Federal Personnel: Issues on the Need for NOAA's Commissioned Corps
Published: 1996-10-31T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Pursuant to a congressional request, GAO reviewed the operations of the National Oceanic and Atmospheric Administration's (NOAA) Commissioned Corps, focusing on: (1) whether there continues to be a need for a commissioned corps with military-like pay, allowances, and benefits; and (2) what the costs would be if federal civilian employees performed the Corps' functions.
section_title: What GAO Found
paragraphs: GAO found that: (1) the NOAA Corps carries out civilian, rather than military, functions; (2) Corps officers operate and manage NOAA research and survey ships that collect the data needed to support fishery management plans, oceanographic and climate research, and hydrographic surveys; (3) Corps officers' entitlement to military ranks and military-like compensation was an outgrowth of their temporary assignments to the armed forces during World Wars I and II; (4) the Department of Defense's war mobilization plans envision no role for the Corps in the future; (5) Corps officers are not subject to the Uniform Code of Military Justice; (6) the government would realize estimated net savings of $661,000 by converting the Corps to civilian status; and (7) a general downsizing in the Department of Commerce reduced the number of Corps officers to 332 as of July 1996, with a goal of 285 officers by 2000.

section_title: Letter
paragraphs: This report responds to your request that we review the operations of the National Oceanic and Atmospheric Administration’s (NOAA) Commissioned Corps. NOAA’s Commissioned Corps is a uniformed service whose officers are covered by a military-like compensation system in a manner similar to the Commissioned Corps of the Public Health Service (PHS). NOAA Corps officers carry out a variety of navigational and scientific functions, such as charting and oceanographic research.
You asked us to provide information on (1) issues surrounding whether there is a continuing need for the NOAA and PHS Corps as uniformed services with military-like pay, allowances, and benefits and (2) what the costs would be if federal civilian employees carried out the Corps’ functions. In a May 7, 1996, report, we presented the results of our review of the PHS Corps. This report presents the results of our review of the NOAA Corps. Like the report on the PHS Corps, this report provides answers to questions your designated representative agreed would provide the information you were seeking. In general, the questions addressed why the NOAA Corps exists; what the Corps officers’ duties are; how the Corps is similar to and different from the military; and what savings, if any, might result from not using uniformed personnel to carry out current Corps functions. Our review did not examine whether the Corps’ functions or the number of persons used to accomplish those functions were necessary or could be changed as the result of civilianization.
In developing the information for this report, we interviewed—and analyzed documents provided by—officials of NOAA, the NOAA Commissioned Corps, the Department of Defense (DOD), the Office of the Navy Oceanographer, the Office of Naval Research, the National Science Foundation, and other organizations that could provide insights into the Corps’ functions, responsibilities, and costs. Appendix I describes in detail the objective, scope, and methodology of our review, which was done in accordance with generally accepted government auditing standards. We requested comments on a draft of this report from the Departments of Commerce and Defense. The Department of Commerce provided written comments. Its letter is discussed at the end of this report and reprinted in appendix II. The Department of Defense had no comments on the report.
subsections: section_title: NOAA Corps History and Current Status
paragraphs: The organization that became NOAA was established in 1807, and in 1836 it officially became known as the Coast Survey. The Survey dispatched technical and scientific teams to survey the uncharted U.S. coastline and relied on the Army and the Navy to supply personnel to augment the organization’s civilian employees. After the Civil War, the Army withdrew from the Survey’s work; the Navy withdrew during the Spanish-American War, leaving the work to be done solely by the employees of the newly named Coast and Geodetic Survey. After the Army and the Navy withdrew their personnel, many of the Coast and Geodetic Survey’s civilian employees working in the field continued (1) maintaining a military-like operation with distinct lines of authority, (2) wearing Navy uniforms, and (3) giving and taking orders.
