Defense Transportation: DOD Has Taken Actions to Address Hazardous Material Transportation Issues but It Is Too Soon to Evaluate the Effectiveness of These Efforts
Published: 2017-07-21T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Commercial carriers transport over 3 billion tons of HAZMAT in commerce in the United States each year, transporting an estimated 1 million HAZMAT shipments per day. DOD relies heavily on commercial carriers to transport HAZMAT, using them to transport about 90 percent of the department's HAZMAT shipments. DOD uses the TPS program to transport certain sensitive materials including ammunition and classified materials that follow more stringent safety and security standards.
House Report 113-446 accompanying a bill for the National Defense Authorization Act for Fiscal Year 2015 directed DOD to report on the root causes of improper documentation and packaging of HAZMAT; the extent to which TPS is used for materials that could be transported using less costly means; and any needed corrective actions and a plan, with milestones, to address them. The House report also included a provision for GAO to review DOD's report. DOD issued its report in September 2015.
This report examines the extent to which DOD (1) identified the root causes of improper documentation and packaging of HAZMAT shipments and any corrective actions taken since the report's issuance and (2) reported on the department's use of TPS carriers to transport shipments that could have been safely and securely transported using less costly alternatives.
GAO examined DOD's HAZMAT data and found the data it examined sufficiently reliable for the purposes of the review.
DOD reviewed a draft of this report and did not have any comments.
section_title: What GAO Found
paragraphs: The Department of Defense (DOD) has addressed the committee direction to identify the root causes regarding the improper documentation and packaging of hazardous materials (HAZMAT) shipments and any needed corrective actions, but it is too soon to evaluate the effectiveness of these efforts. In its September 2015 report, DOD identified:
contract- and documentation-related issues and human error as the root causes,
several corrective actions—such as improved reporting—that aligned with these root causes, and
milestones and DOD stakeholders to implement the corrective actions.
In addition to aligning with the DOD-identified root causes, the corrective actions also align with the root causes of improper documentation and packaging that GAO identified in its May 2014 report. However, it is too early to determine the efficacy of these corrective actions. According to DOD officials, most of the corrective actions were to begin in late fiscal year 2016, and the key performance measures for assessing those and the remaining actions will not be fully completed until late fiscal year 2017.
DOD has addressed the committee direction to report on the extent to which the department had used Transportation Protective Services (TPS) for HAZMAT shipments that could have been safely and securely transported using less costly alternatives, but did not include in its September 2015 report detail on the assumptions or limitations made underpinning its analysis. In its analysis, conducted specifically to address the committee direction, DOD concluded that it had used TPS infrequently when not required between June 1, 2013, and July 31, 2014. Specifically, DOD reported it used TPS to transport 518 of 31,373 HAZMAT shipments that it could have transported using less costly alternatives. This resulted in a total unnecessary cost of approximately $126,000, according to DOD. While GAO found DOD did not include detail on the assumptions or limitations underpinning its analysis, GAO concurs with the report's general conclusion that DOD had infrequently used TPS unnecessarily to transport HAZMAT during the period studied and that the additional cost associated with these shipments was relatively small. Further, as part of its plan of action, DOD has identified corrective actions to preclude future unnecessary use of TPS, which, if properly implemented, should help ensure that in the future DOD uses TPS only when necessary.

section_title: Letter
paragraphs: Commercial carriers transport over 3 billion tons of hazardous materials  (HAZMAT) in commerce in the United States each year, transporting an  estimated 1 million HAZMAT shipments per day. The Department of  Defense (DOD) relies heavily on commercial carriers to transport  HAZMAT, using them to transport about 90 percent of the department’s  HAZMAT shipments. In fiscal year 2016 DOD transported approximately  313,354 HAZMAT shipments. These shipments range from materials  associated with everyday use (e.g., chlorine, fire extinguishers, and  lithium batteries) to sensitive materials considered to pose a risk to  national security (e.g., ammunition and explosives, nuclear weapons-related components and toxins). HAZMAT at both ends of this spectrum  can pose a significant threat to transportation workers, emergency  responders, and the general public if the HAZMAT shipment is not  properly documented and packaged for transportation. Improper  documentation and packaging can also delay the transport of needed  supplies to military units, potentially creating a backlog of material.
