International Security: DOD and State Need to Improve Sustainment Planning and Monitoring and Evaluation for Section 1206 and 1207 Assistance Programs
Published: 2010-04-15T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: In 2006, the United States created two new programs, authorized in Sections 1206 and 1207 of the Fiscal Year 2006 National Defense Authorization Act, to respond to the threats of global terrorism and instability. These programs have provided over $1.3 billion in military and nonmilitary aid to 62 countries and are due to expire in 2011 and 2010, respectively. The Congress mandated that GAO assess the programs. This report addresses the extent to which the programs (1) are consistent with U.S. strategic priorities, (2) are distinct from other programs, (3) address sustainment needs, and (4) incorporate monitoring and evaluation. GAO analyzed data and program documents from the Departments of Defense (DOD) and State (State), and the U.S. Agency for International Development (USAID), and interviewed U.S. and host country officials.
section_title: What GAO Found
paragraphs: The Section 1206 and 1207 programs have generally been consistent with U.S. strategic priorities. The Section 1206 program was established to build the military capacity of foreign countries to conduct counterterrorism and stabilization operations. DOD and State have devoted 82 percent of this program's funds to address specific terrorist threats, primarily in countries the U.S. intelligence community has identified as priorities for the counterterrorism effort. The Section 1207 program was established to transfer DOD funds to State for nonmilitary assistance related to stabilization, reconstruction, and security. DOD, State, and USAID have devoted 77 percent of this program's funds to countries at significant risk of instability, mostly those the United States has identified as vulnerable to state failure. Based on agency guidelines, the Section 1206 program is generally distinct from other programs, while the Section 1207 program is not. In most cases, Section 1206 projects addressed urgent and emergent counterterrorism and stabilization priorities of combatant commanders and did so more quickly than other programs, sometimes in a year, whereas Foreign Military Financing (FMF) projects can take up to 3 years to plan. DOD and embassy officials GAO spoke to consistently explained why projects do not overlap those of FMF and other programs, although project proposals GAO reviewed did not always document these distinctions. Section 1207 projects are virtually indistinguishable from those of other foreign aid programs in their content and time frames. Furthermore, the Section 1207 program has entailed additional implementation costs and funding delays beyond those of traditional foreign assistance programs, while the 1206 program has not. The uncertain availability of resources to sustain Section 1206 projects poses risks to achieving long-term impact. Enabling nations to achieve sustainable counterterrorism capabilities is a key U.S. policy goal. The long-term viability of Section 1206 projects is threatened by (1) the limited ability or willingness of partner nations to support new capabilities, as 76 percent of Section 1206 projects are in low- or lower-middle-income countries, and (2) U.S. legal and policy restrictions on using FMF and additional Section 1206 resources for sustainment. In contrast, sustainment risks for Section 1207 projects appear minimal, because State, USAID, and DOD are not restricted from drawing on a variety of overlapping funding sources to continue them. DOD and State have incorporated little monitoring and evaluation into the Section 1206 and 1207 programs. For Section 1206 projects, the agencies have not consistently defined performance measures, and results reporting has generally been limited to anecdotal information. For Section 1207 projects, the agencies have defined performance measures and State requires quarterly reporting on project implementation. However, State has not fully analyzed this information or provided it to DOD to inform program management. As a result, agencies have made decisions to sustain and expand both Section 1206 and 1207 projects without documentation of progress or effectiveness.

section_title: Letter
paragraphs: With the threats of terrorism and instability continually emerging and  evolving overseas, the Departments of Defense (DOD) and State (State)  have recognized the need for more flexibility in the tools used to address  these challenges. Sections 1206 and 1207 of the fiscal year 2006 National  Defense Authorization Act (NDAA) created funding authorities for DOD to  formulate and implement security assistance programs jointly with State.  Section 1206 authorizes DOD to use its own funds to train and equip  partner nations’ national military and maritime forces to conduct  counterterrorism operations or to participate in or support military or  stability operations in which the U.S. armed forces participate. Section  1207 authorizes DOD to transfer funds to State for reconstruction,  stabilization, and security activities in foreign countries. Both authorities  have been renewed as part of national defense authorization legislation.  Currently, the Section 1207 authority will expire after fiscal year 2010, and  the Section 1206 authority will expire after fiscal year 2011, unless they are  renewed again. The fiscal year 2010 NDAA Report of the House of  Representatives Committee on Armed Services requires us to report to the  Senate and House of Representatives Committees on Armed Services,  Foreign Affairs (House), and Foreign Relations (Senate) on the timeliness,  effectiveness, and interagency coordination of these programs.
DOD and State have established two programs to implement these broad  authorities, and have written separate guidelines for each program. The  agencies have revised both sets of guidelines periodically to reflect lessons  learned, congressional interests, and other considerations. Though the  guidelines for each program are unique, reflecting fundamental differences  in the nature of the two programs, as of fiscal year 2009 they have several  key similarities: projects funded by the programs are required to address  U.S. priorities, be distinct from those of other traditional foreign  assistance programs, and include plans for long-term sustainment.
For fiscal years 2006 through 2009, DOD has provided more than $1.3  billion through both authorities to support projects in 62 countries.  Through the Section 1206 program, DOD has allotted $985 million in 53  countries for projects such as radars and other maritime surveillance  equipment in several African countries along the Gulf of Guinea, trucks  and small arms to suppress terrorist activities along the Yemeni border,  boats for maritime interdiction in the Philippines, and training of Georgian  mechanized infantry for deployment to Afghanistan. DOD has provided  more than $350 million of Section 1207 funds in 23 countries for projects  such as judicial reform and police training in Somalia, postconflict  removal of unexploded ordnance in Lebanon, reform of extremism  education programs in Bangladesh, and transportation infrastructure  initiatives in the Philippines.
We reviewed DOD’s and State’s use of the Section 1206 and 1207 funding  authorities from fiscal years 2006 through 2009. In particular, we examined  the extent to which the Section 1206 and 1207 programs (1) have been  consistent with U.S. government strategic priorities, (2) are distinct from  other U.S. programs, (3) have addressed the sustainment needs of  executed projects, and (4) incorporate monitoring and evaluation to  assess implementation and effectiveness.
To address these issues, we reviewed and analyzed Section 1206 and 1207  project documentation and program guidelines. We interviewed agency  officials from DOD, State, and the U.S. Agency for International  Development (USAID) in Washington, D.C., and all six U.S. geographic  combatant commands. We traveled to seven countries that received  Section 1206 or 1207 funding (Albania, the Bahamas, Georgia, Haiti,  Kazakhstan, Malaysia, and the Philippines) to interview U.S. embassy and  host government officials, implementing agencies and organizations, as  well as project beneficiaries, and to visit project sites and review relevant  project records. In three additional countries (Ethiopia, Pakistan, and  Uganda), we interviewed U.S. embassy officials in conjunction with other  related work we were conducting. We also interviewed U.S. program  officials via telephone in eight other countries (Honduras, Kenya,  Lebanon, Mali, Mexico, Nigeria, Sri Lanka, and Ukraine). We selected the  countries we visited and telephoned primarily based on the amount of  Section 1206 and 1207 funds those countries received, the maturity of the  projects in those countries, and geographic distribution. Projects in these  countries account for 62 percent ($831 million) of the $1.3 billion allotted  through the Section 1206 and 1207 programs during fiscal years 2006  through 2009.
We conducted this performance audit from February 2009 to April 2010 in  accordance with generally accepted government auditing standards. These  standards require that we plan and perform the audit to obtain sufficient,  appropriate evidence to provide a reasonable basis for our findings and  conclusions based on our audit objectives. We believe that the evidence  obtained provides a reasonable basis for our findings and conclusions  based on our audit objectives. Appendix I provides a more detailed  description of our scope and methodology.
subsections: section_title: Background
paragraphs: The National Defense Authorization Act for Fiscal Year 2006 established  the authority for the Section 1206 and 1207 programs. Section 1206  authorizes the Secretary of Defense to use up to $350 million each year,  with the concurrence of the Secretary of State, to train and equip foreign  military and nonmilitary maritime forces, such as coast guards, to conduct  counterterrorist operations or to support military and stability operations  in which the U.S. armed forces are a participant. The authority will expire  at the end of fiscal year 2011 if it is not renewed. Section 1207 of the fiscal  year 2006 NDAA provides authority for DOD to transfer up to $100 million  per fiscal year to State to support reconstruction, stabilization, and  security activities in foreign countries. A congressional notification  describing the project is required upon the exercise of the transfer  authority. The funds are subject to the authorities and limitations in the  Foreign Assistance Act of 1961, the Arms Export Control Act, or any law  making appropriations to carry out such acts. The funds also remain  available until expended. This authority was intended to be temporary and  expires at the end of fiscal year 2010.
The Foreign Military Financing program has traditionally been the  primary mechanism for providing training and equipment assistance to  foreign military forces. State and USAID have traditionally addressed  civilian reconstruction, stabilization, and security needs abroad through  programs funded by several foreign operations appropriations accounts,  including Development Assistance; Economic Support Funds; Freedom  Support Act (now Assistance for Europe, Eurasia, and Central Asia);  International Narcotics Control and Law Enforcement; Nonproliferation,  Antiterrorism, Demining, and Related Programs; Peacekeeping Operations;  and Transitions Initiatives. (See app. II for a description of U.S. foreign  assistance programs and accounts.)