At the outbreak of World War I, ships and men who were qualified to operate the ships were needed immediately to augment the military forces. The Coast and Geodetic Survey was the only federal civilian agency that could respond to these requirements. Accordingly, in 1917, Congress passed legislation authorizing the President to transfer the Survey’s ships and men to the Navy and War Departments for the duration of the war and officially giving military rank to Coast and Geodetic Survey field officers when serving in the Army or Navy. The Joint Service Pay Act of 1920 extended the Navy’s pay, allowances, and retirement system to the members of the Coast and Geodetic Survey who held ranks equivalent to Navy officers.
In World War II, about half of the commissioned officers and ships of the Coast and Geodetic Survey were temporarily transferred to the armed services. Officers’ duties included training amphibious troops in seamanship and navigation, serving as battalion observation officers, and executing hydrographic surveys in advance of fleet operations in the Aleutian Islands and the Western Pacific. At the end of the war, all Survey ships and officers were returned to the Coast and Geodetic Survey and to civilian duties. However, the Corps continued to exist, and its officers retained their military ranks and compensation.
In 1965, the Coast and Geodetic Survey became the Environmental Science Services Administration (ESSA), and in 1970, ESSA became NOAA. NOAA is composed of five line offices—(1) the National Marine Fisheries Service; (2) the Office of Oceanic and Atmospheric Research; (3) the National Weather Service; (4) the National Ocean Service; and (5) the National Environmental Satellite, Data, and Information Service—and the Office of the Administrator. Corps officers are assigned to work in all component offices of NOAA. Table 1 provides Corps officers’ assignments to NOAA’s component offices in April 1995.
Corps officials said officers can expect to serve one-third of their careers in each of the following work categories: (1) sea duty; (2) shore duty that involves responsibilities in marine centers, vessel support, geodetic surveys, or aircraft operations; and (3) shore duty that involves management and technical support throughout NOAA.
In October 1994, the Corps had approximately 400 commissioned officers. As a result of general downsizing in the Department of Commerce, the Corps was reduced to 332 officers as of July 1, 1996. According to a Corps official, the ultimate downsizing goal was to reduce the number of officers to 285 by the year 2000.
NOAA has since expressed an interest in eliminating the Corps and using civilian employees to carry out the Corps’ functions. In January 1996, NOAA’s Administrator announced that the NOAA Corps would begin a transition to civilian status on October 1, 1996, and directed that the transition be completed within 6 months. He asked the Director of NOAA Corps operations to develop an implementation plan for civilianizing the Corps. NOAA officials said that plan was being reviewed by the Secretary of Commerce.
section_title: NOAA Corps’ Similarity to and Differences From the Military
paragraphs: Corps members’ entitlement to military ranks and military-like compensation, including eligibility for retirement at any age after 20 years of service, was an outgrowth of their temporary service with the armed forces during World Wars I and II. The NOAA Corps has not been incorporated into the armed forces since World War II, and DOD’s war mobilization plans envision no role for the Corps in the future. Corps officers continue to receive virtually the same pay and benefits (including retirement) as the military.
A 1984 DOD report provided a detailed discussion of the criteria and principles used to justify the military compensation system. According to the report, the main purpose of the military compensation system is to ensure the readiness and sustainability of the armed forces. Military personnel can be assigned at any time to any locations the services see fit, regardless of members’ personal preferences or risks. In other words, the military compensation system is based on the premise that individual aspirations and preferences are subordinated to the good of the service. The NOAA Corps is not considered an armed service, and Corps officers are not subject to the Uniform Code of Military Justice, which underlies how military personnel are managed. Accordingly, NOAA cannot press criminal charges or pass sentence against an officer who disobeys orders, and Corps officers can quit the Corps without legal sanctions.