We have previously reported on issues regarding the improper  documentation and packaging of HAZMAT and DOD’s evaluation of the  safety and performance information for the U.S. Transportation  Command’s (TRANSCOM) Transportation Protective Services (TPS)  commercial carriers. TPS commercial carriers transport certain types of  sensitive materials, including ammunition and classified materials, and  are to follow additional procedures and meet more stringent safety and  security standards than other commercial carriers. For example, DOD  regulations require that TPS commercial carriers handling certain  security-sensitive shipments have two drivers with security clearances in  trucks transporting those shipments. In 2014, we found that over 25  percent of DOD’s HAZMAT shipments were delayed at aerial ports  because of improper documentation and packaging. We recommended  that DOD take actions to improve the documentation and packaging of  HAZMAT, eliminate instances in which DOD installations deny “secure- hold” for TPS HAZMAT shipments, and examine the limitations on  Department of Transportation data used to select commercial carriers of  HAZMAT. DOD concurred with these recommendations and, in  November 2014, improved reporting regarding HAZMAT transportation  and established a “secure-hold denial” category in the Defense  Transportation Tracking System for tracking the unauthorized parking of  security-sensitive shipments. In 2015, we recommended that DOD  establish and use an approach for reviewing available Department of  Transportation safety violation data and develop guidance on analyzing  DOD incident trends and fully investigating HAZMAT incidents. DOD did  not concur with our two recommendations on reviewing Department of  Transportation violation data but concurred with the other two  recommendations, and in November 2016 implemented the latter by  issuing guidance including responsibilities related to the analysis of  incident trends and the investigation of incidents involving DOD  munitions.
The House Armed Services Committee’s report accompanying a bill for  the National Defense Authorization Act for Fiscal Year 2015 directed  DOD to report on the root causes of improper documentation and  packaging of HAZMAT throughout DOD’s transportation system; the  extent to which TPS is used for materials that could be safely and  securely transported using less costly means; and any needed corrective  actions and a plan, with milestones, to implement them. The  Committee’s report also included a provision for us to review DOD’s  report. DOD issued its report in September 2015. We reviewed DOD’s  report and determined the extent to which DOD had (1) identified the root  causes of improper documentation and packaging of HAZMAT shipments  throughout the DOD transportation system and any corrective actions  taken since the report’s issuance to address those root causes, and (2)  reported on the department’s use of TPS carriers to transport shipments  that could have been safely and securely transported using less costly  alternatives.
For objective one, we identified the root causes that DOD reported in  September 2015 for HAZMAT shipments being delayed because of  improper documentation and packaging and compared those root causes  with the associated plan of action and milestones that DOD described in  its report. We also compared the DOD-identified root causes with the  elements directed in the House report and provisions in the Defense  Transportation Regulation, which among other things requires that DOD  transportation officers ensure that carriers have documentation to  properly label HAZMAT and ensure that HAZMAT is properly marked,  packaged, and labeled in accordance with applicable regulations for each  mode of transportation. We interviewed officials from the offices with the  primary responsibility identified in DOD’s report for the development and  implementation of DOD’s plan of action and milestones to discuss their  approach for identifying the root causes of HAZMAT shipments being  delayed because of improper documentation and packaging. In addition,  we visited three of DOD’s five major domestic aerial ports of  embarkation/debarkation on the East Coast to discuss the status of the  implementation of DOD’s corrective actions with officials that process  delayed HAZMAT cargo and to get their perspectives on whether these  corrective actions had addressed the DOD-identified root causes of  improper documentation and packaging of HAZMAT shipments. We  also assessed aerial ports data from October 1, 2013, through March 9,  2017, and determined that the data were sufficiently reliable for the  purpose of our review by reviewing relevant DOD documentation on  shipments to the aerial ports; performing standard electronic data  reliability testing, such as looking for outliers or missing data; and  interviewing aerial ports officials about their methodology.