For both the Section 1206 and 1207 programs, DOD and State established  an interagency process to implement each program. Within DOD, the  Office of the Assistant Secretary of Defense for Special Operations, Low  Intensity Conflict, and Interdependent Capabilities has overall  responsibility for both programs. This office coordinates primarily with  State’s Bureau of Political-Military Affairs for the Section 1206 program  and with State’s Office of the Coordinator for Reconstruction and  Stabilization (State/S/CRS) for the Section 1207 program. DOD and State  solicit project proposals for each program annually, in accordance with  guidelines and project proposal instructions for each program that are  revised periodically to reflect lessons learned, congressional concerns,  and other considerations. Interagency boards review the proposals— approved by both the relevant U.S. combatant commander and  ambassador—and select projects to recommend to the Secretaries of  Defense and State for final funding approval. Once projects are approved,  DOD and State may begin implementation after notification to designated  congressional committees. For approved Section 1206 projects, the  Defense Security Cooperation Agency assumes overall responsibility for  procuring training and equipment, while security assistance officers  (SAO)—posted at U.S. embassies and reporting to both the ambassador  and the relevant U.S. geographic combatant commands—are responsible  for coordinating in-country project implementation. For approved Section  1207 projects, country teams at U.S. embassies are responsible for  implementing projects in cooperation with relevant State and USAID  offices, while State/S/CRS is responsible for oversight.
For fiscal years 2006 through 2009, DOD has allotted about $985 million  for Section 1206 projects in 53 countries and $350 million for Section 1207  projects in 23 countries. Figures 1 and 2 depict the geographic  distribution of Section 1206 and 1207 resources, respectively. (See app. III  for detailed information on the geographic distribution of Section 1206 and  1207 funds.)
The Section 1206 and 1207 programs incorporate a wide variety of  assistance. The most common types of Section 1206 program assistance  have been training and technical assistance and radios and other  communications equipment. Under the Section 1207 program, the most  common types of assistance activities are local government capacity  development and police training and equipment. Tables 1 and 2 list the  types of assistance provided by the Section 1206 and 1207 programs,  respectively, and the number of countries receiving them. (See app. IV for  more detailed information on the types of assistance provided through the  Section 1206 and 1207 programs from fiscal years 2006 to 2009.)
Figure 3 shows an example of radar and surveillance equipment provided  to Malaysia and 36 other countries under the Section 1206 program to  conduct coastal surveillance.
section_title: Section 1206 and 1207 Programs Are Generally Consistent with U.S. Strategic Priorities
paragraphs: The Section 1206 and 1207 programs have generally been consistent with  U.S. strategic priorities relating to combating terrorism and addressing  instability. DOD and State have devoted 82 percent of Section 1206  counterterrorism resources spent through fiscal year 2009 to addressing  specific terrorist threats, primarily in countries designated as priorities by  the U.S. government. DOD, State, and USAID devoted 77 percent of  Section 1207 program resources to relatively unstable countries, mostly  those the U.S. government has identified as vulnerable to state failure.
subsections: section_title: Section 1206 Program Consistent with U.S. Counterterrorism Strategic Priorities
paragraphs: Implementation of the Section 1206 program has generally been in  alignment with U.S. counterterrorism priorities. Section 1206 authorizes  DOD and State to build the capacity of partner nations’ national military  forces to (1) conduct counterterrorist operations or (2) participate in or  support military and stability operations in which the U.S. armed forces  are a participant. From fiscal year 2006 to 2009, DOD and State allotted  $932 million (95 percent) of all Section 1206 funding for counterterrorism- related equipment and training and $47 million (5 percent) to build the  capacity of five partner nations to participate in stability operations with  the United States. Overall, DOD and State have allotted 82 percent of  these resources to projects that address specific terrorist threats, based on  our review of approved project proposals. Furthermore, we found that  most Section 1206 counterterrorism resources have been directed to  countries that the U.S. intelligence community has identified as priority  countries for the counterterrorism effort.
The focus on specific terrorist threats increased in fiscal year 2009. In  fiscal years 2007 and 2008, DOD and State allotted 75 percent ($405  million) of $536 million to fund Section 1206 projects targeted at specific  terrorist threats. Proposals for the remaining projects identify global  terrorist threats in general or security issues indirectly related to  terrorism, such as ungoverned spaces and smuggling. For example, in the  Caribbean region, several Section 1206 projects funded in fiscal years 2007  and 2008 were justified as countering a terrorist threat but did not  specifically identify the source of that threat, and appeared to address  narcotics trafficking more directly. In Albania, a U.S. official noted that the  country received Section 1206 funding in fiscal year 2008 even though  there was no significant terrorist threat there. He explained that Section  1206-funded boats would be used primarily to respond to potential  security threats such as smuggling and human trafficking in coastal waters  that the Albanian government had not previously patrolled. For fiscal year  2009, DOD and State issued instructions that project proposals must  describe the “actual or potential terrorist threat” to be addressed and how  the project responds to “an urgent and emergent threat or opportunity.” In  line with these instructions, we found that 92 percent ($306 million) of the  $334 million approved for fiscal year 2009 proposals identified a specific  terrorist threat to be addressed (see fig. 4).
section_title: Section 1207 Program Generally Consistent with U.S. Stabilization Priorities
paragraphs: The Section 1207 program has generally been consistent with U.S.  stabilization priorities. According to State guidelines for the program,  State uses DOD funds to provide reconstruction, stabilization, and security  assistance to a foreign country for the purpose of restoring or maintaining  peace and security. State has therefore indicated that countries eligible to  receive Section 1207 funding should be at significant risk of instability or  working to recover from instability. State uses a U.S. government source— an interagency “watchlist” developed to identify countries vulnerable to  state failure—to help determine which countries could merit conflict  prevention and mitigation efforts, and has established inclusion on the list  as one of the criteria for a country to receive funding through the Section  1207 program. We found that most countries receiving Section 1207  funding appear on this watchlist. Further, according to our analysis of  data we obtained from an independent risk forecasting firm, DOD, and USAID allotted 77 percent of Section 1207 funds to countries  measuring high, very high, or extremely high levels of instability, as s in figure 5. Section 1207 projects shows that these projects address either the  prevention of instability in a particular country or region or the recovery  from instability or conflict. Eighteen proposals (about two-thirds) w projects to help countries recover from instability or conflict, as in  Georgia, Kenya, and Lebanon. The remaining 10 proposals (about one third) were for projects that hel p prevent instability, as in Bangladesh,  Panama, and the Philippines.
As reported by IHS Global Insight’s Global Risk Service in the country rating section for  short-term, internal political risk. IHS Global Insight is a private forecasting company that  provides economic, financial, and political analyses, including risk assessments, of over 200  countries. IHS Global Insight’s Global Risk Service monitors and updates country risk  assessments on a quarterly basis. The Global Risk Service political risk score is a weighted  average summary of probabilities that different political events, both domestic and  external, such as civil war and trade conflicts, will reduce gross domestic product growth  rates. The subjective probabilities are assessed by economists and country analysts at IHS  Global Insight, on the basis of a wide range of information, and are reviewed by a team to  ensure consistency across countries.
section_title: Section 1206 Program Is Generally Distinct, but Section 1207 Program Is Not
paragraphs: According to DOD and State guidelines, the Section 1206 program has  generally been distinct from other train and equip programs. DOD and  State have used it to address unforeseen U.S. military needs relatively  quickly compared with FMF and other programs. The Section 1207  program is not distinct from other programs, as it has funded  reconstruction, stability, and security-related activities that are virtually  indistinguishable from those of other foreign aid programs in their content  and time frames. Furthermore, using Section 1207 program funding for  these projects has entailed additional implementation costs and funding  delays.
subsections: section_title: Section 1206 Program Is Generally Distinct from Other Train and Equip Programs
paragraphs: According to DOD and State guidelines for fiscal year 2009, the Section  1206 program should be distinct from security assistance programs in that  its projects (1) address U.S. military priorities; (2) respond to urgent and  emergent needs; (3) do not overlap with other State and DOD train and  equip programs, such as FMF, by “backfilling” lower-priority projects  unfunded by those programs; and (4) are administered with a dual key, or  DOD and State interagency process, to ensure they accord with U.S.  foreign policy.
subsections: section_title: Addressing U.S. Military Priorities
paragraphs: DOD and State have consistently used Section 1206 to address U.S.  military priorities. Each U.S. geographic military command reviews  proposals from U.S. embassy country teams in its area of responsibility  and endorses for final submission those proposed projects that address its  highest priorities. Furthermore, the U.S. Special Operations Command  reviews all Section 1206 project proposals to ensure that each aligns with  U.S. military strategy and ranks each proposal across the geographic  combatant commands in accordance with counterterrorism priorities.  Our review of approved Section 1206 project proposals indicates that  projects are designed primarily to address U.S. military requirements that  are also aligned with the countries’ security interests. DOD officials we  interviewed described the Section 1206 program as a way to meet U.S.  military priorities that they may not have been able to address without the  Section 1206 program. For example, in Kazakhstan, according to a U.S.  embassy official, DOD and State have used Section 1206 funds to address  its priority of enhancing the country’s counterterrorism capacity in the  Caspian Sea, while Kazakhstan has requested FMF funding for its priority  to develop its military airlift capability. In Pakistan, U.S. officials used  Section 1206 funds to increase special operations capacity to support  counterterrorism operations on its western border, a U.S. military  counterterrorism priority for which DOD and State had not been able to  persuade the country to use FMF resources.
