2012 Census estimates of the state populations as of July 1. The law only provides for 435 seats in the House, but the table illustrates not only the last seats assigned by the apportionment formula (ending at 435), but the states that would just miss getting additional representation. The apportionment counts transmitted by the Census Bureau to the President (who then sends them to Congress) are considered final. Thus, most states that lost seats in the 113 th Congress had only one possible option for retaining them: urge Congress to increase the size of the House. Any other option such as changing the formula used in the computations, or changing the components of the apportionment population (such as omitting the foreign-based military and federal civilian employees) might only affect a small number of states if the House stays at 435 seats. As noted above, the 435-seat limit was imposed in 1929 by 46 Stat. 21, 26-27. Altering the size of the House would require a new law setting a different limit. Article I, Section 2 of the Constitution establishes a minimum House size (one Representative for each state), and a maximum House size (one Representative for every 30,000, or 10,306 based on the 2010 Census). In 2013, a House size of 468 would be necessary to prevent states from losing seats they held from the 108 th to the 112 th Congresses, but, by retaining seats through an increase in the House size, other states would also have their delegations become larger. At a House size of 468, California's delegation size, for example, would be 56 instead of 53 seats. The apportionment figures released on December 21, 2010, are made up of three components: total resident population figures for the 50 states and the District of Columbia, the foreign-based military and overseas federal employees allocated to each state and DC, and the sum of these numbers (excluding DC), which becomes the apportionment population. These numbers (minus DC) are all that is needed to reapportion the House, but most states need figures for very small geographic areas in order to draw new legislative and congressional districts. The Census Bureau must provide small-area population totals to the legislatures and governors of each state by one year after the census (e.g., April 1, 2011). The Census Bureau data delivered by April 1, 2011 (some states started receiving the information in February 2011), are often referred to as the P.L. 94-171 program data (89 Stat. 1023). This program provides, to each state, information from the 2010 Census. As such, the information is very limited—including age, race, and Hispanic origin. No other demographic information that might be useful to the persons constructing political jurisdictions, such as income or employment status, is available in the P.L. 94-171 data. Such data, however, are available from the results of the American Community Survey for geographic areas with populations as small as 20,000 persons. Census data are usually reported by political jurisdictions (states, cities, counties, and towns), and within political jurisdictions by special Census geography (such as Census designated places, tracts, block numbering areas, and blocks). The P.L. 94-171 program allows states, which chose to participate in it (49 in 2010), to request Census data by certain nontraditional Census geography such as voting districts (precincts) and state legislative districts. These special political jurisdiction counts enable the persons drawing the district lines to assess past voting behavior when redrawing congressional and state legislative districts. In most states, redrawing congressional districts is the responsibility of the state legislature with the concurrence of the governor. In seven states, Arizona, California, Hawaii, Idaho, Montana, New Jersey, and Washington, a non-partisan or bi-partisan commission is responsible for drawing and approving the plans. Some states have explicit deadlines in law to complete their congressional districting. Most do not, so the effective deadline for the legislatures or commissions to complete their work would have been whatever deadlines were established in the states for filing for primaries for the 2012 elections. Although many states have standards mandating equal populations, compactness, contiguousness, and other goals to not split counties, towns, and cities, federal law controls the redistricting process. Other than a requirement that multi-member states cannot elect Representatives at-large (2 U.S.C. 2c) however, no federal statutory law establishes explicit standards for redistricting. The principal laws that apply are the Supreme Court decisions mandating one person, one vote and the Voting Rights Act. The fundamental federal rule governing redistricting congressional districts, one person, one vote , was promulgated by the Supreme Court in Wesberry v. Sanders (376 U.S. 7, 1964). The Court has refined that ruling in a series of cases culminating in Karcher v. Daggett (462 U.S. 725, 1983) that one person, one vote means that any population deviation among districts in a state must be justified, but the deviations from absolute equality may be permitted if the states strive to make districts more compact, respect municipal boundaries, preserve the cores of prior districts, or avoid contests between incumbents. Section 2 of the Voting Rights Act (VRA) applies nationwide. It prohibits states or localities from imposing a "voting qualification or prerequisite to voting or standard, practice or procedure ... in a manner which results in the denial or abridgement of the right to vote on account of race or color." The Supreme Court interpreted the VRA's application to redistricting in a series of cases responding, in part, to the extraordinarily complicated districts created by many states in the 1990s to maximize minority representation (beginning with Shaw v. Reno , 509 U.S. 630, 1993). The Court ended the decade by establishing new principles concerning such practices: (1) race may be considered in districting to remedy past discrimination; (2) but, states must have a compelling state interest to ignore traditional redistricting principles and "gerrymander" to establish majority-minority districts; (3) courts will apply "strict scrutiny" to such assertions that racial "gerrymanders" are necessary to determine whether such plans are narrowly tailored to achieve the compelling state interest.

On December 21, 2010, the Commerce Department released 2010 Census population figures and the resulting reapportionment of seats in the House of Representatives. The apportionment population of the 50 states in 2010 was 309,183,463, a figure 9.9% greater than in 2000. Just as in the 108th Congress, 12 seats shifted among 18 states in the 113th Congress as a result of the reapportionment. The next census data release was February 2011, when the Census Bureau provided states the small-area data necessary to re-draw congressional and state legislative districts in time for the 2012 elections. This report examines the distribution of seats based on the most recent estimates of the population of the states (as of July 1, 2012). It explores the question of, what, if any, would be the impact on the distribution of seats in the U.S. House of Representatives if the apportionment were conducted today, using the most recent official U.S. Census population figures available. The report will be updated as is deemed necessary.

Four major principles underlie U.S. policy on legal permanent immigration: the reunification of families, the admission of immigrants with needed skills, the protection of refugees, and the diversity of admissions by the country of origin. These principles are embodied in federal law, the Immigration and Nationality Act (INA) first codified in 1952. Congress has significantly amended the INA several times since, most recently by the Enhanced Border Security and Visa Reform Act of 2002 ( P.L. 107-173 ). An alien is "any person not a citizen or national of the United States" and is synonymous with noncitizen . It includes people who are here legally, as well as people who are here in violation of the INA. Noncitizen is generally used to describe all foreign-born persons in the United States who have not become citizens. The two basic types of legal aliens are immigrants and nonimmigrants . Immigrants are persons admitted as legal permanent residents (LPRs) of the United States. Nonimmigrants—such as tourists, foreign students, diplomats, temporary agricultural workers, exchange visitors, or intracompany business personnel—are admitted for a specific purpose and a temporary period of time. Nonimmigrants are required to leave the country when their visas expire, though certain classes of nonimmigrants may adjust to LPR status if they otherwise qualify. The conditions for the admission of immigrants are much more stringent than nonimmigrants, and many fewer immigrants than nonimmigrants are admitted. Once admitted, however, immigrants are subject to few restrictions; for example, they may accept and change employment, and may apply for U.S. citizenship through the naturalization process, generally after 5 years. Immigration admissions are subject to a complex set of numerical limits and preference categories that give priority for admission on the basis of family relationships, needed skills, and geographic diversity. These include a flexible worldwide cap of 675,000, not including refugees and asylees (discussed below), and a per-country ceiling , which changes yearly. Numbers allocated to the three preference tracks include a 226,000 minimum for family-based, 140,000 for employment-based, and 55,000 for diversity immigrants (i.e., a formula-based visa lottery aimed at countries that have low levels of immigration to the United States). The per country ceilings may be exceeded for employment-based immigrants, but the worldwide limit of 140,000 remains in effect. In addition, the immediate relatives of U.S. citizens (i.e., their spouses and unmarried minor children, and the parents of adult U.S. citizens) are admitted outside of the numerical limits of the per country ceilings and are the "flexible" component of the worldwide cap. The largest number of immigrants is admitted because of family relationship to a U.S. citizen or immigrant. Of the 1,064,318 legal immigrants in FY2001, 64% entered on the basis of family ties. Immediate relatives of U.S. citizens made up the single largest group of immigrants, as Table 1 indicates. Family preference immigrants —the spouses and children of immigrants, the adult children of U.S. citizens, and the siblings of adult U.S. citizens—were the second largest group. Additional major immigrant groups in FY2001 were employment-based preference immigrants , including spouses and children, refugees and asylees adjusting to immigrant status, and diversity immigrants . The Bureau of Citizenship and Immigration Services (BCIS) in the Department of Homeland Security (DHS) is the lead agency for immigrant admissions. Refugee admissions are governed by different criteria and numerical limits than immigrant admissions. Refugee status requires a finding of persecution or a well-founded fear of persecution in situations of "special humanitarian concern" to the United States. The total annual number of refugee admissions and the allocation of these numbers among refugee groups are determined at the start of each fiscal year by the President after consultation with the Congress. Refugees are admitted from abroad. The INA also provides for the granting of asylum on a case-by-case basis to aliens physically present in the United States who meet the statutory definition of "refugee." All aliens must satisfy State Department consular officers abroad and DHS Bureau of Customs and Border Protection inspectors upon entry to the U.S. that they are not ineligible for visas or admission under the so-called "grounds for inadmissibility" of the INA. These criteria categories are: health-related grounds; criminal history; national security and terrorist concerns; public charge (e.g., indigence); seeking to work without proper labor certification; illegal entrants and immigration law violations; lacking proper documents; ineligible for citizenship; and, aliens previously removed. Some provisions may be waived or are not applicable in the case of nonimmigrants, refugees (e.g., public charge), and other aliens. All family-based immigrants entering after December 18, 1997, must have a new binding affidavit of support signed by a U.S. sponsor in order to meet the public charge requirement. The INA also specifies the circumstances and actions that result in aliens being removed from the United States, i.e., deported. The category of criminal grounds has been of special concern in recent years, and the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 expanded and toughened the deportation consequences of criminal convictions. The category of terrorist grounds has also been broadened and tightened up by the USA Patriot Act of 2001. ( P.L. 107-77 ). The annual number of LPRs admitted or adjusted in the United States rose gradually after World War II, as Figure 1 illustrates. However, the annual admissions never again reached the peaks of the early 20 th century. The BCIS data present only those admitted as LPRs or those adjusting to LPR status. The growth in immigration after 1980 is partly attributable to the total number of admissions under the basic system, consisting of immigrants entering through a preference system as well as immediate relatives of U.S. citizens, that was augmented considerably by legalized aliens. In addition, the number of refugees admitted increased from 718,000 in the period 1966-1980 to 1.6 million during the period 1981-1995, after the enactment of the Refugee Act of 1980. The Immigration Act of 1990 increased the ceiling on employment-based preference immigration, with the provision that unused employment visas would be made available the following year for family preference immigration. There are two major statistical perspectives on trends in immigration. One uses the official BCIS admissions data and the other draws on Bureau of Census population surveys. The BCIS data present only those admitted as LPRs or those adjusting to LPR status. The census data, on the other hand, include all residents in the population counts, and the census asks people whether they were born in the United States or abroad. As a result, the census data also contain long-term temporary (nonimmigrant) residents and unauthorized residents. The percent of the population that is foreign born, depicted in Figure 2 , resembles the trend line of annual admissions data presented in Figure 1 . It indicates the proportion of foreign born residents is not as large as during earlier periods, but is approaching historic levels at the turn of the last century. Figure 2 illustrates that the sheer number—32.5 in 2002—has more than doubled from 14.1 million in 1980 and is at the highest point in U.S. history. Another tradition of immigration policy is to provide immigrants an opportunity to integrate fully into society. Under U.S. immigration law, all LPRs are potential citizens and may become so through a process known as naturalization . To naturalize, aliens must have continuously resided in the United States for 5 years as LPRs (3 years in the case of spouses of U.S. citizens), show that they have good moral character, demonstrate the ability to read, write, speak, and understand English, and pass an examination on U.S. government and history. Applicants pay fees of $310 when they file their materials and have the option of taking a standardized civics test or of having the examiner quiz them on civics as part of their interview. The language requirement is waived for those who are at least 50 years old and have lived in the United States at least 20 years or who are at least 55 years old and have lived in the United States at least 15 years. Special consideration on the civics requirement is to be given to aliens who are over 65 years old and have lived in the United States for at least 20 years. Both the language and civics requirements are waived for those who are unable to comply due to physical or developmental disabilities or mental impairment. Certain requirements are waived for those who have served in the U.S. military. For a variety of reasons, the number of LPRs petitioning to naturalize has increased in the past year but has not reached nearly the highs of the mid-1990s when over a million people sought to naturalize annually, as Figure 3 depicts. The pending caseload for naturalization remains over half a million, and it is not uncommon for some LPRs to wait 1-2 years for their petitions to be processed, depending on the caseload in the region in which the LPR lives. Illegal aliens or unauthorized aliens are those noncitizens who either entered the United States surreptitiously, i.e., entered without inspection (referred to as EWIs), or overstayed the term of their nonimmigrant visas, e.g., tourist or student visas. Many of these aliens have some type of document—either bogus or expired—and may have cases pending with BCIS. The former INS estimated that there were 7.0 million unauthorized aliens in the United States in 2000. Demographers at the Census Bureau and the Urban Institute estimated unauthorized population in 2000 at 8.7 and 8.5 million respectively, but these latter estimates included "quasi-legal" aliens who had petitions pending or relief from deportation. Noncitizens' eligibility for major federal benefit programs depends on their immigration status and whether they arrived before or after enactment of P.L. 104-193 , the 1996 welfare law (as amended by P.L. 105-33 and P.L. 105-185 ). Refugees remain eligible for Supplemental Security Income (SSI) and Medicaid for 7 years after arrival, and for other restricted programs for 5 years. Most LPRs are barred SSI until they naturalize or meet a 10-year work requirement. LPRs receiving SSI (and SSI-related Medicaid) on August 22, 1996, the enactment date of P.L. 104-193 , continue to be eligible, as do those here then whose subsequent disability makes them eligible for SSI and Medicaid. All LPRs who meet a 5-year residence test and all LPR children (regardless of date of entry or length of residence) are eligible for food stamps. LPRs entering after August 22, 1996, are barred from Temporary Assistance for Needy Families (TANF) and Medicaid for 5 years, after which their coverage becomes a state option. Also after the 5-year bar, the sponsor's income is deemed to be available to new immigrants in determining their financial eligibility for designated federal means-tested programs until they naturalize or meet the work requirement. Unauthorized aliens, i.e., illegal aliens, are ineligible for almost all federal benefits except, for example, emergency medical care. Aliens in the United States are generally subject to the same tax obligations, including Social Security (FICA) and unemployment (FUTA) as citizens of the United States, with the exception of certain nonimmigrant students and cultural exchange visitors. LPRs are treated the same as citizens for tax purposes. Other aliens, including unauthorized migrants, are held to a "substantive presence" test based upon the number of days they have been in the United States. Some countries have reciprocal tax treaties with the United States that—depending on the terms of the particular treaty—exempt citizens of their country living in the United States from certain taxes in the United States.

Congress typically considers a wide range of immigration issues and now that the number of foreign born residents of the United States—32.5 million in 2002—is at the highest point in U.S. history, the debates over immigration policies grow in importance. As a backdrop to these debates, this report provides an introduction to immigration and naturalization policy, concepts, and statistical trends. It touches on a range of topics, including numerical limits, refugees and asylees, exclusion, naturalization, illegal aliens, eligibility for federal benefits, and taxation. This report does not track legislation and will not be regularly updated.

Several components within DOJ, DHS, and the Departments of Defense, Labor, and State have responsibility for investigating and prosecuting human trafficking crimes, as shown in figure 1. In addition to federal investigative and prosecutorial agencies, other agencies play a role in helping to identify human trafficking, such as DHS’s Transportation Security Administration (TSA), U.S. Citizenship and Immigration Services (USCIS), U.S. Customs and Border Protection, Federal Emergency Management Agency, and Coast Guard. These agencies may encounter human trafficking victims in their daily operations, including at airports, land borders, and seaports. The Equal Employment Opportunity Commission (EEOC) and the Department of Labor’s Wage and Hour Division may encounter human trafficking when conducting investigations related to their statutory authority. For example, EEOC investigates alleged violations of Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination based on, race, color, religion, sex, and national origin, which in certain circumstances involve human trafficking victims. In addition to investigating and prosecuting human trafficking crimes, federal agencies, primarily DOJ and the Department of Health and Human Services (HHS), support state and local efforts to combat human trafficking and assist victims. Several components within DOJ’s Office of Justice Programs, including the Office of Juvenile Justice and Delinquency Prevention, Office for Victims of Crime, Bureau of Justice Assistance (BJA), and National Institute of Justice (NIJ), administer grants to help support state and local law enforcement in combating human trafficking and to support nongovernmental organizations and others in assisting trafficking victims or conducting research on human trafficking in the United States. HHS also provides grant funding to entities to provide services and support for trafficking victims, primarily through components of the Administration for Children and Families (ACF), including the Children’s Bureau, Family and Youth Services Bureau, and Administration for Native Americans. Further, ACF established the Office on Trafficking in Persons in 2015 to coordinate anti-trafficking responses across multiple systems of care. Specifically, HHS supports health care providers, child welfare, social service providers, and other first responders likely to interact with potential victims of trafficking through a variety of grant programs. These efforts include integrated and tailored services for victims of trafficking, training and technical assistance to communities serving high-risk populations, and capacity-building to strengthen coordinated regional and local responses to human trafficking. In our May 2016 report, we identified 105 provisions across the six statutes that we reviewed that called for the establishment of a program or initiative. Many of the provisions identified more than one entity that is responsible for implementing the programs or initiatives. The breakdown of whether or not federal entities reported taking actions to implement these provisions is as follows: For 91 provisions, all responsible federal entities reported taking action to implement the provision. For 11 provisions, all responsible federal entities reported that they had not taken action to implement the provision. For 2 provisions, at least one of the responsible federal entities reported that they had not taken action to implement the provision or they did not provide a response. For 1 provision, none of the responsible federal entities provided a response. The provisions cover various types of activities to address human trafficking and related issues, including: Grants (33), Coordination and Information Sharing (29), Victim Services (28), Reporting Requirements (26), Training and Technical Assistance (25), Research (24), Criminal Justice (20), Public Awareness (14), and Penalties and Sanctions (7). Agency officials provided various explanations for why they had not taken any actions to implement certain provisions for which they were designated as the lead or co-lead. For example, in three cases, officials cited that funding was not appropriated for the activity. In June 2016, we reported that federal, state and local law enforcement officials and prosecutors identified several challenges with investigating and prosecuting human trafficking, including a lack of victim cooperation, limited availability of services for victims, and difficulty identifying human trafficking. The officials told us that obtaining the victim’s cooperation is important because the victim is generally the primary witness and source of evidence. However, the officials said that obtaining and securing victims’ cooperation is difficult, as victims may be unable or unwilling to testify due to distrust of law enforcement or fear of retaliation by the trafficker, among other reasons. According to these officials, victim service programs, such as those that provide mental health and substance abuse services have helped improve victim cooperation; however, the availability of services is limited. Further, the officials reported that identifying and distinguishing human trafficking from other crimes such as prostitution can be challenging. Federal, state, and local agencies have taken or are taking actions to address these challenges, such as increasing the availability of victim services through grants and implementing training and public awareness initiatives. With respect to training, we reported that federal agencies have implemented several initiatives to train judges, prosecutors, investigators and others on human trafficking. For example, in accordance with the JVTA, the Federal Judicial Center provided training to federal judges and judicial branch attorneys, including judicial law clerks, on human trafficking through a webinar in August 2015. The training walked participants through the provisions of the JVTA and addressed how child exploitation manifests in human trafficking cases, among other things. According to Federal Judicial Center officials, 1,300 registered viewers participated in the webinar, which is now available for on-demand viewing on the Federal Judicial Center website. In addition, DHS’s Immigration and Customs Enforcement, Homeland Security Investigations provides a human trafficking training course that uses video scenarios and group discussions to teach its agents how to identify human trafficking, how to distinguish human trafficking from smuggling, and how to conduct victim- centered investigations, among other things. Similarly, the Federal Bureau of Investigation provides annual specialized training in the commercial sexual exploitation of children and dealing with victims of child sex trafficking. We reported that some federal agencies also have efforts related to increasing public awareness of human trafficking. For example, In January 2016, DOJ’s Office for Victims of Crime released resources to raise awareness and serve victims, including a video series called “The Faces of Human Trafficking” and posters to be used for outreach and education efforts of service providers, law enforcement, prosecutors, and others in the community. The video series includes information about sex and labor trafficking, multidisciplinary approaches to serving victims of human trafficking, effective victim services, victims’ legal needs, and voices of survivors. Since 2010, DHS, through the Blue Campaign, reported it has worked to raise public awareness about human trafficking, leveraging partnerships with select government and nongovernmental entities to educate the public to recognize human trafficking and report suspected instances. According to DHS officials, Blue Campaign posters are displayed in public locations including airports and bus stops. HHS established the “Look Beneath the Surface” public awareness campaign through its Rescue and Restore Victims of Human Trafficking program. These materials, which included posters, brochures, fact sheets, and cards with tips on identifying victims, were available in eight languages. In June 2016, we also reported that in addition to training and public awareness, federal agencies have established grant programs to, among other things, increase the availability of services to assist human trafficking victims. We identified 42 grant programs with awards made in 2014 and 2015 that may be used to combat human trafficking or to assist victims of human trafficking, 15 of which are intended solely for these purposes. According to our prior work addressing overlap and duplication: Overlap occurs when multiple granting agencies or grant programs have similar goals, engage in similar activities or strategies to achieve these goals, or target the same or similar beneficiaries. Duplication occurs when a single grantee uses grant funds from different federal sources to pay for the exact same expenditure or when two or more granting agencies or grant programs engage in the same or similar activities or provide funding to support the same or similar services to the same beneficiaries. Each of the15 grant programs that are intended solely to combat human trafficking contained at least some potential overlap with other human trafficking grant programs in authorized uses. For instance, funding under each of the 15 grant programs can be used for either collaboration or training purposes. Similarly, 9 of the 15 grant programs provide support for direct services to victims of human trafficking. Further, of the 123 organizations that were awarded grants specific to human trafficking in fiscal years 2014 or 2015, 13 received multiple grants for either victim services or for collaboration, training, and technical assistance from DOJ and HHS. Of the 13, 7 had multiple grants that could be used for victim services, and 3 had multiple grants that could be used for collaboration, training, and technical assistance. We also reported in June 2016 that there are circumstances in which some overlap or duplication may be appropriate. For example, overlap can enable granting agencies to leverage multiple funding streams to serve a single purpose. However, coordination across the administering granting agencies is critical for such leveraging to occur. On the other hand, there are times when overlap and duplication are unnecessary, such as if a grantee uses multiple funding streams to provide the same services to the same beneficiaries. DOJ and HHS each have intra-agency processes in place to prevent unnecessary duplication. According to DOJ and HHS officials, each agency operates an internal working group to allow the components administering human trafficking grants to communicate on a regular basis. For example, HHS officials indicated that offices that administer human trafficking grant programs meet monthly to exchange information, which may include grant-related announcements and coordination of anti-trafficking activities. DOJ has taken action to implement recommendations from a prior GAO report to identify overlapping grant programs and mitigate the risk of unnecessary grant award duplication in its programs. In response to these recommendations, DOJ also requires grant applicants to identify in their applications any federal grants they are currently operating under as well as federal grants for which they have applied. DOJ and HHS officials also reported that they routinely shared grant announcements with one another in an informal manner. For instance, HHS officials noted that DOJ and HHS meet bi-weekly during co-chair meetings for the Senior Policy Operating Group (SPOG) Victim Services Committee and both agencies participate in the SPOG Grantmaking Committee meetings, which provide opportunities to share information for the purposes of coordination and collaboration. Since 2006, the SPOG has provided a formal mechanism for all agencies administering human trafficking grants to communicate with one another. According to the SPOG guidance, which was updated in March 2016, participating agencies are to share information with members of the grants committee prior to final decisions in at least one of the following ways: (1) share plans for programs containing anti-trafficking components during the grant program development process; (2) notify the SPOG of grant solicitations within a reasonable time after they are issued; or (3) notify SPOG partner agencies of proposed funding recipients prior to announcing the award. Further, agencies are also to share information with members of the Grantmaking Committee after final decisions are made. Chairman Grassley, Ranking Member Leahy, and Members of the Committee, this completes my prepared statement. I would be pleased to respond to any questions that you may have at this time. If you or your staff have any questions about this testimony, please contact Gretta L. Goodwin, Acting Director, Homeland Security and Justice at (202) 512-8777 or goodwing@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this statement. GAO staff who made key contributions to this testimony are Kristy Love, Assistant Director; Kisha Clark, Analyst-in Charge; Paulissa Earl; Marycella Mierez; and Amanda Parker. Key contributors for the previous work on which this testimony is based are listed in each product. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

Human trafficking involves the exploitation of a person typically through force, fraud, or coercion for the purpose of forced labor, involuntary servitude, or commercial sex. Human trafficking victims include women, men and transgender individuals; adults and children; and foreign nationals and U.S. citizens or nationals who are diverse with respect to race, ethnicity, and sexuality, among other factors. Over the few decades, Congress has taken legislative action to help combat human trafficking and ensure that victims have access to needed services. The executive branch also has several initiatives to address human trafficking in the United States and assist victims. The Justice for Victims of Trafficking Act of 2015 (JVTA) includes two provisions for GAO to study efforts to combat human trafficking. This testimony summarizes GAO’s May 2016 and June 2016 reports that were related to the JVTA. Specifically, this testimony addresses (1) federal efforts to implement certain provisions across six human trafficking-related statutes, including the JVTA; (2) any challenges faced by federal and selected state law enforcement and prosecutorial agencies when addressing human trafficking; and (3) federal grant programs to combat trafficking and assist trafficking victims, as well as the extent to which there is any duplication across these grant programs. GAO identified 105 provisions across six human trafficking-related statutes that called for the establishment of a program or initiative. Many of the provisions identified more than one entity that is responsible for implementing the programs or initiatives. The breakdown of whether or not federal entities reported taking actions to implement these provisions is as follows: For 91 provisions, all responsible federal entities reported taking action to implement the provision. For 11 provisions, all responsible federal entities reported that they had not taken action to implement the provision. For 2 provisions, at least one of the responsible federal entities reported that they had not taken action to implement the provision or they did not provide a response. For 1 provision, none of the responsible federal entities provided a response. GAO identified 42 grant programs with awards made in 2014 and 2015 that may be used to combat human trafficking or to assist victims of human trafficking, 15 of which are intended solely for these purposes. Although some overlap exists among these human trafficking grant programs, federal agencies have established processes to help prevent unnecessary duplication. For instance, in response to recommendations in a prior GAO report, DOJ requires grant applicants to identify any federal grants they are currently operating under as well as federal grants for which they have applied. In addition, agencies that participate in the grantmaking committee of the Senior Policy Operating Group (SPOG)—an entity through which federal agencies coordinate their efforts to combat human trafficking—are to share grant solicitations and information on proposed grant awards, allowing other agencies to comment on proposed grant awards and determine whether they plan to award funding to the same organization.

Concerns over the price of oil and supply of petroleum have revived interest in alternative energy supplies, including the development of oil shale to help address energy needs in the United States. The process used to develop oil shale resources requires a plentiful water supply. According to news reports, oil companies currently hold senior water rights in the states where oil shale reserves are located. As explained below, appropriation of water in these states is based on a priority system, under which water rights holders have seniority over other water rights holders who acquired rights later. These senior rights reportedly have not been exercised for decades, allowing junior water rights holders to use the water. Because of the nature of the water rights systems in the relevant states, junior water rights holders might face significant limitations on their future use of water from the Colorado River Basin if the oil companies exercise their rights. This report will provide a brief overview of water rights in Colorado, Utah, and Wyoming; changes that may be made to currently held water rights; and the possibility for abandonment of unused water rights. The law of water rights is traditionally an area regulated by the states, rather than the federal government. Individual states may choose the system under which water rights are allocated to water users. Western states, including Colorado, Utah, and Wyoming, generally follow the prior appropriation doctrine of water rights, often referred to as "first in time, first in right." These states typically are drier and experience regular water shortages. The prior appropriation system allows water users to acquire well-defined rights to certain quantities of water by designating senior and junior rights to avoid uncertainty during times of water scarcity. Under the prior appropriation doctrine, a person who diverts water from a watercourse and makes reasonable and beneficial use of the water acquires a right to use of the water. The user's location relative to the watercourse (whether upstream, downstream, adjacent, or remote) does not affect the ability to obtain a water right. Typically, under a prior appropriation system of water rights, users apply for a permit from a state administrative agency which manages the acquisition and transfers of such rights. The prior appropriation system limits users to the quantified amount of water the user secured under the permit process with a priority based on the date the water right was conferred by the state. The user's right that was appropriated first (the senior water right) is considered superior to later appropriators' rights to the water (the junior water right). Appropriators fill their needs according to the order in which they secured the right to the water and not based on the available quantity. Therefore, in times of shortage, junior rights holders could be without the water they need. The issues regarding water rights in the Colorado River Basin arise from the fact that a limited supply of water is sought after by many different users. Junior rights holders who use waters from the Basin to meet agricultural and municipal interests potentially are limited by what oil companies, as senior rights holders, use. These junior rights holders have been able to use water to fill their needs for decades, while senior rights holders have not used the water. The dispute over a possible water shortage when both groups wish to use water likely will raise questions about the nature and administration of water rights, whether existing water rights may be amended to account for the changed circumstances, and the options available for users who seek to claim unused water rights from other users. Water rights typically are established through an administrative permit system of the state in which the water is being appropriated. Water rights seekers must file an application with the proper state administrative organization, which dates the seniority of the water right. State law provides that the water is the property of the state, but a water right is considered an individual's property right in the priority of the use of the state's water. The specific nature of water rights may vary depending on the state. For example, in Colorado, water rights can be either absolute or conditional. Absolute rights are assigned to users who have diverted water and put the water to beneficial use, whereas conditional water rights allow the user to maintain the priority of the right he intends to acquire until the diversion is complete. In other words, a user with an absolute right has fulfilled all the requirements necessary to acquire a right to the water. A user with a conditional right has asserted an intention to acquire a right but has not yet fulfilled all of the requirements necessary to do so, and that right is conditioned on the completion of all requirements. Utah law provides that water rights become real property only when the application has been perfected under the required legal process, meaning that title of the right is properly filed with the state. Wyoming issues permits to applicants for water rights, which allow the user time to construct and complete a project to put water to a beneficial use. The water right is not considered permanent until the process is complete and may be disputed or removed until that time. In the context of oil shale in the Colorado River Basin, oil companies hold both absolute and conditional rights for water in Colorado. The nature of the rights held could influence the future use of the water and may provide a basis for junior rights holders to challenge the continuing validity of the senior rights holders' rights. Both junior and senior rights holders may seek to alter certain water rights if circumstances of water use change. For example, in Colorado, senior rights holders may seek to convert their conditional rights to absolute rights, as discussed. Other state laws provide for water rights to be altered as circumstances change. Junior or senior rights holders may seek to change the geographic or purpose parameters set at the time they acquired their rights. Water rights generally are allocated based on a specific point of diversion, location of use, and purpose of use. In order to change the point from which water is diverted from its source or to change the place or purpose of use, a water right holder must apply to the appropriate state office for approval. The state office considering the change may consider factors such as whether the change would exceed historical levels and whether other users' vested water rights would be impaired by the change. Junior rights holders may seek to secure water by acquiring the rights of senior rights holders under the water rights transfer process in each state. In Colorado, a water right may be bought, sold, or leased to other entities if the transfer is filed with the appropriate state office and the transfer would not injure the vested rights of another user. Similarly, Utah water law provides that a water right may be bought or sold if the transfer is approved by the state. Under Wyoming law, a water right attaches to the lands or the place of use in the permit rather than to an individual. Water rights may be transferred only if included in the sale of land, or by petition for a change in place of use to the appropriate state office. Senior rights holders may lose their rights if those rights are not used. Conditional rights in Colorado require rights holders to demonstrate continuous efforts in developing the water right on a regular basis. Other water rights also may be lost under certain circumstances according to state law. If senior rights holders lose their rights, the water supply available for junior rights holders to fill their needs would increase. In Colorado, a water right may be considered abandoned if it is not used for a 10-year period and there is an intent to abandon. In Utah, water rights may be abandoned or forfeited. For a water right to be abandoned, there must be intent to abandon by the user and there is no time requirement. For a water right to be forfeited, the water right must not be used for a five-year period. In Wyoming, abandonment may take three forms. First, the user may voluntarily abandon the water right. Second, one user may allege that another user's right has been abandoned because the other user has not used the right for a five-year period and that reactivation of that right would injure the user's right. Third, the state may allege an abandonment if the water is not put to beneficial use for a five-year period and reallocation would serve the public interest. Water rights that are lost under these processes revert to the state and may be appropriated in the future. State water laws govern the allocation of water within the state, but water resources rarely are confined to state boundaries. Rather, like the Colorado River Basin, water basins spread across several states. As a result, states often compete for resources from shared basins, and the competition often leads to water disputes between states in regions with shared water resources. Interstate water disputes may be resolved in various manners. Two of the most common methods are equitable apportionment in the U.S. Supreme Court and interstate compact negotiated by the parties and approved by Congress. The Colorado River Basin is no exception to the likelihood of disputes and is subject to a number of judicial decisions and interstate compacts, commonly referred to as the "Law of the River." The Law of the River governs the waters of the Colorado River Basin in addition to regulation by the individual states in which water rights are allocated. The Law of the River is a collection of laws and agreements that govern the distribution of the water throughout the Basin as a whole. Because the Colorado River Basin includes seven states, which have varying needs and all draw upon the same resources, a series of court decisions, statutes, interstate compacts, and international treaties address the use and management of Colorado River water. The laws and agreements that form the Law of the River attempt to allocate the waters of the Colorado River Basin among the states, providing broad parameters for the distribution of the Basin's waters. Thus, the Law of the River would not govern individual water rights directly, but it would place limits on the water available for allocation by each state. Development of oil shale resources has been a controversial political issue. Some have expressed an interest in pursuing more aggressive oil shale development programs. Others have suggested that such programs would be harmful to environmental protection policies. In 2008, the Department of Interior announced proposed regulations that would promote oil shale development and issued final regulations that took effect in January 2009. The 111 th Congress may consider directing future activity in oil shale development, whether in accordance with the regulations or enacting legislation providing other direction for future agency actions.

Concerns over fluctuating oil prices and declining petroleum production worldwide have revived interest in oil shale as a potential resource. The Energy Policy Act of 2005 (EPAct; P.L. 109-58) identified oil shale as a strategically important domestic resource and directed the Department of the Interior to promote commercial development. Oil shale development would require significant amounts of water, however, and water supply in the Colorado River Basin, where several oil shale reserves are located, is limited. According to news reports, oil companies holding water rights in the region have not exercised those rights in decades, which has allowed other water rights holders to use the water for agricultural and municipal needs. Because of the nature of the water rights systems in the relevant states, these users might face significant limitations in their future use of water from the Colorado River Basin if the oil companies exercise their rights. This report will provide a brief overview of water rights in Colorado, Utah, and Wyoming, including changes that may be made to currently held water rights and the possibility for abandonment of unused water rights.