Corps officials said the essential functions of the uniformed Corps are to serve as deck officers aboard NOAA ships and to be a mobile cadre of professionals who can be assigned with little notice to any location and function where their services are necessary, often in hazardous or harsh conditions. We found that some Corps assignments are of this nature, but civilian employees in other agencies are often assigned to duties similar to those of the Corps. For example, the Environmental Protection Agency (EPA), the National Transportation Safety Board, and the Federal Emergency Management Agency use civilian employees to respond quickly to disasters and other emergency situations. Moreover, EPA and the Navy use ships operated by civilian employees or contractors in conducting their oceanic research. Officials from these agencies said they have experienced no problems in using civilian deck officers on the vessels. Also, NOAA ships have been operated on occasion by Wage Marine (civilian) deck officers, and NOAA officials termed this approach successful.
section_title: Potential Cost Reduction Resulting From Civilianizing the NOAA Corps
paragraphs: NOAA contracted with Arthur Andersen LLP to determine the comparative costs of using civilian employees rather than Corps officers to carry out the Corps’ functions. The contractor’s report was issued August 30, 1995. We examined the contractor’s approach and methodology and generally found them to be similar to those we would have used. Thus, other than making an adjustment we believed was necessary for a more complete comparison, we accepted the contractor’s estimates of the comparative costs of using Corps officers and civilian employees. On the basis of the contractor’s report and the adjustment we made, we estimated that the cost to the government would have been about $661,000 lower during the year July 1994 through June 1995, if civilian employees had been used. If the Corps is downsized as intended, the estimated cost savings would be smaller in subsequent years.
subsections: section_title: Arthur Andersen LLP Cost Comparison Study
paragraphs: The Arthur Andersen LLP report concluded that civilianization of the Corps would increase government costs by $573,000 a year. This estimate was based on actual costs incurred during the year ending June 30, 1995, and used a Corps strength of 384 officers. Table 2 shows the Arthur Andersen LLP estimates.
section_title: Our Adjustment to the Contractor’s Estimates
paragraphs: Arthur Andersen LLP did not include in its comparison the federal income tax advantage Corps officers receive from their housing and subsistence allowances. Like members of the military, NOAA Corps officers pay no federal income taxes on these allowances. As DOD explained, the “cost” to the government arising from this tax advantage comes in the form of a loss to the U.S. Treasury of the federal income taxes that would otherwise have been paid if the allowances were taxable. Federal civilian employees receive no such tax advantages; they must pay their living expenses from their fully taxable salaries.
A DOD publication pointed out that the actual federal tax benefit that an individual member realizes is governed by many considerations. These considerations include (1) the aggregate amount of a member’s (and his or her spouse’s) income, both earned and unearned; (2) the amount of the member’s housing and subsistence allowances; (3) the member’s marital status and number of dependents; (4) whether the member takes the standard deduction or itemizes deductions for federal income tax purposes; and (5) whether the member is entitled to other types of tax exclusions. DOD developed a series of numerical estimates of the tax advantages to members using certain assumptions related to these factors. The publication noted that members do not actually receive the tax advantage in cash or in kind. Accordingly, it is not a cost item in DOD’s budget, nor is it in NOAA’s budget.
According to its report, Arthur Andersen LLP did not include Corps members’ tax advantage as a cost of maintaining the Corps because it did not represent “costs incurred by the Federal Government.” However, because the tax advantage represents a revenue loss to the government and is of considerable monetary value to Corps members, we believe it should be included in any cost comparison.
Since NOAA Corps officers receive the same base pay and housing and subsistence allowances as military officers at the same ranks, we used DOD’s tax advantage estimates to estimate the tax advantage afforded to Corps members. We estimated that the annual tax advantage associated with the housing and subsistence allowance amounts used in the Arthur Andersen LLP study would be $1,234,000 a year. Adjusting the Arthur Andersen LLP study results by the estimated tax advantage amount results in a total government cost for the Corps of $30,942,000 for the year, compared with the estimated $30,281,000 cost of using civilian employees—a difference of $661,000.