section_title: Responding to Urgent and Emergent Needs
paragraphs: DOD and State can use Section 1206 funds to respond to urgent and  emergent needs more quickly than they have been able to do with FMF  and other security assistance programs. With the Section 1206 program,  DOD and State have often formulated and begun implementing projects  within 1 fiscal year, while FMF projects have usually required up to 3 years  of planning. U.S. geographic combatant commands and embassies submit  project proposals early in the fiscal year, and DOD and State select  projects for funding in the months that follow. DOD and State had already  approved Section 1206 project proposals for fiscal year 2009 when we  interviewed most SAOs, some of whom told us that equipment associated  with those proposals had already begun to arrive in country. For example,  radios approved as part of a fiscal year 2009 equipment package for Mali  arrived and were installed in September of that same fiscal year. In  contrast, several SAOs we interviewed in fiscal years 2009 and the  beginning of 2010 were either drafting or had recently submitted FMF  requests for fiscal year 2012. This requires the SAOs to plan for training  and equipment relatively far in advance, without necessarily knowing what  the geopolitical context will be when the countries receive the assistance.  According to DOD and State officials, this process, including consultation  and negotiation with partner nations, incorporating funding requests into  State’s budget, and obtaining appropriations, can take up to 3 years.  Because DOD and State can review and approve Section 1206 project  proposals more quickly than this, SAOs have used Section 1206 projects to  begin addressing new requirements that DOD may not have not foreseen  when it submitted the FMF request for the same fiscal year.
section_title: Avoiding Overlap with Other Train and Equip Programs
paragraphs: DOD officials we interviewed stated that the narrower goals of the Section  1206 program prevent overlap with the FMF program. They indicated that  FMF program objectives have traditionally been to achieve a variety of  U.S. foreign policy and partner nation military goals, which have not  necessarily included counterterrorism and stability operations. For  example, State has used the FMF program to strengthen bilateral  relationships, gain access to foreign governments, foster long-term defense  modernization of partner nations, and achieve other broad foreign policy  objectives. Eight of 15 SAOs we interviewed noted that the Section 1206  projects they were implementing addressed objectives substantially  different from those of the FMF program. SAOs further explained that  there is no guarantee that partner nations will use FMF to fund  counterterrorism and stability operations. For example, the SAO in  Kazakhstan explained that FMF has been used to enhance diplomatic  relations with that key ally by responding to its request for helicopters.
The Section 1206 program is also distinct in that it allows the United States  to provide partner countries with complete assistance packages, whereas  other funding sources might provide only a portion of the aid needed to  build a counterterrorism or stability operations capability. Eight of the 15  SAOs we interviewed noted that the Section 1206 program offered a  unique means to provide bundled training and equipment, such as  operations and maintenance training and spare parts. Agency officials in  Washington, D.C., also attested that one of the unique strengths of the 1206  program is that it allows the United States to provide partner countries  with comprehensive assistance packages. Of the 53 countries receiving  assistance in fiscal years 2006 through 2009, 50 (94 percent) received spare  parts or training, and 40 (75 percent) received both. SAOs we interviewed  indicated that other programs, such as FMF, may be used to fund spare  parts, or that Joint Combined Exchange Training might be used to provide  additional training for foreign troops, but those programs may not be able  to independently provide all the equipment and training components  typical of a Section 1206 package.
Although DOD and embassy officials we interviewed consistently  explained why there was no overlap between Section 1206 projects and  other programs, project proposals we reviewed have not always  documented the distinctions. DOD and State revised program guidelines in  fiscal year 2009 in response to congressional concerns regarding program  overlap with counternarcotics and other funding sources. However, in  reviewing the 25 approved Section 1206 project proposals for fiscal year  2009, 11 identified similar ongoing efforts that were funded by FMF or  other U.S. programs. Only 1 proposal clearly explained why there was no  overlap with other programs, and the remaining proposals did not  specifically address this issue. Also, during our overseas visits, we  observed some potential overlap between Section 1206 projects and other  U.S. security assistance programs that was not explained in corresponding  project proposals. In the Bahamas, DOD and State used Section 1206  program funds to provide that country with the same type of boats that  State had previously provided with International Narcotics Control and  Law Enforcement funding. (See fig. 6.)
In Kazakhstan, DOD and State used both the Section 1206 program and the  Global Peace Operations Initiative to provide equipment to a Kazakh  peacekeeping unit. The Global Peace Operations Initiative has also  funded training and equipment for at least 572 foreign troops worldwide  for deployments to operations in Iraq and Afghanistan, which could  overlap with Section 1206 program stabilization objectives. Figure 7  shows an example of U.S. assistance to Kazakhstan to build its capacity  for conducting stability operations, in part by providing spare parts for its  ground vehicles.
DOD and State have used a dual key decision-making process for selecting  Section 1206 projects, and in doing so have addressed three key practices  for interagency collaboration we have previously identified. DOD and  State incorporate interagency input at several stages of the Section 1206  proposal development and selection process. First, SAOs at recipient  country embassies have typically developed Section 1206 project  proposals—including objectives and implementation strategies—with  input from State and other colleagues. For instance, 12 of the 15 SAOs we  interviewed indicated that they had requested country team counterparts  to at least review, if not help draft, Section 1206 proposals before  submitting them. Through this process, DOD and State have defined  common outcomes and joint strategies for achieving them, two key  practices for interagency collaboration. Second, the relevant regional U.S.  geographic combatant commander and ambassador have approved each  proposal before officially submitting them to the Joint Staff for  consideration. Once a proposal is submitted, a DOD-State working group  reviews it and considers how Section 1206 projects will support U.S.  foreign policy and foreign assistance goals. Last, the Secretary of State  concurs with the Secretary of Defense’s approval of Section 1206 projects,  thereby leveraging resources for mutually beneficial projects—another  key practice for enhancing interagency collaboration.
section_title: Section 1207 Projects Are Largely Indistinguishable from Other State and USAID Activities, but Add Implementation Costs and Funding Delays
paragraphs: DOD and State guidelines indicate that Section 1207 projects should fund  activities that are distinct from those of other U.S. government foreign  assistance programs, and address urgent or emergent threats or  opportunities that conventional foreign assistance programs cannot  address in the required time frame.
subsections: section_title: Funding Distinct Activities
paragraphs: Section 1207 program-funded projects are consistent with the purposes  stated in the law but are not distinct from activities funded by other  foreign assistance programs. Overall, Section 1207 projects achieved  objectives commonly addressed through a variety of other programs. In  our country visits to Haiti, Georgia, and the Philippines, we observed many  Section 1207 program-funded activities with objectives similar to those of  prior or existing State and USAID programs in those countries. Moreover,  according to State and USAID officials in those countries, the same  activities implemented through Section 1207 funding could be  accomplished with additional funding from traditional foreign assistance  accounts, such as Economic Support Funds and Assistance for Europe,  Eurasia, and Central Asia.
Haiti’s Section 1207 project in fiscal year 2007 was aimed at stabilizing Cité  Soleil, an urban area of Port-au-Prince, Haiti’s capital, through rapid  implementation of short-term job creation activities, infrastructure  improvements, and security enhancement through police training and  equipment. However, from 2004 to 2006 (prior to the Section 1207 project)
USAID had implemented the Haiti Transition Initiative, which attempted to  stabilize urban areas, such as Cité Soleil, by rebuilding local services and  infrastructure and providing short-term employment. In 2005, USAID also  began the Urban Peace-Building Initiative, which attempted to stabilize  urban areas, including Cité Soleil, through economic development.  According to a USAID official in Haiti, this initiative was the precursor to  Haiti’s Section 1207 project. USAID used existing contracts with  nongovernmental organizations implementing other projects to carry out  the short-term job creation and infrastructure improvements in Haiti’s  Section 1207 project (see fig. 8).
Georgia’s Section 1207 project in fiscal years 2008 and 2009 provided  reconstruction assistance after the August 2008 Russian invasion,  including support for resettlement of internally displaced persons (see fig.  9), police training and equipment, and removal of unexploded ordnance.  However, according to State and USAID embassy officials, the Section  1207 project funded some activities with objectives that were previously  being addressed through existing programs. For example, by amending a  cooperative agreement with a nongovernmental organization partner,  USAID carried out its Section 1207-funded school rehabilitation activities  through an infrastructure initiative that had been operating since 2004.  Also, State’s Bureau for International Narcotics and Law Enforcement’s  (State/INL) plans to use Section 1207 funds to upgrade the Ministry of  Interior’s emergency communications system and national criminal  database were continuations of previously established State/INL programs  in Georgia. The removal of unexploded ordnance to facilitate the return of  internally displaced persons was carried out through a State humanitarian  demining program that had been operating in Georgia for several years.
The Philippines’ Section 1207 projects in fiscal years 2007 and 2009  attempt to stabilize the region of Mindanao through economic  development, with a focus on infrastructure development activities as well  as police training and equipment. However, USAID implemented the  Section 1207 infrastructure development activities in Mindanao through an  existing program—Growth with Equity in Mindanao—which had been  carrying out similar activities in the region since 1995 (see fig. 10). Also,  the Department of Justice has been conducting similar police training and  equipment activities in the Philippines, including in Mindanao, since 2006.