In 2013, we found that most agencies did not comply with spending requirements for the SBIR or STTR programs in all 6 years, based on data the agencies submitted to SBA for fiscal years 2006 to 2011. Specifically, 8 of the 11 agencies did not consistently meet annual spending requirements for SBIR. Data from 3 of the agencies—DHS, Education, and HHS—indicated that they met their spending requirements for all 6 years. For STTR, 4 of 5 agencies did not consistently meet annual spending requirements. Data from 1 agency— HHS—indicated that it met its STTR spending requirements for all 6 years. Figure 1 shows the number of years that each agency complied with spending requirements for fiscal years 2006 through 2011. Additional data on each agency’s spending on the programs is included in our 2013 report. SBIR and STTR program managers identified reasons why spending the required amount in a given fiscal year could be difficult, which we described in our 2013 report. For example, in that report, we found that delays in receiving final appropriations can delay agencies’ awarding of contracts for SBIR or STTR projects. Some program managers said that they tend to wait to award some grants and contracts until receiving their final appropriations in case the agency’s extramural R&D budget—and, therefore, its SBIR or STTR spending requirement—differs significantly from the expected amount. Because the award process can be lengthy, a delay can push the awards and spending into the following fiscal year. As we found in our 2013 report, when appropriations were received late in the year, agencies used differing methodologies to calculate their spending requirements, making it difficult to determine whether agencies’ calculations were correct. Although SBA provided guidance in policy directives on calculating their spending requirements, we found that the policy directives did not provide guidance to agencies on how to calculate such spending requirements when agency appropriations are delayed. We found that, without such guidance, that agencies would likely continue to calculate spending requirements in differing ways. In our 2013 report, we recommended that SBA provide additional guidance on how agencies should calculate spending requirements when agency appropriations are received late in the fiscal year. SBA has since begun taking steps to address this recommendation. We also found in 2013 that agencies participating in the SBIR and STTR programs did not consistently comply with requirements in the Small Business Act to annually report a description of their methodologies for calculating their extramural R&D budgets to SBA and that SBA did not consistently comply with the act’s requirements for annually reporting to Congress. With the exception of NASA in certain years, agencies did not submit their methodology reports to SBA within the time frame required by the Small Business Act for fiscal years 2006 through 2011 for the SBIR and STTR programs. As noted earlier, the act requires that agencies report to SBA their methodologies for calculating their extramural budgets within 4 months after the date of enactment of their respective appropriations acts. However, most participating agencies documented their methodologies for calculating their extramural R&D budgets for these fiscal years and submitted them to SBA after the close of the fiscal year with their annual reports. SBA officials said that they did not hold the agencies to the act’s deadline for submitting methodology reports, in part because delays in receiving annual appropriations pushed the required reporting date until late in the fiscal year and it was more convenient for agencies to submit their methodology reports with their annual reports. By not having the methodology reports earlier in the year as specified by law, however, SBA did not have an opportunity to analyze these methodologies and provide the agencies with timely feedback to assist agencies in accurately calculating their spending requirements. By not providing such feedback, SBA was forgoing the opportunity to assist agencies in correctly calculating their program spending requirements and to help ensure that they spent the mandated amounts. More significantly, we found in 2013 that the majority of the agencies did not include an itemization of each R&D program excluded from the calculation of the agency’s extramural budget and a brief explanation of why it was excluded, as required. We found that it was difficult for SBA to comprehensively analyze the methodologies and determine whether agencies were accurately calculating their spending requirements without having more consistent information from agencies. We also found that agencies could have benefited from guidance on the format of methodology reports, and that without such guidance, participating agencies might continue to provide SBA with broad, incomplete, or inconsistent information about their methodologies and spending requirements. We recommended that SBA provide additional guidance to agencies on the format that they are to include in their methodology reports. We also recommended that SBA provide timely annual feedback to each agency following submission of its methodology report on whether its method for calculating the extramural R&D budget complies with program requirements, including an itemization of and an explanation for all exclusions from the basis for the calculations. SBA is in the process of taking steps to address these recommendations. We also found in 2013 that SBA had not consistently complied with the requirement to report its analysis of the agencies’ methodologies in its annual report to Congress, as required by the Small Business Act. Over the 6 years covered in our review, SBA reported to Congress for 3 of those; fiscal years 2006, 2007, and 2008. We found that these reports contained limited analyses of the agencies’ methodologies, and some of the analyses were inaccurate. For example, SBA’s analysis was limited to a table attached to the annual report to Congress that often did not include information on particular agencies. In our 2013 report, we found that, without more comprehensive analysis and accurate information on participating agencies in SBA’s annual report, Congress did not have information on the extent to which agencies are reporting what is required by law. In that report, we recommended that SBA provide Congress with a timely annual report that includes a comprehensive analysis of the methodology each agency used for calculating the SBIR and STTR spending requirements, providing a clear basis for SBA’s conclusions about whether these calculations meet program requirements. SBA is in the process of taking steps to address this recommendation. In 2013, we also found that changing the methodology to calculate the SBIR and STTR spending requirements based on each agency’s total R&D budget instead of each agency’s extramural R&D budget would increase the amount of each agency’s spending requirement for the programs, some much more than others, depending on how the change was implemented. Also, such a change would increase the number of agencies that would be required to participate in the programs if the threshold for participating in the programs remained the same. For example, two additional agencies—the Departments of Veterans Affairs (VA) and the Interior—would have been required to participate in SBIR in fiscal year 2011 if total R&D budgets had been the criteria because these agencies reported total R&D budgets in excess of $100 million. For STTR, three additional agencies—Commerce, USDA, and VA—would also have been required to participate in the program for fiscal year 2011 if total R&D budgets had been the criteria because these agencies reported total R&D budgets in excess of $1 billion. Some agencies told us in 2013 that changing the methodology to calculate the SBIR and STTR spending requirements could have effects on their R&D programs and create challenges. For example, changing the base would increase SBIR and STTR budgets and could result in reductions in certain types of intramural R&D, with corresponding reductions in full-time equivalent staffing of these programs. In addition, some agency officials said there would potentially be changes in the content of the agency’s extramural R&D effort because of changes in the types of businesses that receive grants and contracts. We found in 2013 that the participating agencies’ cost of administering the SBIR and STTR programs could not be determined because the agencies neither collected that information nor had the systems to do so. Neither the authorizing legislation for the programs nor SBA policy directives require agencies to track and estimate all administrative costs, and neither the law nor the policy directives define these administrative costs. Estimates agencies provided for our report indicated that the greatest amounts of administrative costs in fiscal year 2011 were for salaries and expenses, contract processing, outreach programs, technical assistance programs, support contracts, and other purposes. With the implementation in 2013 of a pilot program allowing agencies under certain conditions to use up to 3 percent of SBIR program funds for certain administrative costs, SBA expected to require agencies in the pilot program to track and report the spending of that 3 percent but not all of their administrative costs. Chairwoman Cantwell, Ranking Member Risch, and Members of the Committee, this completes my prepared statement. I would be pleased to respond to any questions that you may have at this time. If you or your staff have any questions about this testimony, please contact me at (202) 512-3841 or neumannj@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this statement. GAO staff who made key contributions to this testimony are Hilary Benedict, Assistant Director; Antoinette Capaccio; Cindy Gilbert; Rebecca Makar; Cynthia Norris; and Daniel Semick. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

Federal agencies have awarded more than 156,000 contracts and grants, totaling nearly $40 billion through the SBIR and STTR programs to small businesses to develop and commercialize innovative technologies. The Small Business Act mandates that agencies, with extramural R&D budgets that meet the thresholds for participation, must spend a percentage of these annual budgets on the two programs. The agencies are to report to SBA and SBA is to report to Congress. This testimony is based on a report GAO issued in September 2013 and addresses for fiscal years 2006 through 2011, (1) the extent to which participating agencies complied with program spending requirements, (2) the extent to which participating agencies and SBA complied with certain reporting requirements, (3) the potential effects of basing the spending requirements for the SBIR and STTR programs on agencies' total R&D budgets instead of their extramural R&D budgets, and (4) what is known about the amounts participating agencies spent for administering the programs. For that report, GAO reviewed agency calculations of spending requirements and required reports, and interviewed SBA and participating agency officials. Using data agencies had reported to the Small Business Administration (SBA), GAO found in its 2013 report that 8 of the 11 agencies participating in the Small Business Innovation Research (SBIR) program and 4 of the 5 agencies participating in the Small Business Technology Transfer (STTR) program did not consistently comply with spending requirements for fiscal years 2006 to 2011. SBA, which oversees the programs, provided guidance in policy directives for agencies on calculating these requirements, but the directives did not provide guidance on calculating the requirements when appropriations are late and spending is delayed. Some SBIR and STTR program managers told GAO that it can be difficult to spend the required amount because delays in receiving final appropriations can delay agencies' awarding of contracts. As GAO found in its 2013 report, when appropriations were received late in the year agencies used differing methodologies to calculate their spending requirements, which made it difficult to determine whether agencies' calculations were correct. GAO found that, without further SBA guidance, agencies would likely continue calculating spending requirements in differing ways. GAO also found in 2013 that the participating agencies and SBA had not consistently complied with certain program reporting requirements. For example, participating agencies did not itemize each program excluded from the calculation of their extramural research or research and development (R&D) budgets and explain why the program was excluded, as required. (Extramural R&D is generally conducted by nonfederal employees outside of federal facilities.) Also, SBA's annual reports to Congress that were available at the time of GAO's review contained limited analysis of the agencies' methodologies, often not including information on particular agencies. By providing more analysis of the agencies' reports, as GAO recommended in its 2013 report, SBA can provide information to Congress on the extent to which agencies were reporting what is required. In 2013, GAO found that the potential effects of basing each participating agency's spending requirement on its total R&D budget instead of its extramural R&D budget would increase the amount of the spending requirement—for some agencies more than others, depending on how the change was implemented. Also, if the thresholds of the spending requirements for participation in the programs did not change, changing the base to an agency's total R&D budget would increase the number of agencies required to participate. In addition, GAO found in 2013 that the agencies' cost of administering the programs could not be determined because the agencies had not consistently tracked costs as they were not required to do so by the authorizing legislation of the programs. Estimates agencies provided to GAO indicated that the greatest amounts of administrative costs in fiscal year 2011 were for salaries and expenses, contract processing, outreach programs, technical assistance programs, support contracts, and other purposes. With the start of a pilot program allowing agencies to use up to 3 percent of SBIR program funds for administrative costs in fiscal year 2013, SBA planned to require participating agencies to track and report administrative costs paid from program funds. GAO is not making any new recommendations, but made several to SBA in GAO's 2013 report on this topic. SBA agreed with those recommendations and is taking steps to implement them.

Representative Frederick Richmond reportedly began forming what became the Congressional Arts Caucus in response to proposals by the Reagan Administration to eliminate funding for the National Endowment for the Arts (NEA) and the National Endowment for the Humanities (NEH), and the defeat of other prominent arts advocates in Congress. Within days, 77 Members of the House of Representatives had joined the caucus, and by the start of the 98 th Congress (January 1983), House membership had grown to 166 Members—reportedly one of the largest caucuses on Capitol Hill at that time. Representative Richmond served as the first chairman and Representative Jim Jeffords as the first vice-chairman. (See Table C-1 for a list of the chairs.) In July 1981, on behalf of the Congressional Arts Caucus, Representative Richmond proposed to the Speaker of the House, Representative Thomas P. O'Neill Jr., a program for encouraging nationwide artistic creativity by high school students through art exhibits in the tunnels connecting the Capitol to the House Office Buildings. In October 1981, Speaker O'Neill, in his role as chair of the House Office Building Commission, indicated no objection to an exhibit as long as it was conducted at no expense to the government. The Speaker further required that the Arts Caucus work with the House Office Building Commission and the Architect of the Capitol (AOC) on the details and to ensure that a jury of qualified people approves the final selection of student art for the exhibit. A detailed proposal for the manner of display of the artwork was also requested. (See Figure A-1 , letter from Speaker O'Neill to Representative Richmond.) In February 1982, the AOC sent a letter to the chairman of the House Office Building Commission in which he submitted the proposal for the National Art Competition program as prepared by the Arts Caucus. In the letter, the AOC expressed his approval and recommended that the House Office Building Commission do the same. (See Figure A-2 , letter from AOC George M. White to Chairman O'Neill.) The letter includes the signatures of all three of the House Office Building Commission members. Subsequently, on February 9, 1982, Speaker O'Neill and several members of the Arts Caucus announced the first annual Congressional Art Competition. Representative Richmond said, about the competition, that "members of Congress would conduct the contest among high school students in their districts. The winning art will line a corridor in the Capitol." No legislation has been introduced to authorize, sanction, or otherwise make permanent the Congressional Art Competition. On July 23, 1991, H.Res. 201 (102 nd Congress, first session) was introduced by the Congressional Art Competition co-chair, Representative Ted Weiss, to recognize the 10 th anniversary of the competition. On November 18, 1991, the resolution was agreed to by voice vote. The only other piece of legislation was H.Res. 1453 (111 th Congress, second session) introduced by the Congressional Art Competition co-chair, Representative Steve Driehaus, to celebrate the 29 th anniversary of the competition. This resolution was introduced on June 17, 2010, and referred to the Committee on House Administration with no further action. Throughout the competition's history, reportedly, a few submitted artworks have been removed as part of a controversy or otherwise. In 2012, an entry submitted to the Illinois Fourth Congressional District for the Congressional Art Competition was the subject of a controversy before being selected as the district winner. A Chicago high school student entered a city-wide competition to determine the next city vehicle sticker. Days before the city was to print 1.2 million new stickers, allegations surfaced on a number of police blogs claiming the design displayed gang signs and other symbols of the Maniac Latin Disciples street gang. The city decided not to use the artwork. It was subsequently entered into the Congressional Art Competition for the IL-04 congressional district. The artwork won the district competition and hung in the Cannon Tunnel for a full year without objection. Prior to the 2016-2017 Congressional Art Competition, the federal government, in a court filing, identified only one other occasion when a piece of art was removed after it was put on display as part of the competition; the work appeared to be a copy of a photograph that had appeared that year in Vogue magazine. In two other identified instances prior to the 2016-2017 competition, when suitability questions arose and the AOC reached out to the sponsoring Member of Congress, the Member agreed to submit another piece. During the 2016-2017 competition, an AOC-convened panel reviewed submissions and identified two works that raised suitability concerns, one titled "Recollection," which depicts a young man with apparent bullet holes in his back, and the other depicting marijuana use by Bob Marley. Consistent with its usual practice, AOC staff contacted the sponsoring Member'' offices regarding these works, and the Members indicated they supported the works' display. Both of these works were displayed. . Artwork for the 2016 Congressional Art Competition went on public exhibit in May 2016. In early December 2016, letters from Members of Congress and the Capitol Police requesting the removal of the winning entry from Missouri's 1 st Congressional District were sent to Speaker Paul Ryan and AOC Stephen T. Ayres. The artwork was viewed by some as violating suitability guidelines in the rules for the competition, as it depicted law enforcement officers as animals abusing protesters. Subsequently, the artwork was repeatedly removed and re-hung in the Cannon Tunnel to the Capitol by various Members of Congress. An administrative decision to prohibit the painting was made by Architect Ayers, which triggered the filing of an injunction in U.S. District Court for the District of Columbia on behalf of the artist, claiming violation of First Amendment rights. In April 2017, a judge in the District Court for the District of Columbia denied the plaintiffs' injunction, ruling that due to the public location of the artwork in a tunnel connecting the U.S. Capitol to a House office building, the art was government speech and that Members of Congress who objected to the content had a right to remove it. The artwork continued to be banned from display until May 2017 when all artwork from that competition year was removed. The House Ethics Manual addresses the issue of the appropriateness of congressional involvement in the Art Competition in the section on "Official and Outside Organizations." House ethics rules generally prohibit endeavors jointly supported by a combination of private resources and official funds. For example, House Rule 24 prohibits the use of private resources for the operation of both congressional Member organizations (CMOs) and Member advisory groups. Yet, the House Ethics Manual goes on to explain that, "Nevertheless, the giving of advice by informal advisory groups to a Member does not constitute the type of private contribution of funds, goods, or in-kind services to the support of congressional operations that is prohibited by House Rule 24." Later the Ethics Manual specifically addresses the Congressional Art Competition in the following: "One instance when cooperation with private groups has been explicitly recognized is the annual competition among high school students in each congressional district to select a work of art to hang in the Capitol, referred to as the Congressional Art Competition. Members may announce their support for the competition in official letters and news releases, staff may provide administrative assistance, a local arts organization or ad hoc committee may select the winner, and a corporation may underwrite costs such as prizes and flying the winner to Washington, D.C. Private involvement with the Congressional Art Competition in this manner is not viewed as a subsidy of normal operations of the congressional office. Members may not solicit on behalf of the arts competition in their district without Standards Committee [now Committee on Ethics] permission unless the organization to which the donation will be directed is qualified under § 170(c) of the Internal Revenue Code." The general guidelines concerning Member solicitations is stated in the Ethics Manual , and solicitation guidelines as related to the Art Competition are addressed in the " Ethics Guidance " document for the 2018 Congressional Art Competition. In their earliest years, the Congressional Arts Caucus and Congressional Art Competition were financially supported by a $300 contribution from the allowances of members of the caucus. The funds were used to pay the salaries of two full-time staff and other operational costs. During the period 1982 to 1994, the caucus used its staff and interns to manage administrative duties related to the competition, such as announcements, guidelines, deadlines, the receipt of completed forms and art, and recordkeeping. These individuals also coordinated the art competition's awards program and reception to honor the winning artists. After 1995, many administrative tasks were undertaken by two Member offices—typically the offices of the co-chairs of the Arts Caucus. From the competition's inception, the AOC curator and the House superintendent have assisted with the moving, arranging, labeling, and hanging of the art works, as well as returning the art to participating Members' offices at the end of a competition—this is done in May of each year just prior to the commencement of a new competition. The curator also arranges the winning artwork alphabetically by state, maintains a tracking system, works with the House carpenters to have the artwork hung in the Cannon House Office Building tunnel, and prepares and attaches the accompanying descriptive labels. In 2005, General Motors, which had provided financial and logistical support to the Art Competition since 1982, asked the Public Governance Institute to assist with logistical support. In 2009, the Congressional Institute, Inc. took over from the Public Governance Institute, providing both advice and logistical support for the competition. According to its website, the Congressional Institute was founded in 1987 and "is a not-for-profit corporation dedicated to helping Members of Congress better serve their constituents and helping their constituents better understand the operations of the national legislature." Currently, each participating House Member solicits entries from high school students for the event and establishes his or her own method of judging the submissions. There is no entry fee for the competition and previous entrants (including winners) may re-enter as long as they are high school students. The winning artwork must conform to strict guidelines and meet all deadlines. By mid-February of each year, the Art Competition guidelines and forms to accompany the submitted art are available to the public on the House of Representatives website at https://www.house.gov/content/educate/art_competition . It is the prerogative of the co-chairs, the House Office Building Commission, the AOC curator, or the Congressional Institute, Inc., to modify the guidelines from year to year. Two sets of guidelines are available: The "2018 Rules and Regulations for Congressional Offices" (shown as Figure B-1 , unavailable electronically). The "2018 Rules and Regulations for Students and Teachers" can be found on the House of Representatives public website at https://www.house.gov/sites/default/files/uploads/documents/2018Rulesfor StudentsandTeachers.pdf (s hown as Figure B-2 ) . The "Student Information & Release Form" is available at https://www.house.gov/sites/default/files/uploads/documents/2018StudentReleaseForm.pdf (shown as Figure B-3 ), and a "2018 Art Submission Checklist" is shown as Figure B-4 (unavailable electronically) . Since 2009, the Congressional Institute, Inc. has assisted and advised Member offices on how to run the competition. The institute responds to questions from participants, collects district winner information, prepares the list of winners, organizes the receipt of the artwork, and shares coordination of the reception honoring the district winners. The institute also photographs the artwork and provides a digital record of each annual competition to the House of Representatives for posting on its public website. It has been the practice for the Congressional Institute to mail the invitations, print the programs, and provide food for the annual reception. The reception, transportation, name tags, T-shirts, photography, event website, and program printing have always been privately sponsored. Recent corporate sponsors have included General Motors and Southwest Airlines. Members of Congress may also obtain the services of local sponsors to assist with transportation and local awards. At the culmination of the annual Art Competition, the winning entries from participating congressional districts are available on the House of Representatives website. The names of the 2018 winners and their artwork are available at https://www.conginst.org/art-competition/?compYear=2018&state=all . The Congressional Art Competition co-chairs generally invite an artist from their respective congressional districts to address the student winners at the reception. Since it began in 1982, "over 650,000 high school students nationwide have been involved with the nation-wide competition." There are no required procedures for selecting the winning entries for participating congressional districts. Any entry that conforms to the general specifications stated in the "Guidelines for Students and Teachers" is eligible to represent a congressional district. Members of Congress may have local art teachers, art gallery owners, civic leaders, local businesses, or Member office staff assist with the judging to select their district winner. Members of Congress may also enlist the participation of businesses in the congressional district to donate plaques, savings bonds, and other prizes, or to sponsor a reception or event to announce the competition's district winner. For example, since 2004, the Savannah College of Art and Design (SCAD) in Savannah, GA, has offered scholarship opportunities to the first-place winners of the district competitions as long as funding is available, according to school sources. The $3,000 scholarship may be renewed annually. Other scholarships are targeted for winning entrants from a specific congressional district. In recent years, these have included scholarships to the High School Summer Institute at Chicago's Columbia College and the Art Institute of Phoenix. Georgia's 13 th congressional district winner may receive a scholarship to the Art Institute of Atlanta, in Pennsylvania, the 15 th congressional district winner is eligible for a full-year scholarship to the Baum School of Art in Allentown, and Tennessee 3 rd congressional district participants are eligible for a $3,000 scholarship to Tennessee Wesleyan University in Athens, TN. Additional prizes that have been awarded include roundtrip airfare to Washington, DC, for the opening of the annual exhibition, gift certificates to local art supply stores, family memberships for a year to an art museum, and cash. Although no congressional or taxpayer funds may be used for prizes or scholarships, corporate sponsorship is allowed. As in past years, Southwest Airlines is providing two roundtrip tickets to winning entrants from any city with scheduled Southwest service to Ronald Reagan Washington National Airport or Baltimore-Washington's Thurgood Marshall International Airport (BWI). Tickets will be issued to a parent or guardian as ePasses and are to be used within the period of two weeks before and two weeks after the Washington, DC, Congressional Art Competition ceremony. Southwest Airlines does not provide hotel accommodations or hotel discounts. Appendix A. Letters Establishing the Congressional Art Competition Appendix B. Congressional Art Competition Sample Forms Appendix C. Congressional Art Competition Leadership

Sponsored by the Congressional Arts Caucus, and known in recent years as "An Artistic Discovery," the Congressional Art Competition is open to high school students nationwide. Begun in 1982, the competition, based in congressional districts, provides the opportunity for Members of Congress to encourage and recognize the artistic talents of their young constituents. Since its inception, more than 650,000 high school students nationwide have been involved in the program. Each year, the art of one student per participating congressional district is selected to represent the district. The culmination of the competition is the yearlong display of winning artwork in the Cannon House Office Building tunnel as well as on the House of Representatives' website. This report provides a brief history of the Congressional Arts Caucus and the Congressional Art Competition. It also provides a history of sponsorship and support for the caucus and the annual competition. The report includes copies of the original correspondence establishing the competition, a sample competition announcement, sample guidelines and required forms for the competition, and a chronological list of congressional co-chairs.

When the House considers legislation, one of the last steps it takes is to consider a motion to recommit. The motion to recommit represents the last chance of the House to affect a measure. In practice, that means either to offer amendatory language or to send the bill back to committee. In practice, the motion to recommit, as authorized by Rule XIX, is offered after the previous question has been ordered on passage. For these motions, the Speaker affords priority in recognition to those opposed to the measure and gives preference among those opposed to a minority party Member, which has resulted in the motion being dubbed, "the minority's motion." Among minority opponents, priority to offer the motion is given first to the minority leader or his or her designee and then to Members from the reporting committee in order of their committee seniority. Only one proper motion to recommit is in order. If a motion to recommit is ruled out of order, a second, proper motion to recommit may be offered. A motion to recommit may be amended (although it is uncommon in practice) but only if the previous question has not yet been ordered on the motion. A motion to recommit offered after the previous question has been ordered on the bill may not be tabled. House rules specifically prohibit the House Committee on Rules from reporting a special rule that would prevent the motion to recommit from being offered on initial passage of a bill or joint resolution. House rules also guarantee that the motion to recommit may include instructions that include an amendment otherwise in order if offered by the minority leader or his or her designee. This guarantee does not apply to consideration of a Senate bill for which the text of a House-passed measure has been substituted, because the motion would have been protected during initial consideration of the House-passed measure. Motions to recommit are characterized as being of two types. The first type, referred to as a "simple" or "straight" motion to recommit, includes no instructions. If adopted by the House, it returns the underlying measure to committee. When a "straight" motion to recommit is offered, the clerk will report it in the following form: Mr. Obey of Wisconsin moves to recommit the bill, H.R. 3010 to the Committee on Appropriations. The other type of motion to recommit, offered much more frequently, includes instructions and must contain language directing that the legislation be reported "forthwith," meaning that if the House adopts such a motion, the measure remains on the House floor, and the committee chair (or designee) immediately rises and reports the bill back to the House with any amendment(s) contained in the instructions of the recommittal motion. The House votes on agreeing to the amendment(s) before moving to final passage of the bill as it may have been amended. Typically, if the motion to recommit has been agreed to, the amendment in the instructions is agreed to by voice vote. However, amendment(s) in the instructions are subject to division of the question if it consists of two or more separable substantive propositions. When a motion to recommit with instructions is offered, the clerk will report it in the following form: Mr. Scott of Virginia moves to recommit the bill H.R. 10 to the Committee on Oversight and Government Reform with instructions to report the same back to the House forthwith with the following amendment: Add at the end of section 6 the following new subsection:(f) Requiring Protection of Students and Applicants Under Civil Rights Laws.—Section 3008 (sec. 38-1853.08, D.C. Official Code) is amended by adding at the end the following new subsection: "(i) Requiring Protection of Students and Applicants Under Civil Rights Laws.—In addition to meeting the requirements of subsection (a), an eligible entity or a school may not participate in the opportunity scholarship program under this Act unless the eligible entity or school certifies to the Secretary that the eligible entity or school will provide each student who applies for or receives an opportunity scholarship under this Act with all of the applicable protections available under each of the following laws:" (1) Title IV of the Civil Rights Act of 1964 (42 U.S.C. 2000c et seq.). Both types of motions to recommit are debatable for 10 minutes. The majority floor manager of a bill or joint resolution may ask that debate time be extended to one hour. In either case, debate time is equally divided between the Member making the motion and a Member opposing it. Instructions in a motion to recommit generally may not propose to do that which may not be done by amendment under the rules of the House. For example, instructions that do any of the following would be out of order: Propose an amendment that is not germane to the measure. Amend or eliminate an amendment already adopted by the House, unless permitted by a special rule. Propose an amendment in violation of Rule XXI clause 2, 4, or 5. Propose an amendment in violation of Rule XXI, clause 10, "the CUTGO rule." Authorize a committee to report at any time or direct a committee to report by a date certain. A motion to recommit may have several procedural effects. First, it allows the minority to offer and obtain a vote on policy language of their design, an opportunity that might otherwise be unavailable if the measure is being considered under the terms of a special rule that restricts or prevents the offering of amendments. Further, a motion to recommit grants the minority the last opportunity to amend legislation before final passage. The motion to recommit even allows the offering of an amendment previously rejected by the House during consideration in Committee of the Whole. House approval of a "straight" motion to recommit could have the effect of sending the bill back to the committee from which it was reported for further work on the measure. If the underlying legislation was not first reported by the committee of jurisdiction before coming to the floor—either because it was never referred to committee or because the committee was discharged from further consideration of the bill—the minority might try to use the motion as a way to put the legislation before the committee for its consideration. A motion to recommit can also send a measure to a committee to which the bill had not been originally referred. This kind of action could be tied to the creation of an ad hoc committee, such as in the following example: Mr. Ryan of Wisconsin moves to commit the resolution ( H.Res. 6 ) to a select committee composed of the Majority Leader and the Minority Leader with instructions to report back the same to the House forthwith with only the following amendment. An ad hoc committee like this has no permanence and is not required to meet. Such motions to commit are frequently used in conjunction with the House rules package on the opening day of Congress, before standing committees have been established. Additionally, the motion to recommit might seek to send the bill to a committee to which it was not referred due to jurisdictional issues. For example, in 1975, a "straight" motion to recommit attempted to send a bill which had been reported by the Committee on Ways and Means, not only to that committee, but also to the Committee on Interstate and Foreign Commerce. This motion to recommit appeared to suggest that the goal of the underlying legislation might be achieved in additional ways under the jurisdiction of this second panel. "Straight" motions to recommit could also create a situation that would effectively dispose of the underlying measure, since once the measure is recommitted, a committee is not obligated to take further action. It could be argued that it would be unlikely for a committee to report back a measure that the House has voted to remove from the floor. Debate in the House on a "straight" motion to recommit may, however, provide a committee with a non-binding understanding of what should be done to improve the measure. A committee's decision whether to act on a recommitted measure might also be influenced by House and committee rules. For instance, a Speaker pro tempore observed in response to a parliamentary inquiry, "The Chair cannot say what in the rules of a committee might constrain the timing of any action it might take. Neither can the Chair render an advisory opinion whether points of order available under the rules of the House might preclude further proceedings on the floor." As described below, the motion to recommit underwent fundamental changes in 1909 with the stated purpose of giving the minority the right "to have a vote upon its position upon great public questions." This seems to imply that the motion was intended to have not only procedural effects but also political ones, allowing Members to go on record as supporting or opposing a specific policy, an opportunity that may be important for demonstrating their policy preference to constituents that might not otherwise occur in the absence of the motion. Besides providing a policy vote, the motion to recommit can have additional political effects. A motion to recommit may combine several proposed amendments, providing the opportunity to package together a set of views as a way to create a comprehensive public record to emphasize the minority party's differences from the platform of the majority. As described above, using a "straight" motion to recommit without instructions can have the effect of delaying or even "killing" a measure, since a committee to which the measure is recommitted would never be required to act. Motions to recommit may also have the effect of providing an outlet for the minority to express its discontent with restrictions related to the openness or fairness of the legislative process. For example, a minority dissatisfied with the number of amendments its Members have been allowed to offer in the Committee of the Whole may make use of their right to offer a motion to recommit with instructions as a means for expressing their opposition to the policies of the majority party. The motion to recommit has its antecedents in the British Parliament and has existed since the First Congress. Prior to 1909, however, it operated differently than it does today, and priority in recognition for the offering of the motion to recommit was not reserved for a Member opposed to the measure. Instead, as former Speaker of the House Joseph Cannon remarked: The object of this provision [for a motion to recommit] was, as the Chair has always understood, that the motion should be made by one friendly to the bill. Often, the majority floor manager of a bill would make a "straight" motion to recommit with the expectation that it would be defeated. Since only one proper motion to recommit is in order, this would preclude anyone else from trying to use the motion in order to defeat or amend the measure. For most of the history of the House, the purpose of the motion to recommit more closely resembled the current usage of the motion to reconsider. Recommittal provided Members with a final opportunity to correct errors within the measure, and in 1891, the Speaker ruled that a bill could be recommitted "forthwith," meaning the committee chair would report the amendments in the motion at once without the bill having to be sent back to committee. The use of the motion to recommit changed substantially in 1909 as a result of changes made in House procedures championed largely by a coalition of Democrats and Progressive Republicans who opposed the autocratic rule of Speaker Cannon. During debate on the adoption of the rules package for the 61 st Congress (1909-1910), the previous question was defeated, allowing Representative John Fitzgerald to propose a set of rules changes, one of which guaranteed priority in recognition to offer the motion to recommit to a Member opposed to the bill. This rules change was offered with the stated purpose of giving the minority the right "to have a vote upon its position upon great public questions." Further, the Fitzgerald amendment prohibited the Rules Committee from reporting any special rule that would prevent the offering of a motion to recommit. This amended rules package passed 211-173. It was not until 1932, however, that precedent definitively established giving priority in recognition to offer the motion to a minority party Member opposed to the bill. This solidified the motion as a "minority right." At the beginning of the 92 nd Congress (1971-1972), the language now contained in House Rule XIX, clause 2(b), was added to the standing rules, allowing 10 minutes of debate on a motion to recommit with instructions, equally divided between a proponent and an opponent. Also in the 92 nd Congress, a new rule made recorded votes in the Committee of the Whole in order for the first time, causing some to question whether the motion to recommit had become redundant or unnecessary. An earlier ruling by the Speaker pro tempore noted that in the Committee of the Whole, "there is no roll-call vote, so that the only opportunity that a minority may have to go on record is by means of a motion to recommit in the House." Because the rules now allowed for recorded votes in the Committee of the Whole, some argued that the motion's main purpose could be achieved in other ways, making the motion to recommit "much less necessary." The right of the minority to offer a motion to recommit, however, remained intact, even in light of the expanded rules on voting. Following the successful adoption of a motion to recommit in 1984 that included the Crime Bill as amendatory instructions, the House decided that 10 minutes of debate might not always be sufficient, since these motions had the potential of adding substantial portions of legislation to an underlying measure. At the start of the 99 th Congress (1985-1986), the current language in clause 2(c) of the rule was added, allowing the majority floor manager to demand that debate time on the motion be extended to one hour equally divided and controlled by the proponent and an opponent. To date, the one-hour extension has been demanded only once. During the 1980s and 1990s, the Rules Committee issued what the minority perceived to be an increased number of special rules restricting both the amending process as well as the motion to recommit. In 1995, the House added language now in Rule XII, clause 6(c), prohibiting the Rules Committee from reporting a special rule that would prevent the offering of a motion to recommit with instructions, thereby preventing the Rules Committee from restricting the scope or content of the motion to recommit. During the 110 th Congress (2007-2008), there was a significant increase in motions to recommit offered, specifically motions to recommit with instructions that did not include the term forthwith , referred to as motions to recommit with "non-forthwith" instructions (or sometimes referred to as "promptly" motions). If adopted, a motion to recommit with "non-forthwith" instructions would have returned the bill to the specified committee whose eventual report, if any, would not have been immediately or automatically before the House. Motions to recommit with "non-forthwith" instructions sometimes had the effect of creating a difficult political choice for Members who supported both the underlying measure and the amendment contained in the motion to recommit. Some Members argued that motions to recommit with "non-forthwith" instructions were designed to trap majority party Members reluctant to vote against the motion's amendment, forcing them into a "lose-lose" situation. Also, it was argued that the use of motions to recommit with "non-forthwith" instructions including specific policy amendments were not necessary because the motion could usually be offered "forthwith," which if successful would have immediately incorporated the motion's amendments. These arguments led the House to amend its rules. The rules adopted by the House at the beginning of the 111 th Congress (2009-2010) added a requirement that any instructions must be in the form of a direction to report an amendment or amendments back to the House "forthwith." The rules package of the 111 th Congress further altered the rules surrounding the motion to recommit by making "straight" motions to recommit debatable. Prior to this, only motions to recommit with instructions had been debatable. These changes are still in effect.

The motion to recommit provides a final opportunity for the House to affect a measure before passage, either by amending the measure or sending it back to committee. The motion to recommit is often referred to as "the minority's motion," because preference in recognition for offering a motion to recommit is given to a member of the minority party who is opposed to the bill. The stated purpose of giving the minority party this right was to allow them to "have a vote upon its position upon great public questions." House rules protect this minority right, as it is not in order for the House Committee on Rules to report a special rule that would preclude offering a motion to recommit a bill or joint resolution prior to its initial passage. Motions to recommit are of two types: "straight" motions and motions that include instructions. A Member offering a "straight" motion to recommit seeks to send the measure to committee with no requirement for further consideration by the House. A Member offering a motion to recommit with instructions seeks to immediately amend the underlying bill on the House floor. A motion to recommit may have various procedural effects, including amending an underlying measure, sending it to one or more committees, providing additional time for its consideration, or potentially disposing of the legislation. Due to its inclusion of policy language, the motion to recommit might also have political effects, such as allowing Members to go on record as supporting or opposing a specific policy and creating a comprehensive public record to emphasize the minority party's differences from the platform of the majority. This report provides an overview of House rules and precedents governing the motion to recommit and describes procedural and political effects of the motion. This report will be updated to reflect any changes in House rules governing the usage of the motion to recommit.