For objective two, we reviewed the methodology that DOD presented in  its September 2015 report and the data and analysis that DOD used to  support its conclusions on the use of TPS. We analyzed the methodology  and the supporting data and analysis within the context of the  methodological standards identified in our prior work. We selected those  standards that were most relevant to assessing the methodology  underpinning a defense study, in particular those related to identifying any  assumptions used and any limitations. We also applied principles from  our Standards for Internal Control in the Federal Government, which calls,  among other things, for any data obtained to be processed into quality  information. For both objectives, we interviewed senior officials from the  Office of the Under Secretary of Defense for Acquisition, Technology, and  Logistics; TRANSCOM headquarters and its military service components,  and the Defense Logistics Agency.
We conducted this performance audit from April 2016 to July 2017 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.
subsections: section_title: DOD Has Addressed the Direction to Identify Root Causes and Corrective Actions, but It Is Too Soon to Evaluate the Effectiveness of These Efforts
paragraphs: In its September 2015 report, DOD addressed the committee direction to  identify root causes regarding the improper documentation and packaging  of HAZMAT shipments and any needed corrective actions, but it is too  soon to determine the effectiveness of the department’s efforts. DOD  identified the root causes of the improper documentation and packaging  of HAZMAT shipments and developed a plan of action with milestones to  address them. In its September 2015 report, DOD used an approach  involving stakeholders from throughout DOD’s transportation system.  According to officials, the Office of the Deputy Assistant Secretary of  Defense for Supply Chain Integration coordinated the stakeholders’  efforts. According to its officials, the office established a working group  comprising stakeholder representatives from the Office of the Deputy  Assistant Secretary of Defense for Supply Chain Integration, the Defense  Logistics Agency, TRANSCOM, the Air Mobility Command, the Army’s  Surface Deployment Distribution Command, and the Government  Services Administration. As part of this working group, these stakeholders  analyzed HAZMAT transportation data from, among other DOD  transportation sources, the Global Air Transportation Execution System,  the Defense Logistics Agency, and the Web Supply Discrepancy Reports,  according to officials.
As a result of this approach, DOD identified in its report contract- and  documentation-related issues and human error as root causes of  improper documentation and packaging of HAZMAT. For example, air  HAZMAT shipment documentation and packaging discrepancies resulted  from HAZMAT shipments arriving at an aerial port without certain required  documentation for air transportation. Specifically, according to the report,  missing documentation included confirmation of air clearance, the  Advance Transportation Control and Movement Document, and Shipper’s  Declaration of Dangerous Goods. In addition, DOD noted in its report  that contract- and process-related issues contribute to HAZMAT  shipments arriving at an aerial port not documented or packaged correctly  for air transportation. According to the report, for many shipments  delivered directly from the vendors, contracts did not clearly specify for  vendors when they must prepare HAZMAT for air shipment, to include  preparing required documentation, requesting air clearance, and  packaging in accordance with the applicable rules for that mode of  transportation. In addition, some contracts did not instruct vendors to use  the Defense Logistics Agency’s Vendor Shipping Module website, which  could have assisted them in requesting air clearance, submitting advance  transportation movement and control data, and printing military shipment  labels.
Further addressing the committee direction, DOD in its September 2015  report included a plan of action and milestones to address the root  causes identified and specified over 40 corrective actions. Our analysis  found that these corrective actions generally align with the root causes  that DOD identified. Examples follow of corrective actions intended to  reduce the percentage of HAZMAT shipments with missing, incomplete,  or inaccurate documentation arriving at aerial ports and to improve the  reporting of HAZMAT shipment documentation and packaging  discrepancies:  reducing the percentage of HAZMAT shipments from government  shippers arriving at aerial ports with missing documentation by  notifying shippers of the requirement to prepare HAZMAT for  shipment to the final destination, to include preparing required  documentation, requesting air clearance, and repacking in  accordance with applicable rules;  reducing the percentage of HAZMAT shipments arriving at aerial ports  with incorrect or incomplete documentation by investigating and  recommending alternatives for reducing human error in HAZMAT  documentation; and   improving the reporting of HAZMAT shipment documentation and  packaging discrepancies by adding specific data elements for  HAZMAT shipments in a web-based supply discrepancy reporting  system, such as WebSDR—an automated process used to report  shipping or packaging discrepancies and to provide appropriate  responses and resolution.