In addition, we reviewed all 28 approved Section 1207 proposals for fiscal  years 2006 through 2009, including the 6 proposals for the countries we  visited. We found that 22 proposals expand on recent or ongoing State and  USAID activities funded through other foreign assistance accounts. For  example, Colombia’s Section 1207 project in fiscal year 2007, which aimed  to stabilize regions of that country recently freed from insurgent control,  supported an interagency body of the Colombian government that the U.S.  Southern Command had funded 3 years earlier. In addition, Tajikistan’s  Section 1207 project in fiscal year 2008, intended to reduce the potential  for conflict in unstable areas, supports community policing and local  government development activities that build upon previous and  continuing USAID and State initiatives. Finally, Uganda’s Section 1207  project in fiscal year 2009, aimed at reestablishing the rule of law in the  north of the country, includes training for police and construction of  community justice centers, which have both been implemented under  previous and current USAID initiatives.
In December 2009, the Congress established the Complex Crises Fund,  which provides greater flexibility to USAID to prevent or respond to  emerging or unforeseen complex crises overseas. The Congress  appropriated $50 million for this fund, with which the Administrator of  USAID can fund such programs and activities, in consultation with the  Secretary of State. Furthermore, in its proposed budget for fiscal year  2011, released in February 2010, State requested another $100 million in  flexible contingency funding to meet unforeseen reconstruction and  stabilization needs. This request is intended to transition the funding of the  Section 1207 program from DOD to State. DOD has not requested Section  1207 funding for fiscal year 2011.
section_title: Addressing Urgent or Emergent Threats or Opportunities More Quickly than Other Programs
paragraphs: We found that State and USAID can provide funding to address urgent or  emergent threats or opportunities just as quickly, or more quickly, through  other foreign assistance programs, than through the Section 1207 program.  For example, in Georgia, where DOD and State allotted $100 million in  Section 1207 funds for reconstruction projects after the 2008 Russian  invasion, State provided over $50 million in Economic Support Funds to  start similar projects before the full amount of Section 1207 funds was  available. In the Philippines, when faced with an initial delay in receiving  approved Section 1207 funds in fiscal year 2007 for police training in  Mindanao, State reprogrammed International Narcotics Control and Law  Enforcement funds for this purpose. Furthermore, our review of Section  1207 project proposals shows that the proposals for projects in Lebanon in  fiscal year 2006 and Kenya in fiscal year 2009 describe using  reprogrammed funds from conventional accounts alongside Section 1207  funds to help achieve similar stabilization goals.
section_title: Additional Implementation Costs and Funding Delays
paragraphs: Using Section 1207 funding for reconstruction, stabilization, and security- related projects has created a new layer of program management through  State’s Office of the Coordinator for Reconstruction and Stabilization  (State/S/CRS)—the office responsible for oversight of the Section 1207  program—which has entailed additional implementation costs and funding  delays with negative consequences.
In addition to State and USAID’s normal administrative costs for  implementing an assistance project, State/S/CRS charges a fee for  oversight of Section 1207 projects to cover the cost of program support  and coordination from Washington, D.C., and in the field. For fiscal years  2008 and 2009, this fee totaled nearly $2.5 million, which State/S/CRS  deducted from the project funds DOD transferred to State. When added to  State and USAID administrative costs of nearly $5.4 million during the  same period, the State/S/CRS fee represents an increase of 46 percent for  overall administrative costs for Section 1207 projects during these 2 years.  Furthermore, according to embassy officials we spoke to in Haiti, Georgia,  and the Philippines, State/S/CRS oversight over Section 1207 has not  necessarily improved project implementation or effectiveness. State and  USAID officials at these embassies questioned the added value of  State/S/CRS’s oversight of the Section 1207 program. According to the  officials, State/S/CRS offers to coordinate interagency efforts and facilitate  interagency collaboration within the country teams to help develop and  execute Section 1207 projects. However, the embassy officials stated that  interagency collaboration is already a part of how their country teams  operate, through country team working groups and the development of  mission strategic plans, and that the ambassador or deputy chief of  mission can encourage such collaboration when necessary. In our  discussions with State/S/CRS officials, they identified their ability to  facilitate a whole-of-government approach for embassy country teams as  their key added value and cited six countries—Lebanon, Nepal, Panama,  Sri Lanka, Tajikistan, and Uganda—where their involvement brought  benefits. However, they did not provide any documentation to support this  claim.
We also found that addressing urgent or emergent threats or opportunities  through the Section 1207 program has caused funding delays, which have  had some negative consequences. In two countries we visited, funding for  State/INL-implemented activities was significantly delayed compared with  funding for USAID activities within the same project. In the Philippines,  U.S. embassy officials told us that State borrowed funds from an existing  police assistance project in order to start its Section 1207-funded police  training on time, with an understanding that Section 1207 funds would  arrive quickly for reimbursement. However, the Section 1207 funds took 6  months longer than expected to arrive, which subsequently delayed the  existing police assistance project by 18 months and decreased the overall  quantity of equipment procured. According to officials at the U.S. embassy  in Georgia, a 6-month delay in receiving State’s Section 1207 funds for law  enforcement activities interfered with the embassy’s goal of  simultaneously improving the security and economy in the conflict zone.  We also found in our review of quarterly reporting documents for all  Section 1207 projects that funding delays for State activities was an issue  in at least three other countries—Bangladesh, Kenya, and Malaysia. For  example, in Kenya, U.S. embassy officials reported that the delay of  Section 1207 funds for State’s police assistance resulted in the  postponement of a State/INL assessment visit necessary to begin providing  assistance.
In contrast, DOD and State implement the 1206 program within the  existing management structure of FMF, under the auspices of the Defense  Security Cooperation Agency. Hence, the Defense Security Cooperation  Agency charges the same administrative fees for both programs and  procures training and equipment at least as quickly for Section 1206  projects as for FMF.
section_title: Long-term Impact of Section 1206 Projects at Risk without Sustainment Planning
paragraphs: The long-term impact of Section 1206 projects is at risk, because it is  uncertain whether funds will be available to sustain the military  capabilities that these projects are intended to build. U.S. law and DOD  and State policies limit the use of U.S. government funds for sustainment  of Section 1206 projects, and most participating countries have relatively  low incomes and may be unwilling or unable to provide the necessary  resources. For the Section 1207 program, since State, USAID, and DOD are  not restricted by law or agency policy from drawing on a variety of  overlapping funding sources to continue and expand Section 1207  projects, sustainment risks are not as significant.
subsections: section_title: Availability of Funding to Sustain Section 1206 Projects Is Uncertain
paragraphs: According to State planning documents, including department- and  bureau-level performance plans, helping partner nations achieve  sustainable counterterrorism capabilities is a key foreign policy  objective. In addition, the joint DOD and State Inspectors General report  on the Section 1206 program found that continued sustainment is essential  to achieving the intended objectives of the Section 1206 program and that  long-term sustainability of Section 1206 projects depends on continued  investment by the partner nations or U.S. government. DOD officials  have noted that some Section 1206 projects are intended to address an  immediate threat and may not require long-term sustainment.  Nevertheless, according to Section 1206 project proposal instructions,  proposals must explain how projects will be sustained in future years.
However, we found that the availability of sustainment funds from the U.S.  government is uncertain. DOD and State policy has potentially constrained  the use of U.S. government funding for Section 1206 project sustainment.  According to fiscal year 2009 program guidelines, the Section 1206  program should not fund projects that must be continued over long  periods (more than 3 years) to achieve a capability for a partner nation.  However, Section 1206 projects are highly dependent on U.S. funding for  long-term sustainment. Prior to fiscal year 2009, 62 (56 percent) of 110  approved Section 1206 proposals we reviewed indicated that FMF  resources would be used to sustain projects. Other potential sources of  sustainment funds identified in proposals include partner nations’ own  resources and other U.S. programs.
Despite the new guidelines, 13 (52 percent) of the 25 approved fiscal year  2009 Section 1206 proposals we reviewed indicated that partner nations  would use FMF resources to sustain Section 1206 projects. Furthermore,  11 (73 percent) of the 15 SAOs we interviewed had already requested or  planned to request FMF resources to sustain Section 1206 projects.  However, several SAOs were not certain that State would award the funds  they had requested. State determines FMF allotments to recipient  countries based on congressional direction and availability of funds, and at  the time of our interviews, State had not finalized fiscal year 2010  allotments. Moreover, in fiscal years 2006 through 2009, 18 (34 percent) of  the 53 Section 1206 recipient countries did not receive any FMF funding.  While proposals continue to cite FMF for Section 1206 project  sustainment, a provision of the fiscal year 2009 Omnibus Appropriations  Act potentially further constrains the use of FMF to sustain Section 1206  projects. This provision, which prohibits the use of FMF funds to support  or continue any Section 1206 projects unless the Secretary of State  justifies such use to the Committees on Appropriations, may limit the  availability of FMF for Section 1206 project sustainment.