Like most states, Ohio provides various tax incentives to encourage businesses to locate or expand operations in the state. In 1998, DaimlerChrysler agreed to construct a new assembly plant in Ohio in exchange for various benefits, which were valued at $280 million. One benefit the company was qualified to receive because of the plant construction was Ohio's investment tax credit. This credit was a non-refundable credit against the state's corporate franchise tax for taxpayers who purchased new manufacturing machinery and equipment and installed it in the state. Taxpayers from Ohio and Michigan then brought suit against DaimlerChrysler, Ohio, and several other defendants, alleging, among other things, that the investment tax credit violated the Commerce Clause of the U.S. Constitution. As discussed below, the U.S. district court held that the credit was constitutional, whereas the Sixth Circuit Court of Appeals held the opposite. In 2006, the Supreme Court ordered the case be dismissed because the plaintiffs lacked standing to bring suit in federal court. The Commerce Clause grants Congress the power to regulate interstate commerce. Congress's authority to regulate interstate commerce has been described as plenary and limited only by other constitutional provisions. On the flip side of the issue, the Supreme Court has long held that the states may not unduly burden interstate commerce in the absence of federal regulation. This restriction is founded in what is referred to as the dormant Commerce Clause. A state tax provision does not violate the dormant Commerce Clause if four qualifications are met: (1) the activity taxed has a substantial nexus with the state, (2) the tax is fairly apportioned to reflect the degree of activity that occurs within the state, (3) the tax does not discriminate against interstate commerce, and (4) the tax is fairly related to benefits provided by the state. In the Cuno case, the only issue with respect to the Commerce Clause was whether the tax incentive was discriminatory. There is no simple definition of the term "discriminatory." Instead, the Supreme Court has provided general principles, which are then applied to the specific tax at issue. For example, the Court has declared that a "fundamental principle" of the Commerce Clause is that states may not "impose a tax which discriminates against interstate commerce...by providing a direct commercial advantage to local business." Another general rule is that a state may use its tax system to encourage intrastate commerce and may compete with other states for interstate commerce so long as the state does not "discriminatorily tax the products manufactured or the business operations performed in any other [s]tate." The Supreme Court has not addressed whether an investment tax credit similar to the one at issue in Cuno is discriminatory. Thus, the district court and court of appeals were left to look at the general principles found in the Court's decisions and analogize the Ohio credit to the tax credits in the prior cases. As shown by the opposite outcomes of the two lower courts (discussed below), it is possible to come to different conclusions about the meaning of the Supreme Court's prior cases. The decisions by the district court and court of appeals broadly represent two viewpoints of the Court's jurisprudence. The district court's decision represents the idea that the purpose of the Commerce Clause is to prevent economic protectionism by the states (i.e., to prevent states from helping in-state businesses by penalizing out-of-state businesses). The court of appeals' decision represents the view that the Clause's purpose is to encourage free trade by limiting the state's ability to use its taxing power to coerce taxpayers into conducting business in that state. As seen in the two opinions, there is support in the Supreme Court's prior decisions for both interpretations. The Supreme Court, in holding that the plaintiffs lacked standing to bring suit in federal court, did not address whether the tax credit violated the Commerce Clause. The U.S. district court, in granting the defendants' motion to dismiss the case for failure to state a claim, held that the investment tax credit did not violate the Commerce Clause. The court began by describing what it believed were the two types of state taxation schemes the Supreme Court had found to be discriminatory. The first was that states could not tax goods imported from other states without imposing a tax on in-state goods, and the court found this was not an issue with the Ohio credit. The second was that a state's tax could not be based on the proportion of a business's activities carried on in that state to the amount carried on in other states. The court described the tax scheme in Westinghouse Electric Co. v. Tully as the "paradigmatic example" of what was not allowed under this second rule. In Westinghouse , the Supreme Court held that a New York corporate tax credit that lowered the effective tax rate on a company's income as its subsidiary's exports from New York increased relative to those from other states was discriminatory. The district court in Cuno noted that the New York and Ohio credits were similar in that an increase in New York activity increased the New York credit and an increase in Ohio activity increased the Ohio credit. However, the court distinguished between the two cases: although an increase in activity conducted outside New York decreased the New York credit, an increase in activity conducted outside Ohio did not decrease the Ohio credit. Based on this distinction, the court held the Ohio credit was not discriminatory. The plaintiffs appealed the district court's decision. The U.S. Court of Appeals for the Sixth Circuit held that the investment tax credit violated the Commerce Clause and reversed this part of the lower court's decision. The court began by rejecting the defendants' argument, accepted by the district court, that prior Supreme Court opinions had held that only two types of taxes were unacceptable: those that functioned as tariffs and those that determined the taxpayer's effective tax rate using both in-state and out-of-state activities. The court characterized this view as "primarily concerned with preventing economic protectionism," and the court rejected it because it "rests on the distinction between laws that benefit in-state activity and laws that burden out-of-state activity." The court described this distinction as "tenuous" because the Supreme Court had stated that "virtually every discriminatory statute . . . can be viewed as conferring a benefit on one party and a detriment on the other, in either an absolute or relative sense." Instead, the court of appeals compared the Ohio tax incentives with state tax schemes that the Supreme Court had found to be discriminatory because they involved a state using its taxing power to encourage investment in the state at the expense of investment in other states. The court looked at three cases: Boston Stock Exchange v. State Tax Commission , 429 U.S. 318 (1977), where the Court invalidated part of a New York securities transfer tax. New York imposed a tax on a transfer of securities if a taxable event occurred in the state. Since New York was the only state that taxed securities transfers, the tax placed New York brokers at a disadvantage. The state created incentives to encourage New York sales: if a sale occurred in New York, then nonresidents were taxed at a lower rate and both residents and nonresidents could not be taxed above a certain amount. The court of appeals quoted the Supreme Court as finding that the incentives "foreclosed tax-neutral decisions" and that New York was improperly using "its power to tax an in-state operation as a means of requiring [other] business operations to be performed in the home state," which was "wholly inconsistent with the free trade purpose of the Commerce Clause." Maryland v. Louisiana , 451 U.S. 725 (1981), where the Supreme Court invalidated a Louisiana severance tax credit that favored in-state natural gas producers. The appeals court quoted the Supreme Court as finding that since the credit "favored those who both own [offshore] gas and engage in Louisiana production" and that the "obvious economic effect of this Severance Tax Credit [was] to encourage natural gas owners involved in the production of [offshore] gas to invest in mineral exploration and development within Louisiana rather than to invest in further [offshore] development or in production in other States," the credit "unquestionably discriminated against interstate commerce in favor of local interests." Westinghouse Electric Corp. v. Tully , which was discussed above in the section on the district court's opinion and was distinguished by that court. The court of appeals quoted the Supreme Court as stating that the tax scheme "penalized increases in the [export] shipping activities in other states," which meant it placed "a discriminatory burden on commerce to its sister States." The court of appeals found the Ohio credit to be analogous to these other tax incentives in that the credit, by reducing a business's pre-existing franchise tax liability, coerced businesses into making in-state investments. A business with activities in Ohio would be subject to the state's franchise tax regardless of whether the business made an investment in new property eligible for the tax credit. The business could, however, reduce its existing franchise tax liability by making new investments that would qualify for the tax credit. On the other hand, if the business chose to make the new investments outside of Ohio, it could not reduce its Ohio franchise tax liability. This meant, in the court's view, that Ohio was using its power to tax to coerce businesses subject to the Ohio franchise tax to expand in Ohio rather than in another state. As a result, it held the credit was discriminatory. Ohio and the other defendants appealed the decision as it related to the investment tax credit to the U.S. Supreme Court. In 2006, the Court held that the plaintiffs did not have standing to bring the case in federal court and vacated and remanded that part of the court of appeals' opinion for dismissal. The issue of standing had not been addressed by the court of appeals. It was briefly an issue before the district court after the defendants asked for the case, which the plaintiffs had initially brought in state court, to be removed to federal court. The plaintiffs used their potential lack of standing as one reason why the suit should not be removed, but the district court, in approving the removal, stated that the plaintiffs had standing to challenge the tax credit under the "municipal taxpayer standing" rule. That rule derives from a Supreme Court case, Massachusetts v. Mellon , in which the Court indicated that a municipal resident could have standing to challenge the illegal spending of money by a municipality because of the special relationship that arose between the resident and municipality due to the latter's corporate status. The district court apparently felt that the Cuno plaintiffs had standing to challenge the state investment tax credit because they had standing to challenge the other benefits provided to DaimlerChrysler, specifically a property tax exemption provided by an Ohio municipality as authorized under Ohio law. Before the Supreme Court, the Cuno plaintiffs claimed they had standing due to their status as Ohio taxpayers who were injured because the credit reduced the funds available in the Ohio fisc to be used for lawful purposes and therefore imposed a disproportionate burden on them. The Supreme Court, in rejecting their claim, began by noting that standing is an integral part of the "case or controversy" requirement in Article III of the U.S. Constitution and requires plaintiffs show a "personal injury fairly traceable to the defendant's allegedly unlawful conduct and likely to be redressed by the requested relief." The Court noted that federal taxpayers generally do not have standing solely because of their taxpayer status to challenge an expenditure of federal funds. This is because such taxpayers' injuries are (1) not particularized to those plaintiffs, but rather common to the general taxpaying public, and (2) hypothetical because whether they will occur or be redressed depends on future actions by a legislative body. The Court concluded that the same reasons for denying standing to federal taxpayers applied to deny standing to state taxpayers, including the plaintiffs in Cuno. The Court also rejected the plaintiffs' contention that there should be an exception to the general rule disallowing taxpayer standing for Commerce Clause challenges, similar to the exception that exists for Establishment Clause challenges. The Court distinguished between the two situations, noting that the injury in taxpayer suits alleging violation of the Establishment Clause was the taxing and spending itself and that the injury could be redressed by enjoining the taxing and spending activity without requiring further legislative action. The Court also reasoned that allowing an exception for Commerce Clause suits would lead to the creation of exceptions for any constitutional provision that implicates a government's taxing and spending powers, and thus be inconsistent with the general rule that disallows taxpayer standing. Finally, the Court rejected the argument that the plaintiffs had standing to challenge the investment tax credit under the theory of supplemental jurisdiction (which would have allowed them to challenge the investment tax credit because they had standing as municipal taxpayers to challenge the property tax exemption provided to DaimlerChrysler by an Ohio municipality), stating that the plaintiffs must have standing for each claim presented. The Economic Development Act of 2005 ( H.R. 2471 and S. 1066 ) would give states the authority to offer incentives like the investment tax credit struck down by the Sixth Circuit in Cuno . The act would generally allow the states to provide discriminatory tax incentives that are for an economic development purpose, including any legally permitted activity for attracting, retaining, or expanding business activity, jobs, or investment in a state. Some incentives would not be allowed, including those that depend on state of incorporation or domicile, require the recipient to acquire or use services or property produced in the state, are reduced as a direct result of an increase in out-of-state activity, result in a loss of a compensating tax system, require reciprocal tax benefits from another jurisdiction, or reduce a tax not imposed on apportioned interstate activities. The act would apply to all qualifying tax incentives, regardless of their date of enactment.

In 2005, the Sixth Circuit Court of Appeals held in Cuno v. DaimlerChrsyler that Ohio's investment tax credit violated the Commerce Clause of the U.S. Constitution. The case received significant attention because most states have similar credits. In 2006, the Supreme Court held that the Cuno plaintiffs lacked standing to challenge the credit in federal court. Because the Supreme Court based its decision on the issue of standing, it did not address whether the credit violated the Commerce Clause. Introduced prior to the Supreme Court's decision, the Economic Development Act of 2005 ( H.R. 2471 and S. 1066 ) would authorize states to offer tax incentives similar to Ohio's investment tax credit.

The President is responsible for appointing individuals to positions throughout the federal government. In some instances, the President makes these appointments using authorities granted by law to the President alone. Other appointments are made with the advice and consent of the Senate via the nomination and confirmation of appointees. Presidential appointments with Senate confirmation are often referred to with the abbreviation PAS. This report identifies, for the 113 th Congress, all nominations submitted to the Senate for executive-level full-time positions in the 15 executive departments for which the Senate provides advice and consent. It excludes appointments to regulatory boards and commissions as well as to independent and other agencies, which are covered in other CRS reports. Information for this report was compiled using the Senate nominations database of the Legislative Information System (LIS) ( http://www.lis.gov/nomis/ ) , the Congressional Record (daily edition), the Weekly Compilation of Presidential Documents , telephone discussions with agency officials, agency websites, the United States Code , and the 2012 Plum Book ( United States Government Policy and Supporting Positions ). Related Congressional Research Service (CRS) reports regarding the presidential appointments process, nomination activity for other executive branch positions, recess appointments, and other appointments-related matters may be found at http://www.crs.gov . Table 1 summarizes appointment activity, during the 113 th Congress, related to full-time PAS positions in the 15 executive departments. President Barack H. Obama submitted 273 nominations to the Senate for full-time positions in executive departments. Of these 273 nominations, 162 were confirmed; 8 were withdrawn; and 103 were returned to the President under the provisions of Senate rules. The length of time a given nomination may be pending in the Senate has varied widely. Some nominations were confirmed within a few days, others were confirmed within several months, and some were never confirmed. This report provides, for each executive department nomination confirmed in the 113 th Congress, the number of days between nomination and confirmation ("days to confirm"). For confirmed nominations, a mean of 119.2 days elapsed between nomination and confirmation. The median number of days elapsed was 92.0. Under Senate Rules, nominations not acted on by the Senate at the end of a session of Congress (or before a recess of 30 days) are returned to the President. The Senate, by unanimous consent, often waives this rule—although not always. This report measures the "days to confirm" from the date of receipt of the resubmitted nomination, not the original. Each of the 15 executive department profiles provided in this report is divided into two parts: (1) a table listing the organization's full-time PAS positions as of the end of the 113 th Congress and (2) a table listing appointment action for vacant positions during the 113 th Congress. Data for these tables were collected from several authoritative sources, as listed earlier. In each department profile, the first of these two tables identifies, as of the end of the 113 th Congress, each full-time PAS position in that department and its pay level. For most presidentially appointed positions requiring Senate confirmation, pay levels fall under the Executive Schedule. As of the end of the 113 th Congress, these pay levels ranged from level I ($201,700) for Cabinet-level offices to level V ($147,200) for lower-ranked positions. The second table, the appointment action table, provides, in chronological order, information concerning each nomination. It shows the name of the nominee, position involved, date of nomination or appointment, date of confirmation, and number of days between receipt of a nomination and confirmation. It also notes actions other than confirmation (e.g., nominations returned to or withdrawn by the President). The appointment action tables with more than one nominee to a position also list statistics on the length of time between nomination and confirmation. Each appointment action table provides the average days to confirm in two ways: mean and median. Although the mean is a more familiar measure, it may be influenced by outliers in the data. The median, by contrast, does not tend to be influenced by outliers. In other words, a nomination that took an extraordinarily long time might cause a significant change in the mean, but the median would be unaffected. Examining both numbers offers more information with which to assess the central tendency of the data. For a small number of positions within a department, the two tables may contain slightly different titles for the same position. This is because the title used in the nomination the White House submits to the Senate, the title of the position as established by statute, and the title of the position used by the department itself are not always identical. The first table listing incumbents at the end of the 113 th Congress uses data provided by the department itself. The second table listing nomination action within each department relies primarily upon the Senate nominations database of the LIS. This information is based upon the nomination sent to the Senate by the White House. Any inconsistency in position titles between the two tables is noted in the notes following each appointment table. Appendix A provides two tables. Table A-1 relists all appointment action identified in this report and is organized alphabetically by the appointee's last name. Table entries identify the agency to which each individual was appointed, position title, nomination date, date confirmed or other final action, and duration count for confirmed nominations. The table also includes the mean and median values for the "days to confirm" column. Table A-2 provides summary data for each of the 15 executive departments identified in this report. The table summarizes the number of positions, nominations submitted, individual nominees, confirmations, nominations returned, and nominations withdrawn for each department. It also provides the mean and median values for the numbers of days taken to confirm nominations within each department. A list of department abbreviations can be found in Appendix B . Appendix A. Presidential Nominations, 113 th Congress Appendix B. Abbreviations of Departments

The President makes appointments to positions within the federal government, either using the authorities granted by law to the President alone, or with the advice and consent of the Senate. There are some 351 full-time leadership positions in the 15 executive departments for which the Senate provides advice and consent. This report identifies all nominations submitted to the Senate during the 113 th Congress for full-time positions in these 15 executive departments. Information for each department is presented in tables. The tables include full-time positions confirmed by the Senate, pay levels for these positions, and appointment action within each executive department. Additional summary information across all 15 executive departments appears in the Appendix. During the 113 th Congress, the President submitted 273 nominations to the Senate for full-time positions in executive departments. Of these 273 nominations, 162 were confirmed, 8 were withdrawn, and 103 were returned to him in accordance with Senate rules. For those nominations that were confirmed, a mean (average) of 119.2 days elapsed between nomination and confirmation. The median number of days elapsed was 92.0. Information for this report was compiled using the Senate nominations database of the Legislative Information System (LIS) ( http://www.lis.gov/nomis/ ) , the Congressional Record (daily edition), the Weekly Compilation of Presidential Documents , telephone discussions with agency officials, agency websites, the United States Code , and the 2012 Plum Book ( United States Government Policy and Supporting Positions ). This report will not be updated.

SSA historically has compiled death information about SSN-holders in order to ensure it does not pay Social Security benefits to deceased individuals and to establish benefits for survivors. When SSA receives a report of death—which could include name, date of birth, date of death, and SSN—it matches that information against corresponding information in its database of all SSN-holders, known as the Numerical Index File (Numident). SSA then marks the appropriate Numident record with a death indicator. This death information was not publicly available until 1980 when, in response to Freedom of Information Act requests, SSA began to extract Numident records that had a death indicator into a separate file it called the DMF. According to SSA officials, SSA received about 7 million death reports in 2012 from a variety of sources. These sources include family members, funeral directors, post offices, financial institutions, other federal agencies, and state vital records agencies (states). To get death reports from the states, SSA has established formal agreements that set forth a payment structure for the states’ death reports and limit SSA’s ability to share this information. However, the Social Security Act requires SSA to share death information, including data reported by the states, with federal agencies to ensure proper payment of benefits to individuals. The act also prohibits SSA from sharing state-reported death information for any other purposes. As a result, SSA maintains two versions of the DMF. The “full DMF,” which contains all death records, is available to federal benefit-paying agencies. The “partial DMF,” which excludes state- reported death information, is available publicly to any interested party. Following the Social Security Act, SSA removes the state-reported records from the full DMF and provides the partial DMF to the Department of Commerce’s National Technical Information Service (NTIS), which reimburses SSA for the cost of providing the file and sells it through a subscription service. Our work to date has identified ways in which SSA’s procedures for compiling and verifying death reports may affect the accuracy of death reports in the DMF. To guide how to handle death reports, SSA has determined accuracy levels for each of the sources based on its past experience. Of all the sources of death reports that SSA receives, SSA considers those submitted by states through Electronic Death Registration Systems (EDRS) to be the most accurate. As part of these systems, states generally verify the names and SSNs from death reports with SSA’s databases before submitting them. As of March 2013, 35 states submit their death reports using EDRS. SSA considers reports from funeral directors and family members of decedents the next most accurate. Finally, SSA considers reports from the remaining sources to be less accurate. According to SSA officials, SSA does not collect data on the number of death reports submitted by each source. However, officials told us that if SSA receives multiple death reports for the same individual, the Numident record is updated to reflect only the source SSA considers to be the most accurate. For example, if SSA first receives a death report from a family member and subsequently receives an electronic report from a state about the same individual, the original report is overridden and SSA records only the state as the source of the death report. Whether SSA verifies death reports depends upon (1) whether the decedent is receiving Social Security benefits, and (2) the source of the report. Verification includes confirming the date of death and decedent’s SSN to ensure that the person identified in the death report is the person who has died. According to SSA officials, the agency only verifies death reports for individuals currently receiving Social Security program benefits because it is essential to its mission to stop payments to deceased beneficiaries. Even then, SSA verifies only those reports from sources it considers to be less accurate, such as financial institutions and other federal agencies. Therefore, death reports for non-beneficiaries are not verified (see table 1). SSA officials said they do not maintain data on the number of death reports they verify annually or how long such verifications take. The following scenarios illustrate SSA’s approach to verification: SSA receives a death report from a funeral director and determines the decedent is currently receiving Social Security benefits. Because the report was received from a source considered highly accurate, SSA takes no further steps to verify the death. The death is recorded in the decedent’s Numident record and subsequently the DMF. SSA receives a death report from a post office based on a returned Social Security benefit check noting the addressee is deceased. Because the decedent is a current SSA beneficiary and the report came from a source considered less accurate, it is turned over to an SSA field office to verify. Field office staff attempt to contact either the family of the decedent or some other source that is likely to have first- hand knowledge of the death to confirm the decedent’s identity and date of death. Once this is completed, the death is recorded in the decedent’s Numident record and the DMF. Veterans Affairs submits a death report to SSA. SSA determines the decedent is not receiving Social Security benefits. SSA does not verify the death before recording it in the Numident record and subsequently the DMF. Because there are a number of death reports that SSA does not verify, the agency risks having erroneous death information in the DMF, such as including living individuals in the file or not including deceased individuals. Specifically, for death reports that are not verified, SSA would not know with certainty if the individuals reported as dead are, in fact, the ones who are dead. SSA acknowledges these limitations and does not guarantee the accuracy of the file. Other SSA practices may prevent deaths from being included in the DMF or lead to other errors. For example, if SSA cannot match a death report to a corresponding Numident record because of differences in name, date of birth, or gender, it generally will not take actions to resolve the non- match. As a result, these deaths would not be included in the DMF. In addition, analysis we performed on existing DMF records identified potentially erroneous information. Specifically, we identified: 130 records where the date of death was recorded to occur before the 1,295 records where the recorded age at death was between 111 and 1,791 records where the recorded death preceded 1936, the year SSNs were first issued, although the decedents had SSNs assigned to them. SSA officials said some of these anomalies were likely associated with records added prior to the mid-1970s that were manually processed. For example, SSA staff could have keyed in a date of birth that occurred after a date of death. In addition, they told us SSA is taking steps toward identifying or preventing these types of potential errors. These include implementing an edit check to catch records showing a date of birth after date of death, and undertaking a review of cases in which persons appear to be unreasonably old and still receiving benefits to determine if they are dead or if their birth date was entered incorrectly. Finally, there are other situations in which deaths would not be included in the DMF. For example, decedents who were never assigned an SSN cannot be matched to the Numident. In addition, some deaths may not be reported to SSA, because, for example, identity cannot be established or a body is never found. However, it was beyond the scope of our review to determine the extent to which such gaps occurred. A number of federal agencies access the DMF, but the conditions of access vary widely due to legal and administrative factors. Federal agencies’ access to the full DMF depends on various legal requirements, including (1) whether they pay federal benefits and (2) whether their proposed use of the DMF is consistent with uses outlined in the Social Security Act. Currently, SSA shares the full DMF with six federal benefit- paying agencies which have requested access and which it has determined meet the relevant legal requirements: Centers for Medicare & Medicaid Services Department of Defense (Defense Manpower Data Center) Department of Veterans Affairs Internal Revenue Service Office of Personnel Management Railroad Retirement Board To address administrative conditions of access, these agencies have established information exchange agreements to receive the full DMF. As a part of these agreements, SSA and the agencies agree on what the agency will pay for receiving the data, among other things. SSA has statutory authority to require reimbursement to cover the reasonable cost of sharing the data, and the amount varies by agency. According to SSA officials, although the cost is generally related to the volume of data SSA provides, other factors may affect what agencies pay. For example, the Department of Veterans Affairs does not reimburse SSA for the DMF because it is statutorily exempted from doing so. The Office of Personnel Management similarly does not reimburse SSA because it provides other data to SSA, and the agencies have agreed that the expenses involved in the exchanges are reciprocal. In contrast, the Defense Manpower Data Center pays over $40,000 annually for monthly updates, while CMS officials told us it pays about $10,000 per year for weekly updates. A number of other federal agencies purchase only the partial DMF that is publicly available from NTIS. Several of these pay federal benefits, including the Department of Labor’s Energy Employees Occupational Illness Compensation Program, which provides compensation and health benefits to eligible Department of Energy workers and certain survivors. In addition, the Department of Agriculture’s Farm Service Agency administers several programs that pay benefits to farmers. Other agencies include, for example, the Department of Homeland Security, the Department of Justice, and the Department of the Treasury office that administers the Do Not Pay Initiative. According to SSA officials, the partial DMF has about 10 percent fewer records than the full DMF due to the removal of state-reported deaths. As more states submit records via EDRS, SSA officials expect this difference to grow over time. As a result, any benefit-paying agency relying on the partial DMF to help identify deceased program participants may be missing death records for some of its beneficiaries because it has access to only about 87 million of the 98 million records in the full DMF. Although SSA officials make the determination about which agencies are eligible to receive the full DMF, they told us agencies must first formally request it. In response to agencies’ requests, SSA makes determinations about agencies’ statutory eligibility on a case-by-case basis. However, SSA officials said they were not aware of written standards or guidelines to follow in determining which federal agencies meet statutory requirements. SSA officials said that Offices of Inspectors General at benefit-paying agencies would likely be eligible to receive the full DMF for the purpose of ensuring proper payments of benefits. In contrast, SSA officials said that the agency has determined that the Department of the Treasury would not be eligible to receive the full DMF for the purposes of administering the Do Not Pay Initiative. Even though this initiative is designed to help agencies prevent improper payments, SSA officials explained that under the Do Not Pay Initiative, Treasury would share state death information with agencies that do not pay benefits, which would put SSA in violation of the Social Security Act and its agreements with the states. In summary, SSA’s death information can serve as a helpful tool in preventing improper payments, but can only do so if it is accurate and accessible to federal agencies that need it. As we continue our work, we will explore these and other issues in more detail and look forward to providing a final product later in 2013. Chairman Carper, Ranking Member Coburn, and Members of the Committee, this completes my prepared statement. I would be pleased to respond to any questions that you may have at this time. For further information about this testimony, please contact me at (202) 512-7215 or bertonid@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this testimony. Other key contributors to the testimony include Keira Dembowski, Holly Dye, Joel Marus, Sara Pelton and Lori Rectanus. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

As the steward of taxpayer dollars, the federal government is accountable for safeguarding against improper payments--those that should not have been made or that were made in an incorrect amount. One tool federal agencies can use to do this is the DMF, which is a file containing records of deceased individuals who are SSNholders. Through data matching, federal benefit-paying agencies can use the DMF to alert them of deceased benefit recipients. However, the SSA Office of Inspector General and others have identified inaccuracies in the DMF, including deceased individuals who were not listed in the file. Such inaccuracies could adversely affect its usefulness to federal agencies. This testimony addresses preliminary observations on (1) SSA's process for handling death reports for inclusion in the DMF, and (2) federal agency access to the DMF. In addressing these objectives, we interviewed SSA officials regarding how the agency obtains death reports and maintains the DMF; reviewed applicable federal laws, SSA procedures, and reports; interviewed representatives of organizations that report deaths to SSA; and interviewed officials at other federal agencies that use the DMF. The Social Security Administration's (SSA) procedures for handling and verifying death reports may allow for erroneous death information in the Death Master File (DMF) because SSA does not verify certain death reports or record others. SSA officials said, in keeping with its mission, the agency is primarily focused on ensuring that it does not make benefit payments to deceased Social Security program beneficiaries. As a result, it only verifies death reports received for individuals who are current program beneficiaries, and even then, only for those reports received from sources it considers to be less accurate. For example, SSA officials consider death reports from states that have pre-verified decedents' name and SSN to be highly accurate, so SSA does not verify that the subjects of these reports are actually deceased. It would, however, verify a report received from a source such as a post office. SSA verifies no death reports for individuals who are not beneficiaries, regardless of source. Because there are a number of death reports that SSA does not verify, the agency risks including incorrect death information in the DMF, such as including living individuals in the file or not including deceased individuals. Specifically, for death reports that are not verified, SSA would not know with certainty if the individuals are correctly reported as dead. SSA also does not record some deaths because incorrect or incomplete information included in death reports generally prevents SSA from matching decedents to SSA records. For example, if SSA is unable to match a death report to data in its records such as name and Social Security Number (SSN), it generally does not follow up to correct the non-match and does not record the death. A number of federal agencies access the DMF for the purpose of matching it against data in their files, but the conditions of access depend on a variety of legal and other factors. Currently SSA shares a full version of the DMF with six federal agencies that it has determined meet legal requirements for accessing the file, which include being an agency that pays federal benefits. By law, SSA can require reimbursement for the cost of sharing the data, however various factors affect what the agencies actually pay. The Department of Veterans Affairs and the Office of Personnel Management pay nothing to receive the file, whereas the Department of Defense annually pays more than $40,000. A number of other federal agencies--including several that administer programs that pay benefits-- purchase a partial version of the DMF that is publicly available through the Department of Commerce's National Technical Information Service (NTIS). NTIS reimburses SSA for receipt of the file. The partial DMF does not include statereported data and, according to SSA officials, has about 10 percent fewer records than the full DMF (roughly 87 million, compared to 98 million). Thus, agencies accessing this version of the file, such as the Department of Labor's Energy Employees Occupational Illness Compensation Program, may be missing deceased program participants. If agencies want access to the full DMF, they must formally request it. SSA makes determinations about their eligibility on a case-by-case basis. SSA officials said they were not aware of written standards or guidelines to follow in making these determinations. The work is ongoing and GAO has no recommendations at this time. GAO plans to issue its final report later in 2013.

This report responds to frequently asked questions about the Small Business Administration (SBA) Disaster Loan Program. Authorized by the Small Business Act, the SBA Disaster Loan Program has been a source of economic assistance to businesses, nonprofit organizations, homeowners, and renters as they repair or replace property damaged or destroyed in a federally declared disaster. The SBA Disaster Loan Program is also designed to help small agricultural cooperatives recover from economic injury resulting from a disaster. SBA disaster loans include (1) Home and Personal Property Disaster Loans, (2) Business Physical Disaster Loans, and (3) Economic Injury Disaster Loans (EIDL). As demonstrated in Figure 1 and Figure 2 , most direct disaster loans (approximately 83%) are awarded to individuals and households rather than small businesses. The program generally offers low-interest disaster loans at a fixed rate that have loan maturities of up to 30 years. There are five ways in which the SBA Disaster Loan Program can be put into effect. These include two types of presidential declarations as authorized by the Robert T. Stafford Disaster Relief and Emergency Assistance Act (the Stafford Act) and three types of SBA declarations. While the type of declaration may determine what types of loans are made available, declaration type has no bearing on loan terms or loan caps. The SBA Disaster Loan Program becomes available when: 1. The President issues a major disaster declaration, or an emergency declaration, and authorizes both Individual Assistance (IA) and Public Assistance (PA) under the authority of the Stafford Act. When the President issues such a declaration, SBA disaster loans become available to homeowners, renters, businesses of all sizes, and nonprofit organizations located within the disaster area. Economic Injury Disaster Loans (EIDL) may also be made for survivors in contiguous counties or other political subdivisions. 2. The President makes a major disaster declaration or emergency declaration that only provides the state with PA. In such a case, a private nonprofit entity located within the disaster area that provides noncritical services may be eligible for a physical disaster loan and EIDL. It is important to note that Home Physical Disaster Loans and Personal Property Loans are not made available to renters and homeowners under this type of declaration. Additionally, Business Physical Disaster Loans, and EIDLs are generally not made available to businesses (unless they are a private nonprofit entity) if the declaration only provides PA. 3. The SBA Administrator issues a physical disaster declaration in response to a gubernatorial request for assistance. When the SBA Administrator issues this type of declaration, SBA disaster loans become available to eligible homeowners, renters, businesses of all sizes, and nonprofit organizations within the disaster area or contiguous counties and other political subdivisions. 4. The SBA Administrator may make an EIDL declaration when SBA receives a certification from a state governor that at least five small businesses have suffered substantial economic injury as a result of a disaster. This declaration is offered only when other viable forms of financial assistance are unavailable. Small agricultural cooperatives and most private nonprofit organizations located within the disaster area or contiguous counties and other political subdivisions are eligible for SBA disaster loans when the SBA Administrator issues an EIDL declaration. 5. The SBA Administrator may issue a declaration for EIDL loans based on the determination of a natural disaster by the Secretary of Agriculture. These loans are available to eligible small businesses, small agricultural cooperatives, and most private nonprofit organizations within the disaster area, or contiguous counties and other political subdivisions. Additionally, the SBA administrator may issue a declaration based on the determination of the Secretary of Commerce that a fishery resource disaster or commercial fishery failure has occurred. As demonstrated by Figure 3 , from calendar year 2000 to 2014, the Secretary of Agriculture issued the greatest number of declarations (58%). The SBA issued 15% of the declarations for the period. Presidential declarations for PA and presidential declarations for IA and PA were 14% and 10% respectively. EIDL declarations account for 15% of the declarations issued during this period. The fewest declarations issued were based on the determination of the Secretary of Commerce (only two were issued during the time period). Loan approvals are often used in performance reviews and budget justifications. Some might argue that loan disbursals more accurately reflect program usage because not all approved applicants accept the loans. From 2000 to 2014, approximately 72% (380,450 loans) of approved disaster loans during the time period, amounting to roughly $15.5 billion, were actually disbursed to businesses and households. Figure 4 displays the percent of all approved loans that were disbursed each year. Disaster loans may be used in conjunction with other types of assistance including insurance but only to the extent to which there is no duplication of assistance. Section 312 of the Stafford Act requires federal agencies providing disaster assistance to ensure that businesses and individuals do not receive disaster assistance for losses for which they have already been compensated. An individual receiving federal assistance for a major disaster is liable to the United States when the assistance duplicates benefits provided for the same purpose. FEMA regulation 44 C.F.R. 206.191 establishes policies and procedural guidance to ensure uniformity in preventing duplication of benefits, including a "delivery sequence" of disaster assistance provided by volunteer organizations and certain federal agencies. According to the regulation, the agency or organization that is lower in the delivery sequence should not provide assistance that duplicates assistance provided by a higher level agency or organization. SBA regulation 13 C.F.R. 123.101(c) prohibits applicants from receiving a home disaster loan if their damaged property can be repaired or replaced with the proceeds of insurance, gifts, or other compensation. These amounts must either be deducted from the amount of the claimed losses or, if received after SBA has approved and disbursed a loan, must be paid to SBA as principal payments on their loans. SBA can approve and disburse a loan for the total replacement cost up to specified lending limits. However, if there is a duplication of benefits after the insurance settles, those funds are applied to the balance of the disaster loan. SBA will not require collateral to secure a business or home disaster loan of $25,000 or less. In general, SBA will not decline a loan when inadequacy of collateral is the only unfavorable factor in a disaster loan application and SBA is reasonably sure that the applicant can repay the loan. SBA may decline or cancel loans for applicants who refuse to pledge available collateral. SBA uses approximate processing standards based on tiered levels of application volumes for all disaster loans: two to three weeks for less than 50,000 applications per year (level I); three to four weeks for 50,001-250,000 applications per year (level II); four-plus weeks for more than 250,000 applications per year (level III); and more than four-plus weeks for more than 500,000 applications per year (level IV). According to SBA, the percent of disaster loans processed according to the tiered standard performance goal was 100% in FY2010, 100% in FY2011, 95% in FY2012, 55% in FY2013, and 100% in FY2014. SBA noted that its lower performance in FY2013 was largely due to increased loan volumes following Hurricane Sandy. A July 2015 SBA Office of Inspector General study found that SBA's processing time for home disaster loans averaged 18.7 days and application processing times for business disaster loans averaged 43.3 days. Congress generally appropriates funds to the SBA Disaster Loan Program through annual appropriations. In some cases, after large-scale disasters (such as Hurricanes Katrina and Sandy), Congress has appropriated additional funds for the program through supplemental appropriations. It is not uncommon for Congress to carry funds left over from these supplemental appropriations to the next fiscal year and forego an annual appropriation (see Table 1 ). As shown in Table 1 , from FY2005 to FY2015 the average annual appropriation to the SBA Disaster Loan Program was $120 million. The average supplemental appropriation for the same time period was $623 million. Combined, Congress has appropriated $4.1 billion—a yearly average of $408 million—to the program from FY2005 to FY2015. Disaster loans provided to individuals and households in declared disaster areas fall into two categories: Personal Property Loans and Real Property Loans. A Personal Property Loan provides a creditworthy homeowner or renter located in a declared disaster area with up to $40,000 to repair or replace personal property owned by the survivor. Real Property Loans provide creditworthy homeowners located in a declared disaster area with up to $200,000 to repair or restore the homeowner's primary residence to its pre-disaster condition. However, the amount SBA will lend depends on the cost of repairing or replacing the home and/or personal property (minus insurance settlements or grant assistance). Personal Property Loans cover only uninsured or underinsured property and primary residences in a declared disaster area. Personal Property Loans can be used to repair or replace clothing, furniture, cars, or appliances damaged or destroyed in the disaster. Eligibility of luxury items with functional use, such as antiques and rare artwork, is limited to the cost of an ordinary item meeting the same functional purpose. Only uninsured or otherwise uncompensated disaster losses are eligible for loan assistance. The loans may not be used to upgrade a home or build additions to the home, unless the upgrade or addition is required by city or county building codes. Secondary homes or vacation properties are not eligible for Real Property Loans. Repair or replacement of landscaping and/or recreational facilities cannot exceed $5,000. A homeowner may borrow funds to cover the cost of improvements to protect their property against future damage (e.g., retaining walls, sump pumps, etc.). In some cases, SBA loans can be used to refinance all or part of a previous mortgage when the applicant does not have credit available elsewhere, has suffered substantial disaster damage not covered by insurance, and intends to repair the damage. SBA considers refinancing when processing each application. In addition, loan recipients can use loan money to pay their insurance deductible. A homeowner may borrow funds to cover the cost of improvements to protect their property against future damage (e.g., safe rooms or similar structures designed to protect occupants from natural disasters, retaining walls, sump pumps, etc.). Mitigation funds may not exceed 20% of the disaster damage, as verified by SBA, to a maximum of $200,000 for home loans. Interest rate ceilings are statutorily set at 8% per annum or 4% per annum if the applicant is unable to obtain credit elsewhere. Generally, borrowers pay equal monthly installments of principal and interest, beginning five months from the date of the loan. The loans can have maturities up to 30 years. SBA will not require collateral to secure a physical disaster home loan of $25,000 or less. In general, SBA will not decline a loan when inadequacy of collateral is the only unfavorable factor in a disaster loan application and SBA is reasonably sure that the applicant can repay the loan. SBA may decline or cancel loans for applicants who refuse to pledge available collateral. SBA offers loans to help businesses repair and replace damaged property and financial assistance to businesses that have suffered economic loss as a result of a disaster. Disaster loans provided to businesses fall into two categories: Business Physical Disaster Loans and EIDLs. Any business, regardless of size (other than an agricultural enterprise), and private, nonprofit organizations located in a declared disaster area may be eligible for a Business Physical Disaster Loan. Business Physical Disaster Loans provide up to $2 million to repair or replace damaged physical property including machinery, equipment, fixtures, inventory, and leasehold improvements that are not covered by insurance. Damaged vehicles normally used for recreational purposes may be repaired or replaced with SBA loan proceeds if the borrower can submit evidence that the vehicles were used for business purposes. Businesses may utilize up to 20% of the verified loss amount for mitigation measures (e.g., grading or contouring of land, relocating or elevating utilities or mechanical equipment, building retaining walls, safe rooms or similar structures designed to protect occupants from natural disasters, or installing sewer backflow valves) in an effort to prevent loss should a similar disaster occur in the future. Interest rates for Business Physical Disaster Loans cannot exceed 8% per annum or 4% per annum if the business cannot obtain credit elsewhere. Borrowers generally pay equal monthly installments of principal and interest starting five months from the date of the loan. Business Physical Disaster Loans can have maturities up to 30 years. EIDLs provide up to $2 million to help meet financial obligations and operating expenses that could have been met had the disaster not occurred. Loan proceeds can only be used for working capital necessary to enable the business or organization to alleviate the specific economic injury and to resume normal operations. Loan amounts for EIDLs are based on actual economic injury and financial needs, regardless of whether the business suffered any property damage. EIDLs are available only to businesses that are located in a declared disaster area, have suffered substantial economic injury, are unable to obtain credit elsewhere, and are defined as small by SBA size regulations. Size standards vary according to a variety of factors including industry type, average firm size, and start-up costs and entry barriers. Small agricultural cooperatives and most private and nonprofit organizations that have suffered substantial economic injury as the result of a declared disaster are also eligible for EIDLs. Businesses can secure both an EIDL and a Business Physical Disaster loan to rebuild, repair, and recover from economic loss. The loan amount cannot exceed $2 million. Interest rate ceilings are statutorily set at 4% per annum or less and loans can have maturities up to 30 years. Collateral requirements vary by declaration type. In presidential declarations, Business Physical Disaster Loans over $25,000 must be secured to the extent possible. For agency declarations, Business Physical Disaster Loans over $25,000 must be secured to the extent possible. The SBA administrator is prohibited from requiring businesses to use their personal residence as collateral for loans under $200,000 if the applicant has other collateral, including assets related to the operation of the business that is sufficient to cover the value of the loan. SBA will not require collateral to secure an EIDL of $25,000 or less. All EIDL loans over $25,000 must be secured to the extent possible. SBA takes real estate as collateral when it is available. SBA will not decline a loan for lack of collateral. However, the applicant is required to pledge by what they have available as collateral.