During the course of our review, and according to DOD officials, we found  that as of February 2017 DOD had modified and added new corrective  actions based on feedback from the working group that developed the  September 2015 report and had conducted further analysis of the  documentation and packaging issues addressed there. According to DOD  officials, the working group of stakeholders involved in this effort meets  every quarter to elicit input from its members and update the plan of  action and milestones as necessary to reflect actions taken in the field.  For example, DOD officials reported that the plan of action and  milestones has been updated in response to Joint Base McGuire-Dix- Lakehurst implementing the use of WebSDR in September 2016 and the  Defense Logistics Agency implementing a contract provision in January  2017 to help ensure proper documentation and packaging of shipments  arriving at aerial ports.
As DOD implements its corrective actions, it continues to face issues with  improper documentation and packaging causing delayed cargo,  according to DOD officials. According to the Global Air Transportation  Execution System data that we reviewed for HAZMAT shipments at the  five major aerial ports and according to DOD officials whom we  interviewed during the course of our review, there continue to be a  number of HAZMAT shipments that were not documented and packaged  properly. According to DOD officials, these documentation and packaging  discrepancies can result in shipment delays that can be as short as a few  hours or last several days, depending on the nature of the issue. Based  on DOD’s Global Air Transportation Execution System database and  according to transportation officials, of the 62,703 total shipments of  HAZMAT received from October 1, 2013, through March 9, 2017, 34,040  shipments or 54.2 percent were delayed. Of the 34,040 delayed  shipments, 19,858 or 58.3 percent were delayed primarily because they  were not in compliance with the Defense Transportation Regulation  requirements for documentation and packaging, and 14,183 shipments or  41.6 percent were delayed for security-clearance-related reasons (i.e., for  shipments supporting foreign assistance missions) that are out of the  control of the shipper or DOD. Following are examples of HAZMAT  shipments that we identified in 2016 during the course of our review that  were delayed for documentation and packaging issues:
Scissor lifts were delayed in transport to Bagram Air Base in  Afghanistan because, according to DOD transportation officials, they  arrived without shipping documentation, air certifications, and shoring  (packaging). According to the Defense Transportation Regulation,  the transportation officer must ensure that HAZMAT is properly  marked, packaged, and labeled for air transportation. However, the  shipping papers for the scissor lifts did not identify Bagram Air Base  as the destination. In addition, there was ineffective coordination  between the vendor, shipper, and contracting officer (who is located at  Bagram Air Base), according to the DOD transportation officials.
Cylinders filled with refrigerant gas were delayed because, according  to DOD officials, the Shipper’s Declaration for Dangerous Goods was  missing or incomplete, and the cylinders were not properly packaged  for shipment. According to the Defense Transportation Regulation, the  transportation officer must ensure that HAZMAT is properly marked,  packaged, and labeled for air transportation.
A skid of lithium-ion batteries was delayed because, according to  DOD officials, the Shipper’s Declaration for Dangerous Goods was  missing the correct gross weight. The Defense Transportation  Regulation requires that when transporting HAZMAT by air, the  shipper must accurately reflect the quantity of the material to be  transported.
DOD officials noted that is too early to evaluate the effectiveness of the  corrective actions identified in the report’s plan of action and milestones  to mitigate delays in transporting HAZMAT. According to DOD officials,  most of the corrective actions were to begin in late fiscal year 2016 and  the key performance measures for assessing those and the remaining  actions will not be completed until late fiscal year 2017.The officials  added that it will take time to accumulate data and conduct subsequent  analyses to determine the efficacy of actions that have already been  taken or are currently in progress. We agree with DOD that is too early to  evaluate and determine the efficacy of the corrective actions. DOD  officials also told us that they recognize that root causes are long- standing reasons for transportation delays, that several studies have  documented the delayed cargo issues at aerial ports of embarkation, and  that the issue of delayed cargo will never go away completely. However,  the officials noted that the corrective actions will help the warfighter  receive needed equipment without delay. By continuing to identify and  address the root causes for these transportation delays, the department  will be able to continue to develop and implement corrective actions to  mitigate delays of its HAZMAT shipments in support of the warfighter.