The ability of partner nations to sustain Section 1206 projects in the  absence of U.S. funding is also uncertain. DOD and State have not required  countries to sign formal commitments to sustain Section 1206 projects,  and only 35 (26 percent) of the 135 proposals we reviewed for fiscal years  2007-2009 projects explicitly address the recipient country’s ability or  willingness to bear sustainment costs. Furthermore, only 9 (7 percent) of  those 135 proposals provided estimates of the project’s maintenance,  operation, or other sustainment costs. Moreover, DOD and State have  implemented 113 (76 percent) of 149 Section 1206 projects in low- or  lower-middle-income countries, as classified by the World Bank, where  funding for sustainment efforts may be scarce. Only 1 of the SAOs we  interviewed in 15 countries indicated that he believed his partner nation  had the ability to sustain its Section 1206 projects independently; 6 SAOs  said that they did not believe their partner nations had this ability, and 8  were uncertain. For example, the SAO in Nigeria was concerned about  that country’s ability to support long-term maintenance activities for the  vehicles, surveillance, and other Section 1206-funded equipment. Similarly,  the SAO in Mali noted that sustainment of the Section 1206 project to train  and equip that country’s light infantry units would be problematic if the  country had to find its own funding. Only the SAO in Malaysia believed  that the partner nation would fund the necessary sustainment of its  maritime surveillance projects, based on that government’s stated  intention to do so. Furthermore, Section 1206 program managers at U.S.  geographic combatant commands also questioned the likelihood of  partner nations to sustain Section 1206 projects. For example, at the U.S.  Africa Command, the Section 1206 program manager explained that while  the command would prefer that partner nations budget for sustainment  activities, it was unlikely this would happen.
section_title: State and USAID Can Leverage Other U.S. Assistance Program Resources to Sustain Section 1207 Projects
paragraphs: Since the Section 1207 program does not have the same statutory or policy  constraints as the Section 1206 program on using other U.S. assistance  program resources to sustain projects, State and USAID use other U.S.  assistance program resources for this purpose. State and DOD  acknowledged in fiscal year 2008 guidelines that Section 1207 projects  should seek to achieve short-term security, stabilization, or reconstruction  objectives that are coordinated with longer-term development efforts to be  sustained by the host government, international organizations, or other  forms of U.S. foreign assistance. In our visits to Haiti, Georgia, and the  Philippines, we found that State and USAID have provided assistance  through other projects that are similar to Section 1207 projects and help  sustain and consolidate their impacts. For example, in Haiti, USAID’s  implementing partners have helped support the goals of the fiscal year  2007 Section 1207 project by funding assistance activities in Cité Soleil and  neighboring areas through other ongoing USAID projects. In addition, in  September 2009, State and USAID officials in Haiti told us that they  planned to continue efforts to stabilize Port-au-Prince by using Economic  Support Funds and International Narcotics Control and Law Enforcement  funding. In the Philippines, where the Section 1207 project in fiscal year  2007 has attempted to stabilize the region of Mindanao through economic  development, USAID applied funds from an ongoing project in the region  to supplement a Section 1207 activity—an upgrade to a local water  distribution system—that required additional support.
Furthermore, in our review of all 28 proposals for Section 1207 projects,  we found that 21 proposals address the issue of sustainment by identifying  possible sources of funding to sustain or build on project results. Among  the 21 proposals, 17 identify additional U.S. foreign assistance funding as a  source, 10 cite host government resources, and 5 mention other donors,  such as other countries and international organizations. Only 3 proposals  identify host government resources as the sole source of possible  sustainment funding: Two of these are for upper-middle-income countries  and the third is in a lower-middle-income country. Not every project goal  funded through the Section 1207 program requires sustainment funding.  For example, in Georgia’s Section 1207 project in fiscal year 2008, USAID  funded a “winter wheat” initiative, which was designed as onetime  assistance to provide seed, fertilizer, and other supplies so that farmers  disrupted by the 2008 Russian invasion could produce a wheat crop in the  months after the conflict. As a result of this initiative, the farmers  harvested a better than expected wheat crop in the fall of 2009, according  to the Georgian Deputy Minister of Agriculture.
section_title: Section 1206 and 1207 Program Monitoring and Evaluation Is Weak
paragraphs: DOD and State have conducted little monitoring and evaluation of the  Section 1206 and Section 1207 programs. DOD and State have not carried  out systematic program monitoring for the Section 1206 program, and  reporting has generally consisted of anecdotal information, although DOD  has taken initial steps to establish such a system. For the Section 1207  program, State requires quarterly reporting on project implementation but  has not analyzed this information or reported results to DOD to inform  program management and funding decisions. As a result of these  deficiencies, U.S. agencies have made decisions to sustain and expand  both Section 1206 and 1207 projects without formal assessments of project  progress or impact.
The Government Performance and Results Act of 1993 requires agencies to  develop objective performance measures, monitor progress on achieving  goals, and report on their progress in their annual performance reports.  Our previous work has noted that the lack of clear, measurable goals  makes it difficult for program managers and staff to link their day-to-day  efforts to achieving the agency’s intended mission. Furthermore,  according to Standards for Internal Control in the Federal Government,  U.S. agencies should monitor and assess the quality of performance over  time. In addition, we have previously reported that key practices for  enhancing and sustaining interagency collaboration include developing  mechanisms to monitor, evaluate, and report the results of collaborative  programs; reinforcing agency accountability for collaborative efforts  through agency plans and reports; and reinforcing individual  accountability for collaborative efforts through agency performance  management systems. Also, the Congress has directed the Secretaries of  Defense and State to report on the implementation and impact of Building  Global Partnership authorities provided under the Section 1206 and 1207  authorities no later than December 31, 2010.
subsections: section_title: Section 1206 Program Lacks Measurable Performance Objectives, Monitoring and Evaluation Plans, and Results Reporting
paragraphs: DOD and State have not consistently defined performance measures for  their Section 1206 projects, although the agencies have made some  improvement in doing so. Section 1206 program guidelines and  instructions for fiscal year 2007 required project proposals to identify  measures of effectiveness, and in fiscal year 2008, revised instructions  required project proposals to identify the anticipated outcomes. However,  we found that only 27 percent (30) of 110 approved proposals for fiscal  year 2007 and 2008 provided this information. DOD and State refined the  instructions for fiscal year 2009 by requiring project proposals to identify  measures of effectiveness. As a result, 72 percent (18 of 25) of projects  approved in fiscal year 2009 include this information. Overall, DOD and  State have defined measures of effectiveness or anticipated outcomes for  only 32 percent (48 of 149) of all projects approved from fiscal years 2006  through 2009.
Furthermore, DOD and State have not established a plan to monitor and  evaluate Section 1206 program results systematically. DOD officials stated  that they had not consistently monitored Section 1206 projects, and State  officials were not involved with or aware of a formal evaluation process.  In addition, only 34 (25 percent) of 135 approved fiscal year 2007-2009  proposals we reviewed documented an intention to monitor project  results. Some SAOs we interviewed noted that embassy officials  sometimes informally monitor Section 1206 project activities. For  example, in Georgia, U.S. military trainers observed the use and  maintenance of some Section 1206 program-funded equipment when they  helped prepare troops for deployment to Afghanistan. Also, in Sri Lanka,  DOD officials inspected some Section 1206 equipment when they hosted  an Inspector General visit to the country.
Although regular reporting on performance is an established good  management practice, DOD and State have not required Section 1206  program managers to report on progress or results. Only one of the six  U.S. geographic combatant commands indicated that it routinely required  SAOs implementing Section 1206 projects overseas to submit regular  progress reports. Furthermore, 13 of the 15 SAOs we interviewed indicated  that they do not routinely submit any formal reports to DOD or State on  the Section 1206 projects they implement. For example, 1 SAO indicated  that no reports were required and that he had not volunteered to write  any. A few SAOs noted that they report the status of equipment deliveries,  but not project results or impact. DOD and State have undertaken two  evaluations of the Section 1206 program, focusing largely on initial  projects. The first, prepared by a contractor in July 2008, addressed fiscal  year 2006 and 2007 projects in Lebanon, Yemen, Pakistan, and São Tomé  and Principe. The second, prepared jointly by the DOD and State  Inspectors General, focused on seven countries with projects approved in  fiscal year 2006. Since DOD and State had not established objective  performance measures for most of the projects reviewed, these reports  relied heavily on anecdotal information to assess progress and  effectiveness.
These monitoring, evaluation, and reporting deficiencies may stem from  DOD’s and State’s unclear assignment of roles and responsibilities for  these tasks. We have previously reported that clearly identifying roles and  responsibilities and establishing policies to operate across agency  boundaries are key practices for enhancing interagency collaboration.  However, DOD and State have not applied these practices for Section 1206  program monitoring and evaluation. Section 1206 program managers we  spoke to at U.S. geographic combatant commands had varied opinions  regarding who should be responsible for monitoring Section 1206 projects.
For example, officials at the U.S. Central Command indicated that  monitoring and evaluation should be the joint responsibility of State,  relevant embassies’ chiefs of mission, U.S. geographic combatant  commands, as well as the SAOs. The security assistance manager at the  U.S. Africa Command understood that monitoring was a responsibility of  the relevant embassy country teams. Meanwhile, DOD officials in the  Office of the Secretary of Defense told us they thought the U.S. geographic  combatant commands should evaluate Section 1206 projects. One project  proposal indicated only that “the embassy” should be responsible for  monitoring the project in question, without identifying any particular  office for this task.
DOD and State lack a monitoring and evaluation system; nevertheless,  they have requested additional funding to sustain Section 1206 projects  without documented evidence of results. SAOs have sometimes submitted  FMF requests for Section 1206 project sustainment before the projects are  fully implemented in order to have those funds available by the end of the  2-year period for which spare parts are typically included in Section 1206  packages. For example, the SAO in Lebanon explained that the Lebanon  Armed Forces planned to use FMF to sustain its Section 1206 projects, and  that he had already submitted FMF requests to that end despite the fact  that most Section 1206 projects in Lebanon have not yet been fully  implemented. In Ukraine, the SAO has submitted FMF requests for fiscal  years 2010 through 2012, although some of the Section 1206 equipment  had not yet been shipped to the country.