This report responds to frequently asked questions about the Small Business Administration (SBA) Disaster Loan Program. The SBA Disaster Loan Program provides direct loans to help businesses, nonprofit organizations, homeowners, and renters repair or replace property damaged or destroyed in a federally declared disaster. The program is also designed to help small agricultural cooperatives recover from economic injury resulting from a disaster. SBA disaster loans include (1) Home and Personal Property Disaster Loans, (2) Business Physical Disaster Loans, and (3) Economic Injury Disaster Loans (EIDL). Most direct disaster loans (approximately 80%) are awarded to individuals and households rather than small businesses. The program generally offers low-interest disaster loans at a fixed rate with loan maturities of up to 30 years. Key issues of interest to Congress include: how the program is put into effect, how much Congress appropriates to the program, what types of loans are available to businesses and homeowners, the use of SBA disaster loans in conjunction with insurance, loan interest rates and terms for SBA disaster loans, eligible activities, loan processing times, and collateral requirements. For additional information on Small Business Administration Disaster Loan Program, see CRS Report R41309, The SBA Disaster Loan Program: Overview and Possible Issues for Congress, by [author name scrubbed].

This report discusses proposals to raise the cigarette tax to help pay for reauthorization of the State Children's Health Insurance Program. This report describes current taxes, discusses potential revenue gains, and discusses some of the basic issues surrounding a tax increase. It also briefly discusses the tax increase on cigars. H.R. 2 passed the House on January 14, 2009 and it included the same cigarette tax as proposed in the 110 th Congress, an increase of 61 cents per pack, raising the tax from 39 cents to $1. The estimated revenues in the House bill were $64.7 billion for FY2009-FY2018, with $57.3 billion of the total from cigarettes. The Senate version and the final legislation, P.L. 111-3 includes taxes similar to H.R. 2 (very slightly higher across the board, with a 61.66 cents increase in cigarette taxes). The vast majority of tobacco taxes are on cigarettes, which account for 94% of tobacco sales (totaling $75 billion in 2007). Federal cigarette taxes are $0.39 per pack, accounting for 94% of federal tobacco tax revenue. There is a 4 cent tax on a package of small cigars. Large cigars carry a tax of 20.719% of sales price, not to exceed $48.75 per 1,000 units, leading to a maximum tax of almost 5 cents per cigar. Per ounce, the tax is 7 cents on pipe tobacco; 1 cent on chewing tobacco; 4 cents on snuff; and 7 cents on pipe and roll-your-own tobacco. There are also taxes on cigarette paper and cigarette tubes. The 61-cent cigarette tax increase would lead to a tax about 2.5 times the current tax.; these same proportions are proposed for snuff, chewing, tobacco and pipe tobacco. Roll your own tobacco's tax increases about eight fold and seven fold and the relatively small taxes on small cigars are increased to those on cigarettes. Large cigars are the only tobacco product with a tax based on price, but they also have a cap; the price-based tax rises in proportionally, but the cap increases by much more, from 5 cents per cigar to $0.40 in the House bill ($0.4026 in the Senate Finance bill and the final legislation). Tobacco tax receipts in the United States in FY2007 included $7.5 billion in federal tax, $16.2 billion in state and local taxes, and $8 billion in payments from the Master Tobacco Settlement. State and local taxes, therefore, were roughly 88 cents per pack and the tobacco settlement payment is approximately the same as the federal tax, 43 cents per pack. Although the tobacco settlement payments resulted from negotiations between the tobacco companies and the states to settle state lawsuits, the payments function as if they were a national tobacco excise tax that is allocated to the states, and any changes that alter consumption would affect these payments. Some of the states have securitized their payments (exchanged the stream of payment for a fixed up-front amount). According to estimates, about a quarter of payments are made to private investors, rather than to state and local governments. As a percentage of sales revenues, the federal, state and local, and tobacco settlement payments are respectively 10.0%, 21.6% and 10.7%, for a total of 42.2%. The Joint Committee on Taxation projected an FY2010 revenue gain of $6.4 billion from the 61 cent increase. CRS estimates suggest there will be a loss of revenue to the states approaching $1.5 billion. There are many alternative sources of revenue (or offsetting spending) for funding the child health program. Are tobacco taxes the most desirable source of revenue? Compared to other taxes, the incentive effects may be desirable. At the same time, the burden falls heavily on lower income people, which may be of concern. Thus, there is a trade-off between the objective of discouraging smoking, and particularly discouraging youth smoking, and the distributional effects of the tax. The remaining issue involves an economic efficiency question relating to arguments that have been made that additional taxes are appropriate to cover costs smokers impose on others. A number of economic studies have questioned that proposition. The following sections discuss these issues. A large body of literature has suggested that increases in the price of tobacco reduce smoking. However, this response is not very large (in economists' parlance, the response is relatively "inelastic"). Most of the evidence has found the price elasticity to be between 0.3 and 0.5 in absolute value, meaning that a 10% increase in price would cause a 3% to 5% decrease in the number of cigarettes smoked. For older adult smokers, about half of this effect was due to fewer smokers (a participation response) and about half due a reduction in smoking (a quantity response). For younger smokers, the participation response was more important. There is some evidence that the response declines with age and that it rises with income, and that it is higher for women, African-Americans, and Hispanics. A recent study, however, found no variation with income. Some recent studies suggest that the response may be less, or that the benefits of reducing smoking may be less. There is some evidence that the response has been declining, an unsurprising outcome since, given a decline in smoking, the remaining smokers are more resistant to price signals. In addition, there is evidence that elasticities might be overstated in studies that compare state smoking levels because states with higher taxes may also have populations more hostile to smoking. Also, recent studies found that smokers may respond to price increases by increasing the intensity of smoking by buying cigarettes with more nicotine and tar, inhaling more deeply and smoking closer to the filter, which could have deleterious effects since more intensive smoking can be more harmful. Due to the limited effects on adult smoking, some arguments have been made that the increased taxes on adults are necessary over the interim to discourage teenage smoking. Evidence has suggested that teenage smoking is more responsive to price; the original responses were estimated at elasticities over one, but subsequent analysis led to an estimate of around 0.7 and a number of recent studies have confirmed this general range. Other studies have found smaller responses, or a very small response by younger teenagers. One recent study replicated the 0.7 elasticity using one statistical approach, but in using another the authors consider superior, they found essentially no response of the initiation of smoking to price. Another paper found a weak and insignificant effect after controlling for anti-smoking sentiment. While much evidence suggests that teenagers are more responsive to prices, these recent studies raise some questions about the effectiveness of tax increases on teenage smoking, especially among young teenagers. The evidence on smoking indicates that higher prices will decrease smoking participation and quantity. It is possible, however, that other types of interventions, such as stricter regulations on sales to teenagers, counseling, education, and assistance with smoking cessation might be more effective. It is generally recognized that cigarette taxes are one of the most regressive taxes, that is, a tax that falls more heavily on lower income individuals as a percentage of income. Indeed, it is probably the most regressive of the federal taxes. Smokers tend to smoke a fixed amount of cigarettes, so that they pay a fixed amount of tax. (Since the tax is a fixed amount per pack, lower income individuals who buy cheaper brands still pay the same amount of tax.) In addition, smoking is more prevalent among lower income individuals. To illustrate, in 1998 the Joint Committee on Taxation estimated that a 76 cent tax increase (brought about through a proposed federal tobacco settlement) would raise the effective tax rate on average by 0.3% of income, but would increase the burden of those with incomes below $10,000 by 2% of income and the burden of those in the $10,000-$20,000 income by 0.6% of income. Since this rate applies to all families, those families with smokers would pay more. For example, a family with one smoker who smokes 1.5 packs a day would pay, with a 76 cent tax, an additional $417 in taxes, which is 4.2% of a $10,000 income and 8.4% of a $5,000 income. To the extent the burden of the tax falls on low-income families and the individuals in those families continue to smoke, low-income children in some families could be harmed even though the child health care provision helps low-income children in general. A final issue that may arise relevant to cigarette taxes is the argument that higher taxes should be imposed on smokers because they impose costs on others largely through higher health care costs paid for through government and private insurance plans, lost days at work, and some other costs. Some economists have questioned this argument, however, because smokers' premature deaths, while harmful to smokers and their families, reduce costs of certain government programs such as Social Security, Medicare, and Medicaid. These calculations do not account for more subjective effects such as irritation to others, although such problems might be better addressed through private market mechanisms (provision of smoking and non-smoking commercial establishments) and regulation. Some disputes about the magnitude of environmental tobacco smoke remain. If smokers are not imposing costs on others, or imposing costs that are less than existing taxes, and if they are making rational decisions to engage in an activity which, while damaging to their health, is nevertheless pleasurable, then an additional tax would not increase economic efficiency. It is not clear, however, whether young smokers, where smoking is generally initiated, are able to fully assess the costs of smoking. Although taxes on other products are a small part of total tobacco taxes, there has been some controversy about the increases for cigars in 110 th Congress proposals and their potential disruption of the industry , as reported in the media. Small cigar taxes increase by a factor of 27. They are apparently viewed by some as substitute for cigarettes who argue they should bear the same tax. Small cigars constitute less than 1/10 of 1% of cigarette sales. For large cigar taxes, which are currently a maximum of 5 cents, the tax could rise to as much as $10 in the original Senate Finance Committee proposal in the 110 th Congress. The ceiling was lowered to $3 on the Senate floor in the 2007 legislation and the ceiling in the House bill was $1 in 2007. H.R. 2 has a ceiling of $0.40, which although much lower is eight times the previous maximum. According to tax data, large cigar sales above the current 5 cents cap (premium cigars) account for about half the total. According to the Cigar Association of America, the average manufacturer's price is about $1.90 for these premium cigars; the average tax on these cigars would be almost a dollar (0.5313 times $1.90 minus $.05) in the original 110 th Congress Senate proposal, but much smaller in the House bill because of lower rate and cap and smaller in the final proposal. Most state cigar taxes are based on value and would apply to the federal tax; they are estimated by the Cigar Association of America at about 30%. If retail prices are twice the manufacturer's price the price of large cigars under the cap in the original Senate proposal would have risen by 20.8% and the price of large cigars over the cap, while varying considerably, would have averaged a 33% increase. Prices would rise more if there is also a retailers markup on the tax. The ceiling of $0.4026 would result in much more modest effects. There is less information on the effects of other tobacco products on health or the behavioral response. If the purpose of the tax on cigars is to account for health costs, a per unit rather than a price based tax would seem appropriate. Cigars may differ from cigarettes in that a larger share may be likely to be smoked only occasionally and would therefore be less harmful to health. They may also be less concentrated at lower incomes. The occasional usage (lack of addictiveness) may mean a larger price response, but the usage by higher income consumers may mean a smaller response.

On January 15, the House passed H.R. 2, a bill which included increased tobacco taxes to finance State Children's Health Insurance Program (SCHIP). This legislation was similar to that passed in the 110th Congress (H.R. 976 and H.R. 3162) although the initial House proposal had smaller tax increases.. H.R. 2 increases cigarette taxes, the primary source of tobacco tax revenues from 39 cents to $1.00. According to the Joint Committee on Taxation, the cigarette tax will raise $6.4 billion in federal revenues in FY2010 with all federal tobacco taxes increases raising $7.1 billion. A similar tax increase was contained in the Senate bill, and in the final proposal, P.L. 111-3 (although in both case the tax was increased by an additional two thirds of a cent, to $1.0066.) The analysis suggests that state and local governments will lose about $1 billion in cigarette tax revenues and up to $0.5 billion in lost revenues from the tobacco settlement payments. The legislation is now being considered in the Senate. A justification is to discourage teenage smoking, but this effect is probably small; a reservation is that the burden falls heavily on low-income individuals. Taxes on other tobacco products are also increased, although cigarette taxes account for most tobacco revenues. In the 110th Congress, the President vetoed the 110th Congress SCHIP proposal on October 3, 2008, the House failed to override the veto and a new bill, H.R. 3963 passed the House and Senate, with no changes in the cigarette tax, but changes in spending rules, and the President vetoed that version on December 12, 2008.

Senate rules, procedures, and precedents give significant parliamentary power to individual Senators during the course of chamber deliberations. Many decisions the Senate makes—from routine requests for additional debate time, to determinations of how legislation will be considered on the floor—are arrived at by unanimous consent. When a unanimous consent request is proposed on the floor, any Senator may object to it. If objection is heard, the consent request does not take effect. Efforts to modify the original request may be undertaken—a process that can require extensive negotiations between and among Senate leaders and their colleagues—but there is no guarantee that a particular objection can be addressed to the satisfaction of all Senators. The Senate hold emerges from within this context of unanimous-consent decision-making as a method of transmitting policy or scheduling preferences to Senate leaders regarding matters available for floor consideration. Many hold requests take the form of a letter addressed to the majority or minority leader (depending on the party affiliation of the Senator placing the hold) expressing reservations about the merits or timing of a particular policy proposal or nomination. An example of a hold letter is displayed in Appendix A . More often than not, Senate leaders—as agents of their party responsible for defending the political, policy, and procedural interests of their colleagues—honor a hold request because not doing so could trigger a range of parliamentary responses from the holding Senator(s), such as a filibuster, that could expend significant amounts of scarce floor time. Unless the target of a hold is of considerable importance to the majority leader and a supermajority of his colleagues—60 of whom might be required to invoke cloture on legislation under Senate Rule XXII—the most practical course of action is often to lay the matter aside and attempt to promote negotiations that could alleviate the concerns that gave rise to the hold. With hold-inspired negotiations underway, the Senate can turn its attention to more broadly-supported matters. Holds can be used to accomplish a variety of purposes. Although the Senate itself makes no official distinctions among holds, scholars have classified holds based on the objective of the communication. Informational holds, for instance, request that the Senator be notified or consulted in advance of any floor action to be taken on a particular measure or matter, perhaps to allow the Senator to plan for floor debate or the offering of amendments. Choke holds contain an explicit filibuster threat and are intended to kill or delay action on the target of the hold. Blanket holds are leveled against an entire category of business, such as all nominations to a particular agency or department. Mae West holds intend to foster negotiation and bargaining between proponents and opponents. R etaliatory holds are placed as political payback against a colleague or administration, while rolling (or rotating ) holds are defined by coordinated action involving two or more Senators who place holds on a measure or matter on an alternating basis. Until recently, many holds were considered a nonymous (or secret ) because the source and contents of the request were not made available to the public, or even to other Senators. Written hold requests emerged as an informal practice in the late 1950s under the majority leadership of Lyndon B. Johnson as a way for Senators to make routine requests of their leaders regarding the Senate's schedule. Early usage was largely consistent with prevailing expectations of Senate behavior at that time, such as reciprocity, deference, and accommodation of one's Senate colleagues. Over time, holds have evolved to become a potent extra-parliamentary practice, sometimes likened to a "silent filibuster" in the press. "The hold started out as a courtesy for senators who wanted to participate in open debate," two Senators wrote in 1997. Since then, "it has become a shield for senators who wish to avoid it." These and other Senators were concerned that keeping holds confidential tended to enable Senators who placed holds to block measures or nominations while leaving no avenue of recourse open to their supporters. Accordingly, rather than restricting the process itself, recent attempts to alter the operation of holds have focused on making the secrecy of holds less absolute. The Senate has considered a variety of proposals targeting the Senate hold in recent years, two of which the chamber adopted. Both sought to eliminate the secrecy of holds by creating a process through which holds—formally referred to in the new rules as "notices of intent to object to proceeding"—would be made public within some period of time if certain criteria were met. Prior to these rules changes, hold letters were written with the expectation that they would be treated as private correspondences between a Senator and his or her party leader. The first proposal, enacted in 2007 as Section 512 of the Honest Leadership and Open Government Act ( P.L. 110-81 ), established new reporting requirements that were designed to take effect if either the majority or minority leader or their designees, acting on behalf of a party colleague on the basis of a hold letter previously received, objected to a unanimous consent request to advance a measure or matter to the Senate floor for consideration or passage. If objection was raised on the basis of a hold letter, then the Senator who originated the hold was expected to submit a "notice of intent to object" to his or her party leader and, within six days of session thereafter, deliver the objection notice to the Legislative Clerk for publication in both the Congressional Record and the Senate's Calendar of Business (or, if the hold pertained to a nomination, the Executive Calendar ). Under Section 512, objection notices were to take the following form: "I, Senator ___, intend to object to proceeding to ___, dated ___ for the following reasons___." To accommodate the publication of these notices, a new "Notice of Intent to Object to Proceeding" section was added to both Senate calendars as shown in Appendix B . Each calendar entry contained four pieces of information: (1) the bill or nomination number to which the hold pertained; (2) the official title of the bill or nomination; (3) the date on which the hold was placed; and (4) the name of the Senator who placed the hold. Publication was not required if a Senator withdrew the hold within six session days of triggering the notification requirement. Once published, an objection notice could be removed from future editions of a calendar by submitting for inclusion in the Congressional Record the following statement: "I, Senator ___, do not object to proceed to ___, dated ___." On October 3, 2007, roughly two weeks after the new disclosure procedures were signed into law, the first notice of an intent to object was published in the Congressional Record . A total of 5 such notices appeared during the 110 th Congress (2007-2008), and 12 were published during the 111 th Congress (2009-2010), but these numbers should not be interpreted to reflect the entirety of hold activity that occurred during those two Congresses. Instead, they represent the subset of holds that activated the notification requirements established in Section 512 of P.L. 110-81 . Recall that notification is required when three conditions are met: (1) the majority or minority leader (or their designee) asks unanimous consent to proceed to or pass a measure or matter; (2) objection is raised on the basis of a colleague's hold letter; and (3) six days of session have elapsed since the objection was made. Many holds lodged during the 110 th and 111 th Congresses (2007-2010) are likely to have fallen outside the purview of Section 512 regulation. At least two reasons account for this. First, the new notification requirements would not apply to holds placed on measures or matters the Senate did not attempt to proceed to or pass (perhaps on account of an implicit filibuster threat contained in a hold letter). When scheduling business for floor consideration, the content and quantity of hold letters received on a particular measure or matter are likely to factor into the negotiations and considerations Senate leaders make. Rather than take action that could have the effect of vitiating the confidentiality of a holding Senator, Senate leaders might simply decide to advance other matters to the floor instead (or at least try to). A second reason the actual number of holds is likely to exceed the number published in the Record during these two Congresses has to do with the six session day window between an objection being raised and reporting requirements becoming mandatory. Designed to provide Senators with sufficient time to study an issue before deciding whether or not to maintain a hold beyond the six session day grace period, this provision may have encouraged the use of revolving (or rotating) holds. If one Senator removes his or her hold within six session days of activating the reporting requirement and another Senator puts a new hold in its place, the effect would be to reset the six session day clock each time a new hold was placed on a given measure or matter. In this way, two or more Senators could maintain the secrecy of their holds for an indefinite period without running afoul of the new disclosure procedures. In response to the limited applicability of Section 512, the Senate established—by a 92-4 vote on January 27, 2011—a standing order ( S.Res. 28 ) that extends notification requirements to a larger share of hold activity. Instead of a six day reporting window, S.Res. 28 provides two days of session during which Senators are expected to deliver their objection notices for publication. The action that triggers the reporting requirement also changed: from an objection on the basis of a colleague's hold request (under Section 512) to the initial transmission of a written objection notice to the party leader (under S.Res. 28 ). The proper language to communicate a hold remained largely the same as before, except that holding Senators must now include a statement that expressly authorizes their party leader to object to a unanimous consent request in their name. In the event that a Senator neglects to deliver an objection notice for publication within two session days and a party leader nevertheless raises objection on the basis of that hold, S.Res. 28 requires that the name of the objecting party leader be identified as the source of the hold in the "Notice of Intent to Object" section of the appropriate Senate calendar. The process of removing an objection notice from either calendar remains unchanged. During the 112 th Congress (2011-2012), a total of 24 objection notices were published in accordance with the provisions of S.Res. 28 . Nine notices were printed during the 113 th Congress (2013-2014), and 34 were published in the 114 th Congress (2015-2016). See Appendix C for an example of how these notices appear in the Congressional Record . As before, caution should be exercised when interpreting these numbers. What looks like a drop-off in the use of holds could instead reflect broader challenges inherent in efforts to regulate this kind of communication. Senate holds are predicated on the unanimous consent nature of Senate decision-making. The influence they exert in chamber deliberations is based primarily upon the significant parliamentary prerogatives individual Senators are afforded in the rules, procedures, and precedents of the chamber. As such, efforts to regulate holds are inextricably linked with the chamber's use of unanimous consent agreements to structure the process of calling up measures and matters for floor debate and amendment. While not all holds are intended to prevent the consideration of a particular measure, some do take that form, and Senate leaders justifiably perceive those correspondences as implicit filibuster threats. As agents of their party, Senate leaders value the information that holds provide regarding the policy and scheduling preferences of their colleagues. For this reason, rules changes that require enforcement on the part of Senate leaders—as both efforts discussed here do—tend to conflict with the managerial role played by contemporary Senate leaders and the expectation on the part of their colleagues that leaders will defend their interests in negotiations over the scheduling of measures and matters for floor consideration. A second challenge to hold regulation involves the nature of the transmission itself. Both recent proposals address a particular kind of communication: a letter written and delivered to a Senator's party leader that expresses some kind of reservation about the timing or merits of a particular proposal or nomination. Hold requests might be conveyed in less formal ways as well; in a telephone call to the leader's office, for instance, or in a verbal exchange that occurs on or off the Senate floor. An objection to a unanimous consent request transmitted through the "hotline" represents another common method of communicating preferences to Senate leaders. Some Senate offices have circulated "Dear Colleague" letters specifying certain requirements legislation must adhere to in order to avoid a hold being placed. It remains unclear, however, whether or not these alternative forms of communication fall within the purview of recent hold reforms. Appendix A. A Hold Letter Appendix B. The "Notice of Intent to Object" section of the Calendar of Business Appendix C. A Notice of Intent to Object

The Senate "hold" is an informal practice whereby Senators communicate to Senate leaders, often in the form of a letter, their policy views and scheduling preferences regarding measures and matters available for floor consideration. Unique to the upper chamber, holds can be understood as information-sharing devices predicated on the unanimous consent nature of Senate decision-making. Senators place holds to accomplish a variety of purposes—to receive notification of upcoming legislative proceedings, for instance, or to express objections to a particular proposal or executive nomination—but ultimately the decision to honor a hold request, and for how long, rests with the majority leader. Scheduling Senate business is the fundamental prerogative of the majority leader, and this responsibility is typically carried out in consultation with the minority leader. The influence that holds exert in chamber deliberations is based primarily upon the significant parliamentary prerogatives individual Senators are afforded in the rules, procedures, and precedents of the chamber. More often than not, Senate leaders honor a hold request because not doing so could trigger a range of parliamentary responses from the holding Senator(s), such as a filibuster, that could expend significant amounts of scarce floor time. As such, efforts to regulate holds are inextricably linked with the chamber's use of unanimous consent agreements to structure the process of calling up measures and matters for floor debate and amendment. In recent years the Senate has considered a variety of proposals that address the Senate hold, two of which the chamber adopted. Both sought to eliminate the secrecy of holds. Prior to these rules changes, hold letters were written with the expectation that their source and contents would remain private, even to other Senators. In 2007, the Senate adopted new procedures to make hold requests public in certain circumstances. Under Section 512 of the Honest Leadership and Open Government Act (P.L. 110-81), if objection was raised to a unanimous consent request to proceed to or pass a measure or matter on behalf of another Senator, then the Senator who originated the hold was expected to deliver for publication in the Congressional Record, within six session days of the objection, a "notice of intent to object" identifying the Senator as the source of the hold and the measure or matter to which it pertained. A process for removing a hold was also created, and a new "Notice of Intent to Object" section was added to both Senate calendars to take account of objection notices that remained outstanding. An examination of objection notices published since 2007 suggests that many hold requests are likely to have fallen outside the scope of Section 512 regulation. In an effort to make public a greater share of hold requests, the Senate adjusted its notification requirements by way of a standing order (S.Res. 28) adopted at the outset of the 112th Congress (2011-2012). Instead of the six session day reporting window specified in Section 512, S.Res. 28 provides two days of session during which Senators are expected to deliver their objection notices for publication. The action that triggers the reporting requirement also shifted: from an objection on the basis of a colleague's hold request (under Section 512) to the initial transmission of a written objection notice to the party leader (under S.Res. 28). In the event that a Senator neglects to deliver an objection notice for publication and a party leader nevertheless raises objection on the basis of that hold, S.Res. 28 requires that the name of the objecting party leader be identified as the source of the hold in the "Notice of Intent to Object" section of the appropriate Senate calendar.

Over the past two decades—from 1991 through 2012—there was a substantial increase in the number of FLSA lawsuits filed, with most of the increase occurring in the period from fiscal year 2001 through 2012. As shown in figure 1, in 1991, 1,327 lawsuits were filed; in 2012, that number had increased over 500 percent to 8,148. FLSA lawsuits can be filed by DOL on behalf of employees or by private individuals. Private FLSA lawsuits can either be filed by individuals or on behalf of a group of individuals in a type of lawsuit known as a “collective action”. The court will generally certify whether a lawsuit meets the requirements to proceed as a collective action. The court may deny certification to a proposed collective action or decertify an existing collective action if the court determines that the plaintiffs are not “similarly situated” with respect to the factual and legal issues to be decided. In such cases, the court may permit the members to individually file private FLSA lawsuits. Collective actions can serve to reduce the burden on courts and protect plaintiffs by reducing costs for individuals and incentivizing attorneys to represent workers in pursuit of claims under the law. They may also protect employers from facing the burden of many individual lawsuits; however, they can also be costly to employers because they may result in large amounts of damages. For fiscal year 2012, we found that an estimated 58 percent of the FLSA lawsuits filed in federal district court were filed individually, and 40 percent were filed as collective actions. An estimated 16 percent of the FLSA lawsuits filed in fiscal year 2012 (about a quarter of all individually-filed lawsuits), however, were originally part of a collective action that was decertified (see fig. 2). Federal courts in most states experienced increases in the number of FLSA lawsuits filed between 1991 and 2012, but large increases were concentrated in a few states, including Florida, New York, and Alabama. Of all FLSA lawsuits filed since 2001, more than half were filed in these three states, and in 2012, about 43 percent of all FLSA lawsuits were filed in Florida (33 percent) or New York (10 percent). In both Florida and New York, growth in the number of FLSA lawsuits filed was generally steady, while changes in Alabama involved sharp increases in fiscal years 2007 and 2012 with far fewer lawsuits filed in other years (see fig. 3). Each spike in Alabama coincided with the decertification of at least one large collective action, which likely resulted in multiple individual lawsuits. For example, in fiscal year 2007, 2,496 FLSA lawsuits (about one-third of all FLSA lawsuits) were filed in Alabama, up from 48 FLSA lawsuits filed in Alabama in fiscal year 2006. In August 2006, a federal district court in Alabama decertified a collective action filed by managers of Dollar General stores. In its motion to decertify, the defendant estimated the collective to contain approximately 2,470 plaintiffs. In fiscal year 2012, an estimated 97 percent of FLSA lawsuits were filed against private sector employers, and an estimated 57 percent of FLSA lawsuits were filed against employers in four industry areas: accommodations and food services; manufacturing; construction; and “other services”, which includes services such as laundry services, domestic work, and nail salons. Almost one-quarter of all FLSA lawsuits filed in fiscal year 2012 (an estimated 23 percent) were filed by workers in the accommodations and food service industry, which includes hotels, restaurants, and bars. At the same time, almost 20 percent of FLSA lawsuits filed in fiscal year 2012 were filed by workers in the manufacturing industry. In our sample, most of the lawsuits involving the manufacturing industry were filed by workers in the automobile manufacturing industry in Alabama, and most were individual lawsuits filed by workers who were originally part of one of two collective actions that had been decertified. FLSA lawsuits filed in fiscal year 2012 included a variety of different types of alleged FLSA violations and many included allegations of more than one type of violation. An estimated 95 percent of the FLSA lawsuits filed in fiscal year 2012 alleged violations of the FLSA’s overtime provision, which requires certain types of workers to be paid at one and a half times their regular rate for any hours worked over 40 during a workweek. Almost one-third of the lawsuits contained allegations that the worker or workers were not paid the federal minimum wage. We also identified more specific allegations about how workers claimed their employers violated the FLSA. For example, nearly 30 percent of the lawsuits contained allegations that workers were required to work “off-the-clock” so that they would not need to be paid for that time. In addition, the majority of lawsuits contained other FLSA allegations, such as that the employer failed to keep proper records of hours worked by the employees, failed to post or provide information about the FLSA, as required, or violated requirements pertaining to tipped workers such as restaurant wait staff (see fig. 4). An estimated 14 percent of FLSA lawsuits filed in federal district court in fiscal year 2012 included an allegation of retaliation. limitations for filing an FLSA claim is 2 years (3 years if the violation is “willful”), New York state law provides a 6-year statute of limitations for filing state wage and hour lawsuits. A longer statute of limitations may increase potential financial damages in such cases because more pay periods are involved and because more workers may be involved. Adding a New York state wage and hour claim to an FLSA lawsuit in federal court could expand the potential damages, which, according to several stakeholders, may influence decisions about where and whether to file a lawsuit. In addition, according to multiple stakeholders we interviewed, because Florida lacks a state overtime law, those who wish to file a lawsuit seeking overtime compensation generally must do so under the FLSA. Ambiguity in applying the law and regulations. Ambiguity in applying the FLSA statute or regulations—particularly the exemption for executive, administrative, and professional workers—was cited as a factor by a number of stakeholders. In 2004, DOL issued a final rule updating and revising its regulations in an attempt to clarify this exemption and provided guidance about the changes, but a few stakeholders told us there is still significant confusion among employers about which workers should be classified as exempt under these categories. Industry trends. As mentioned previously, about one-quarter of FLSA lawsuits filed in fiscal year 2012 were filed by workers in the accommodations and food service industry. Nationally, service jobs, including those in the leisure and hospitality industry, increased from 2000 to 2010, while most other industries lost jobs during that period. Federal judges in New York and Florida attributed some of the concentration of such litigation in their districts to the large number of restaurants and other service industry jobs in which wage and hour violations are more common than in some other industries. An academic who focuses on labor and employment relations told us that changes in the management structure in the retail and restaurant industry may have contributed to the rise in FLSA lawsuits. For example, frontline managers who were once exempt have become nonexempt as their nonmanagerial duties have increased as a portion of their overall duties. We also reviewed DOL’s annual process for determining how to target its enforcement and compliance assistance resources. The agency targets industries for enforcement that, according to its recent enforcement data, have a higher likelihood of FLSA violations, along with other factors. In addition, according to WHD internal guidance, the agency’s annual enforcement plans should contain strategies to engage related stakeholders in preventing such violations. For example, if a WHD office plans to investigate restaurants to identify potential violations of the FLSA, it should also develop strategies to engage restaurant trade associations about FLSA-related issues so that these stakeholders can help bring about compliance in the industry. However, DOL does not compile and analyze relevant data, such as information on the subjects or the number of requests for assistance it receives from employers and workers, to help determine what additional or revised guidance employers may need to help them comply with the In developing its guidance on the FLSA, WHD does not use a FLSA.systematic approach that includes analyzing this type of data. In addition, WHD does not have a routine, data-based process for assessing the adequacy of its guidance. For example, WHD does not analyze trends in the types of FLSA-related questions it receives. This type of information could be used to develop new guidance or improve the guidance WHD provides to employers and workers on the requirements of the FLSA. Because of these issues, we recommended that WHD develop a systematic approach for identifying areas of confusion about the requirements of the FLSA that contribute to possible violations and improving the guidance it provides to employers and workers in those areas. This approach could include compiling and analyzing data on requests for guidance on issues related to the FLSA, and gathering and using input from FLSA stakeholders or other users of existing guidance through an advisory panel or other means. While improved DOL guidance on the FLSA might not affect the number of lawsuits filed, it could increase the efficiency and effectiveness of its efforts to help employers voluntarily comply with the FLSA. A clearer picture of the needs of employers and workers would allow WHD to more efficiently design and target its compliance assistance efforts, which may, in turn, result in fewer FLSA violations. WHD agreed with our recommendation that the agency develop a systematic approach for identifying and considering areas of confusion that contribute to possible FLSA violations to help inform the development and assessment of its guidance. WHD stated that it is in the process of developing systems to further analyze trends in communications received from stakeholders such as workers and employers and will include findings from this analysis as part of its process for developing new or revised guidance. In closing, while there has been a significant increase in FLSA lawsuits over the last decade, it is difficult to determine the reasons for the increase. It could suggest that FLSA violations have become more prevalent, that FLSA violations have been reported and pursued more frequently than before, or a combination of the two. It is also difficult to determine the effect that the increase in FLSA lawsuits has had on employers and their ability to hire workers. However, the ability of workers to bring such suits is an integral part of FLSA enforcement because of the limits on DOL’s capacity to ensure that all employers are in compliance with the FLSA. Chairman Walberg, Ranking Member Courtney, and members of the Committee, this completes my prepared statement. I would be happy to respond to any questions you may have. For further information regarding this statement, please contact Andrew Sherrill at (202) 512-7215 or sherrilla@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this statement. GAO staff who made key contributions to this testimony include Betty Ward-Zukerman (Assistant Director), Catherine Roark (Analyst in Charge), David Barish, James Bennett, Sarah Cornetto, Joel Green, Kathy Leslie, Ying Long, Sheila McCoy, Jean McSween, and Amber Yancey-Carroll. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

The FLSA sets federal minimum wage and overtime pay requirements applicable to millions of U.S. workers and allows workers to sue employers for violating these requirements. Questions have been raised about the effect of FLSA lawsuits on employers and workers and about WHD's enforcement and compliance assistance efforts as the number of lawsuits has increased. This statement examines what is known about the number of FLSA lawsuits filed and how WHD plans its FLSA enforcement and compliance assistance efforts. It is based on the results of a previous GAO report issued in December 2013. In conducting the earlier work, GAO analyzed federal district court data from fiscal years 1991 to 2012 and reviewed selected documents from a representative sample of lawsuits filed in federal district court in fiscal year 2012. GAO also reviewed DOL's planning and performance documents, interviewed DOL officials, as well as stakeholders, including federal judges, plaintiff and defense attorneys who specialize in FLSA cases, officials from organizations representing workers and employers, and academics. Substantial increases occurred over the last decade in the number of civil lawsuits filed in federal district court alleging violations of the Fair Labor Standards Act of 1938, as amended (FLSA). Federal courts in most states experienced increases in the number of FLSA lawsuits filed, but large increases were concentrated in a few states, including Florida and New York. Many factors may contribute to this general trend; however, the factor cited most often by stakeholders GAO interviewed—including attorneys and judges—was attorneys' increased willingness to take on such cases. In fiscal year 2012, an estimated 97 percent of FLSA lawsuits were filed against private sector employers, often from the accommodations and food services industry, and 95 percent of the lawsuits filed included allegations of overtime violations. The Department of Labor's Wage and Hour Division (WHD) has an annual process for planning how it will target its enforcement and compliance assistance resources to help prevent and identify potential FLSA violations. In planning its enforcement efforts, WHD targets industries that, according to its recent enforcement data, have a higher likelihood of FLSA violations. WHD, however, does not have a systematic approach that includes analyzing relevant data, such as the number of requests for assistance it receives from employers and workers, to develop its guidance, as recommended by best practices previously identified by GAO. In addition, WHD does not have a routine, data-based process for assessing the adequacy of its guidance. For example, WHD does not analyze trends in the types of FLSA-related questions it receives from employers or workers. According to plaintiff and defense attorneys GAO interviewed, more FLSA guidance from WHD would be helpful, such as guidance on how to determine whether certain types of workers are exempt from the overtime pay and other requirements of the FLSA. In its December 2013 report, GAO recommended that the Secretary of Labor direct the WHD Administrator to develop a systematic approach for identifying and considering areas of confusion that contribute to possible FLSA violations to help inform the development and assessment of its guidance. WHD agreed with the recommendation and described its plans to address it.