section_title: DOD Has Addressed the Direction to Report on the Unnecessary Use of Transportation Protective Services, but Lacked Detail on the Assumptions or the Limitations Underpinning Its Analysis
paragraphs: In its September 2015 report, DOD addressed the committee direction to  report on the extent to which it used TPS for HAZMAT shipments that  could have been safely and securely transported using less costly  alternatives, and identified two corrective actions. However, the report did  not fully disclose the assumptions and limitations associated with its  analysis. In its report, DOD concluded that between June 1, 2013, and  July 31, 2014, it had used TPS motor carriers to transport 518 of 31,373  HAZMAT shipments that could have been transported using less costly  alternatives and that doing so had resulted in a total unnecessary cost of  approximately $126,000. DOD reported that in the majority of these  instances transportation officers had either made errors or conscious  decisions that two drivers were necessary to meet tight time frame  delivery requirements or, when transportation officers could not obtain  complete cargo documentation to determine whether a TPS designation  was needed, they had erred on the side of safety and opted to use the  TPS carriers to transport the shipments. DOD reported that it had  calculated the approximately $126,000 in unnecessary costs by  accounting for the “accessorial charges” for TPS carriers–the additional  costs incurred for providing constant surveillance, dual-driver protection,  protective security service, and satellite motor surveillance. DOD  concluded that it had infrequently used TPS carriers unnecessarily and  that the additional costs incurred for doing so were relatively low.
DOD developed and conducted a one-time analysis to address the  committee direction. According to DOD’s Transportation Policy officials,  DOD developed this analysis in order to respond to the congressional  direction since the department lacked an established procedure to extract  and match the tens of thousands of records of HAZMAT shipments  transported by motor, rail, or air carriers using TPS each year and  calculate the costs for doing so. DOD’s analysis included data for motor  and air TPS HAZMAT shipments transported from June 1, 2013, through  July 31, 2014, and data for rail HAZMAT shipments transported through  TPS from January 1, 2014, through June 30, 2014. The Transportation  Command’s Surface Deployment and Distribution Command, which  manages the TPS program for DOD, provided these data for DOD’s  analysis. Next, DOD used TPS guidance in the Defense Transportation  Regulation as criteria to identify scenarios within the data set where DOD  shipping activities may have ordered TPS for shipments when not  required. An item’s Controlled Item’s Inventory Code located in the  Federal Logistics Information System determines whether an item  requires TPS. According to officials because the Surface Deployment and  Distribution Command TPS data lack cost information, DOD matched the  bill of lading records in the data system to shipment entries in DOD’s  Third Party Payment System to determine the cost of TPS shipments that  could have been safely and securely transported using less costly  means. DOD was able to match most of the bill of lading records in the  two systems. According to DOD, the shipments that they could not match  were likely never invoiced by the transportation provider.
In reviewing DOD’s September 2015 report, supporting documentation  and interviewing agency officials, we identified assumptions and  limitations that the report did not disclose in its findings and conclusions.  Absent these disclosures, decision makers cannot be assured this report  is conveying quality information. Generally accepted research standards  and Standards for Internal Control in the Federal Government call, among  other things, for a study methodology to explicitly identify any  assumptions and limitations and for any data obtained to be processed  into quality information. Following are examples of assumptions and  limitations the report did not include in its description of its analysis:
The number of shipments requiring TPS varied depending on the  assumptions used: For example, during our review we requested  that Surface Deployment and Distribution Command officials provide  TPS shipment data for the same time frame DOD used in the  September 2015 report (June 1, 2013 through July 31, 2014). The  data that they provided showed there were a potential of 1,097 TPS  motor shipments that may not have required TPS, compared with the  518 TPS motor shipments referred to in the report. Surface  Deployment and Distribution Command officials said the difference  between the two totals could be a result of how DOD applied certain  Controlled Item Inventory Codes when it determined whether an item  required TPS to create the data set of TPS shipments that was  subsequently analyzed, and how they counted non-TPS shipments  that were transported with TPS shipments.