According to a DOD official in the Office of the Assistant Secretary of  Defense for Special Operations, Low Intensity Conflict, and  Interdependent Capabilities—the office with overall responsibility for the  Section 1206 program—DOD has begun to implement a new two-phase  initiative to assess Section 1206 projects. This assessment process is  intended to use both quantitative and qualitative performance-related data  to form the basis for measuring progress toward desired project outcomes.  For the first phase, DOD has hired a contractor to identify current Section  1206 roles, data sources, and ongoing assessment activities to develop a  framework for implementing Section 1206 assessments. The contract was  signed in January 2010 and the final deliverable is due 8 months later.  According to the officer, the second phase will consist of using the newly  designed framework to assess a sample of Section 1206 projects. In  addition, the official indicated that resources would not be available to  evaluate all Section 1206 projects, and that the agency had not yet  determined what sample of countries would be assessed.
section_title: Section 1207 Projects Have Measures of Effectiveness, but State Has Conducted Limited Monitoring and Evaluation
paragraphs: In general, State and USAID have established measures of effectiveness  for individual Section 1207 projects. In our review of all 28 approved  proposals for the Section 1207 program, we found that 25 proposals  identified measures of effectiveness or performance indicators. For  example, in the Philippines, State and USAID indicated that they would  assess the effectiveness of a Section 1207 project by measuring changes in  private sector investment, the prevalence of waterborne diseases, and  police response times, among other performance indicators.
State and DOD first issued guidelines for Section 1207 project monitoring  in January 2008, 2 years after the program began. According to these  guidelines, embassies with Section 1207 projects are responsible for  submitting quarterly progress reports containing both narrative and  financial data to State’s Office of the Coordinator for Reconstruction and  Stabilization (State/S/CRS) and to DOD’s Office of Partnership Strategy  and Stability Operations. According to the guidelines, the reports should  describe the project’s progress against the measures of effectiveness  established in the project proposal, identify any challenges expected over  the next quarter, and describe the expenditure to date on different project  activities. State/S/CRS officials told us that, initially, embassies typically  submitted these reports several months later than expected, but that  punctuality improved after State/S/CRS hosted a Section 1207 program  conference in May 2009. Since then, State/S/CRS officials said they usually  receive reports within 30 days after the end of the quarter.
State/S/CRS officials told us that they had not fully analyzed the quarterly  reports they received. According to these officials, State/S/CRS began  systematically analyzing the financial information contained in the reports  in April 2009, thereby monitoring the progress of project implementation  by tracking the obligation and expenditure of funds over time for each  component of the projects. However, State/S/CRS officials indicated that  they routinely reviewed the reports when they arrived, but had not  systematically analyzed them, because of staffing shortages. Thus,  State/S/CRS was not systematically monitoring project effectiveness or  implementation challenges described in the narrative section of these  reports as a basis for providing program oversight. In December 2009,  State/S/CRS assigned an additional employee to review the narrative  reports.
Although Section 1207 program guidelines instruct embassies to submit  quarterly reports to both State and DOD, embassies have not been sending  these reports to DOD, and State/S/CRS has not forwarded them.  State/S/CRS officials indicated that they have provided DOD information  on problems with Section 1207 projects but not on progress or  effectiveness. An official in DOD’s Office of Partnership Strategy and  Stability Operations responsible for the Section 1207 program issues told  us that, as of mid-December 2009, he had not received any Section 1207  quarterly reports, but that he was working with State/S/CRS to develop an  evaluation process for Section 1207 projects. Because of limited  monitoring and evaluation, State and DOD have made decisions about  sustaining Section 1207 projects without documentation on project  progress or effectiveness. For example, officials at the U.S. Southern  Command told us that they did not support a proposal from the U.S.  embassy in Haiti for a second Section 1207 project in fiscal year 2008  because they were not aware of the implementation progress or results of  the first project. Nevertheless, State/S/CRS officials told us that the  information obtained from the quarterly reports informed decisions about  proposal approval and funding at the decision-making level.
State/S/CRS officials told us that in January 2010 they began efforts to  develop information for the congressionally required report on the  implementation and impact of the Section 1207 program, which is due on  December 31, 2010. In particular, State/S/CRS offered to hire evaluation  specialists to help embassies receiving Section 1207 program funds in  fiscal year 2009 meet the congressional reporting requirement by  developing a monitoring strategy and carrying out data collection and  analysis. State/S/CRS has not offered this assistance to embassies that  received program funds in prior years, which represent 59 percent of all  Section 1207 funding through fiscal year 2009.
section_title: Conclusions
paragraphs: The Section 1206 and 1207 programs are aimed at achieving high-priority  counterterrorism, stabilization, reconstruction, and security objectives for  the United States. Anecdotal evidence from some early Section 1206 and  1207 projects suggests that individual projects under both programs could  achieve noteworthy results, but achieving long-term results from the  projects is likely to require a sustained U.S. effort, especially in poorer  countries. State and USAID can continue to draw upon traditional foreign  aid programs to continue nonmilitary assistance initiated under Section  1207. However, as the appropriate funding source for sustaining military  assistance under Section 1206 is unclear, given current legal restrictions  and agency policy, DOD and State need guidance from the Congress on  how to fund longer-term assistance. Furthermore, without a rigorous  monitoring and evaluation system, DOD and State have gathered little  evidence to prove that the programs have been effective and whether  continued funding should be provided to sustain the efforts they have  initiated. The Section 1207 authority has allowed DOD to infuse existing  USAID and State programs with additional resources to help those  agencies achieve their objectives. However, channeling these resources  through the Section 1207 authority has created a new layer of program  management, which appears to be largely redundant and entails additional  implementation costs and funding delays. Moreover, a new funding source  for projects similar to those of the Section 1207 program may supplant the  need to continue Section 1207 funding.
section_title: Matter for Congressional Consideration
paragraphs: In preparing to reauthorize U.S. national defense programs, the Congress  should consider requiring the Secretaries of Defense and State  to document how Section 1207 projects are distinct from those of other  foreign assistance programs and that these projects incur no additional  implementation costs and experience no funding delays beyond those of  other foreign assistance programs. In the absence of this documentation,  the Congress should consider not reauthorizing the Section 1207 program  for fiscal year 2011 and, instead, appropriate funds to State and USAID  programs.
Recommendations for  We are making five recommendations relating to the Section 1206 and  Executive Action  1207 programs. For the Section 1206 program, we recommend that the  Secretary of Defense, in consultation with the Secretary of State, (1)  develop and implement specific plans to monitor, evaluate, and report  routinely on Section 1206 project outcomes and their impact on U.S.  strategic objectives; (2) base further decisions about sustaining existing  Section 1206 projects on the results of such monitoring and evaluation; (3)  estimate the cost of sustaining projects at the time they are proposed and,  where possible, obtain a commitment from partner nations to fund those  costs; and (4) seek further guidance from the Congress on what funding  authorities are appropriate to sustain Section 1206 projects when the  Secretary determines that (a) projects address specific terrorist and  stabilization threats in high-priority countries, (b) reliable monitoring and  evaluation have shown that projects are effective, and (c) partner nation  funds are unavailable. For the Section 1207 program, we recommend that  the Secretary of Defense, in consultation with the Secretary of State and  the Administrator of USAID, develop and implement specific plans to  monitor, evaluate, and report on their outcomes and their impact on U.S.  strategic objectives to determine whether continued funding for these  projects is appropriate under other authorities and programs.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to DOD, State, and USAID. We received  written comments from all three, which we have reprinted in appendixes  V, VI, and VII, respectively. The agencies also provided technical  comments, which we incorporated throughout the report, as appropriate.
DOD concurred with all of our recommendations.
State indicated in its written comments that it appreciated the  observations contained in our report and would take them into account  when shaping the Complex Crises Fund, which State requested for fiscal  year 2011 to replace the Section 1207 program. State noted that this new  fund will solve many of the issues outlined in our report, including an  unwieldy funds transfer process that has sometimes prevented as rapid a  response to immediate needs as State would have preferred. State also  indicated that our findings regarding the limited monitoring and evaluation  for the Section 1207 program and additional administrative costs entailed  by the program were contradictory, noting that State has increasingly  developed and refined its monitoring and evaluation of Section 1207  projects, requiring adequate administrative costs to carry out. We disagree.  While State/S/CRS had taken some steps to increase its monitoring of  Section 1207 projects, it had neither systematically analyzed embassy  reports on the effectiveness of Section 1207 projects nor provided these  reports to its DOD counterparts responsible for the projects’ funding.  Accordingly, we do not believe that these efforts justified the additional  fees this office charged beyond those that State and USAID already  charged to implement the projects.
USAID noted in its written comments that our report highlights several  issues of interest to all agencies participating in the Section 1207 process  and that USAID looks forward to continuing to refine its business  processes based on our review.
We are sending copies of the report to the Secretaries of Defense and State  and other interested parties or interested congressional committees. In  addition, the report will be available at no charge on the GAO Web site at  http://www.gao.gov.