Title III of the Congressional Budget Act of 1974 (Titles I-IX of P.L. 93-344 , 2 U.S.C. 601-661) ("the Budget Act"), as amended, provides for the adoption of an annual concurrent resolution on the budget by Congress. The budget resolution establishes the levels of revenues, spending, the surplus or deficit, and the public debt for each year covering the upcoming fiscal year and at least four additional years ("out-years") to be enacted through subsequent legislation. This report does not discuss the enforcement of those levels or committee allocations. This report will outline the most significant provisions contained within the Budget Act that affect the consideration and amending of budget resolutions in the Senate. With only a few exceptions, these Budget Act provisions are enforced by points of order. Because points of order are not self-enforcing (not automatically triggered), enforcement requires that a Senator raise a point of order against the consideration of the budget resolution or an amendment. In the event that no point of order is raised, the budget resolution or amendment is presumed to be within the limits prescribed by the Budget Act. After a Senator raises a Budget Act point of order against an amendment, the Senator offering the amendment may make a motion to waive the point of order. Most Budget Act points of order may be waived by a vote of at least three-fifths of all Senators duly chosen and sworn (60 votes if there are no vacancies). If three-fifths of Senators vote to adopt the motion to waive the point of order, the Senate can then hold a vote on the amendment itself. If three-fifths of Senators do not vote in favor of the motion to waive the point of order, the point of order is sustained and the amendment falls. Few Budget Act points of order are raised during the consideration of budget resolutions, and, of those, even fewer are waived. Consideration of a budget resolution is privileged, meaning the motion for the Senate to proceed to consideration of a budget resolution is nondebatable. For most other measures, a motion to proceed to their consideration is debatable. Section 301(a) of the Budget Act prescribes the content required for this the budget resolution, and is discussed below. Section 305(b)(1) of the Budget Act limits total debate time in the Senate on budget resolutions to 50 hours. It provides that the majority and minority leaders or their designees, normally the chair and ranking member of the Budget Committee, manage the time. It further specifies that the 50 hours of debate is equally divided and controlled so that both the majority and minority managers have 25 hours each, and they in turn can yield time to other Senators. Debate, debatable motions, appeals, and amendments are included in the 50 hours. Time used for quorum calls is counted toward the 50 hours, but roll call votes are not. Because the limit is specifically applied to debate, consideration may sometimes extend beyond the 50-hour limit. After the 50 hours expires (or remaining time is yielded back), Senators may continue to consider the budget resolution and offer further amendments, motions, and appeals, but with no time provided for debate. In practice, the Senate often uses unanimous consent agreements to conduct business in a way divergent from the provisions of 305(b). For example, in lieu of recognizing the real time running on the clock, the Senate has sometimes agreed by unanimous consent at the end of a day to consider a specific amount of time on the resolution as remaining, regardless of the actual amount of time used to that point. Similarly, the Senate may choose a specific day and time at which the debate time on the budget resolution will be deemed expired. Section 305(b)(3) also provides that, after opening statements, up to four hours may be designated for Senate debate on economic goals and policies. Although the Senate does not normally explicitly reserve time for debating economic goals and policies during debate on the budget resolution, Senators may informally discuss economic goals and policies before the resolution is even brought to the floor, often during a period of morning business in the days leading up to the beginning of initial consideration, or Senators offer commentary during the leaders' time for opening statements. Sometimes the Senate agrees through unanimous consent to postpone the offering of amendments, thereby effectively reserving a block of time for general debate. For example, a unanimous consent agreement might provide that, once the resolution is brought up, amendments are not in order until the following day's session, or until after an afternoon recess. The Budget Act contains provisions that specifically govern the process for amending the budget resolution. These provisions supplement the general principles and practices of the Senate pertaining to the amendment process. Section 305(b)(2) of the Budget Act limits Senate debate on an amendment to the resolution to two hours. Time on each amendment counts against the total 50 hours. The two hours are divided between and managed by the mover of the amendment and the manager of the budget resolution. In the event that both the mover of the amendment and the manager are both proponents of the amendment, the time in opposition is controlled by the minority manager. If neither manager yields time, the time used by the recognized Senator will be taken equally from both sides. In practice, the time used on amendments is often charged equally to both sides. Section 305(b)(2) also provides that a manager can yield additional time to a Senator. A Senator may reserve time on a pending amendment, particularly in situations in which consideration of the amendment is temporarily set aside by unanimous consent. However, even if a Senator has reserved a portion of the amendment's time, the expiration of the total 50 hours on the resolution would supersede this. Section 305(b)(2) also provides that debate on any amendment to an amendment, debatable motion, or appeal is limited to one hour. Quorum calls during the consideration of an amendment to the budget resolution are taken from the amendment's time, unless otherwise agreed to through unanimous consent. In practice, the Senate also uses unanimous consent agreements to modify the Section 305(b)(2) time limits or further structure the amendment process. Frequently used unanimous consent requests involve the Senate agreeing to expedite voting by scheduling amendment votes at particular times, in a particular order, limiting second-degree amendments, or some combination thereof. Section 305(b)(1) of the Budget Act limits total Senate debate on the budget resolution to 50 hours, but the Senate has not always disposed of all amendments by the expiration of that time. This first occurred during consideration of the FY1994 budget resolution in 1993, when the statutory time expired during the fifth day of consideration. After some discussion, the Senate tabled the next nine amendments and entered into a unanimous consent agreement that any amendments not disposed of by noon the following day (excepting any amendment being considered at noon) would not be in order, and all votes after the initial vote would be limited to 15 minutes. The following day, some amendments were tabled but five were agreed to. This marked the first instance of what would later become known as "vote-arama." Vote-arama is not a formal procedure, but instead a description of a practice, developed through custom, of agreeing to some form of accelerated voting procedure to address amendments not yet disposed of or offered when the 50 hours has expired. The practice is so named because the agreements usually produce a succession of back-to-back votes. In recent years, the primary unanimous consent agreements setting up a vote-arama have taken a relatively consistent form: a set list and order of amendments to be voted upon, a two minute explanation allowed for each amendment (1 minute per side), a ten minute vote on each amendment, and a directive that any additional amendments not be in order. The unanimous consent agreements can become quite complex, often listing the order of amendments, deadlines for offering amendments, time limitations for each, organizing votes en bloc, and specifying timelines for completion. Since the advent of vote-aramas, the Senate has disposed of all amendments before the expiration of time in only two years—1994 and 2004. Between 1993 and 2009, an average of 78 amendments to the budget resolution were offered per year during floor consideration, with an average of 26 (33%) of those being debated and disposed of before the expiration of time. An average of 17 (22%) of amendments were offered, and presumably debate begun, before the expiration of time, but were pending when time expired and subsequently disposed of after the expiration of time. An average of 35 (45%) amendments were offered and disposed of after the expiration of time. Put another way, during the years of 1993 to 2009, about one-third of all amendments were disposed of before time expired, and about two-thirds were disposed of after time expired as part of the vote-arama. Many examples exist in the record of Senators expressing their frustration toward the vote-arama process. In February of 2009, the Senate Budget Committee held a hearing called "Senate Procedures for Consideration of the Budget Resolution/Reconciliation," during which committee members sought information about the vote-arama process and potential possibilities for adjustment or reform. Section 301(a) of the Budget Act specifies that the budget resolution must contain the following elements for the upcoming fiscal year ("budget year") and at least the next four out-years: totals of new budget authority and outlays, total federal revenues, the budget surplus or deficit, new budget authority and outlays for each major functional category, and the public debt. Senate enforcement also requires figures for outlays and revenues under the Old-Age, Survivors, and Disability Insurance program established under the Social Security Act. The Budget Act further specifies that neither the outlays nor the revenues from the Social Security program should be included in the budget resolution's overall surplus or deficit totals. Section 301(b) provides for other elements that may be included in the budget resolution, such as reconciliation instructions, or establishing procedures for adjusting committee allocations. Section 301(b)(4) is known as the "elastic clause" and permits the inclusion of other matters or procedures deemed appropriate to carry out the Budget Act. Section 301(g) provides that any reconciliation instructions included in a budget resolution must not affect Social Security. Section 301(g) of the Budget Act creates a point of order against the Senate considering a budget resolution that utilizes more than one set of economic assumptions, and amendments that cause the budget resolution to use more than one set of economic assumptions—that is, the technical assumptions such as economic growth or inflation that are used to make budget projections. It is rare that a Senator would offer an amendment that would result in the budget resolution using more than one set of economic assumptions. One instance in which this point of order was raised against an amendment occurred during the consideration of the FY1988 budget resolution. The chair of the Senate Budget Committee proposed an amendment that would substitute the Office of Management and Budget (OMB) budget estimates for the purposes of complying with deficit targets while the rest of the budget assumptions were based upon the Congressional Budget Office (CBO) estimates. However, when a second Senator made a point of order, the presiding officer ruled the point of order to be not well taken. Because Section 312 of the Budget Act provides that budget estimates shall be provided by the Senate Budget Committee, the presiding officer stated that he had to rely on the estimates provided to him by the Budget Committee chair. The second Senator's attempt to appeal the ruling of the chair was not successful. Ultimately, the Senate voted to adopt the amendment, and later voted to adopt the budget resolution conference report. In addition to the requirement that Social Security figures be separately presented, Section 301(i) of the Budget Act creates a point of order against the Senate considering a budget resolution, or an amendment to a budget resolution, which causes a decrease of the Social Security surplus. This point of order is not frequently raised, but has been discussed on the Senate floor. Section 305(b)(2) of the Budget Act provides for a point of order against non-germane amendments. This has been the most common point of order raised against budget resolution amendments. In fact, this provision accounts for all sustained Budget Act points of order during budget resolution consideration in the past 10 years. Determining whether an amendment is "germane" can prove difficult, and is decided on a case-by-case basis. A non-germane amendment generally is one that would introduce new subject matter not present in the underlying resolution. The primary factor in determining germaneness is the strength of the relationship between the amendment's subject and the text of the underlying resolution. Section 305(b)(6) of the Budget Act, unlike most Budget Act provisions that restrict the type or form or time of an amendment, instead provides that, notwithstanding any other rule of limitation on the amending process, it is in order to offer an amendment for the purpose of ensuring mathematical consistency. This rule applies even when the amendment might otherwise be out of order—for example, offering an amendment that would re-amend already amended text would normally be out of order, but should be held in order if its purpose is to ensure mathematical consistency. Additionally, if a complete substitute to a budget resolution is adopted, amendments that ensure mathematical consistency that were previously adopted are still in order. Section 305(d) further provides that it is out of order for the Senate to vote on agreeing to a budget resolution unless the figures contained in it are mathematically consistent. This rule can be distinguished from Section 301(g)—"economic assumptions" refers to the different methods that can be utilized to calculate budget projections, but "mathematical consistency" refers only to whether the actual computation of figures is mathematically sound.

Title III of the Congressional Budget Act of 1974 (Titles I-IX of P.L. 93-344, 2 U.S.C. 601-688) ("the Budget Act"), as amended, provides for the adoption of an annual concurrent resolution on the budget ("budget resolution") by Congress. The Budget Act includes provisions governing the consideration and amending process of the budget resolution, such as establishing points of order, setting time limits on certain motions, amendments, and the budget resolution itself, and restricting the content of amendments. This report highlights some of the Budget Act's budget resolution provisions, and how they play out on the Senate floor during consideration and amending. One notable subject that this report addresses is the "vote-arama," or the period when the Senate disposes of amendments after the time for debate on the resolution has expired. In addition to Budget Act provisions, this report also includes examples of when the Senate has utilized unanimous consent agreements to further structure floor procedure.

Operation Enduring Freedom (OEF) began on October 7, 2001, and was primarily conducted in Afghanistan. On December 28, 2014, President Obama announced that OEF had ended. A "follow-on mission," Operation Freedom's Sentinel (OFS), was started on January 1, 2015, to "continue training, advising, and assisting Afghan security forces." Operation Iraqi Freedom (OIF) began on March 19, 2003, and was primarily conducted in Iraq. On August 31, 2010, President Obama announced that OIF had ended. A transitional force of U.S. troops remained in Iraq under Operation New Dawn (OND), which ended on December 15, 2011. Several thousand U.S. civilian personnel, contract personnel, and a limited number of U.S. military personnel remain in Iraq carrying out U.S. government business and cooperative programs under the auspices of agreements with the Iraqi government. On October 15, 2014, U.S. Central Command designated new military operations in Iraq and Syria against the Islamic State of Iraq and the Levant as Operation Inherent Resolve (OIR). (For more information on war and conflict dates, see CRS Report RS21405, U.S. Periods of War and Dates of Recent Conflicts , by [author name scrubbed].) Daily updates of total U.S. military and civilian casualties in OIF, OEF, OND, OIR, and OFS can be found at the Department of Defense's (DOD's) website, at http://www.defense.gov/news/casualty.pdf . Table 1 gives the overall casualties in OIF, OND, and OEF. The U.S. Army Office of the Surgeon General (OSG), using the Defense Medical Surveillance System (DMSS), provided data on the incidence of post-traumatic stress disorder (PTSD) cases. According to Dr. Michael Carino of the OSG, a case of PTSD is defined as an individual with two or more outpatient visits or one or more hospitalizations during which PTSD was diagnosed. The threshold of two or more outpatient visits is used in the DMSS to increase the likelihood that the individual has, or had, clinically diagnosable PTSD. A single visit on record commonly reflects a servicemember who was evaluated for possible PTSD, but did not actually meet the criteria for clinical diagnosis. In this data set, an incident of PTSD among deployed servicemembers is defined as occurring when a deployed servicemember was diagnosed with PTSD at least 30 days after being deployed. Many statistics on traumatic brain injury (TBI) are available to the public, at the Defense and Veterans Brain Injury Center, at http://dvbic.dcoe.mil/dod-worldwide-numbers-tbi . Unlike PTSD numbers, which are segmented by those deployed and those not previously deployed, TBI numbers represent medical diagnoses of TBI that occurred anywhere U.S. forces are located, including the continental United States. Table 4 shows the number of individuals with battle-injury major limb amputations for OEF, OFS, OIF, OND, and OIR. A major limb amputation includes the loss of one or more limbs, the loss of one or more partial limbs, or the loss of one or more full or partial hand or foot. The total number of individuals with major limb amputations as of June 1, 2015, is 1,645. Figure 3 charts the number of major limb amputations due to a battle injury in OIF, OND, OIR, OEF, and OFS from 2001 through June 1, 2015, for all services. DOD provides data on the demographics of servicemembers who have died or been wounded in action in OIF, OND, and OEF through the Defense Casualty Analysis System at https://www.dmdc.osd.mil/dcas/pages/casualties.xhtml . To find this information, select a conflict and select between "deaths" or "wounded in action," and then select from the demographic categories, including gender, age, race, and ethnicity. Similar data have not yet been publically released for OEF and OIR.

This report presents statistics regarding U.S. military and civilian casualties in the active missions Operation Freedom's Sentinel (OFS, Afghanistan) and Operation Inherent Resolve (OIR, Iraq and Syria) and, as well as operations that have ended, Operation New Dawn (OND, Iraq), Operation Iraqi Freedom (OIF, Iraq), and Operation Enduring Freedom (OEF, Afghanistan). It also includes statistics on post-traumatic stress disorder (PTSD), traumatic brain injury (TBI), and amputations. Some of these statistics are publicly available at the Department of Defense's (DOD's) website and others have been obtained through DOD experts. For more information on pre-2000 casualties, see CRS Report RL32492, American War and Military Operations Casualties: Lists and Statistics, by [author name scrubbed] and [author name scrubbed]. This report will be updated as needed.

DOD has taken steps to implement our August 2008 recommendations to improve its sexual assault prevention and response program; however, its efforts reflect various levels of progress, and opportunities exist for further program improvements. To its credit, DOD has implemented four of the nine recommendations in our August 2008 report. First, the Office of the Secretary of Defense (OSD) established a working group to address our recommendation to evaluate the adequacy of DOD policies for implementing its sexual assault prevention and response program in joint and deployed environments. Based on the working group’s findings, OSD suggested revisions to joint policy, which a Joint Staff official told us they are using to modify related publications. Second, the military service secretaries have each taken a variety of steps to address our recommendation to emphasize responsibility for program support at all levels of command. The most notable examples of this support include the U.S. Navy’s recent establishment of a sexual assault prevention and response office that will report directly to the Secretary of the Navy, and the Army’s incorporation of a sexual assault program awareness assessment into promotional boards for its noncommissioned officers. Third, OSD chartered the Health Affairs Sexual Assault Task Force to address our recommendation to evaluate and address factors that may prevent or discourage servicemembers from seeking health services. Specifically, the task force evaluated and subsequently issued a number of recommendations that are intended to improve access to health care following a sexual assault, including chartering a Sexual Assault Health Care Integrated Policy Team to review department-level policies regarding clinical practice guidelines, standards of care, personnel and staffing, training requirements and responsibilities, continuity of care, and in- theater equipment and supplies. Fourth, in August 2008, the Defense Task Force on Sexual Assault in the Military Services began its examination of matters related to sexual assault, as we recommended, and on December 1, 2009 the task force released a report with its findings and recommendations. However, DOD’s actions toward implementing the other five recommendations from 2008 reflect less progress. For example, although OSD has drafted an oversight framework, that framework does not contain all the elements necessary for effective strategic planning and program implementation, such as criteria for measuring progress to facilitate program evaluation and to identify areas needing improvement. However, according to OSD officials, they plan to develop these within the next 2 years. Further, the draft oversight framework does not include information on how OSD plans to use or report the results of its performance assessments, does not identify how program resources correlate to its achievement of program objectives, and does not correlate with the program’s two strategic plans. Therefore, to improve oversight of the department’s sexual assault prevention and response programs, in our February 2010 report we recommend that OSD strengthen its oversight framework by identifying how the results of performance assessments will be used to guide the development of future program initiatives, identifying how program resources correlate to its achievement of strategic program objectives, and correlating the oversight framework with the program’s two strategic plans. In written comments on our draft report, DOD concurred and noted that it has already taken steps toward implementing these recommendations. For example, DOD stated that it currently has efforts underway to establish criteria for measuring its progress and expects to have a plan in early 2010 for tracking the department’s progress toward performance objectives. DOD also noted that it plans to align its budget categories with specific performance objectives, starting with the 2012 budget cycle. Further, DOD noted that the process it plans to use to track its progress toward performance objectives will also allow the department to synchronize the objectives, timelines, and strategies of its two strategic plans. We commend DOD for taking immediate steps in response to our recommendations, and encourage the department to continue taking positive actions toward fully implementing them. Further, while OSD has introduced some changes in DOD’s annual report to Congress, it has not completed the process of developing a standardized set of sexual assault data elements and definitions. OSD officials noted that the standardization of data definitions is something they expect to accomplish in the near term, while standardizing data elements will take longer as it is a task that will be completed in conjunction with their development of a centralized sexual assault database. However, we note that in the meantime, information in DOD’s annual report still cannot be compared across the military services, and it may not be effectively characterizing incidents of sexual assault in the military services. Thus, to enhance visibility over the incidence of sexual assaults involving DOD servicemembers, and to improve the department’s sexual assault prevention and response programs and the pending implementation of the Defense Sexual Assault Incident Database, in our February 2010 report we recommend that DOD standardize the type, amount, and format of the data in the military services’ report submissions. In written comments on our draft report, DOD stated that it is working to achieve complete data uniformity among the military services, but that this will ultimately be accomplished once the Defense Sexual Assault Incident Database—which we will discuss next—has been established. While we recognize the complexity of this task, we continue to assert that the full establishment and implementation of standardized data elements and definitions will facilitate a more comprehensive understanding of DOD’s sexual assault prevention and response programs. We also found that OSD cannot assess training programs as we recommended, because OSD’s strategic plans and draft oversight framework do not contain measures against which to benchmark performance, and DOD has not implemented our recommendation to evaluate processes for staffing key installation-level positions because, according to OSD officials, they were advised that the Defense Task Force on Sexual Assault in the Military Services would be making related recommendations. Finally, OSD officials stated that they will not address our recommendation to collect installation-level data—despite its availability and the military services’ willingness to provide them—until they have implemented the Defense Sexual Assault Incident Database to maintain these data. We did not make any new recommendations to DOD in our February 2010 report regarding these findings however, we continue to assert that until these recommendations are fully implemented, OSD cannot be sure that the programs are improving the department’s prevention of and response to sexual assault incidents. DOD has taken preliminary steps to establish the centralized, case-level Defense Sexual Assault Incident Database that Congress directed it to implement in the National Defense Authorization Act for Fiscal Year 2009, but it did not meet the statutorily mandated January 2010 deadline for implementing the database. Instead, only general milestones for acquiring the database have been set, and DOD cannot currently commit to when the system will be implemented because it does not have a reliable acquisition and implementation schedule. Further, a range of key information technology management practices that are essential to successfully acquiring and implementing a system remain to be accomplished. Our research and evaluations of information technology programs across the federal government have shown that adherence to such practices—including assessing a program’s overlap with related programs and using reliable estimates of life cycle costs and benefits to justify investment in the system—is essential to delivering promised system capabilities and benefits on time and within budget. However, more remains to be accomplished before these disciplines will be effectively implemented. For example, while DOD developed a business case for the database in June 2009 that includes a cost estimate of $12.6 million, the cost estimate does not include all costs over the system’s life cycle, has not been adjusted to account for program risks, and does not include a comparison of alternatives on the basis of net present value. To increase the chances of the database being successfully acquired and implemented, in our February 2010 report we recommend that DOD adhere to key system acquisition management processes and controls, including, but not limited to developing a reliable integrated master schedule, assessing the program’s overlap with related programs, and justifying the investment based on reliable estimates of life cycle costs and benefits. In written comments on our draft report, DOD agreed with these recommendations but noted that doing so depends in part on hiring a system development contractor. In this regard, DOD expects to release the Request for Proposals for a system developer soon, and award a contract sometime between April and June 2010. While the Coast Guard has partially implemented one of our recommendations to further develop its sexual assault prevention and response program, it has not implemented the other. In August 2008, we reported that the Coast Guard’s sexual assault prevention and response program was hindered by several issues, and we made two recommendations to strengthen its program’s implementation. In response to these recommendations, the Coast Guard has established a headquarters-level program manager position to oversee its sexual assault prevention and response program, and it has initiated an assessment of the current workload requirements and resource allocations for its Sexual Assault Response Coordinators. In written comments on our draft report, the Coast Guard stated that it had recently completed its assessment of the workload requirements and resource allocations for its Sexual Assault Response Coordinators, and upon release of the final report the Coast Guard plans to review and analyze the recommendations and as appropriate, incorporate additional resource requirements into its annual budget process. Further, the Coast Guard lacks a systematic process to collect, document, and maintain its sexual assault data and related program information, and it lacks quality control procedures to ensure that program data being collected are reliable. For example, Coast Guard officials noted that in fiscal year 2008, the Coast Guard Investigative Service documented 78 reports of alleged sexual assault, while Coast Guard Headquarters, using its hard copy log of reports from its coordinators, had documented only 30. Therefore, in our February 2010 report we recommend that the Coast Guard improve the oversight and accountability of its sexual assault prevention and response program by establishing a systematic process for collecting, documenting, and maintaining sexual assault incidence data, and by establishing quality control processes to ensure that program information collected is reliable. In written comments on our draft report, the Coast Guard noted that it is currently developing a prototype of an electronic database to track sexual assault reports and that it expects to complete the database in 2010. Additionally, while the Coast Guard’s instruction requires that all Coast Guard Sexual Assault Response Coordinators be trained to perform relevant duties, officials stated that they have not developed a curriculum or implemented training for the Coast Guard’s 16 Sexual Assault Response Coordinators, as they had elected alternatively to develop a training curriculum for other program personnel. Thus, to ensure that the Coast Guard can provide proper advice to its personnel, in our February 2010 report we recommend that it establish and administer a curriculum for all key program personnel. In written comments on our draft report, the Coast Guard noted that it has scheduled training in May 2010 for all of its personnel performing Sexual Assault Response Coordinator duties. We commend the Coast Guard for the steps it has taken and its plans for further developing its sexual assault prevention and response program, and we encourage the service to continue taking positive actions toward fully implementing our recommendations. In summary, we want to reiterate our recognition that both DOD and the Coast Guard have taken a number of positive steps toward addressing our recommendations from 2008 to further strengthen their respective sexual assault prevention and response programs. Additionally, each service has proactively developed and implemented a variety of initiatives—beyond what we recommended—to increase program awareness and to improve prevention of and response to occurrences of sexual assault. While such progress is noteworthy, DOD’s and the Coast Guard’s efforts have not fully established sound management frameworks that include a long-term perspective and clear lines of accountability—all of which are needed to withstand the administrative, fiscal, and political pressures that confront federal programs on a daily basis. Further, successful program implementation will require the personal involvement of top DOD and Coast Guard leadership in order to maintain the long-term focus on and accountability for program objectives. Without such support, DOD’s and the Coast Guard’s programs will not be able to maximize the benefits of their respective prevention and response initiatives, and they may not be able to effect the change in military culture that is needed to ensure that their programs are institutionalized. Chairman Tierney and Members of the Subcommittee, this concludes our prepared statement. We would be pleased to answer any questions you may have at this time. If you or your staff have any questions on matters discussed in this statement, please contact Brenda Farrell at (202) 512-3604 or farrellb@gao.gov or Randolph Hite at (202) 512-3439 or hiter@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this statement. Key contributors to this statement include Marilyn K. Wasleski, Assistant Director; Neelaxi Lakhmani, Assistant Director; Divya Bali; Stacy Bennett; K. Nicole Harms; Jim Houtz; Ron La Due Lake; Kim Mayo; Adam Vodraska; and Cheryl A. Weissman. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

This report discusses our efforts to evaluate the Department of Defense's (DOD) and the U.S. Coast Guard's oversight and implementation of their respective sexual assault prevention and response programs. Our findings build upon our previous work related to sexual assault in the military services. DOD and the Coast Guard have taken a number of positive steps to increase program awareness and to improve their prevention and response to occurrences of sexual assault, but additional actions are needed to strengthen their respective programs. As we have previously reported, sexual assault is a crime with a far-reaching negative impact on the military services in that it undermines core values, degrades mission readiness and esprit de corps, subverts strategic goodwill, and raises financial costs. Since we reported on these implications in 2008, incidents of sexual assault have continued to occur; in fiscal year 2008, DOD reported nearly 3,000 alleged sexual assault cases, and the Coast Guard reported about 80. However, it remains impossible to accurately analyze trends or draw conclusions from these data because DOD and the Coast Guard have not yet standardized their respective reporting requirements. DOD has taken steps to implement our August 2008 recommendations to improve its sexual assault prevention and response program; however, its efforts reflect various levels of progress, and opportunities exist for further program improvements. To its credit, DOD has implemented four of the nine recommendations in our August 2008 report. Further, while the Office of the Secretary of Defense (OSD) has introduced some changes in DOD's annual report to Congress, it has not completed the process of developing a standardized set of sexual assault data elements and definitions. We also found that OSD cannot assess training programs as we recommended, because OSD's strategic plans and draft oversight framework do not contain measures against which to benchmark performance, and DOD has not implemented our recommendation to evaluate processes for staffing key installation-level positions because, according to OSD officials, they were advised that the Defense Task Force on Sexual Assault in the Military Services would be making related recommendations. Finally, OSD officials stated that they will not address our recommendation to collect installation-level data--despite its availability and the military services' willingness to provide them--until they have implemented the Defense Sexual Assault Incident Database to maintain these data. While the Coast Guard has partially implemented one of our recommendations to further develop its sexual assault prevention and response program, it has not implemented the other. In August 2008, we reported that the Coast Guard's sexual assault prevention and response program was hindered by several issues, and we made two recommendations to strengthen its program's implementation. Further, the Coast Guard lacks a systematic process to collect, document, and maintain its sexual assault data and related program information, and it lacks quality control procedures to ensure that program data being collected are reliable. Additionally, while the Coast Guard's instruction requires that all Coast Guard Sexual Assault Response Coordinators be trained to perform relevant duties, officials stated that they have not developed a curriculum or implemented training for the Coast Guard's 16 Sexual Assault Response Coordinators, as they had elected alternatively to develop a training curriculum for other program personnel. Thus, to ensure that the Coast Guard can provide proper advice to its personnel, in our February 2010 report we recommend that it establish and administer a curriculum for all key program personnel.

RS21542 -- Department of Homeland Security: Issues Concerning the Establishment of Federally Funded ResearchandDevelopment Centers (FFRDCs) Updated November 13, 2003 FFRDCs are not-for-profit organizations which are financed on a sole-source basis, exclusively or substantially by an agency of thefederal government, which are not subject to Office of Personnel Management regulations. They operate as privatenon-profitcorporations, although they are subject to certain personnel and budgetary controls imposed by Congress and/or theirsponsoringagency. Each Center is administered, through a contract with the sponsoring federal agency, by either an industrialfirm, a university,or a nonprofit institution. Center personnel are not considered federal employees, but rather employees of theorganization thatmanages and operates the center. FFRDCs were established by the federal government during and immediatelyfollowing World WarII. For various reasons, the federal government was not able to attract the top scientific and technological talent dueto lower pay thanin the private sector and slow hiring procedures necessary to meet its broad R&D requirements. BecauseFFRDCs are not allowed tocompete for federal or private sector contracts, government officials have often asserted they are free from conflictof interest, and in abetter position to protect classified and/or proprietary information. There are four categories of FFRDCs: research laboratories, R&D laboratories, study and analysis centers, and systemsengineering/systems integration centers (see table). A research laboratory is usually limited tobasic and applied research thatincludes efforts directed towards the solution of specific problems, but short of engaging in major developmentrelated activities. An R&D laboratory engages in a variety of research activities, ranging from basic and appliedresearch through the actual developmentof hardware for experimental or demonstration purposes. Study and analysis centers are involvedin analytical activities in whichvery little hardware-related laboratory research or development is carried out. These study Centers were initiallyestablished toprovide the Office of the Secretary of Defense, the three Services, and the Defense Advanced Research ProjectsAgency with help insolving organizational or operational problems. Systems engineering/systems integration (SE/SI) centers primarily provide systemsengineering, R&D systems integration, and management support for definition and development of largetechnical systems. DOD established these Centers because it lacked certain in-house capabilities in large systems development, integration,and verification. Summary of Current FFRDCs 1. Parts of the FAA's FFRDC also are identified as a study and analysis center and a systems engineering center. Eight federal agencies currently operate a total of 36 FFRDCs. As indicated in the table, the Department ofEnergy (DOE) and theDepartment of Defense (DOD) together sponsor 26 FFRDCs, with DOE operating 16 Centers and DOD operating10. The other 10FFRDCs are operated by the National Science Foundation (NSF), the Federal Aviation Administration (FAA), theNationalAeronautics and Space Administration (NASA), the National Institutes of Health (NIH), the Nuclear RegulatoryCommission (NRC),and the Internal Revenue Service (IRS). Of the 16 DOE FFRDCs, nine are administered by a single university ora consortium ofuniversities, three are managed by a private sector company, and four through a not-for-profit organization. DOD's10 Centers includethree R&D laboratories, five Study and Analysis Centers, and two Systems Engineering, Systems IntegrationCenters. Those 10Centers are administered by two universities and eight not-for-profit organizations. According to the National Science Foundation, in FY2000 the federal government spent $77.4 billion on R&D, of which $6.385billion or 8.3% was obligated for FFRDCs (1) . Of the$6.385 billion spent on R&D at FFRDCs, DOE accounted for $3.897 billion or61% of total federal FFRDC expenditures. This represents 57% of DOE's total federal R&D budget of $6.063billion, in FY2000. Asa result, DOE is more reliant on FFRDCs to meet its research, development and acquisition requirements than anyother federalagency. As a matter of comparison, NASA's only FFRDC, the Jet Propulsion Laboratory, received $1.202 billionin FY2000,comprising 12.3% of the agency's $9.755 billion R&D budget. DOD's 10 FFRDCs received $783 million inFY2000, representingonly 2.4% of its RDT&E budget. The Office of Federal Procurement Policy (OFPP) Letter 84-1, and the Federal Acquisition Regulations (FAR) which implement thepolicy letter, are the two primary regulatory documents that govern the establishment of an FFRDC. (2) The purpose of the letter was toestablish government-wide policies for the establishment, utilization, and evaluation of FFRDCs. In 1990, the Officeof FederalProcurement issued regulations to implement the policy letter. (3) In general, the implementation regulations state that FFRDCs shouldnot be established unless the agency cannot accomplish the activity in-house, through other government agencies,or throughtraditional procurement procedures. The regulation also states there should be sufficient work to be performed bythe FFRDC; thatcost controls should be established to protect the government; and that the parameters of the mission of the FFRDCare spelled outclearly enough to enable the differentiation between FFRDC responsibilities and the agency's non-FFRDC work. (4) To establish an FFRDC, an agency must follow the guidelines of the OFPP. According to the National Science Foundation, once theagency implements the OFPP guidelines, the new FFRDC should have the following characteristics: (1) its primaryactivities shouldinclude: basic research, applied research, development, or management of research and development; (2) it is aseparate operationalunit within the parent organization or is organized as a separately incorporated organization; (3) it performs actualR&D or R&Dmanagement either upon direct request of the federal government or under a broad charter from the federalgovernment, but in eithercase under direct monitoring by the federal government; (4) it receives its major financial support (70% or more)from the federalgovernment, usually from one agency; (5) it has, or is expected to have, a long-term relationship with its sponsoringagency (usually 5years, with a review of the center's progress conducted by the sponsoring agency during the third year of theagreement); (6) most orall of its facilities are owned by, or are funded under contract with, the federal government, (7) it has an averageannual budget(operating and capital equipment) of at least $500,000; and (8) when renewing the sole-source contract, thesponsoring agency isrequired to determine if it still needs to sponsor an FFRDC or if the work could be done in a federal facility, orthrough a traditionalprivate sector contract. (5) To minimize conflicts of interest, Centers are established as not-for-profit entities that cannot compete with for-profit companies foradditional government contracts and are not allowed to produce and market commercial products. As a result,government officialsargue that FFRDCs are allowed access to key government officials and highly sensitive data from industry andgovernment sources.Such privileged access enables the Centers to address complex long-term problems with a high degree of objectivitybased on theirrestrictions concerning selling products to the government, or joining forces with those who do, while remainingoutside of thegovernment itself. While Centers are not-for-profit entities, they are allowed to charge the government fees aboveand beyond thecost of carrying out their responsibilities. Some Centers charge fees to cover ordinary and necessary costs of doingbusiness that arenot otherwise reimbursable, but that the government recognizes must be incurred. These fees can also be used byan FFRDC toconduct independent research. The FAR acknowledges the legitimacy of such fees. (6) Within Title III, Science and Technology in Support of Homeland Security, of the Homeland Security Act ( P.L.107-296 ) there are twoprovisions that call for the establishment of FFRDCs. Section 305 of the Act states that "the Secretary, actingthrough theUndersecretary for Science and Technology, may establish or contract with one or more FFRDCs to carry out otherresponsibilities ofthe Act, including the coordination and integration of the agency's extramural and intermural research programs." (7) Section 312directs the Secretary of DHS to establish an FFRDC known as the Homeland Security Institute. According to thelegislation, theInstitute, among other things, "should conduct systems analysis, risk analysis, and simulation and modeling todeterminevulnerability of the Nation's critical infrastructure." (8) However, the legislation also states that "the Institute shall terminate threeyears after the effective date of this Act." Some have raised concerns that this provision could make it difficult forDHS to recruit thebest people for this Center. This legislative language provides the Secretary of Homeland Security with the authority the agency needs to establish multipleFFRDCs, as long as the Department complies with OFPP Letter 84-1, and the implementing FAR 35.017-2. Oncethese requirementshave been met, the DHS can develop a request for proposals to establish one or more FFRDCs. It should be notedthat theCompetition in Contracting Act (CICA) permits the government to use sole-source procedures to establish or sustainan FFRDC.Proponents of this practice contend this allows the government to select the highest quality bid, rather than thelowest cost bid thatapplies to traditional federal procurement actions. However, to help control costs, Congress can set ceilings on thetotal annualspending and/or established personnel levels for the Center. In addition to universities and private sector firms,existing FFRDCs canalso compete to operate and manage a DHS sponsored FFRDC, if the mission of the proposed FFRDCis similar to the existingFFRDC. FFRDCs operate under a five year contract, with a review of the Center's performance by the sponsoringagency after thethird year of operation. This review is to determine if the FFRDC should be renewed for another 5 years,re-competed as an FFRDC,abolished, or decertified as an FFRDC while continuing to operate as an independent nonprofit organization. Once the DHS selects the organization that will administer and operate an FFRDC, the Board of Trustees for the FFRDC willestablish operating procedures, and select the Director of the FFRDC. (9) While the sponsoring agency has some input in the selectionof the Center's Director, the Board of Trustees is ultimately responsible for selecting the Director of the FFRDC.The Director is thenresponsible for hiring the remainder of the Center's personnel who, like the Director, are employees of theorganization that operatesthe FFRDC, not the sponsoring federal agency. The primary objective of this unique arrangement between thesponsoring agency andthe Center is to help ensure the independence of the Center while concomitantly establishing a long-term, closepartnershiprelationship, as opposed to the "arms length" required with for-profit federal contracts. Further, the personnelpolicies allow theFFRDC to rapidly employ, if necessary, new scientific and technical expertise that are difficult to recruit, sustain,and manage throughthe federal civil service system. (10) For many years FFRDCs have attracted the attention of Congress. In their early years of operation, Congress' primary concernsregarding FFRDCs centered around the growing number of Centers, cost to the government, insulation from thecompetitiveenvironment, and the quality of products. More recently, congressional concerns have focused on the continuingneed for FFRDCs,diversification into areas beyond the Centers' original mission, and each sponsoring agency's oversight of itsFFRDC's activities. Public sector advocacy groups, such as the Professional Services Council (PSC), have pointed out that the nation's scientific,engineering, and technological capabilities have increased dramatically since FFRDCs were first introduced in thelate 1940s.Specifically, PSC contends that, given that the private sector has developed significant capabilities to perform studies and analysisand systems-engineering and integration work, it seems logical that this work could be performed in the privatesector. However,proponents of FFRDCs argue that the responsibility of the proposed DHS FFRDC includes "the coordination andintegration of theagency's extramural and intermural research programs" which they contend is ideal, since FFRDCs are not allowedto compete forfederal contracts and are not allowed to develop commercial products. Finally it is unlikely that any of the DHSFFRDCs will beperforming systems integration activities. With the end of the Cold War and declining DOD R&D budgets, observers in the private and public sectors are concerned thatFFRDCs might have diversified into areas beyond their originally defined missions. Some individuals inside andoutside of Congressassert that this has already happened. Representatives from the PSC have also argued that these Centers havereceived a number ofcontracts from various federal agencies for which private service companies had originally competed. However,representatives fromDOD and DOE have indicated that their respective FFRDCs have been asked to develop definitions of their corework for eachCenter. As a result of this exercise each agency has identified work that could be competed through a traditionalprocurement process. (11) Some Members of Congress have expressed concerns about the adequacy of the oversight of many FFRDCs. In a General AccountingOffice (GAO) report, prepared for the House Appropriations Subcommittee on Energy and Water, GAO stated that"Despite DOE'smany reforms, our review of more than 200 audit and consulting reports issued since 1995 reveals that thedepartment has persistentmanagement weaknesses that have led directly to a wide range of performance problems, including major costoverruns and scheduledelays in a variety of noteworthy projects." (12) Tocontrol cost and maintain mission focus at DOD's FFRDCs, Congress continues tomandate employee ceiling levels for each DOD Center. While these are legitimate congressional concerns, it isimportant to note thatDOD and DOE FFRDCs employ thousands of people and have budgets in the hundreds of millions of dollars. Incontrast, DHSFFRDCs are likely to be smaller Centers with initial employment levels ranging from 50-100 people, along with budgets rangingfrom $15 million to $30 million.