DOD used inconsistent dates in its collection of shipment data in  its analysis: The DOD report shows that DOD analyzed HAZMAT  shipment data from the Surface Deployment and Distribution  Command for the period June 1, 2013, through July 31, 2014. We  found, however, that this 13-month time frame included data for only  motor and air TPS shipments. For rail TPS shipments, DOD used  data from a 6-month time frame (January 1, 2014, through June 30,  2014). DOD officials explained that the time frames used for their  analysis were driven by which data were available at the time of their  request. We believe disclosing this limitation would have provided  decision makers with important information about the reliability of the  reported results.
DOD omitted air and rail TPS HAZMAT shipments and their  costs: DOD omitted 10 HAZMAT shipments transported by rail and 4  HAZMAT shipments transported by air from the shipments analyzed  in its report, which together total about $4,525 in unnecessary costs.  These 14 shipments were omitted because, in DOD’s estimation, their  number and their costs were low and therefore statistically  insignificant. Given that DOD concluded that TPS was used only  infrequently when not required, we find it inconsistent that the  additional 14 rail and air TPS shipments and their costs were omitted  from the report, and led to the report conveying incomplete results.  We believe that, in accordance with our generally accepted research  standards, DOD should have fully explained its rationale for such an  omission in its discussion of its methodology.
DOD did not disclose the use of average cost estimates:  According to DOD, on 10 of the 518 invoices for TPS motor carrier  shipments, DOD found the TPS charges exceeded the total amount  paid to the carrier. Including those charges would significantly skew  the results of the analysis, according to DOD. For those 10 invoices,  DOD applied an average cost to estimate the amounts paid for TPS.  DOD estimated average costs using three different methods: average  TPS cost per shipment, average TPS cost per mile, and average TPS  cost as a percentage of the total. DOD chose to use the average cost  per mile as it produced the highest cost estimate for the 10 invoices  according to the DOD documents. We believe that disclosing the use  of TPS shipment cost averages in DOD’s cost calculation for these 10  HAZMAT shipments would inform decision makers about the potential  effect of this approach on the reported results.
DOD officials acknowledged that DOD’s September 2015 report lacked  details regarding the assumptions and limitations made in DOD’s  analysis. However, the officials noted that, because the number of  improper TPS shipments is relatively low and the range of the potential  cost of these shipments is also relatively low, these assumptions and  limitations did not affect the department’s general conclusion that DOD  had infrequently used TPS unnecessarily to transport HAZMAT and that  the additional cost incurred was relativity small. Reviewing the data DOD  provided in support of its analysis, we have reasonable assurance that  DOD was correct in its general conclusion that DOD had infrequently  used TPS during the period studied and that the additional cost  associated with these shipments was relatively small. In addition, DOD  identified corrective actions to preclude the future unnecessary use of  TPS. Specifically, as part of its plan of action and milestones, DOD plans  to publish advisories reiterating TPS usage criteria to transportation  officers. An advisory in November 2015 advised transportation officers  that they should request TPS for shipments only if required by the  Defense Transportation Regulation. To monitor compliance with the  customer advisories and the Defense Transportation Regulation, DOD  plans to conduct spot checks of TPS HAZMAT shipment data every 2  years beginning in November 2017, according to DOD officials. According  to the February 2017 DOD plan of action and milestones, DOD also plans  to identify and evaluate policy options to ensure proper coding of  HAZMAT items in the Federal Logistics Information System by  September 30, 2018. We anticipate that these actions, if properly  implemented, will help ensure that TPS is only used when necessary.
section_title: Agency Comments
paragraphs: We provided a draft of this report to DOD, and DOD responded that it  would not be providing comments.
We are sending copies of this report to the appropriate congressional  committees, the Secretary of Defense, the Director of the Defense  Logistics Agency, the Commander of the U.S. Transportation Command,  and other interested parties. In addition, the report is 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) 512-5431 or russellc@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 the appendix.
section_title: Appendix: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above: James A. Reynolds, Assistant  Director; Colin Chambers; Pat Donahue; Alfonso Garcia; Alexandra  Gonzalez; Mae Jones; Ruben Montes de Oca; and Michael Shaughnessy  made key contributions to this report.