If you or your staff have questions about this report, please contact me at  (202) 512-8979 or at christoffj@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 VIII.
section_title: Appendix I: Scope and Methodology
paragraphs: Our review encompassed all projects funded by the Department of  Defense (DOD) under authorities in Sections 1206 and 1207 of the National  Defense Authorization Act of Fiscal Year 2006, as amended, during fiscal  years 2006 through 2009. For more in-depth project review, we focused on  18 of the 62 countries receiving assistance under these programs: Albania,  the Bahamas, Georgia, Haiti, Kazakhstan, Malaysia, and the Philippines,  where we visited with U.S. embassy officials and host country officials, as  well as implementing partner representatives in Section 1207 recipient  countries; Ethiopia, Pakistan, and Uganda, where we interviewed U.S.  embassy officials in conjunction with other GAO work; and Honduras,  Kenya, Lebanon, Mali, Mexico, Nigeria, Sri Lanka, and Ukraine, where we  conducted interviews with security assistance officers (SAO) or other  project managers via telephone. To select countries to visit, we ranked all  62 countries based on the following criteria: (1) the amount of Section  1206 and 1207 program funding a country had received in order to include  countries representing a significant portion of total funding, as well as  both large and small individual projects from each program; (2) the year  when a country’s projects began, in order to visit mature projects; (3) the  presence of both Section 1206 and Section 1207 projects in a country, in  order to use our time efficiently in visiting projects from both programs in  single country visits; (4) DOD and State suggestions; (5) recent GAO or  DOD and State Inspectors General visits, to reduce the burden on  embassies; (6) congressional interest; (7) security considerations; and (8)  opportunities to consolidate the fieldwork of multiple GAO engagements.  We selected the highest-ranking countries within the areas of  responsibility of each of the six U.S. geographic combatant commands.  For telephone interviews, we selected the next-highest-ranking country  within the area of responsibility of each combatant command and four  additional countries of strategic importance. The results of our work for  the 18 countries we selected are not necessarily generalizable to all 62  countries receiving assistance under these programs.
To assess the extent to which the Section 1206 and 1207 programs have  been consistent with U.S. government strategic priorities, we conducted  the following work.
We interviewed DOD, State, and U.S. Agency for International  Development (USAID) officials involved in implementing Section 1206 and  1207 programs and documented their views on how ongoing projects  relate to U.S. strategies and priorities. At DOD we spoke to officials from  the Office of the Secretary of Defense (OSD) and Joint Staff and the  Defense Security Cooperation Agency, in Washington, D.C.; the U.S.  Special Operations Command in Tampa, Florida; the six geographic  combatant commands—the U.S. Africa Command and the U.S. European  Command in Stuttgart, Germany; the U.S. Central Command in Tampa,  Florida; the U.S. Northern Command in Colorado Springs, Colorado (by  telephone); the U.S. Pacific Command in Honolulu, Hawaii; and the U.S.  Southern Command in Miami, Florida; and the Africa Command Navy  component, in Naples, Italy. At State we spoke to officials in the Bureau of  Political-Military Affairs and the Office of the Coordinator for  Reconstruction and Stabilization (State/S/CRS) in Washington, D.C. At  USAID we spoke to officials from the Office of the Chief Operating Officer  and the Bureau for Democracy, Conflict, and Humanitarian Assistance in  Washington, D.C. We also interviewed U.S. embassy officials (by telephone  or in person) in all 18 countries we selected. To identify U.S. strategic  priorities, we also obtained and analyzed documents, such as mission  strategic plans and lists of priority countries identified by the U.S.  intelligence community.
We analyzed Section 1206 program funding data and DOD’s priority  country list to determine the percentage of funding that has been allotted  for countries on this list. We calculated this amount overall and for each  year to identify any trends over time. Since the list of priority countries is  classified, we aggregated the information we reported from our analysis to  avoid disclosing classified information. We used funding data based on  allotments for each Section 1206 project, in line with DOD’s notifications  to the Congress, which we determined were sufficiently reliable for our  purposes.
We analyzed all written project proposals for approved Section 1206  program-funded projects to determine how many of them described  specific terrorist threats. DOD officials consistently identified these  proposals as the most authoritative and detailed documents about each  project’s purpose and objectives. In all, DOD and State have approved 92  proposals, accounting for 149 projects. No formal proposals had been  submitted for the 11 projects approved in fiscal year 2006 and 3 projects  approved in fiscal years 2007 and 2008. We analyzed the proposals for 135  projects from fiscal years 2007-2009: 62 projects approved in 2007, 48  projects approved in 2008, and 25 projects approved in 2009. We  determined that a project proposal addressed a specific threat if it (1)  provided information indicating that some terrorist act had occurred, had  been attempted, or had been or was being planned for in the  country/region of the project, or (2) referred to a terrorist organization or  individual in the country/region of the project that posed a threat that was  being targeted by the proposed project. If project proposals did not meet  these criteria, we determined that they addressed a nonspecific threat.  Projects that we determined fell into this second category included those  that addressed the global threat of terrorism, the existence of ungoverned  territory, illegal fishing, smuggling, narcotics trafficking, human  trafficking, piracy, or other illegal activities not specifically tied to  observable terrorist-related activity in the country/region in question. Two  analysts independently reviewed all the proposals according to these  criteria, and any disagreements in the determinations both made were  resolved through discussion.
We reviewed applicable Section 1207 program guidelines to identify the  requirements related to meeting U.S. stabilization priorities. We then  analyzed Section 1207 program funding data and a U.S. government  watchlist identifying countries vulnerable to state failure to determine the  percentage of program funding that has been allotted for countries on this  list. Since the watchlist is classified, we did not present specific data from  our analysis to avoid disclosing classified information. We also analyzed  political risk data compiled by IHS Global Insight, a private forecasting  firm, to determine the percentage of project funds that were allotted to  countries categorized as having high, very high, or extremely high short- term, internal political risk. This political risk score is a weighted average  summary of probabilities that different political events, both domestic and  external, such as civil war and trade conflicts, will reduce gross domestic  product growth rates. The subjective probabilities are assessed by  economists and country analysts at Global Insight on the basis of a wide  range of information, and are reviewed by a team to ensure consistency  across countries. The measures are revised quarterly; the measure we used  comes from the first quarter of the year after each project proposal for the  corresponding country was approved, except in the case of fiscal year  2009 projects, for which we used data from the third quarter of 2009  because data from the first quarter of 2010 were not yet available at the  time of our review. We combined the results for all years to indicate what  percentage of total funding was allotted to countries within each political  risk category. To assess the reliability of the risk rating data, we  interviewed officials of IHS Global Insight and reviewed related  documents describing the methods used to gather these data and the  internal control mechanisms employed to ensure consistency and  reliability. We also compared the risk scores of similar sources of data  related to country political risk to assess overall consistency. We  determined that these risk rating data were sufficiently reliable for the  purpose of assessing the general level of political stability of countries  receiving Section 1207 program assistance. In addition, we reviewed all 28  approved proposals relating to 25 projects in the Section 1207 program in  fiscal years 2006 through 2009 and assessed the extent to which proposals  were for projects to help countries recover from or prevent instability. We  considered that a project proposal addressed the prevention of instability  if (1) the project objectives described an attempt to prevent, deny,  counter, or reduce threat(s) to stability, such as armed conflict, violence,  extremism, or terrorism/terrorists, or (2) the project objectives described  an attempt to strengthen or enhance stability, and (3) the project did not  address recovery from a specific event or occurrence of instability. We  considered that a project proposal addressed the recovery from instability  if (1) the project objectives described a specific event or occurrence of  instability (e.g., insurgency, war, or episodic or recurring violence) and  supported postconflict reconstruction or rebuilding efforts, or (2) the  project objectives described efforts to help foreign governments regain or  reestablish control over territories or institutions that were previously  ungoverned or under the control of criminals, terrorists, or insurgents.  Two analysts independently reviewed all the proposals according to these  criteria, and any disagreements in the determinations both made were  resolved through discussion. We used funding data based on allotments  for each Section 1207 project, in line with DOD’s notifications to the  Congress, which we determined were sufficiently reliable for our  purposes.
To assess the extent to which the Section 1206 and 1207 programs are  distinct from other U.S. programs, we conducted the following work.
We reviewed applicable Section 1206 program guidelines to identify the  requirements relating to project distinctness. We then reviewed all  available written proposals for projects to which these requirements  applied (e.g., we compared projects approved in fiscal year 2009 with  fiscal year 2009 guidelines) and analyzed the information that the  proposals provided to distinguish the proposed project from those funded  by other security assistance programs. We categorized each proposal  based on whether the proposal (1) explained the reason(s), other than the  lack of available funds, that another program could not be used; (2) did  not address whether the proposed project was distinct from projects  funded by other programs, other than the lack of available funds; or (3)  identified one or more similar or related projects funded by another  program but did not explain how the proposed project was distinct. Two  analysts independently reviewed all the proposals according to these  criteria, and any disagreements in the determinations both made were  resolved through discussion. We considered only those proposals meeting  the first criterion to have documented that the proposed project was  distinct.
We also interviewed relevant staff—at OSD; State’s Bureau for Political- Military Affairs; all six geographic combatant commands; the Africa  Command Navy component; and the U.S. embassies in Albania, the  Bahamas, Georgia, Kazakhstan, the Philippines, Malaysia, Ethiopia,  Pakistan, Honduras, Lebanon, Mali, Mexico, Nigeria, Sri Lanka, and  Ukraine—in person or by telephone, and documented their views on the  factors that distinguish Section 1206 projects from other train and equip  projects that they help implement under other programs. To determine  whether funding assistance under Section 1206, instead of other  traditional security assistance programs, entailed additional costs or  funding delays, we asked an official from the Defense Security  Cooperation Agency overseeing the Section 1206 program about the fees  and implementation timing under this program and Foreign Military  Financing (FMF).