Federally Funded Research and Development Centers (FFRDCs) were first establishedduring World War II to provide specific defense research and development (R&D) capabilities that were notreadily available withinthe federal government or the private sector. The federal government currently operates 36 FFRDCs. Title III of theDepartmentHomeland Security (DHS) Act (P.L.107-296) calls for the creation of one or more FFRDCs , including a HomelandSecurity Institute.On September 10th, the DHS released a "Sources Sought" notice requesting that contractors indicate their interestin competing tooperate an FFRDC for DHS. Those responding must include a 400 words, or less, qualification statement by October30. DHS plansto release a formal request for proposal, for the FFRDC, before the end of this year. In the past several years, somecongressional andnon-congressional critics have questioned the use of FFRDCs, including the continuing need for such Centers, diversification intoareas beyond the Centers' original missions, and oversight of each FFRDC's activities by its sponsoring agency. Thisreport will beupdated to reflect most recent events.

Since the September 11, 2001, terrorist attacks there has been concern that certain radioactive material could be used in the construction of a radiological dispersion device (RDD). An RDD disperses radioactive material over a particular target area, which could be accomplished using explosives or by other means. The major purpose of an RDD would be to create terror and disruption, not death or destruction. Depending on the type, form, amount, and concentration of radioactive material used, direct radiation exposure from an RDD could cause health effects to individuals in proximity to the material for an extended time; for those exposed for shorter periods and at lower levels, it could potentially increase the long- term risks of cancer. In addition, the evacuation and cleanup of contaminated areas after dispersal could lead to panic and serious economic costs on the affected population. In 2003, a joint NRC/Department of Energy (DOE) interagency working group identified several radioactive materials (including Americium-241 and Cesium-137) as materials at higher risk of being used in an RDD, describing these as “materials of greatest concern.” In its risk-based approach to securing radioactive sources, NRC has made a commitment to work toward implementing the provisions of IAEA’s Code of Conduct. This document provides a framework that categorizes the relative risk associated with radioactive sources. While NRC has recently focused on upgrading its capacity to track, monitor, and secure category 1 and 2 sources, which are considered high risk, category 3 sources are not a primary focus of NRC regulatory efforts. Category 3 sources include byproduct material, which is radioactive material generated by a nuclear reactor, and can be found in equipment that has medical, academic, and industrial applications. For example, a standard type of moisture gauge used by many construction companies contains small amounts of Americium-241 and Cesium-137. According to NRC, it would take 16 curies of Americium-241 to constitute a high-risk category 2 quantity, and 1.6 curies of Americium-241 is considered a category 3 quantity. In October and November 2006, using fictitious names, our investigators created two bogus companies—one in an agreement state and one in a non-agreement state. After the bogus businesses were incorporated, our investigators prepared and submitted applications for a byproduct materials license to both NRC and the department of the environment for the selected agreement state. The applications, mailed in February 2007, were identical except for minor differences resulting from variations in the application forms. Using fictitious identities, one investigator represented himself as the company president in the applications, and another investigator represented himself as the radiation safety officer. The license applications stated that our company intended to purchase machines with sealed radioactive sources. According to NRC guidance finalized in November 2006 and sent to agreement states in December 2006, both NRC and agreement state license examiners should consider 12 screening criteria to verify that radioactive materials will be used as intended by a new applicant. For example, one criterion suggests that the license examiner perform an Internet search using common search engines to confirm that an applicant company appears to be a legitimate business that would require a specific license. Another screening technique calls for the license examiner to contact a state agency to confirm that the applicant has been registered as a legitimate business entity in that state. If the examiner believes there is no reason to be suspicious, he or she is not required to take the steps suggested in the screening criteria and may indicate “no” or “not applicable” for each criteria. If the license examiner takes additional steps to evaluate a criterion, he or she should indicate what publicly available information was considered. If there is concern for a potential security risk, the guidance instructs license examiners to note the basis for that concern. Nine days after mailing their application form to NRC, our investigators received a call from an NRC license examiner. The NRC license examiner stated that the application was deficient in some areas and explained the necessary corrections. For example, the license examiner asked our investigators to certify that the machines containing sealed radioactive source material, which are typically used at construction sites, would be returned to the company office before being transported to a new construction site. The license examiner explained that this was a standard security precaution. Even though we did not have a company office or a construction site, our investigators nevertheless certified their intent to bring the machines back to their office before sending them to a new location. They made this certification via a letter faxed to NRC. Four days after our final correction to the license application, NRC approved our application and mailed the license to the bogus business in the non- agreement state. It took a total of 4 weeks to obtain the license. See figure 1 for the first page of the transmittal letter we received from NRC with our license. The NRC license is printed on standard 8-1/2 x 11 inch paper and contains a color NRC seal for a watermark. It does not appear to have any features that would prevent physical counterfeiting. We therefore concluded that we could alter the license without raising the suspicion of a supplier. We altered the license so that it appeared our bogus company could purchase an unrestricted quantity of sealed source materials rather than the small amounts of Americium-241 and Cesium-137 listed on the original license. We determined the proper language for the license by reviewing publicly available information. Next, we contacted two U.S. suppliers of the machines specified in our license. We requested price quotes and faxed the altered license to the suppliers as proof that we were certified to purchase the machines. Both suppliers offered to sell us the machines and provided us price quotes. One of these suppliers offered to provide twice as many machines as we requested and offered a discount for volume purchases. In a later telephone call to one of the suppliers, a representative of the supplier told us that his company does not check with NRC to confirm the terms listed on the licenses that potential customers fax them. He said that his company checks to see whether a copy of the front page of the license is faxed with the intent to purchase and whether the requested order exceeds the maximum allowable quantity a licensee is allowed to possess at any one time. Although we had no legitimate use for the machines, our investigators received, within days of obtaining a license from NRC, price quotes and terms of payment that would have allowed us to purchase numerous machines containing sealed radioactive source materials. These purchases would have substantially exceeded the limit that NRC approved for our bogus company. If these radioactive materials were unsealed and aggregated together, the machines would yield an amount of Americium-241 that exceeds the threshold for category 3 materials. As discussed previously, according to IAEA, category 3 sources are dangerous if not safely managed or securely protected and “could cause permanent injury to a person who handled them, or was otherwise in contact with them, for some hours. It could possibly—although it is unlikely—be fatal to be close to this amount of unshielded radioactive material for a period of days to weeks.” Importantly, with patience and the proper financial resources, we could have accumulated, from other suppliers, substantially more radioactive source material than what the two suppliers initially agreed to ship to us—potentially enough to reach category 2. According to IAEA, category 2 sources, if not safely managed or securely protected, “could cause permanent injury to a person for a short time (minutes to hours), and it could possibly be fatal to be close to this amount of unshielded material for a period of hours to days.” Ten days after mailing their application form to the agreement state’s department of environment, our investigators received a call from a department license examiner. The license examiner stated that the application was deficient in some areas and said that she would send us a letter outlining what additional information the state required before approving the license. The examiner further stated that before the license was granted, she would conduct a site visit to inspect the company office and storage facilities cited in our application. Our investigators subsequently decided not to pursue the license in this state and requested that their application be withdrawn. According to an official in the department of environment for this state, the license examiner followed the required state procedure in requesting a site visit. The official told us that as a matter of long-standing state policy, license examiners in this state conduct site visits and interview company management (especially radiation safety officers) before granting new licenses for radioactive materials. This state policy is more stringent than the guidance NRC provided agreement states in December 2006. The NRC guidance identified a site visit as one possible screening criterion to use in evaluating a new license application, but, as discussed above, a site visit is not required under the NRC guidance. On June 1, 2007, we contacted NRC and discussed the results of our work. An NRC official indicated that NRC would take immediate action to address the weaknesses we identified. After this meeting, we learned that NRC suspended its licensing program for specific licenses until it could determine what corrective actions were necessary to resolve the weaknesses. NRC also held a teleconference with a majority of the 34 agreement states to discuss our work. On June 12, 2007, NRC issued supplemental interim guidance with additional screening criteria. These criteria are intended to help a license examiner determine whether a site visit or face-to-face meeting with new license applicants is required. NRC told us that it planned to convene a working group to develop improved guidance addressing the weaknesses we identified. NRC’s goal is to provide licenses to only those entities that can demonstrate that they have legitimate uses for radioactive materials. However, our work shows that there continues to be weaknesses in the process NRC uses to approve license applications. In our view, a routine visit by NRC staff to the site of our bogus business would have been enough to reveal our lack of facilities and equipment. Furthermore, if NRC license examiners had conducted even a minimal amount of screening— such as performing common Web searches or making telephone calls to local government or business offices—they would have developed serious doubts about our application. Once we received our license, the ease with which we were able to alter the license and obtain price quotes and commitments to ship from suppliers of radioactive materials is also cause for concern. Accordingly, we are making the following three recommendations to the Chairman of the NRC: First, to avoid inadvertently allowing a malevolent individual or group to obtain a license for radioactive materials, NRC should develop improved guidance for examining NRC license applications. In developing improved screening criteria, NRC should consider whether site visits to new licensees should be mandatory. These improved screening criteria will allow NRC to provide reasonable assurance that licenses for radioactive materials will only be issued to those with legitimate uses. Second, NRC should conduct periodic oversight of license application examiners so that NRC will be assured that any new guidance is being appropriately applied. Third, NRC should explore options to prevent individuals from counterfeiting NRC licenses, especially if this allows the purchase of more radioactive materials than they are approved for under the terms of the original license. Mr. Chairman, this concludes our statement. We would be pleased to answer any questions that you or other Members of the Subcommittee may have at this time. For further information about this testimony, please contact Gregory D. Kutz at (202) 512-7455 or kutzg@gao.gov or Gene Aloise at (202) 512-3841 or aloisee@gao.gov. Contacts points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this testimony. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

The Nuclear Regulatory Commission (NRC) regulates domestic medical, industrial, and research uses of sealed radioactive sources. Organizations or individuals attempting to purchase a sealed source must apply for a license and gain the approval of either NRC or an "agreement state." To become an agreement state, a state must demonstrate to NRC that its regulatory program is compatible with NRC regulations and is effective in protecting public health and safety. NRC then transfers portions of its authority to the agreement state. In 2003, GAO reported that weaknesses in NRC's licensing program could allow terrorists to obtain radioactive materials. NRC took some steps to respond to the GAO report, including issuing guidance to license examiners. To determine whether NRC actions to address GAO recommendations were sufficient, the Subcommittee asked GAO to test the licensing program using covert investigative methods. By using the name of a bogus business that existed only on paper, GAO investigators were able to obtain a genuine radioactive materials license from NRC. Aside from traveling to a non-agreement state to pick up and send mail, GAO investigators did not need to leave their office in Washington, D.C., to obtain the license from NRC. Further, other than obtaining radiation safety officer training, investigators gathered all the information they needed for the license from the NRC Web site. After obtaining a license from NRC, GAO investigators altered the license so it appeared that the bogus company could purchase an unrestricted quantity of radioactive sealed sources rather than the maximum listed on the approved license. GAO then sought to purchase, from two U.S. suppliers, machines containing sealed radioactive material. Letters of intent to purchase, which included the altered NRC license as an attachment, were accepted by the two suppliers. These suppliers gave GAO price quotes and commitments to ship the machines containing radioactive materials. The amount of radioactive material we could have acquired from these two suppliers was sufficient to reach the International Atomic Energy Agency's (IAEA) definition of category 3. According to IAEA, category 3 sources are dangerous if not safely managed or securely protected. Importantly, with patience and the proper financial resources, we could have accumulated substantially more radioactive source material. GAO also attempted to obtain a license from an agreement state, but withdrew the application after state license examiners indicated they would visit the bogus company office before granting the license. An official with the licensing program told GAO that conducting a site visit is a standard required procedure before radioactive materials license applications are approved in that state. As a result of this investigation, NRC suspended its licensing program until it could determine what corrective actions were necessary to resolve the weaknesses GAO identified. On June 12, 2007, NRC issued supplemental interim guidance with additional screening criteria. These criteria are intended to help a license examiner determine whether a site visit or face-to-face meeting with new license applicants is required.

During fiscal years 2002 through 2008, the United States spent approximately $16.5 billion to train and equip the Afghan army and police forces in order to transfer responsibility for the security of Afghanistan from the international community to the Afghan government. As part of this effort, Defense—through the U.S. Army and Navy—purchased over 242,000 small arms and light weapons, at a cost of about $120 million. As illustrated in figure 1, these weapons include rifles, pistols, shotguns, machine guns, mortars, and launchers for grenades, rockets, and missiles. In addition, CSTC-A has reported that 21 other countries provided about 135,000 weapons for ANSF between June 2002 and June 2008, which they have valued at about $103 million. This brings the total number of weapons Defense reported obtaining for ANSF to over 375,000. The Combined Security Transition Command-Afghanistan (CSTC-A) in Kabul, which is a joint service, coalition organization under the command and control of Defense’s U.S. Central Command is primarily responsible for training and equipping ANSF. As part of that responsibility, CSTC-A receives and stores weapons provided by the United States and other international donors and distributes them to ANSF units. In addition, CSTC-A is responsible for monitoring the use of U.S.-procured weapons and other sensitive equipment. Lapses in weapons accountability occurred throughout the supply chain, including when weapons were obtained, transported to Afghanistan, and stored at two central depots in Kabul. Defense has accountability procedures for its own weapons, including (1) serial number registration and reporting and (2) 100 percent physical inventories of weapons stored in depots at least annually. However, Defense failed to provide clear guidance to U.S. personnel regarding what accountability procedures applied when handling weapons obtained for the ANSF. We found that the U.S. Army and CSTC-A did not maintain complete records for an estimated 87,000—or about 36 percent—of the 242,000 weapons Defense procured and shipped to Afghanistan for ANSF. Specifically: For about 46,000 weapons, the Army could not provide us serial numbers to uniquely identify each weapon provided, which made it impossible for us to determine their location or disposition. For about 41,000 weapons with serial numbers recorded, CSTC-A did not have any records of their location or disposition. Furthermore, CSTC-A did not maintain reliable records, including serial numbers, for any of the 135,000 weapons it reported obtaining from international donors from June 2002 through June 2008. Although weapons were in Defense’s control and custody until they were issued to ANSF units, accountability was compromised during transportation and storage. Organizations involved in the transport of U.S.- procured weapons into Kabul by air did not communicate adequately to ensure that accountability was maintained over weapons during transport. In addition, CSTC-A did not maintain complete and accurate inventory records for weapons at the central storage depots and allowed poor security to persist. Until July 2008, CSTC-A did not track all weapons at the depots by serial number and conduct routine physical inventories. Without such regular inventories, it is difficult for CSTC-A to maintain accountability for weapons at the depots and detect weapons losses. Moreover, CSTC-A could not identify and respond to incidents of actual or potential compromise, including suspected pilferage, due to poor security and unreliable data systems. Illustrating the importance of physical inventories, less than 1 month after completing its first full weapons inventory, CSTC-A officials identified the theft of 47 pistols intended for ANSF. During our review, Defense indicated that it would begin recording serial numbers for all weapons it obtains for ANSF, and CSTC-A established procedures to track weapons by serial number in Afghanistan. It also began conducting physical inventories of the weapons stored at the central depots. However, CSTC-A officials stated that their continued implementation of these new accountability procedures was not guaranteed, considering staffing constraints and other factors. Despite CSTC-A training efforts, ANSF units cannot fully safeguard and account for weapons, placing weapons CSTC-A has provided to ANSF at serious risk of theft or loss. In February 2008, CSTC-A acknowledged that it was issuing equipment to Afghan National Police units before providing training on accountability practices and ensuring that effective controls were in place. Recognizing the need for weapons accountability in ANSF units, Defense and State deployed hundreds of U.S. trainers and mentors to, among other things, help the Afghan army and police establish equipment accountability practices. In June 2008, Defense reported to Congress that it was CSTC-A’s policy not to issue equipment to ANSF without verifying that appropriate supply and accountability procedures are in place. While CSTC-A has established a system for assessing the logistics capacity of ANSF units, it has not consistently assessed or verified ANSF’s ability to properly account for weapons and other equipment. Contractors serving as mentors have reported major ANSF accountability weaknesses. Although these reports did not address accountability capacities in a consistent manner that would allow a systematic or comprehensive assessment of all units, they highlighted the following common problems relating to weapons accountability. Lack of functioning property book operations. Many Afghan army and police units did not properly maintain property books, which are fundamental tools used to establish equipment accountability and are required by Afghan ministerial decrees. Illiteracy. Widespread illiteracy among Afghan army and police personnel substantially impaired equipment accountability. For example, a mentor noted that illiteracy in one Afghan National Army corps was directly interfering with the ability of supply section personnel to implement property accountability processes and procedures, despite repeated training efforts. Poor security. Some Afghan National Police units did not have facilities adequate to ensure the physical security of weapons and protect them against theft in a high-risk environment. In a northern province, for example, a contractor reported that the arms room of one police district office was behind a wooden door that had only a miniature padlock, and that this represented the same austere conditions as in the other districts. Unclear guidance. Afghan government logistics policies were not always clear to Afghan army and police property managers. Approved Ministry of Interior policies outlining material accountability procedures were not widely disseminated, and many police logistics officers did not recognize any of the logistical policies as rule. Additionally, a mentor to the Afghan National Army told us that despite new Ministry of Defense decrees on accountability, logistics officers often carried out property accountability functions using Soviet-style accounting methods and that the Ministry was still auditing army accounts against those defunct standards. Corruption. Reports of alleged theft and unauthorized resale of weapons are common, including one case in which an Afghan police battalion commander in one province was allegedly selling weapons to enemy forces. Desertion. Desertion in the Afghan National Police has also resulted in the loss of weapons. For example, contractors reported that Afghan Border Police officers at one province checkpoint deserted to ally themselves with enemy forces and took all their weapons and two vehicles with them. In July 2007, Defense began issuing night vision devices to the Afghan National Army. These devices are considered dangerous to the public and U.S. forces in the wrong hands, and Defense guidance calls for intensive monitoring of their use, including tracking by serial number. However, we found that CSTC-A did not begin monitoring the use of these sensitive devices until October 2008—about 15 months after issuing them. Defense and CSTC-A attributed the limited monitoring of these devices to a number of factors, including a shortage of security assistance staff and expertise at CSTC-A, exacerbated by frequent CSTC-A staff rotations. After we brought this to CSTC-A’s attention, it conducted an inventory and reported in December 2008 that all but 10 of the 2,410 night vision devices issued had been accounted for. We previously reported that Defense cited significant shortfalls in the number of trainers and mentors as the primary impediment to advancing the capabilities of ANSF. According to CSTC-A officials, as of December 2008, CSTC-A had only 64 percent of the nearly 6,700 personnel it required to perform its overall mission, including only about half of the over 4,000 personnel needed to mentor ANSF units. In summary, we have serious concerns about the accountability for weapons that Defense obtained for ANSF through U.S. procurements and international donations. First, we estimate that Defense did not systematically track over half of the weapons intended for ANSF. This was primarily due to staffing shortages and Defense’s failure to establish clear accountability procedures for these weapons while they were still in U.S. custody and control. Second, ANSF units could not fully safeguard and account for weapons Defense has issued to them, despite accountability training provided by both Defense and State. Poor security and corruption in Afghanistan, unclear guidance from Afghan ministries, and a shortage of trainers and mentors to help ensure that appropriate accountability procedures are implemented have reportedly contributed to this situation. In the report we are releasing today we make several recommendations to help improve accountability for weapons and other sensitive equipment that the United States provided to ANSF. In particular, we recommend that the Secretary of Defense (1) establish clear accountability procedures for weapons while they are in the control and custody of the United States, including tracking all weapons by serial number and conducting routine physical inventories; (2) direct CSTC-A to specifically assess and verify each ANSF unit’s capacity to safeguard and account for weapons and other sensitive equipment before providing such equipment, unless a specific waiver or exception is granted; and (3) devote adequate resources to CSTC-A’s effort to train, mentor, and assess ANSF in equipment accountability matters. In commenting on a draft of our report, Defense concurred with our recommendations and has begun to take corrective action. In January 2009, Defense directed the Defense Security Cooperation Agency to lead an effort to establish a weapons registration and monitoring system in Afghanistan, consistent with controls mandated by Congress for weapons provided to Iraq. If Defense follows through on this plan and, in addition, clearly requires routine inventories of weapons in U.S. custody and control, our concern about the lack of clear accountability procedures will be largely addressed. According to Defense, trainers and mentors are assessing the ability of ANSF units to safeguard and account for weapons. For the Afghan National Army, mentors are providing oversight at all levels of command of those units receiving weapons. For the Afghan National Police, most weapons are issued to units that have received instruction on equipment accountability as part of newly implemented training programs. We note that at the time of our review, ANSF unit assessments did not systematically address each unit’s capacity to safeguard and account for weapons in its possession. We also note that Defense has cited significant shortfalls in the number of personnel required to train and mentor ANSF units. Unless these matters are addressed, we are not confident the shortcomings we reported will be adequately addressed. Defense also indicated that it is looking into ways of addressing the staffing shortfalls that hamper CSTC-A’s efforts to train, mentor, and assess ANSF in equipment accountability matters. However, Defense did not state how or when additional staffing would be provided. Mr. Chairman and members of the subcommittee, this concludes my prepared statement. I will be happy to answer any questions you may have. To address our objectives, we reviewed documentation and interviewed officials from Defense, U.S. Central Command, CSTC-A, and the U.S. Army and Navy. On the basis of records provided to us, we compiled detailed information on weapons reported as shipped to CSTC-A in Afghanistan by the United States and other countries from June 2002 through June 2008. We traveled to Afghanistan in August 2008 to examine records and meet with officials at CSTC-A headquarters, visit the two central depots where the weapons provided for ANSF are stored, and meet with staff at an Afghan National Army unit that had received weapons. While in Afghanistan, we attempted to determine the location or disposition of a sample of weapons. Our sample was drawn randomly from a population of 195,671 U.S.-procured weapons shipped to Afghanistan for which Defense was able to provide serial numbers. We used the results of our sampling to reach general conclusions about CSTC-A’s ability to account for weapons purchased by the United States for ANSF. We also discussed equipment accountability with cognizant officials from the Afghan Ministries of Defense and Interior, the U.S. Embassy, and contractors involved in building ANSF’s capacity to account for and manage its weapons inventory. We performed our work from November 2007 through January 2009 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. For questions regarding this testimony, please contact Charles Michael Johnson, Jr. at (202) 512-7331 or johnsoncm@gao.gov. Albert H. Huntington III, Assistant Director; James Michels; Emily Rachman; Mattias Fenton; and Mary Moutsos made key contributions in preparing this statement. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

This testimony discusses the GAO report on accountability for small arms and light weapons that the United States has obtained and provided or intends to provide to the Afghan National Security Forces (ANSF)--the Afghan National Army and the Afghan National Police. Given the unstable security conditions in Afghanistan, the risk of loss and theft of these weapons is significant, which makes this hearing particularly timely. This testimony today focuses on (1) the types and quantities of weapons the Department of Defense (Defense) has obtained for ANSF, (2) whether Defense can account for the weapons it obtained for ANSF, and (3) the extent to which ANSF can properly safeguard and account for its weapons and other sensitive equipment. During fiscal years 2002 through 2008, the United States spent approximately $16.5 billion to train and equip the Afghan army and police forces in order to transfer responsibility for the security of Afghanistan from the international community to the Afghan government. As part of this effort, Defense--through the U.S. Army and Navy--purchased over 242,000 small arms and light weapons, at a cost of about $120 million. These weapons include rifles, pistols, shotguns, machine guns, mortars, and launchers for grenades, rockets, and missiles. In addition, CSTC-A has reported that 21 other countries provided about 135,000 weapons for ANSF between June 2002 and June 2008, which they have valued at about $103 million. This brings the total number of weapons Defense reported obtaining for ANSF to over 375,000. The Combined Security Transition Command-Afghanistan (CSTC-A) in Kabul, which is a joint service, coalition organization under the command and control of Defense's U.S. Central Command is primarily responsible for training and equipping ANSF.3 As part of that responsibility, CSTC-A receives and stores weapons provided by the United States and other international donors and distributes them to ANSF units. In addition, CSTC-A is responsible for monitoring the use of U.S.-procured weapons and other sensitive equipment.

We have suggested that the Congress consider providing the Administrator of GSA with the authority to experiment with funding alternatives, including public-private partnerships, when they reflect the best economic value available for the federal government. Congress has enacted legislation that provides certain other agencies with a statutory basis to enter into joint ventures with the private-sector. This additional property management tool has been provided to VA and DOD. Furthermore, in an effort to provide more agencies with a broader range of property management tools, the Federal Asset Management Improvement Act (H.R. 2710) was recently reintroduced. The term public-private partnership can be used to describe many different types of partnership arrangements. When we refer to public- private partnerships, we are referring to partnerships in which the federal government contributes real property and a private entity contributes financial capital and borrowing ability to redevelop or renovate the real property. Regarding the structure of the hypothetical partnerships developed for our study, the federal government and the private sector entity negotiate to agree on how the specifics of the partnership will work, including how the cash flow will be shared to form the partnership. The private partners will generally require a preferred return to compensate it for the risks it is taking in the partnership. This preferred return is generally a percentage of the cash flow; for our study, the contractors used 11 percent for the Washington, D.C. properties and 9 percent for the other properties. The net cash flow is then divided between the private partner and the federal government at an agreed-upon percentage. Attachment III shows graphically how the hypothetical partnerships in our study were structured. In structuring partnerships for individual properties, it must be remembered that each property is unique and will thus have unique issues that will need to be negotiated and addressed as the partnership is formed. Great care will need to be taken in structuring partnerships to protect the interests of both the federal government and the private sector. In conducting this study, the contractors assumed that certain conditions would govern a public-private partnership. For example, the property must be available for use, in whole or in part, by federal executive agencies, and agreements must not guarantee occupancy by the United States. In addition, the government would not be liable for any actions, debts, or liabilities of any person under an agreement, and the leasehold interests of the United States would be senior to any lender of the nongovernmental partner. There are various factors that indicate whether a property is a potential candidate for a public-private partnership. There must be not only a federal need for space, but also a private-sector demand for space, since the government is not guaranteeing that it will occupy the property. The stronger the market for rental space, both federal and nonfederal, the more likely that the space will be rented and thus producing income. The property must have the ability to provide a sufficient financial return to attract and utilize private-sector resources and expertise. A property in a strong rental market and at a good location is more likely to attract private-sector interest than a property without these characteristics. Another factor is the existence of an unutilized or underutilized asset on the property, which could be used to increase the value of the property. Several of the properties we studied had vacant land. The existence of excess land on the property that could be used to increase the amount of office space by expanding or building a new building, could increase the opportunity for an income-generating partnership. The property in Seattle, WA, has a deepwater port that the government is not using to its potential but that could be very valuable to another user. Any partnership would have to conform with budgetary score-keeping rules. Federal budget scoring is the process of estimating the budgetary effects of pending and enacted legislation and comparing them to limits set in the budget resolution or legislation. Scorekeeping tracks data such as budget authority, receipts, outlays, and the surplus or deficit. Office of Management and Budget (OMB) staff indicated that where there is a long- term need for the property by the federal government, it is doubtful that a public-private partnership would be more economical than directly appropriating funds for renovation. In addition, depending on how OMB scores these transactions, some of the scenarios could trigger capital lease-scoring requirements due to the implicit long-term federal need for the space. Our study designed a conceptual framework for public-private partnerships in order to identify potential benefits of these partnerships. Our contractors developed and analyzed hypothetical public-private partnerships for 10 specific GSA properties. Multiple potential benefits to the federal government were identified. These potential benefits include the utilization of the untapped value of real property, conversion of buildings that are currently a net cost to GSA into net attainment of efficient and repaired federal space, reduction of costs incurred in functionally inefficient buildings, protection of public interests in historic properties, and creation of financial returns for the government. Our study did not identify or address all the issues of partnerships that will need to be considered by the decisionmakers and policymakers as partnerships are developed. Before any partnerships are developed, in- depth feasibility studies would have to be done to evaluate partnership opportunities and other options, such as appropriations, to determine which could provide the best economic value for the government. When deciding whether to enter into a partnership, the government will need to weigh the expected financial return and other potential benefits against the expected costs, including potential tax consequences, associated with the partnership. Any cost associated with vacating buildings during renovation work would also have to be considered in any alternative evaluated. In addition, any actual partnerships involving the properties in our study may be very different from the scenarios developed by our contractors. For a public-private partnership to be a viable option, there must be interest from the private sector in partnering with the government on a selected property. A private-sector partner would generally enter a partnership as a financial business decision. While the private-sector entity would consider numerous factors to determine the viability of a public- private partnership, the financial return from the partnership is the critical factor in the decision on whether to partner with the federal government. According to our contractors, about a 15-percent internal rate of return (IRR) would likely elicit strong interest from the private sector in a partnership. However, this is only one factor, and the circumstances and conditions of each partnership are unique and would have to be evaluated on a case-by-case basis by both the private sector and the federal government. For example, a somewhat lower IRR could be attractive if other conditions, such as the risk level, are favorable. In addition, when our contractors discussed possible partnership scenarios with local developers, the developers said that, to participate, they would want at least a 50-year master ground lease. A public-private partnership would generally be a financial undertaking for the private-sector entity, and the main benefit to it would be financial. With regard to some properties, the private sector may believe it is a benefit to be associated with a particular project if a developer believes that a project is prestigious and might open future opportunities. According to our contractors, the analysis of the hypothetical partnerships for many of the properties in our study showed a sufficient potential financial return to attract private-sector interest in a partnership arrangement. Our contractors determined that 8 of the 10 GSA properties in our study were strong to moderate candidates for public-private partnerships. This determination was based on the (1) estimated IRR for the private- sector partner in year 10 of the project, which ranged from 13.7 to 17.7 percent; (2) level of federal demand for the space; and (3) level of nonfederal demand for space. The level of demand for space, both federal and nonfederal, affects the level of risk that the space will be vacant and thus non-income-producing. The stronger the local market is for rental space, the more likely the space will be rented and thus produce income for the partnership. The properties that were strong candidates for partnerships were located in areas with a strong federal and nonfederal demand for space, and many had untapped value that the partnership could utilize, such as excess land on which a new or expanded building could be built. Leasing authority is available to VA and DOD. Under VA’s enhanced use leasing (EUL) authority, an EUL must enhance the use of the property and provide some space for an activity that contributes to VA’s mission or otherwise improves services to veterans. VA receives fair consideration, monetary or in-kind, as determined by the Secretary and the lease term is not to exceed 75 years. For DOD, terms must promote national defense or be in the public interest, and the lease term may not exceed 5 years without the Service Secretary’s approval. The lease proceeds may be used to fund facility maintenance and repair or environmental restoration at the military installation where the property is located and elsewhere. According to VA and DOD, their ventures yield both financial and nonfinancial benefits. Financial benefits include receiving below market rental rates and the receipt of cash revenue in some cases. Nonfinancial benefits include maximizing the use of capital assets as well as in-kind benefits such as the use of a child care center at reduced rates. In 1999, we reported on two projects under the VA’s EUL authority. In Texas, a private developer constructed a VA regional office building on VA’s medical campus. VA then leased land to the developer on the medical campus and the developer constructed buildings on the land and rented space in them to commercial businesses. In Indiana, the state leased underutilized land and facilities from VA to use as a psychiatric care facility. The leasing revenue that VA receives from both sites is to be used to fund veterans programs. Aside from the work we did in connection with our 1999 report, it is important to note that we did not explore these authorities in depth, nor did we examine the budget scoring implications for projects undertaken based on these authorities. Currently, we are examining DOD’s implementation of its authority to lease non-excess property and how the military services are using this and other special legislative authorities to reduce base operating support costs. We expect this work to be completed early next year. This concludes my prepared statement. I would be happy to respond to any questions you may have. For information about this testimony, please contact Bernard Ungar, Director, Physical Infrastructure Issues, on (202) 512-8387. Individuals making key contributions to this testimony included Ron King, Maria Edelstein, and Lisa Wright-Solomon. Notes Army Corps of Engineers believes that it must relocate to a facility that meets seismic standards $(207,980) Delegated building—IRS pays its operating costs $(1,003,372) To identify the potential benefits to the federal government and private sector of allowing federal agencies to enter into public-private partnerships, we hired contractors to develop and analyze hypothetical partnership scenarios for 10 selected GSA buildings. GSA’s National Capital Region had previously contracted for a study to analyze the financial viability of public-private partnership ventures for three buildings in Washington, D.C. Because the majority of the work for these properties had already been done, we had the contractor update its work on these 3 buildings and selected them as 3 of the 10 GSA properties. To help us select the other 7 properties for our study, GSA provided a list of 36 properties that it considered good candidates for public-private partnerships. In preparing this list of properties, GSA officials said that they considered factors such as the strength of the real estate market in each area, the extent to which the property was currently utilized or had land that could be utilized, and the likelihood of receiving appropriations to rehabilitate the property in the near future. We judgmentally selected seven properties from this list to include properties (1) from different geographic areas of the country, (2) of different types and sizes, and (3) with historic and nonhistoric features. To analyze the potential viability of public-private partnerships for each of the 10 selected GSA properties, the contractors analyzed the local real estate markets, created a hypothetical partnership scenario and redevelopment plan, and constructed a cash flow model. In the contractor’s judgment, the partnership scenarios were structured to meet current budget-scoring rules and provisions in H.R. 3285, introduced in the 106th Congress. These provisions included the requirements that the property must be available for lease, in whole or in part, by federal agreements do not guarantee occupancy by the federal government; the government will not be liable for any actions, debts, or liabilities of any person under an agreement; and leasehold interests of the federal government are senior to those of any lender of the nongovernmental partner. However, a determination on how the partnerships would be treated for budget-scoring purposes would have to be made after more details are available on the partnerships. We accompanied the contractor on visits to the seven GSA properties that had not been previously studied. We interviewed, or participated in discussions with, developers and local officials in the areas where the properties were located as well as officials from GSA. We reviewed the contractors’ work on the 10 properties for reasonableness but did not verify the data used by the contractors. The partnership viability scenarios developed for this assignment are hypothetical, and were based on information that was made readily available by representatives of the local real estate markets, city governments, and GSA. Any actual partnerships involving these properties may be very different from these scenarios. In-depth feasibility studies must be done to evaluate partnership opportunities before they are pursued. There may be other benefits and costs that would need to be considered, such as the possible federal tax consequences and the costs of vacating property during renovation in some cases. This study only looked at the potential benefits to the federal government and private sector of public-private partnerships as a management tool to address problems in deteriorating federal buildings. We did not evaluate the potential benefits of other management tools that may be available for this purpose. We did, however, discuss the implications of using public- private partnerships with OMB representatives. We did our work between November 2000 and June 2001 in accordance with generally accepted government auditing standards.