We reviewed applicable Section 1207 program guidelines to identify the  requirements relating to project distinctness. We then reviewed all  proposals for projects to which these requirements applied (i.e., 28  approved proposals for fiscal years 2006 through 2009) and assessed the  extent to which the proposals included information to distinguish the  respective project from those funded under other foreign assistance  programs. We considered a proposed project to be distinct from other  projects if (1) no other related projects were identified in the proposal, or  (2) the proposed project did not fund a continuation of a prior or existing  program in that country, through expansion of its geographic scope or an  increase in the number of identical or closely related activities. For  example, we did not consider an initiative to increase funding for an  existing school construction program to build additional schools in other  regions of a country to be distinct. We did not consider projects to be  undertaken using existing contracting mechanisms, grants, or cooperative  agreements to be distinct unless the type of proposed activity funded was  described as being substantially different from ongoing activities. Two  analysts independently reviewed all the proposals according to these  criteria, and any disagreements in the determinations both made were  resolved through discussion.
We reviewed quarterly reports from countries that received Section 1207  program funding for State’s Bureau of International Narcotics and Law  Enforcement activities to determine if funding delays were an issue. We  also reviewed Section 1207 program funding data to determine the  administrative costs charged by State/S/CRS, State (at U.S. embassies),  and USAID. In addition, we interviewed cognizant officials at the U.S.  embassies in Georgia, Haiti, Malaysia, the Philippines, and Uganda, and  documented their views of the factors that distinguish respective Section  1207 projects from other assistance activities that they help implement  under other programs. We also interviewed cognizant officials at USAID,  State/S/CRS, and five geographic commands and documented their views  on this topic.
To determine the extent to which the Section 1206 and 1207 projects have  addressed the sustainment needs of executed projects, we conducted the  following work.
We reviewed State and USAID documents describing U.S. foreign policy  goals relating to sustainment of international counterterrorism-related  efforts. We also reviewed Section 1206 program guidelines to identify  requirements relating to project sustainment. We then reviewed all  available written proposals for projects to which these requirements  applied (i.e., projects approved in fiscal year 2009) and analyzed the  information that each proposal included relating to project sustainment.  We identified all the sources of funding that each proposal indicated  would be used to sustain the project and categorized them as Foreign  Military Financing, U.S. programs other than FMF, or host country funds.  We also identified those proposals that indicated that host nation funds  alone would be used for sustainment. Two analysts independently  reviewed all the proposals according to these criteria, and any  disagreements in the determinations both made were resolved through  discussion.
We also interviewed cognizant officials at OSD, State’s Bureau for  Political-Military Affairs, all six geographic combatant commands, the  Africa Command Navy component, and the U.S. embassies in Albania, the  Bahamas, Ethiopia, Georgia, Honduras, Kazakhstan, Lebanon, Malaysia,  Mali, Mexico, Nigeria, Pakistan, the Philippines, Sri Lanka, and Ukraine,  and documented their views regarding sustainment of ongoing Section  1206 projects. We also used the World Bank’s 2010 country income ratings  to analyze the potential ability of recipient countries to independently  sustain Section 1206 projects.
We reviewed applicable Section 1207 program guidelines to identify the  requirements relating to project sustainment. We then reviewed all  available written proposals to which these requirements applied (i.e., all 28  approved proposals for fiscal years 2006 through 2009) and assessed  whether each proposal included information relating to project  sustainment. We identified all the sources of funding that each proposal  indicated would be used to sustain the project and categorized them as  U.S. government assistance, host nation funds, or non-U.S. donors or other  sources. We also identified those proposals that indicated that host nation  resources alone would be used for sustainment. Two analysts  independently reviewed all the proposals according to these criteria, and  any disagreements in the determinations both made were resolved through  discussion. In addition, we interviewed relevant staff at U.S. embassies in  Georgia, Haiti, Malaysia, and the Philippines, and documented their views  regarding sustainment of ongoing Section 1207 projects. We also  documented the views on this topic from cognizant officials at USAID,  State/S/CRS, and five geographic combatant commands. For those  projects where potential sustainment from U.S. or other donor sources  was not addressed by project proposals, we used the World Bank’s 2010  country income ratings to analyze the potential ability of the recipient  countries to independently sustain Section 1207 activities. We determined  that these data were sufficiently reliable for the purpose of this analysis.
To establish the extent to which the Section 1206 and 1207 programs  incorporate plans for monitoring and evaluation to assess project impact  and inform program implementation, we conducted the following work.
We reviewed applicable Section 1206 and 1207 program guidelines, as well  as authorizing legislation, the Government Performance and Results Act of  2003, and Standards for Internal Controls in the Federal Government to  identify the requirements relating to project monitoring and evaluation.
To determine what monitoring and evaluation has been conducted and  what was planned for the Section 1206 program, we interviewed cognizant  DOD and State officials in Washington, D.C., and at the six U.S. geographic  combatant commands and the Africa Command Navy component, as well  as U.S. officials in Albania, the Bahamas, Ethiopia, Georgia, Honduras,  Kazakhstan, Lebanon, Malaysia, Mali, Mexico, Nigeria, Pakistan, the  Philippines, Sri Lanka, and Ukraine in person or via telephone. We also  analyzed the 135 available written project proposals to determine the  extent to which they identified measurable program objectives. We  considered a proposal as having a measurable objective if (1) it identified  an objective or an expected outcome and a means of quantitatively or  qualitatively assessing achievement of that objective or outcome, or (2) it  identified a specific expected outcome, such as the establishment of a  particular military capability or deployment of troops in a particular  stabilization operation, specific enough that an observer could reasonably  be expected to determine by objective means whether the outcome had  been achieved. We did not consider a proposal as having a measurable  objective if (1) it did not identify any objective or expected outcome or (2)  it described the objective or expected outcome in general terms, such as  achieving long-term stability or establishing an effective deterrence against  extremist incursions, without identifying potential indicators or other  quantitative or qualitative means to assess the achievement of that  objective or outcome. Two analysts independently reviewed all the  proposals according to these criteria, and any disagreements in the  determinations both made were resolved through discussion.
To determine what monitoring and evaluation has been conducted and  what was planned for the Section 1207 program, we interviewed cognizant  DOD, State, and USAID officials, as well as agency officials at five U.S.  geographic combatant commands. In addition, we interviewed relevant  staff at U.S. embassies in Georgia, Haiti, Malaysia, and the Philippines, and  documented their views regarding monitoring and evaluation of ongoing  Section 1207 projects. We also analyzed all 28 approved proposals to  determine the extent to which they identified measures of effectiveness.  We considered a proposal to have measures of effectiveness if it identified  either quantitative or qualitative measures or performance indicators that  would be used to assess the results of the proposed project. We did not  require the proposal to provide detailed information about every measure  or indicator that would be used, but we considered a basic description of  them or examples as adequate evidence to meet the criteria. We did not  consider a reference to State’s standard performance measurement  structure as adequate evidence to meet our criteria unless the proposal  identified which standard measures would be used. Two analysts  independently reviewed all the proposals according to these criteria, and  any disagreements in the determinations both made were resolved through  discussion.
We conducted this performance audit from February 2009 to April 2010 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.
section_title: Appendix II: Descriptions of Traditional DOD and State Assistance Programs
paragraphs: Table 3 describes selected U.S. foreign assistance programs and accounts  that DOD, State, and USAID have traditionally used to fund training and  equipment for counterterrorism and stabilization operation support and  assistance related to reconstruction, security, and stabilization.
section_title: Appendix III: Section 1206 and 1207 Funding Allotments
paragraphs: Table 4 lists the recipient countries and their allotments of Section 1206  and 1207 funds for fiscal years 2006 through 2009, ranked according to  total amount funding provided.
Figures 11 and 12 show the allotments of Section 1206 and 1207 funds,  respectively, to U.S. geographic combatant commands for fiscal years 2006  through 2009.
section_title: Appendix IV: Types of Assistance Provided through Section 1206 and 1207 Programs
paragraphs: Table 5 lists the recipients of Section 1206 funds and the type of equipment  DOD and State have provided to each country for fiscal years 2006 through  2009.
Table 6 lists the recipients of Section 1207 funds and the type of  reconstruction, stabilization, and security assistance provided by State and  USAID.
section_title: Appendix V: Comments from the Department of Defense
section_title: Appendix VI: Comments from the Department of State
section_title: Appendix VII: Comments from the U.S. Agency for International Development
section_title: Appendix VIII: GAO Contact and Staff Acknowledgments
subsections: section_title: Staff Acknowledgments
paragraphs: Key contributors to this report include Jeffrey Phillips, Assistant Director;  James Michels; Kathryn Bolduc; Robert Heilman; Martin de Alteriis;  Michael Silver; Mark Dowling; John Pendleton; Marie Mak; Alissa Czyz;  Jodie Sandel; Erin Smith; Thomas Costa; Kathryn Bernet; John Neumann;  Michael Rohrback; Sally Williamson; Jeff Isaacs; Ophelia Robinson; Jenna  Beveridge; Joseph Carney; Lynn Cothern; Anthony Pordes; and Jeremy  Sebest.