This testimony describes the benefits to the federal government of public-private partnerships on real property. Under these partnerships, the private sector finances the renovation or redevelopment of real property contributed by the federal government. Each partner then shares in the net cash flow. Key factors typically considered in public-private partnerships are whether the properties are in areas with a strong real estate market or strong demand for office space. As a result of these partnerships, the federal government can potentially gain efficient, repaired space, and properties that were once a net cost to the government can become revenue producers. This testimony summarized a July report (GAO-01-906).

In May 2001, the Subcommittee’s predecessor held a hearing on USAID financial management. Using that hearing as a baseline, we evaluated, using primarily USAID IG reports, the progress made to improve USAID’s financial management systems, processes, and human capital (people) in the past 2 years. At the time of the May 2001 hearing, USAID was one of three federal agencies subject to the CFO Act that had such significant problems that they were unable to produce financial statements that auditors could express an opinion on. The hearing focused on actions needed to resolve USAID’s financial management issues. At that time, the Acting Assistant Administrator for the Bureau of Management told the Subcommittee that actions to correct reported material weaknesses in financial management were completed or in process and that all reported weaknesses would be resolved by 2002. While USAID has made progress in its financial management since that hearing, it has not achieved the success that it had expected. Rather, its progress relates primarily to improved opinions on USAID’s financial statements. Table 1 below shows that USAID has been able to achieve improved opinions on its financial statements over the past 3 years. Fiscal year 2001 marked the first time that the USAID IG was able to express an opinion on three of USAID’s financial statements—the Balance Sheet, Statement of Changes in Net Position, and Statement of Budgetary Resources. However, as noted above, the opinions were qualified and achieved through extensive efforts to overcome material internal control weaknesses. Further, the IG remained unable to express an opinion on USAID’s Statement of Net Cost and Statement of Financing. Fiscal year 2002 marked additional improvements in the opinions on USAID’s financial statements. All but one of USAID’s financial statements received unqualified opinions. The Statement of Net Cost received a qualified opinion. The IG reported that “…on the Statement of Net Cost, the opinion was achieved only through extensive effort to overcome material weaknesses in internal control” and “lthough these efforts resulted in auditable information, did not provide timely information to USAID management to make cost and budgetary decisions throughout the year.” Compounding USAID’s systems difficulties has been the lack of adequate financial management personnel. Since the early 1990s, we have reported that USAID has made limited progress in addressing its human capital management issues. A major concern is that USAID has not established a comprehensive workforce plan that is integrated with the agency’s strategic objectives and ensures that the agency has skills and competencies necessary to meet its emerging foreign assistance challenges. While a viable financial management system is needed, and offers the capacity to achieve reliable data, it is not the entire answer for improving USAID’s financial management information. Qualified personnel must be in place to implement and operate these systems. In addition to the improved opinions for fiscal year 2002, the IG reported that while USAID had made improvements in its processes and procedures, a substantial number of material weaknesses, reportable conditions, and noncompliance with laws and regulations remain. The report also noted that USAID’s financial management systems do not meet federal financial system requirements. Table 2 shows that while USAID’s opinions on its financial statements improved, reported material weaknesses, reportable conditions, and noncompliance increased. The increase in reported material weaknesses, reportable conditions, and noncompliance is, in part, due to the full scope audits that were not possible in prior years. As financial information improved over the years, it has assisted the USAID IG in identifying additional internal control and system weaknesses. Identifying these additional weaknesses is constructive in that they highlight areas that management needs to address in order to improve the overall operations of the agency and provide accurate, timely, and reliable information to management and the Congress. Several of the weaknesses reported by the USAID IG are chronic in nature and resolution has been a challenge. For example, similar to the USAID fiscal year 2002 material weakness, in 1993 we reported that USAID did not promptly and accurately report disbursements. At that time, USAID could not ensure that disbursements were made only against valid, preestablished obligations and that its recorded unliquidated obligations balances were valid. Additionally, we reported USAID did not have effective control and accountability over its property. The chronic nature of the reported weaknesses at USAID reflect challenges with people (human capital), processes, and financial management systems. USAID management represented to us that, over time, they have lost a significant number of staff in this area and face challenges recruiting and retaining financial management staff. Further, according to IG representatives, many of the individuals that financial managers must depend on to provide the data that are used for financial reports are not answerable to the financial managers and often do not have the background or training necessary to report the data accurately. Also contributing to the challenge are USAID’s nonintegrated systems that require data reentry, supplementary accounting records, and lengthy and burdensome reconciliation processes. Transforming USAID’s financial and business management environment into an efficient and effective operation that is capable of providing management and the Congress with relevant, timely, and accurate information on the results of operation will require a sustained effort. Improved financial systems and properly trained financial management personnel are key elements of this transformation. While these challenges are difficult, they are not insurmountable. Without sustained leadership and oversight by senior management, the likelihood of success is diminished. In its fiscal year 2002 Performance and Accountability Report, USAID noted that it was in the process of implementing an agencywide financial management system. USAID reported that the system has been successfully implemented in Washington. In June 2003, USAID awarded a contract for the implementation of the system overseas. According to USAID officials, they anticipate this effort to be completed by fiscal year 2006. While we are encouraged by USAID’s progress toward implementing an integrated system, it should be noted that this is the second attempt in the past 10 years to implement an agencywide integrated financial management system. To provide reasonable assurance that the current effort is successful, top management must be actively involved in the oversight of the current project. Management must have performance metrics in place to ensure the modernization effort is accomplished on time, within budget, and provides the planned and needed capabilities. In this regard, in fiscal year 2002, USAID redesigned its overall governance structure for the acquisition and management of information technology. Specifically, USAID created the Business Transformation Executive Committee, chaired by the Deputy Administrator and with membership including key senior management. The committee’s purpose is to provide USAID-wide leadership for initiatives and investments to transform USAID business systems and organizational performance. The committee’s roles and responsibilities include: Guiding business transformation efforts and ensuring broad-based cooperation, ownership, and accountability for results. Initiating, reviewing, approving, monitoring, coordinating, and evaluating projects and investments. Ensuring that investments are focused on highest pay-off performance improvement opportunities aligned with USAID’s programmatic and budget priorities. Active, substantive oversight by this committee over USAID’s information technology investments, including its agencywide integrated financial management system initiative, will be needed for business reform efforts to succeed. In addition to improved business systems, it is critical that USAID have sustained financial management leadership and the requisite personnel and skill set to operate the system in an efficient and effective manner once it is in place. We have reported for years and USAID acknowledges that human capital is one of the management challenges that must be overcome. As previously noted, since the early 1990s we have reported that USAID has made limited progress in addressing its human capital management issues. Within the area of financial management, progress in this area has also been slow, with no specific plan of action on how to address shortages of trained financial managers. USAID represented to us that as part of its agencywide human capital strategy, it plans to specifically address its financial management personnel challenges. In addition to addressing systems and human capital challenges, USAID is working to improve its processes and internal controls. Effective processes and internal controls are necessary to ensure that whatever systems are in place are fully utilized and that its operations are as efficient and effective as possible. USAID is working to eliminate the material weaknesses, reportable conditions, and noncompliance reported by the USAID IG in fiscal year 2002. For fiscal year 2003, the Administrator of USAID and the IG agreed to work together to provide for the issuance of audited financial statements by November 15, 2003, in line with the Office of Management and Budget’s accelerated timetable for reporting. To meet this tight timeframe, the CFO must provide timely and reliable information that can withstand the test of audit with little to no needed adjustment. However, given the continued financial management system, process, and human capital challenges, meeting this goal will be difficult. USAID appears to be making a serious attempt to reform its financial management, as evidenced by initiatives to improve its human capital, internal controls, and business systems. However, progress to date is most evident in the improvement in the opinions on its financial statements, which reflect USAID’s ability to generate reliable information one time a year, rather than routinely for purposes of management decision making. Through fiscal year 2002 these improved opinions reflect a significant “heroic” effort to overcome human capital, internal control, and systems problems. Although these improved opinions represent progress, the measures of fundamental reform will be the ability of USAID to provide relevant, timely, reliable financial information and sound internal controls to enable it to operate in an efficient and effective manner. Mr. Chairman, this concludes my statement. I would be pleased to answer any questions you or other members of the Subcommittee may have at this time. For further information about this testimony, please contact Gregory D. Kutz at (202) 512-9095 or kutzg@gao.gov or John Kelly at (202) 512-6926 or kellyj@gao.gov. Other key contributors to this testimony include Stephen Donahue, Dianne Guensberg, and Darby Smith. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

GAO has long reported that the U.S. Agency for International Development (USAID) faces a number of performance and accountability challenges that affect its ability to implement its foreign economic and humanitarian assistance programs. These major challenges include human capital, performance measurement, information technology, and financial management. Effective financial management as envisioned by the Chief Financial Officers Act of 1990 (CFO Act) and other financial management reform laws is an important factor to the achievement of USAID's mission. USAID is one of the federal agencies subject to the CFO Act. In light of these circumstances, the Subcommittee on Government Efficiency and Financial Management, House Committee Government Reform asked GAO to testify on the financial management challenges facing USAID, as well as the keys to reforming USAID's financial management and business practices and the status of ongoing improvement efforts. USAID has made some progress to improve financial management, primarily in achieving audit opinions on its financial statements. Through the rigors of the financial statement audit process and the requirements of the Federal Financial Management Improvement Act of 1996 (FFMIA), USAID has gained a better understanding of its financial management weaknesses. However, pervasive internal control weaknesses continue to prevent USAID management from achieving the objective of the CFO Act, which is to have timely, accurate financial information for day-to-day decision making. USAID's inadequate accounting systems make it difficult for the agency to accurately account for activity costs and measure its program results. Compounding USAID's systems difficulties has been the lack of adequate financial management personnel. Since the early 1990s, we have reported that USAID has made limited progress in addressing its human capital management issues. While some improvements have been made over the past several years, significant challenges remain. Transforming USAID's financial and business environment into an efficient and effective operation that is capable of providing timely and accurate information will require a sustained effort. USAID has acknowledged the challenges it faces to reform its financial management problems and has initiatives underway to improve its systems, processes, and internal controls. USAID has also recognized the need for a specific human capital action plan that addresses financial management personnel shortfalls.

The Knutson-Vandenberg Trust Fund, as authorized by the Act of June 9, 1930, as amended (16 U.S.C. 576-576b), allows portions of the receipts from timber sales to be deposited into the K-V Fund to be used to reforest timber sale areas. In addition to being used for planting trees, these deposits may also be used for eliminating unwanted vegetation and for protecting and improving the future productivity of the renewable resources on forest land in sale areas, including sale area improvement operations, maintenance, construction, and wildlife habitat management. Reforestation is needed where timber harvests or natural disasters have depleted the existing timber stands. In fiscal year 1997, about $166 million was expended from the K-V Fund for reforestation and related projects. The majority of the K-V moneys—about $115 million in fiscal year 1997—was used to fund direct reforestation activities. In addition to the direct reforestation expenditures, about $51 million was used for costs incurred to support and manage the reforestation program, such as rents, utilities, computer equipment, or the salaries of program support staff. Federal law permits the Forest Service to transfer amounts from the K-V Fund, as well as other Forest Service appropriations, to supplement the Forest Service’s firefighting funds when emergencies arise. The Forest Service is authorized to advance money from any of its appropriations and trust funds to pay for fighting forest fires. The Forest Service is not authorized to restore amounts so transferred. Congressional action is required to restore such funds. The Forest Service’s oversight and management of the K-V Fund and the reforestation program are decentralized. Forest Service headquarters and the nine regional offices establish policy and provide technical direction to forest offices. The forest offices, in turn, provide general oversight to district offices and help the districts plan K-V projects. The district ranger is responsible for overseeing the planning and implementation of K-V projects. Between 1990 and 1996, the Forest Service transferred about $645 million from the K-V Fund for emergency firefighting activities that had not been fully reimbursed. Since these transfers had not been reimbursed, these funds were unavailable for K-V projects. In the past, when such transfers were made, the Department of Agriculture requested and received supplemental appropriations to restore the transferred moneys, generally within 2 years of the original transfer. However, in more recent time, the Department of Agriculture had not submitted a request for a supplemental appropriation to the Congress. It was not until March 15, 1996, that the Department of Agriculture submitted a request for supplemental appropriations to the Office of Management and Budget for the $420 million transferred during fiscal years 1990, 1992, and 1995. After an additional $225 million was transferred from the K-V Fund in 1996, the Congress, in 1997, provided $202 million from the emergency firefighting appropriation as a partial reimbursement of the K-V Fund. At the beginning of fiscal year 1998, the K-V Fund had an unrestored balance of about $493 million. To provide the Congress with the information it needs to consider any future requests for appropriations to restore previously transferred funds, we recommended that the Secretary of Agriculture report to the Congress on the financial status of the K-V Fund. The Department of Agriculture has informed the Congress about the general dimensions of the K-V funding issue on several occasions, and that information has resulted in some replenishment of the K-V Fund. For example, the Fiscal Year 1997 Omnibus Appropriation Bill provided additional appropriations for emergency firefighting, and $202 million was apportioned to the K-V Fund in January 1997. In addition, the Department has begun providing the Congress with information on the K-V Fund balance at the beginning of each fiscal year, expected K-V collections during the year, and expected K-V expenditures so that the impact of future firefighting transfers can be assessed. Although the Forest Service acknowledged that failure to restore the amounts transferred from the K-V Fund would potentially disrupt the K-V program, forest and district offices continued to operate and plan for future reforestation projects as if the transfers had not occurred. Furthermore, the Forest Service had not informed the Congress of the impact that the funding shortfall would have on the agency’s reforestation activities or developed a plan or strategy for reallocating the remaining funds to the highest-priority projects. Although timber receipts of as much as $200 million had been added to the fund annually, the Forest Service will not be able to pay for all of its planned projects, estimated in fiscal year 1996 at about $942 million, unless the moneys transferred from the K-V Fund for firefighting purposes are restored. We recommended that if the administration decides not to forward to the Congress the Department’s request for restoration of the funds transferred for firefighting purposes, or the Congress decides not to restore these funds during the fiscal year 1997 budget considerations, the Secretary of Agriculture should direct the Chief of the Forest Service, by the end of fiscal year 1997, to revise the list of planned K-V projects to take into account the actual balance in the K-V Fund. The Department has not implemented this recommendation and believes that the Forest Service had sufficient funding to meet all K-V requirements for 1998 and that revising the list of K-V projects downward to match the reduced K-V funding would be both speculative and not creditable. The Department added that it would not require such a list until it was certain that K-V funding for the year was inadequate. In that event, it would provide the Congress with a generic description of the types of K-V activities that would be dropped. The K-V Act requires that the K-V Fund expenditures in any one sale area not exceed the amount collected in that sale area. To facilitate the management of K-V projects and the accounting for K-V funds, however, the Forest Service allows each forest to pool its K-V collections for each timber sale into a forest-level fund, commonly called a K-V pool. At the end of each fiscal year, each forest is required to create a balance sheet showing the cash available for its K-V projects, the projected collections from ongoing sales, and the estimated costs for planned projects. The Forest Service does not have the financial management information and controls needed to ensure compliance with the K-V Act prohibition limiting K-V Fund expenditures on individual sale areas to the collections from those same sale areas. Collections are recorded for individual sales, whereas expenditures are managed and recorded in total at the district level rather than by individual sales. By allowing each forest to pool K-V collections without adequate financial controls and information, the Forest Service cannot ensure that trust fund expenditures do not exceed collections for a given sale area. We recommended that the Secretary of Agriculture direct the Chief of the Forest Service to perform, in consultation with the Chief Financial Officer, an analysis of alternatives (including the costs and benefits of each alternative) to obtain the financial data necessary to ensure that the K-V Fund’s expenditures in one sale area are limited to the amounts collected from that area, as required by the K-V Act. The Secretary of Agriculture did not request that the Forest Service analyze alternatives to the sale-by-sale accounting system that would ensure compliance with the K-V Act. The Secretary indicated that he did not believe such an analysis was necessary and that the current Forest Service methods fulfilled requirements of the K-V Act. We continue to believe that the Forest Service’s current information systems and controls do not provide assurance that the expenditures in one sale area do not exceed the collections from that sale area as required by law. The Forest Service collects a certain amount of K-V funds on each timber sale to pay for the costs of supporting the program at all organizational levels. The regions and forests issue guidance that specifies the percentage of K-V funds that should be collected from individual sale areas to support the program at the forest, regional, and Washington offices. The agency’s overall guidance, however, does not explain how individual regions or forests should calculate and limit amounts for program support. If the allocations for support costs are not limited to the amount collected, however, funds available for project expenditures in sale areas could be insufficient. Only one forest we visited during our 1996 review limited its use of K-V funds for program support to the amounts collected for that purpose. For three of the forests, the regions did not restrict their expenditures for program support to the amounts that had been collected, nor did the forests limit the amount spent for program support at the forest level. For example, if a project costs $100, the forest might instruct the district to collect an additional 20 percent of the project’s cost, or $20, to cover the cost of supporting the program. When the forest allocated funds for a project to the district, it withheld funds to cover the forest’s support costs. However, rather than limiting these withholdings—to continue our example—to 20 percent of the project’s cost, or $20, the forest would withhold 20 percent of the total cost ($120) or $24. This method of determining support costs would reduce the amount available for project work to $96, $4 less than the projected need. We recommended that the Secretary of Agriculture direct the Chief of the Forest Service to require all organizational levels to use a standardized methodology for assessing and withholding the support costs for the K-V program that would limit expenditures for program support to the amounts collected for such purposes. The Secretary of Agriculture directed the Chief of the Forest Service to establish a standardized methodology for assessing and withholding program support costs for the K-V program, and the Forest Service formed a task force to recommend what that standardized methodology would be. The task force completed its work in November 1997, and the Forest Service estimates that the corrective action will be fully implemented when the recommended changes become part of the agency’s directives in September 1998. Mr. Chairman, on the basis of the Department of Agriculture’s response to our recommendations, it appears that it has taken positive actions on our recommendations to better inform the Congress about the magnitude of transfers from the K-V Fund for firefighting purposes and the need to establish a standardized methodology for assessing and withholding program support costs for the K-V program. The Department of Agriculture has not implemented our recommendations concerning revising the list of K-V projects downward because of inadequate funding or performing an analysis of alternatives to a sale-by-sale accounting of K-V Fund expenditures. We continue to believe that action is needed in these areas. We will be pleased to respond to any questions that you or the Members of the Subcommittee may have. The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and MasterCard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent. U.S. General Accounting Office P.O. Box 37050 Washington, DC 20013 Room 1100 700 4th St. NW (corner of 4th and G Sts. NW) U.S. General Accounting Office Washington, DC Orders may also be placed by calling (202) 512-6000 or by using fax number (202) 512-6061, or TDD (202) 512-2537. Each day, GAO issues a list of newly available reports and testimony. To receive facsimile copies of the daily list or any list from the past 30 days, please call (202) 512-6000 using a touchtone phone. 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Pursuant to a congressional request, GAO discussed the shortcomings in the Forest Service's administration of the Knutson-Vandenberg Trust Fund (K-V Fund), focusing on the: (1) transfers from the K-V Fund that have not been fully restored; (2) effect of unrestored transfers on planned projects; (3) lack of financial information to ensure compliance with the K-V Act requirements; and (4) lack of a standardized methodology for calculating and limiting program support costs. GAO noted that: (1) between 1990 and 1996, $645 million was transferred from the K-V Fund to support emergency firefighting activities that was not reimbursed; (2) to assist Congress in its consideration of any future requests for appropriations to restore previously transferred funds, GAO recommended that the Secretary of Agriculture report to Congress on the financial status of the K-V fund; (3) the Department has begun providing Congress with additional information on the financial status of the K-V Fund; (4) in fiscal year 1997, Congress acted upon that information by providing $202 million to partially repay moneys transferred from the K-V Fund; (5) the Secretary of Agriculture has not directed the Forest Service to revise the list of planned K-V projects to take into account the actual balance in the K-V Fund; (6) although the K-V Act requires that K-V Fund expenditures in one sale area be limited to amounts collected in the same area, the Forest Service does not collect expenditure data on a sale-by-sale basis; (7) GAO recommended that the Secretary of Agriculture direct the Forest Service to perform an analysis of alternatives to obtain the financial data necessary to ensure that the K-V Fund's expenditures in one sale area are limited to the amounts collected from that area, as required by the K-V Act; (8) the Secretary of Agriculture indicated that such an analysis was not necessary and that the current Forest Service methods fulfilled the requirements of the K-V Act; (9) at the time of GAO's 1996 report, the Forest Service did not have a system in place to ensure the consistent handling of program support charges for the K-V program agencywide; and (10) since that time, the Forest Service has completed an analysis of the methodological changes that are needed to standardize the Forest Service's practices for assessing and withholding program support costs for the K-V program and the results of the agency's work should be implemented when the practices become part of the Forest Service's directives in September 1998.

Jared Lee Loughner was arrested on January 10, 2011, on a complaint charging him with attempting to kill a Member of Congress and of killing and attempting to kill federal officers and employees in the performance of the their official duties in violation of 18 U.S.C. 351(c), 1114, 1111, and 1113. What follows is a description of the federal procedures and attendant legal provisions generally associated with the prosecution of such cases. Comparable attributes of state law are beyond the scope of this report. If probable cause exists to believe that Mr. Loughner committed the offenses charged, he may be prosecuted under state or federal law or both. Ordinarily, federal crimes of violence are also crimes under the laws of the state in which they occur. Nevertheless, at first glance, the Constitution's double jeopardy ban might be thought to preclude prosecution by both state and federal authorities. The ban, however, only applies when the same defendant is prosecuted for the same crime by the same sovereign . Following the Oklahoma City bombing, Timothy McVeigh and Terry Nichols were prosecuted and convicted in federal court. Mr. Nichols, who unlike Mr. McVeigh had not been sentenced to death following his federal conviction, was subsequently tried and convicted for the bombing and resulting deaths in Oklahoma state court. First degree murders committed in violation of 18 U.S.C. 1114 are punishable by death or imprisonment for any term of years or for life. The decision to seek the death penalty rests ultimately with the Attorney General. A number of procedural consequences flow from the prosecutor's decision to seek the death penalty. When the prosecutor believes the circumstances justify the death penalty, he must notify the court and the defendant prior to trial or prior to the court's acceptance of the defendant's guilty plea, if the defendant elects to forgo a trial. Federal law permits imposition of the death penalty when authorized by statute as in the case of the first degree murder of a federal official or employee during the performance of his duties. In such cases, imposition of the death penalty requires a finding of at least one aggravating factor. The statutory list of aggravating factors includes instances, for example, when (1) the death occurred during the course of an assault on a Member of Congress or some other designated felony; (2) the homicide was committed in a particular heinous, cruel, or depraved manner; (3) a federal judge was a victim of the offense; (4) the defendant killed or attempted to kill more than one person in a single criminal episode; or (5) when "any other aggravating factor for which notice has been given exists." The Constitution affords defendants charged with a federal felony or capital offense the right to grand jury indictment. Although a defendant charged only with noncapital offenses may waive the right to grand jury indictment, capital offenses will ordinarily be prosecuted by indictment. When the prosecutor intends to seek the death penalty, the indictment must include the aggravating factors upon which the government intends to rely. The defendant in capital cases is entitled, upon request, to the assignment of two counsel, at least one of whom is "learned in the law applicable to capital cases." The right attaches at least upon indictment. Most appellate courts have concluded that the government's decision not to seek the death penalty extinguishes the statutory right. In addition to counsel, the court may authorize payment for investigative, expert, and other services "reasonably necessary" for the defense of an indigent defendant. The Sixth Amendment guarantees the criminally accused "the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed." In doing so, it reinforces the declaration which appears earlier in Article III: "The trial of all Crimes, except in Cases of Impeachment, shall be by Jury; and such Trials shall be held in the State where the said Crimes shall have been committed." In order to secure trial by an impartial jury in a high profile case, an accused may feel compelled to not be tried in, or by a jury of, the place where the crime occurred. In rare instances, the proximity, extent, and character of pretrial media coverage may be such that the courts will presume that trial by an impartial jury in a particular location is impossible. The Federal Rules of Criminal Procedure acknowledge such a possibility by providing that "Upon the defendant's motion, the court must transfer the proceeding against that defendant to another district if the court is satisfied that so great a prejudice against the defendant exists in the transferring district that the defendant cannot obtain a fair trial there." The anticipated trial of Timothy McVeigh in Oklahoma after the Oklahoma City bombing presented such a case. His actual trial in Denver did not. Exceptional cases of extraordinary circumstances aside, however, the courts will ordinarily seek other means to secure trial by an impartial jury—granting continuances, instructing prospective jurors to avoid further pretrial publicity, imposing secrecy orders upon the participants, and questioning potential jurors thoroughly to ensure their impartiality (voir dire)—before granting a request for a change of venue as a last resort. Justice Department guidelines generally describe the types of information which prosecutors may release concerning a criminal case and the types of prejudicial information which they should not. Local Rules of Criminal Procedure of the U.S. District Court for Arizona contain similar provisions applicable to prosecutors and defense counsel alike and authorize the court to make special efforts in "widely publicized or sensational criminal case[s]." The courts are loath to deny the press and the public access to judicial proceedings and records, particularly those that have historically been publicly available. Yet in the face of substantial countervailing interests, they will close proceedings and seal records. In the Timothy McVeigh prosecution, the court took several steps in the name of jury impartiality among others. It prohibited (1) court personnel from disclosing without court approval any information related to the case that was not part of the public record; and (2) attorneys appearing in the cases and anyone associated with them from public statements or leaking information concerning (a) the defendants' criminal record, character, or reputation; (b) the results of any tests that the defendants had taken or refused to take, or any statements that the defendants had made or refused to make to authorities; (c) the identity of any prospective witnesses or the specifics or creditability of their anticipated testimony; (d) the prospect or specifics of any anticipated or negotiated plea bargain; or (e) any speculation of the guilt, strength of evidence, or merits of the case. The court also placed under seal (a) portions of Mr. Nichols's suppression motion; (b) certain FBI notes relating to its interview of Mr. Nichols; (c) portions of the defendants' motions for severance; (d) the information relating to the compensation for defense services provided prior to trial; (e) transcripts of material witness proceedings; (f) motions and orders relating to Mr. McVeigh's conditions of confinement; and (g) proposed questionnaires for prospective jurors. In the Jared Loughner prosecution, the court only authorized the disclosure of sealed search warrant material after the final indictment had been filed. The insanity defense is an affirmative defense which the defendant must establish by clear and convincing evidence. It is available as a federal criminal defense, when at the time of the commission of the offense, the defendant "as a result of a severe mental disease or defense, was unable to appreciate the nature and quality or the wrongfulness of his acts." A defendant must notify the prosecutor, if he wishes to assert the insanity defense at trial or to introduce expert evidence of a mental disease or defect at trial or at his capital sentencing hearing. Notice of a defendant's intent to claim an insanity defense triggers the obligation of the court to refer the defendant for a psychiatric examination upon the motion of the prosecutor. The Constitution does not permit the criminal trial of a mentally incompetent defendant. It requires that a defendant have the mental capacity "to understand the nature and object of the proceedings against him, to consult with counsel, and to assist in the preparing of his defense." The claim of incompetence to commit the offense in the form of an insanity defense notice raises the question of a defendant's competence to stand trial. Consequently, the Federal Rules authorize the court, in the face of such a claim, to order a psychiatric examination of the accused. If the court determines, after a hearing, that the defendant lacks the competence to stand trial, it may commit him to the custody of the Attorney General for medical treatment. Under narrow circumstances, such treatment may include involuntary medication designed to render a defendant competent to stand trial. The court in the Jared Loughner prosecution granted the government's motion for a psychiatric examination to determine the defendant's competence to stand trial. On May 25, 2011, the court found the defendant incompetent to be tried at the time. Pretrial victims' rights consist primarily of a right to notice, the right to confer, a right to attend, and a right to be heard. For purposes of the federal victim rights statute, a victim is "a person directly and proximately harmed as a result of the commission of a federal offense," and includes "[i]n the case of a crime victim who is under 18 years of age, incompetent, incapacitated, or deceased, the legal guardians of the crime victim or the representatives of the crime's estate, family members, or any other persons appointed as suitable by the court." On its face, the definition does not include victims of state crimes. The statute affords victims the right to "reasonable, accurate, and timely" notice of, and generally not to be excluded from, any public judicial proceedings involving the offense. Victims enjoy a reasonable right to confer with prosecutors. In capital cases, the U.S. Attorneys Manual instructs United States Attorneys to consult with families of victims concerning the decision to seek the death penalty and to notify them of the Attorney General's decision. Victims also have a right to be reasonably heard at public judicial proceedings involving the acceptance of an offender's plea. These rights preclude a court approved failure to notify victims until after a plea agreement has been executed, but they do not give victims the right to veto a proposed plea agreement. Both the prosecution and the defense enjoy pretrial discovery rights. The government's failure to advise the defendant of exculpatory evidence or of evidence that undermines the testimony of its witnesses may undo the defendant's conviction. The prosecution has other disclosure obligations under the Federal Rules, including providing the defense with earlier statements of the defendant in its possession. Each side has an obligation to present, upon request, a summary of expert witness testimony upon which they intend to rely. Rules govern the general attributes and procedures of a federal criminal trial. For example, the federal rules ban cameras from the courtroom. They assure the defendant the right to be present at every stage of the trial, a right he may waive by choice or persistent disruptive behavior. They supply the evidentiary standards within which a trial must be conducted. Yet application of the rules and control of a federal criminal trial rests primarily with the trial judge. "[T]he trial judge has the responsibility to maintain decorum in keeping with the nature of the proceeding; 'the judge ... is the governor of the trial for the purpose of assuring its proper conduct.'" Traditionally, witnesses—even victims—could only be present at trial while they were testifying, lest their testimony be influenced by what they heard before they took the stand. Federal law now gives victims, even if they are also witnesses, "[t]he right not to be excluded from [trial], unless the court, after receiving clear and convincing evidence, determines that testimony by the victim would be materially altered if the victim heard other testimony at that proceeding." In capital cases, the right is reinforced by another statutory prohibition—one against victim exclusion from a trial simply because the victim might provide an impact statement during a subsequent sentencing proceeding. Special procedures apply after a defendant is found guilty of a federal capital offense. A sentencing hearing is held before a jury to determine whether the defendant should be sentenced to death. First, in a murder case, the jury must determine whether the defendant acted with the intent necessary to qualify for imposition of the death penalty. If it does so, the penalty may be imposed only if the jury also finds one or more of a series of aggravating factors and finds that the aggravating factor or factors outweigh any mitigating factors to an extent justifying a sentence of death. As noted earlier, the statutory list of aggravating factors includes instances, for example, when (1) the death occurred during the course of an assault on a Member of Congress of some other designated felony; (2) the homicide was committed in a particular heinous, cruel, or depraved manner; (3) a federal judge was a victim of the offense; (4) the defendant killed or attempted to kill more than one person in a single criminal episode; or (5) when "any other aggravating factor for which notice has been given exists." Mitigating factors include, for example, (1) the defendant's impaired capacity; (2) the absence of a significant prior criminal record; (3) commission of the offense "under severe mental or emotional disturbance." Mitigating factors may also be found "in the defendant's background, record, or character or any other circumstance of the offense." A federal death sentence is subject to appellate review. If upheld, the defendant is committed to the custody of the Attorney General for execution. The sentence of death, however, may not be carried out if the defendant lacks the mental capacity, as a result of mental disability, "to understand the death penalty and why it was imposed." In a capital case when the jury finds the defendant eligible for the death penalty but fails to unanimously recommend the death penalty, the court sentences the defendant to "life imprisonment without possibility of release or some other lesser sentence." When the prosecution elects not to seek the death penalty and when the defendant is convicted of a noncapital offense, the court sentences the defendant, without benefit of a jury. Although the federal Sentencing Guidelines are no longer binding, noncapital sentencing begins there. The Guidelines provide a series of sentencing ranges beneath the statutory maximum for the offense of conviction, calibrated to reflect the seriousness of the offense and the extent of the defendant's criminal record. A sentencing court, with reasonable justification, may sentence a defendant outside the applicable Guideline recommended sentencing range. Victims have a right to be reasonably heard during the capital sentencing hearing. Victims of a federal crime of violence are also entitled to an order of restitution, covering the cost of medical expenses, rehabilitation costs, and, in the case of a homicide, funeral expenses. Victims do not have a right to attend the execution of a defendant convicted of murdering a family member, although they may do so at the discretion of the Director of the Bureau of Federal Prisons and, to a more limited extent, at the discretion of the Warden.

Jared Lee Loughner was arrested for the attempted murder of Representative Gabrielle Giffords, the murder of United States District Court Judge John Roll, and the murder or attempted murder of several federal employees. The arrest brings several features of federal law to the fore. Federal crimes of violence are usually violations of the law of the state where they occur; an offender may be tried in either federal or state court or both. Ordinarily, federal crimes must be tried where they occur, but in extraordinary cases a defendant's motion for a change of venue may be granted. In capital cases, the decision to seek the death penalty rests with the Attorney General. Should a defendant elect to assert an insanity defense, he must provide pretrial notification. In the face of that notice, the court may order an examination to determine the defendant's competence to stand trial. Federal law affords victims, including families of the deceased or incapacitated, the right to confer with prosecutors, and to attend the trial and other public judicial proceedings. Defendants, convicted of a murder for which the prosecution seeks the death penalty, are entitled to a jury determination of whether they acted with the intent necessary to qualify for the death penalty and whether the balance of aggravating and any mitigating factors are sufficient to warrant the jury's recommendation that the defendant be put to death. Defendants, convicted of attempted murder or some other noncapital offense, are sentenced by the court without the benefit of a jury. Sentencing in such cases begins with the federal Sentencing Guidelines, from whose recommendations a sentencing court may depart only with reasonable justification. Comparable provisions of state law are beyond the scope of this report.

Before presenting additional preliminary results, I would like to provide some information on our scope and methodology. Specifically, we are interviewing key OWCP and Postal Service officials in Washington, D.C., to discuss and collect pertinent information regarding the employees’ claims for WCP eligibility and for compensation for lost wages and schedule awards. Additionally, we collected and reviewed a total of 483 Postal Service employee WCP case files located at the 12 OWCP district offices throughout the country. For the 12-month period beginning July 1, 1997, we randomly selected the claims and obtained case file records for injuries that occurred or were recognized as job-related during this period on the basis of the type of injury involved: traumatic or occupational; and on the basis of their approval or nonapproval for WCP benefits and compensation or schedule award payments. We chose this period of time because we believed it was current enough to reflect ongoing operations, yet historical enough for most, if not all, of the claims to have been decided upon. Also, in discussing the preliminary results, we generally present our analyses of claim processing times in terms of the “median” time to process cases covered by our review. This means that 50 percent of the cases were processed in the median time or less, and 50 percent of the cases were processed in more time than the median. We did our work from January to May 2002 in accordance with generally accepted government auditing standards. We have not had enough time to fully analyze all of the data we collected, including analyzing the total percentage of claims processed within specified processing standards, or to fully discuss the data with Postal Service or OWCP officials. Accordingly, we are limiting our discussion to median time intervals between the major steps in the WCP claims process up until the time of the decision on the claim and initial compensation payment. Among other things, prior to this hearing, we did not have the time to (1) pinpoint and evaluate specific problems that may have affected the time to process the cases we reviewed, (2) address issues OWCP raised on how the claims processing times might be affected by “administrative closures” or schedule awards, or (3) evaluate numerous other factors that may have affected overall claims processing. Our work has not included an analysis of any time involved in the appeal process of any claim we reviewed, nor did we evaluate the appropriateness of OWCP’s decisions on approving or denying the claims. More detail about our sampling plan is presented in appendix I. Although OWCP is charged with implementing the WCP, there is a federal partnership between OWCP and the employing federal agencies for administering the WCP. In this partnership, federal agencies, including the Postal Service, provide the avenue through which injured federal employees prepare and submit their notice of injury forms and claims for WCP benefits and services to OWCP. Additionally, employing agencies are responsible for paying normal salary and benefits to those employees who miss work for up to 45 calendar days, during a 1-year period, due to a work-related traumatic injury for which they have applied for WCP benefits. After receiving the claim forms from the employing agencies, OWCP district office claims examiners review the forms and supporting evidence to decide on the claimant’s entitlement to WCP benefits or the need for additional information or evidence, determine the benefits and services to be awarded, approve or disapprove payment of benefits and services, and manage and maintain WCP employee case file records. If additional information or other evidence is needed before entitlement to WCP benefits can be determined, OWCP generally corresponds directly with the claimant or the WCP contact at the applicable Postal Service locations. OWCP regulations require that evidence needed to determine a claimant’s entitlement to WCP benefits meet five requirements. These requirements are as follows: 1. The claim was filed within the time limits specified by law. 2. The injured or deceased person was, at the time of injury or death, an employee of the United States. 3. The injury, disease, or death did, in fact, occur. 4. The injury, disease, or death occurred while the employee was in the performance of duty. 5. The medical condition for which compensation or medical benefits is claimed is causally related to the claimed job-related injury, disease, or death. Such evidence, among other things, must be reliable and substantial as determined by OWCP claims examiners. If the claimant submits factual evidence, medical evidence, or both, but OWCP determines the evidence is not sufficient to meet the five requirements, OWCP is required to inform the claimant of the additional evidence needed. The claimant then has at least 30 days to submit the evidence requested. Additionally, if the employer–in this case, the Postal Service–has reason to disagree with any aspect of the claimant’s report, it can submit a statement to OWCP that specifically describes the factual allegation or argument with which it disagrees and provide evidence or arguments to support its position. According to the files we reviewed, about 99 percent of the Postal Service employees’ traumatic injury claims contained evidence related to the five requirements set by OWCP regulations. About 1 percent of the traumatic injury claims were not approved, according to the case files we reviewed, because evidence was not provided for one or more of the requirements. About 97 percent of the claims filed by Postal Service employees for occupational disease claims contained evidence related to the five requirements. The remaining claims, or about 3 percent, did not include all of the required evidence. Generally, the evidence not provided for both types of claims pertained to either (1) the employee’s status as a Postal Service employee or (2) whether the claim was filed within the time limits specified by law. We did not evaluate OWCP’s decisions regarding the sufficiency of the information provided. During the period covered by our review, OWCP regulations required an employee who sustained a work-related traumatic injury to give notice of the injury in writing to OWCP using Form CA-1, “Federal Employee’s Notice of Traumatic Injury and Claim for Continuation of Pay/ Compensation,” in order to claim WCP benefits. To claim benefits for a disease or illness that the employee believed to be work-related, he or she was also required to give notice of the condition in writing to OWCP using Form CA-2, “Notice of Occupational Disease and Claim for Compensation.” Both notices, according to OWCP regulations, should be filed with the Postal Service supervisor within 30 days of the injury or the date the employee realized the disease was job-related. Upon receipt, Postal Service officials were supposed to complete the agency portion of the form and submit it to OWCP within 10 working days if the injury or disease was likely to result in (1) a medical charge against OWCP, (2) disability for work beyond the day or shift of injury, (3) the need for more than two appointments for medical examination/or treatment on separate days leading to time lost from work, (4) future disability, (5) permanent impairment, or (6) COP. OWCP regulations, during the period covered by our review, did not provide time frames for OWCP claims examiners to process these claims. Instead, OWCP’s operational plan for this period specified performance standards for processing certain types of WCP cases within certain time frames. Specifically, the performance standard for processing traumatic injuries specified that a decision should be made within 45 days of its receipt in all but the most complex cases. The performance standards for decisions on occupational disease claims specified that decisions should be made within 6 to 12 months, depending on the complexity of the case. The case files we reviewed indicated that the length of time taken to process a claim–from the date of traumatic injury or the date an occupational disease was recognized as job-related to the date the claimant’s entitlement to benefits was determined–varied widely. For example, we estimate that 25 percent of the claims were processed in up to 48 days for traumatic injury and in up to 78 days for occupational disease. We estimate that 90 percent of the claims were processed in up to 307 days for traumatic injury and in up to 579 days for occupational disease. Finally, we estimate that 50 percent of the claims were processed in up to 84 days for traumatic injuries and in up to 136 days for occupational disease. Specifically, Postal Service employee claims for injuries or diseases covered by our review took the median times shown in table 1 to complete. The median elapsed time taken by Postal Service employees and Postal Service supervisors met the applicable time frames set forth in OWCP regulations. As shown in table 1, the median time taken by Postal Service employees to prepare and submit the claim forms needed to make a determination on their entitlement to WCP benefits for traumatic injuries to the Postal Service supervisor was 2 days from the date of the injury, well within the 30-day time frame set by OWCP regulations. For occupational disease, Postal Service employees signed and submitted the notice of disease form to the Postal Service supervisor in a median time of 26 days from the date the disease was recognized as job-related, or 4 days less than the 30-day time frame set by OWCP regulations. Upon receipt, the Postal Service supervisor then took up to a median time of 11 calendar days–also within the time limit of 10 working days set forth in the regulations–to complete the form and transmit it to OWCP. Also as shown in table 1, once OWCP received the form from the Postal Service, our preliminary analysis showed that OWCP claims examiners processed these notice of injury forms for traumatic injuries in a median time of 59 days to determine a claimant’s entitlement to WCP benefits. As mention earlier, the performance standard for these types of cases was 45 days, or 14 days less than the median time taken. According to OWCP officials, the 59-day median processing time inappropriately included the time during which certain types of claims were “administratively closed,” then reopened later when a claim for compensation was received. We plan to determine the effect to which these types of claims may have affected the processing times as we complete our review. For occupational disease claims, the data showed that OWCP processed these forms at the median time of 63 days, which was within the 6 to 12-month time frame for simple to complex occupational disease cases specified by OWCP’s performance standards. During the period covered by our review, OWCP regulations stated that when an employee was disabled by a work-related injury and lost pay for more than 3 calendar days, or had a permanent impairment, the employer is supposed to furnish the employee with Form CA-7, “Claim for Compensation Due to Traumatic Injury or Occupational Disease.” This form was used to claim compensation for periods of disability not covered by COP as well as for schedule awards. The employee was supposed to complete the form upon termination of wage loss–the period of wage loss was less than 10 days or at the expiration of 10 days from the date pay stopped if the period of wage loss was 10 days or more–and submit it to the employing agency. Upon receipt of the compensation claim form from the employee, the employer was required to complete the agency portion of the form and as soon as possible, but not more than 5 working days, transmit the form and any accompanying medical reports to OWCP. For the period covered by our review, OWCP regulations did not provide time limits for OWCP claims examiners to process these claims. Instead, OWCP’s annual operational plan for the period of our review specified a performance standard for processing wage loss claims. Specifically, the performance standard stated that all payable claims for traumatic injuries– excluding schedule awards–should be processed within 14 days. This time frame was to be measured from the date OWCP received the claim form from the employing agency to the date the payment was entered into the automated compensation payment system. No performance standard was specified for occupational disease compensation claims. The case file data showed that the processing time—from the date the claim for compensation was prepared to the date the first payment was made–varied widely. For example, we estimate that to process 25 percent of the claims, it took up to 28 days for traumatic injuries and up to 32 days for occupational diseases. To process 90 percent of the claims, it took up to 323 days for traumatic injuries and up to 356 days for occupational diseases. To process 50 percent of the claims, it took up to 49 days for the traumatic injuries and up to 56 days for the occupational diseases. Specifically, the median times to process the claims for compensation for the traumatic injury and occupational disease claims covered by our review are shown in table 2. The case files we reviewed did not contain the information that would have enabled us to determine whether the claims for compensation were prepared and filed by the employees within the time frame set forth by OWCP regulations. However, as shown in table 2, once a claim was prepared, at the median time, we found that after receipt of a claim for compensation for a traumatic injury, the Postal Service supervisor completed the agency portion of the form and transmitted it to OWCP in 4 calendar days, which was less than the 5 working days required by OWCP regulations. For occupational disease compensation claims, we found that upon receipt of the claim form from the employee, the Postal Service supervisor took 7 calendar days, which was also within the 5 working day requirement imposed by OWCP regulations, to transmit the claims to OWCP. As also, as shown in table 2, once OWCP received a traumatic injury compensation claim form, the median time for OWCP claims examiners to process the claim was 23 days, which was longer than the 14 days specified by OWCP’s performance standard–excluding schedule awards. However, our data included claims for schedule awards. As mentioned earlier, prior to this hearing we did not have time to evaluate the effect that schedule awards might have had on the median processing time. We plan to do so in our analysis for the final report. For occupational disease claims, our analysis showed that upon receipt, OWCP claims examiners, at the median processing time, took 22 days to make the initial payment for the approved claims. OWCP did not specify a performance standard for occupational disease claims. Finally, our preliminary analysis of case file data showed that during the time between the date of injury or recognition of a disease as job-related, injured employees often (1) continued working in a light-duty capacity, (2) received COP while absent from work, or (3) went on paid annual or sick leave until the time they actually missed work and their pay stopped. In fact, the data showed that the median elapsed time from the date the injury occurred or the disease was recognized as job-related to the beginning date of the compensation period was 98 days for traumatic injuries and 243 days for occupational disease claims. Mr. Chairman, this concludes my prepared statement. I will be pleased to answer any questions you or other Members of the Subcommittee may have. For further information regarding this testimony, please contact Bernard Ungar, Director, or Sherrill Johnson, Assistant Director, Physical Infrastructure Issues, at (202) 512-4232 and (214) 777-5699, respectively. In addition to those named above, Michael Rives, Frederick Lyles, Melvin Horne, John Vocino, Scott Zuchorsky, Maria Edelstein, Lisa Wright- Solomon, Brandon Haller, Jerome Sandau, Jill Sayre, Sidney Schwartz, and Donna Leiss made key contributions to this statement.

In fiscal year 2002, U.S. Postal Service employees accounted for one-third of both the federal civilian workforce and the $2.1 billion in overall costs for the Federal Workers' Compensation Program (WCP). Postal workers submitted half of the claims for new work-related injuries that year. Postal Service employees with job-related traumatic injuries or occupational diseases almost always provided the evidence required to make a determination on their entitlement. In two percent of the cases, the Office of Workers' Compensation Program (OWCP) found that evidence was missing for one or more of the required elements. However, the length of time taken to process claims varied widely even though all were subject to the same OWCP processing standards. OWCP claims examiners took 59 days to process traumatic injury claims after receiving the notice of injury claim forms from the Postal Service--a process that should take 45 days for all but the most complex cases, according to OWCP performance standards. The case files lacked the information necessary to determine whether the claims for compensation were prepared and filed by the employees within the time frame set by OWCP regulations. OWCP claims examiners took 23 days to process traumatic injury compensation claims for wage loss and schedule awards. OWCP's performance standard states that all payable claims should be processed within 14 days from the date of receipt.

By the end of fiscal year 2010, NTIA and RUS awarded grants and loans to 553 broadband projects across the country (see table 1). These projects represent almost $7.5 billion in funds awarded, which exceeds the $7.2 billion provided by the Recovery Act because an agency such as RUS that awards loans can award and obligate funds in excess of its budget authority. NTIA awarded more than $3.9 billion in grant funding to 233 projects for various purposes, including 123 broadband infrastructure projects, 66 public computer center projects, and 44 projects designed to encourage broadband adoption. NTIA reported that the vast majority of its broadband infrastructure projects were investments in middle-mile infrastructure projects, which are intended to provide a link from the Internet backbone to the networks of local broadband service providers, such as cable or phone companies. Based on a budget authority of more than $2.4 billion, RUS awarded funds to 320 projects, including more than $2.3 billion for grants and about $87 million for loans. According to RUS, the budget authority of $87 million for loans supports almost $1.2 billion in total loans, and a combined loan and grant award amount of more than $3.5 billion. According to RUS, the vast majority of its awards and funding amounts went to last-mile projects, which are intended to provide connections from Internet service providers to homes, businesses, or other users. NTIA and RUS awarded the BTOP and BIP grants, loans, and loan/grant combinations in two funding rounds. NTIA and RUS initially proposed using three separate funding rounds during the 18-month window to award the entire $7.2 billion. We reported that under this approach each funding round would operate under a compressed schedule that would impose challenges on applicants in preparing their project applications, as well as on the agencies in reviewing these applications to meet their statutory deadlines. NTIA and RUS subsequently revised their plans and issued the awards in two funding rounds. In the first funding round, which began in July 2009 and ended in April 2010, NTIA and RUS received more than 2,200 applications and awarded 143 grants, loans, and loan/grant combinations totaling almost $2.2 billion to a variety of entities in nearly every state and U.S. territory. In our review of the first funding round, we found that NTIA and RUS, with the help of the agencies’ contractors—Booz Allen Hamilton and ICF International, respectively—consistently substantiated information provided by award recipients in their applications during the first round of funding. We reviewed 32 award recipient applications and found that the agencies consistently reviewed the applications and substantiated the information as specified in the first funding notice. In each of the files, we observed written documentation that the agencies and their contractors reviewed and verified pertinent application materials, and requested additional documentation where necessary. In the second funding round, which began in January 2010 and ended in September 2010, NTIA and RUS received more than 1,700 applications and awarded approximately $5.3 billion in funding for 410 projects. To meet the Recovery Act’s September 30, 2010, deadline for awarding broadband funds, NTIA and RUS streamlined their application review processes by issuing separate funding notices that targeted different types of infrastructure projects and reduced the number of steps in the due- diligence review process. NTIA also reduced the basic eligibility factors for BTOP grants from five to three, moved from a largely unpaid to a paid reviewer model to ensure that reviews were conducted in a timely fashion, and decreased the number of reviewers per application from three to two. Although NTIA officials reported that these steps allowed the agency to complete the initial portion of its review ahead of schedule, we have not evaluated the thoroughness of the revised evaluation process used by the agencies in the second round of funding. We previously reported that NTIA and RUS face several challenges to successfully overseeing the broadband programs. These challenges include: Number and scale of projects. NTIA and RUS will need to monitor and oversee a combined total of 553 projects that are diverse in scale, scope, and technology. The agencies funded several types of broadband projects dispersed nationwide, with at least one project in every state. NTIA funded middle-mile broadband infrastructure projects for unserved and underserved areas, public computer centers, and sustainable broadband adoption projects. RUS funded both last- and middle-mile infrastructure projects in rural areas across the country. The agencies funded projects using multiple types of technology, including wireline, wireless, and satellite. In addition, the agencies awarded funds to many large projects, which may pose a greater risk for misuse of federal funds than smaller projects. One of RUS’s largest projects provided more than $81 million in grant funding and $10 million in loan funding to the American Samoa Telecommunications Authority to replace old copper infrastructure with a fiber-optic network to link the main islands of American Samoa; RUS reported that this project will make broadband services available to 9,735 households, 315 businesses, and 106 anchor institutions, and create an estimated 2,000 jobs. One of NTIA’s largest BTOP projects received more than $154 million, which was awarded to Los Angeles region public safety agencies to deploy a public safety mobile broadband network across Los Angeles County to enable services such as computer-aided dispatch, rapid law-enforcement queries, real-time video streaming, and medical telemetry and patient tracking, among others. Adding to these challenges, NTIA and RUS must ensure that the recipient constructs the infrastructure project in the entire project area, not just the area where it may be most profitable for the company to provide service. For example, the Recovery Act mandates that RUS fund projects where at least 75 percent of the funded area is in a rural area that lacks sufficient access to high-speed broadband service to facilitate rural economic development; these are often rural areas with limited demand, and the high cost of providing service to these areas make them less profitable for broadband providers. Companies may have an incentive to build first where they have the most opportunity for profit and leave the unserved parts of their projects for last in order to achieve the highest number of subscribers as possible. To ensure that Recovery Act funds reach hard-to- serve areas, recipients must deploy their infrastructure projects throughout the proposed area on which their award was based. Providing oversight after Recovery Act funding has ceased. BTOP and BIP projects must be substantially complete within 2 years of the award date and fully complete within 3 years of the award date. As a result, some projects are not expected to be completed until 2013. As we previously reported, NTIA and RUS officials maintain that site visits, in particular, are essential to monitoring progress and ensuring compliance. However, the Recovery Act did not provide specific funding for the administration and oversight of BTOP- and BIP-funded projects beyond September 30, 2010. To effectively monitor and oversee more than $7 billion in Recovery Act broadband funding, NTIA and RUS will have to devote sufficient resources, including staffing, to ensure that recipients fulfill their obligations. Because of these challenges, in our 2009 and 2010 reports, we recommended that NTIA and RUS take several actions to ensure that funded projects receive sufficient oversight: 1. NTIA and RUS should develop contingency plans to ensure sufficient resources for oversight of funded projects beyond fiscal year 2010. Furthermore, we recommended that the agencies incorporate into their risk-based monitoring plans, steps to address the variability in funding levels for postaward oversight beyond September 30, 2010. 2. NTIA and RUS should use information provided by applicants in the first funding round to establish quantifiable, outcome-based performance goals by which to measure program effectiveness. 3. NTIA should determine whether commercial entities receiving BTOP grants should be subject to an annual audit requirement. NTIA and RUS have taken several actions to address these recommendations and improve oversight of funded projects. These actions include: NTIA and RUS developed oversight plans. NTIA has developed and is beginning to implement a postaward framework to ensure the successful execution of BTOP. This framework includes three main elements: (1) monitoring and reporting, (2) compliance, and (3) technical assistance. As part of its oversight plans, NTIA intends to use desk reviews and on-site visits to monitor the implementation of BTOP awards and ensure compliance with award conditions by recipients. NTIA also plans to provide technical assistance in the form of training, Webinars, conference calls, workshops, and outreach for all recipients of BTOP funding to address any problems or issues recipients may have implementing the projects, as well as to assist in adhering to award guidelines and regulatory requirements. Additionally, RUS is putting into place a multifaceted oversight framework to monitor compliance and progress for recipients of BIP funding. Unlike NTIA, which is developing a new oversight framework for BTOP, RUS plans to use the same oversight framework for BIP that it uses for its existing grant and loan programs. The main components of RUS’s oversight framework are (1) financial and program reporting and (2) desk and field monitoring. According to RUS officials, no later than 30 days after the end of each calendar-year quarter, BIP recipients will be required to submit several types of information to RUS, including balance sheets, income statements, statements of cash flow, summaries of rate packages, and the number of broadband subscribers in each community. In addition, RUS intends to conduct desk and site reviews. RUS secured contractor support through fiscal year 2013. RUS extended its contract with ICF International to provide BIP program support through 2013. According to RUS, the agency fully funded the contract extension using Recovery Act funds and no additional appropriations are required to continue the contract through fiscal year 2013. In addition, RUS extended of the term of employment through fiscal year 2011 for 25 temporary employees assigned to assist with the oversight of BIP projects. NTIA established audit requirements for commercial awardees. On May 17, 2010, NTIA reported that for-profit awardees will be required to comply with program-specific audit requirements set forth by the Office of Management and Budget. This audit and reporting requirement will give NTIA the oversight tools it needs to help ensure that projects meet the objectives of the Recovery Act and guard against waste, fraud, and abuse. Even with these actions, NTIA and RUS have not fully addressed all our recommendations and we therefore remain concerned about the oversight of the broadband programs. First, NTIA’s oversight plan assumes the agency will receive additional funding for oversight. For fiscal year 2011, the President’s budget request includes nearly $24 million to continue oversight activities. NTIA reported that it is imperative that it receive sufficient funding to ensure effective oversight. In contrast, the President’s budget request does not include additional resources to continue RUS’s oversight activities, which the agency in part addressed through the extension of its contact with ICF International. However, should there be a reduction in RUS’s fiscal year 2011 budget, the agency will need to assess its impacts and the temporary employment of 25 staff members, as discussed previously. Therefore, we believe the agencies, especially NTIA, need to do more to ensure their oversight plans reflect current fiscal realities. Second, we continue to keep our recommendation regarding performance goals open. NTIA has taken some action on this recommendation, such as creating goals related to new network miles and workstations deployed, but it continues to establish additional goals. Mr. Chairman and Members of the subcommittee, this concludes my prepared statement. I would be pleased to respond to any questions that you or other members of the subcommittee might have. For questions regarding this statement, please contact Mark L. Goldstein at (202) 512-2834 or goldsteinm@gao.gov. Contact points for our Offices of Congressional Relations and Public Relations can be found on the last page of this statement. Michael Clements, Assistant Director; Matt Barranca; Elizabeth Eisenstadt; Hannah Laufe; and Mindi Weisenbloom also made key contributions to this statement. This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.

Access to broadband service--a highspeed connection to the Internet--is seen as vital to economic, social, and educational development, yet many areas of the country lack access to, or their residents do not use, broadband. To expand broadband deployment and adoption, the American Recovery and Reinvestment Act of 2009 (Recovery Act) provided $7.2 billion to the Department of Commerce's National Telecommunications and Information Administration (NTIA) and the Department of Agriculture's Rural Utilities Service (RUS) for grants or loans to a variety of program applicants. The Recovery Act required the agencies to award all funds by September 30, 2010. This testimony addresses (1) NTIA's and RUS's efforts to award Recovery Act broadband funds and (2) the remaining risks that NTIA and RUS face in providing oversight for funded projects. To conduct this work, GAO reviewed and summarized information from prior GAO work. GAO also reviewed NTIA and RUS reports on the status of the agencies' programs and gathered information from the agencies on steps taken to respond to prior GAO recommendations. In past work, GAO recommended that the agencies take several actions, such as developing contingency plans to ensure sufficient resources for project oversight. NTIA and RUS have taken some steps to address GAO's recommendations. NTIA and RUS awarded grants and loans for several hundred broadband projects in two funding rounds. By the end of fiscal year 2010, NTIA and RUS awarded grants and loans to 553 broadband projects across the country. These projects represent almost $7.5 billion in awarded funds, which exceeds the $7.2 billion provided by the Recovery Act because RUS-- which awards loans that must be repaid to the government--has authority to provide funds in excess of its budget authority. In its review of the first funding round, GAO found that NTIA and RUS, with the help of the agencies' contractors, consistently substantiated information provided by award recipients' applications. GAO has not evaluated the thoroughness of the process used by the agencies in the second round of funding. Even with steps taken to address project oversight, risks to the success of the broadband programs remain. GAO previously reported that NTIA and RUS face several challenges to successfully overseeing the broadband programs. These challenges include (1) monitoring and overseeing a combined total of 553 projects that are diverse in scale, scope, and technology and (2) conducting project oversight activities after the expiration of Recovery Act funding on September 30, 2010. Because of these challenges, in two previous reports, GAO recommended that NTIA and RUS take several actions to ensure that funded projects receive sufficient oversight. For example, GAO recommended that NTIA and RUS develop contingency plans to ensure sufficient resources for oversight of funded projects beyond fiscal year 2010. The agencies have taken several actions to address GAO's recommendations and improve oversight of funded projects--both agencies developed oversight plans, RUS secured contractor support though fiscal year 2013, and NTIA established audit requirements for commercial awardees. Even with these actions, GAO remains concerned about the oversight of the broadband programs. In particular, GAO believes the agencies, and especially NTIA, need to do more to ensure their oversight plans reflect current fiscal realities.

VBA’s compensation program pays monthly benefits to veterans with service-connected disabilities (injuries or diseases incurred or aggravated while on active military duty), according to the severity of the disability. VBA’s pension program pays monthly benefits to wartime veterans who have low incomes and are permanently and totally disabled for reasons not service-connected. In addition, VBA pays dependency and indemnity compensation to some deceased veterans’ spouses, children, and parents. In fiscal year 2001, VBA paid over $20 billion in disability compensation to about 2.3 million veterans and over 300,000 survivors. VBA also paid over $3 billion in pensions to over 600,000 veterans and survivors. Veterans may submit their disability claims to any of VBA’s 57 regional offices, which process these claims in accordance with VBA regulations, policies, procedures, and guidance. Regional offices assist veterans in obtaining evidence to support their claims. This assistance includes helping veterans obtain the following documents: records of service to identify when the veteran served, records of medical treatment provided while the veteran was in military service, records of treatment and examinations provided at VA health-care facilities, and records of treatment of the veteran by nonfederal providers. Also, if necessary for decision on a claim, the regional office arranges for the veteran to receive a medical examination or opinion. Once this evidence is collected, VBA makes a rating decision on the claim. Veterans with multiple disabilities receive a single composite rating. For pension claims, VBA determines whether the veteran meets certain criteria. The regional office then notifies the veteran of its decision. In May 2001, the Secretary created the VA Claims Processing Task Force to develop recommendations to improve the compensation and pension claims process and to help VBA improve claims processing timeliness and productivity. The task force observed that the work management system in many VBA regional offices contributed to inefficiency and an increased number of errors. The task force attributed these problems primarily to the broad scope of duties performed by regional office staff—in particular, veterans service representatives (VSR). For example, VSRs were responsible for both collecting evidence to support claims and answering claimants’ inquiries. In October 2001, the task force made short- and medium-term recommendations for improving the claims process and reorganizing regional office operations. In particular, the task force recommended that VBA change its claims processing system to one that utilizes specialized teams. VBA is in the process of implementing many of these recommendations and has established a new claims processing structure that is organized by specific steps in the claims process. For example, regional offices will have teams devoted specifically to claims development, that is, obtaining evidence needed to evaluate claims. VBA’s key timeliness measure does not clearly reflect its timeliness in completing claims because it fails to distinguish among its three disability programs—disability compensation, pension, and dependence and indemnity compensation. The programs’ processing times differ, in part because they have different purposes, beneficiaries, eligibility criteria, and evidence requirements to decide each type of claim. Despite these differences, VBA sets an annual performance goal that is an average of all three programs. For the purposes of reporting its performance to the Congress and other stakeholders, VBA adopted one key timeliness measure—the average time to complete decisions on rating-related cases. This measure includes original and reopened disability compensation, pension, and dependency and indemnity compensation claims—in other words, claims for three VBA compensation and pension programs. VBA sets an annual goal for average days to complete rating-related cases in VA’s annual performance plans and subsequently reports its actual timeliness—and whether it met its goal—in VA’s annual performance reports to the Congress. This one measure does not reflect the differences in the timeliness for the three programs. In general, the disability compensation program requires the most evidence and thus these claims generally take longer to complete, as shown in figure 1. While VBA’s average fiscal year 2002 timeliness was 223 days, disability compensation decisions (which represented about 83 percent of total decisions) took almost twice as long to complete as pension decisions. The aggregate measure understated the time required to decide disability compensation claims by 18 days and overstated the time to decide pension claims by 97 days and dependency and indemnity compensation claims by 51 days. Each program has a different claims processing time frame because each has different evidence requirements resulting from their different purposes and eligibility requirements. For example, a major reason why disability compensation claims take longer is that VBA must not only establish that each claimed disability exists, but that each was caused or aggravated by the veteran’s military service. This process requires substantial evidence gathering, with VBA actively assisting the claimant. To prove service- connection, VBA obtains the veteran’s service medical records and may request medical examinations and treatment records from VA medical facilities. In contrast, pension claims do not require evidence that the claimed disabilities were service-connected. Also, veterans aged 65 and older do not have to prove that they are disabled to receive pension benefits as long as they meet the income and military service requirements. VBA does not yet have adequate data to measure timeliness or set goals for its specialized regional office teams but is making progress in obtaining complete and accurate data. While VBA is in the process of developing performance measures and goals for these teams and has developed a system to report timeliness data, it acknowledges that the quality of its existing timeliness data needs to be improved. Implementation of the task force recommendations to reorganize claims processing requires that VBA measure its performance for its teams. Where teams were once responsible for processing claims from receipt to completion, teams are now responsible for specific phases of the process. With complete and accurate data, VBA will be able to measure the timeliness of the individual teams and, therefore, will be able to hold them accountable for their performance as well as identify processing delays and take corrective actions. VBA expects to be able to obtain more complete and accurate data to measure team performance once it deploys new software applications that should enable it to consistently capture data for all cases and will rely less on manual data entry. VBA expects these applications to be fully deployed by October 2003. The task force recommended that regional office Veterans Service Centers (VSC), which process compensation and pension claims, be reorganized into specialized teams. The task force identified six types of teams—triage, pre-determination, rating, post-determination, appeals, and public contact—based on different phases of the claims process. From February through April 2002, VBA piloted its CPI initiative, which included reorganizing regional offices’ VSCs into specialized teams at four regional offices. The CPI task team noted that processing teams needed clearly defined and reasonable performance expectations and recommended timeliness measures for each team, as shown in table 1. VBA began to implement the CPI model at its other regional offices in July 2002. VBA has implemented an inventory management system (IMS) that allows it to measure and report team timeliness, nationally and at the regional office level. This system should provide VBA with the necessary data to develop annual performance goals, which can be used to hold itself and its regional offices accountable for improving timeliness. IMS should also provide useful data to assist VBA management with identifying problems in specific regional offices and allowing regional office management to identify problems with specific teams for further analysis and corrective actions. However, VBA acknowledges that its IMS reports are not as useful as they can be, because IMS receives incomplete data from an existing VBA system—the Claims Automated Processing System (CAPS). Not all regional offices are fully using CAPS; thus, CAPS data that are sent to IMS are incomplete. CAPS was not being used to collect timeliness data for all cases; rather, it was used to provide regional office staff with information on the status of cases expected to take more than 30 days to process. In order to provide a short-term improvement in the completeness of IMS data, in May 2001 VBA instructed regional offices to ensure that certain data were consistently entered into CAPS; for example, dates when evidence was requested and received. In May 2002, VBA instructed regional offices to report on how fully they use CAPS and to provide estimated timeframes for complete compliance with CAPS data entry requirements. As of August 2002, VBA reported that about 81 percent of its pending cases had records in CAPS. According to VBA officials, as the regional offices implement new software applications, the ability of IMS to provide complete and accurate timeliness reports is expected to improve. For example, Share, the new claims establishment application, will automatically input data on a case into other applications, including CAPS. This will help ensure more complete and consistent data in the short term, because there will be a CAPS record for each case. Eventually, the Modern Award Processing– Development (MAP-D) application will replace CAPS as a source of timeliness data for IMS. MAP-D will, according to VBA officials, contain records for all cases and will reduce the amount of manual data entry required, thus reducing the potential for data input errors. VBA plans to have all regional offices using Share and MAP-D by October 2003. VBA has chosen to use one aggregate performance measure for timeliness for its disability compensation, pension, and dependency and indemnity compensation programs. Such a measure does not reflect VBA’s performance for programs with different purposes, beneficiaries, and claims processing requirements. In particular, VBA’s timeliness in deciding disability compensation claims is assessed under a measure that also covers pension and dependency and indemnity compensation claims, which take much less time. Consequently, the aggregate measure can make the processing time for VBA’s largest and most time-consuming workload look better than it really is. As long as VBA uses an aggregate timeliness measure, it will not be able to clearly demonstrate to the Congress, top VA management, and claimants how well it is meeting its objectives to serve disabled veterans and their families. VBA’s reorganization of its regional office compensation and pension claims processing operations into specialized teams underscores the need for complete and accurate data on the timeliness of the phases of the claims process. VBA does not yet have adequate data for timeliness measurement purposes but is making progress in ensuring that it does. Once VBA has deployed its new claims processing software applications at all of its regional offices, it expects to be able to better measure the timeliness of its specialized teams, provide baselines for future comparisons, quantify team performance goals, and identify problems needing corrective action. In this way, local and team-specific information can be used to hold regional offices and their specialized teams accountable for improving timeliness. We recommend that the Secretary of Veterans Affairs direct the Under Secretary for Benefits to establish separate claims processing timeliness goals for its three main disability programs, incorporate these goals into VA’s strategic plan and annual performance plans, and report its progress in meeting these goals in its annual performance reports. In its written comments on a draft of this report (see app. I), VA concurred in principle with our recommendation. VA noted that VBA plans to develop performance measures for each of its programs, as part of VA’s effort to restructure its budget. However, VA believes establishing new goals by program should be deferred until at least fiscal year 2005, because establishing new goals at this time risks obscuring its focus on achieving the Secretary’s 100-day goal by the end of fiscal year 2003. We believe developing timeliness measures for each program would not obscure VBA’s focus on performance improvement, but would provide a more accurate picture of claims processing timeliness, because the new measures would reflect the differences among the three programs. Because VBA already has the necessary data, we believe that it should report timeliness by program for fiscal year 2004 and set goals by program for fiscal year 2005, at the latest. VA also suggested that we based our calculations of average days to complete disability compensation, pension, and dependency and indemnity compensation decisions, as shown in figure 1, on original claims only. We based our calculations on all eight types of claims (known as end products) that VBA uses to calculate rating-related timeliness. These end products include both original and reopened claims. As agreed with your offices, unless you publicly announce its contents earlier, we plan no further distribution of this report until 1 day after its issue date. At that time, we will send copies of this report to the Secretary of the Department of Veterans Affairs, appropriate congressional committees, and other interested parties. We will also make copies of this report available to others on request. The report will also be available at no charge on GAO’s Web site at http://www.gao.gov. If you or your staff have any questions regarding this report, please call me at (202) 512-7101 or Irene Chu, Assistant Director, at (202) 512-7102. In addition to those named, Susan Bernstein, Martin Scire, and Greg Whitney made key contributions to this report.

The Chairman and Ranking Minority Member, Senate Committee on Veterans' Affairs, asked GAO to assist the Committee in its oversight of the Veterans Benefits Administration's (VBA) efforts to improve compensation and pension claims processing. As part of this effort, GAO assessed (1) whether VBA's key timeliness measure clearly reflects its performance and (2) whether it has adequate data to measure the timeliness of its newly created specialized claims processing teams. VBA's key claims processing timeliness measure does not clearly reflect how quickly it decides claims by veterans and their families for disability compensation, pension, and dependency and indemnity compensation benefits. Although each program has its own purpose and eligibility requirements, VBA does not set a separate timeliness goal for each in its annual performance plan. This obscures the significant differences in the time required to complete decisions under each program. Fiscal year 2002 timeliness, using VBA's measure, was 223 days; however, disability compensation decisions took significantly longer than decisions under the other two programs. A disability compensation decision requires more evidence, in part because VBA must determine that each claimed disability is related to the veteran's military service. VBA does not yet have adequate data to measure the timeliness of its new specialized regional office claims processing teams but is working to improve its data. VBA's inventory management system, which allows it to report and analyze teams' timeliness, relies on an existing information system that does not provide timeliness data on all cases. VBA is acting to improve the completeness of the data in the existing system. Meanwhile, VBA is deploying new software that it expects should enable it to capture more complete and accurate data. VBA expects to deploy this new software at all regional offices by October 2003.