If a decision were made to civilianize the NOAA Corps, whether there would be any actual cost reductions would depend, in large part, on the manner in which a transition to civilian employment would be carried out, including the period of time over which the transition would occur. Any decision to replace Corps officers with civilian employees could be implemented in a number of ways. The possibilities range from requiring all officers to immediately convert to civilian employment, to longer-range measures such as allowing all current officers to remain in place until retirement or other separation and requiring all new entrants to be civilian employees. Or, perhaps all officers with a specific number of years in the Corps could be allowed to continue in the Corps until retirement or other separation.
The amount of transition costs would also depend on how considerations such as the following were resolved. (1) What retirement benefits or credits are given to officers for the time they spend in the Corps before converting to civilian employment and the civilian employee retirement system. (2) What resources would be required to recruit, train, and retain civilian employees that might be needed to replace Corps officers who opt to leave federal service. (3) The amount of additional resources, if any, that would be required to administer the civilian workforce at NOAA after civilianizing the Corps and its administrative personnel.
A plan of action that addresses each of the above factors and other possible considerations would be needed before estimates of the transition costs involved could be determined.
section_title: Agency Comments
paragraphs: The Department of Commerce provided written comments on a draft of this report. The comments and our responses are discussed below. The Department’s comments are provided in their entirety in appendix II.
Although the Department expressed concerns about certain information in the report, it acknowledged that a legislative proposal (prepared by the Department) to “disestablish” the Corps was pending clearance within the administration.
The Department questioned the appropriateness of our applying DOD’s criteria for military compensation to the NOAA Corps. It said the criteria focused exclusively on the military services, rather than on uniformed services in general. In our opinion, the criteria we used were appropriate. The Corps’ compensation system, generally the same as the military compensation system, was legislatively established after some Corps officers were temporarily assigned to the military during World War I. Thus, in evaluating whether the Corps should continue to receive military-like compensation, we believe the application of the criteria DOD used to justify the military compensation system is reasonable.
The Department noted that its goal for downsizing the Corps (if the proposal to “disestablish” the Corps is not accepted) is to have a Corps strength of 285 officers by the year 2000, rather than 280 as stated in the draft report. We changed the report to reflect this updated estimate.
According to the Department, the report’s discussion of the history of the Corps and how Corps officers came to receive ranks and compensation similar to the military should have included more detailed information. We included additional historical information consistent with the Department’s suggestions.
Similarly, the Department suggested that, to be more complete, the report should acknowledge that Corps officers are subject to the Uniform Code of Military Justice when serving with or assigned to the armed forces. We agree that this is the case. However, the report section cited by the Department already pointed out this exception to the general rule in a footnote. Accordingly, we did not believe a change was needed to address this comment.
The Department expressed an opinion that the report did not sufficiently address the ways in which service with the Corps is similar to military service. We disagree. The report discussed areas of similarity between Corps and military service mentioned by Corps officials during our review, but it also pointed out that civilian employees in other agencies were often subject to the same conditions of employment. Moreover, many of the similarities discussed in the Department’s comments exist because the Corps is compensated under a military-like system, not because the Corps has responsibilities like the military. It should also be noted that the criteria for military compensation articulated in the DOD report are based on the need for inducements and incentives to maintain a force necessary “to insure successful accomplishment of the United States national security objectives.” Corps officers have not been involved in meeting national security objectives since World War II.
We also provided a draft of the report to DOD. We were advised that, after reviewing the draft, DOD had no comments.
As agreed with your office, unless you publicly announce its contents earlier, we plan no further distribution of this report until 7 days from the date of this report. At that time, we will send copies to the Secretaries of Commerce and Defense and other interested parties. We will also make copies available to others upon request.
If you have questions concerning this report, please telephone me or Associate Director, Timothy P. Bowling, at (202) 512-8676. Major contributors to this report are listed in appendix III.
section_title: Objective, Scope, and Methodology
paragraphs: The objective of this report is to provide information on the operations of the National Oceanic and Atmospheric Administration (NOAA) Commissioned Corps. We were asked to address why the NOAA Corps exists; what the Corps officers’ duties are; how the Corps is similar to and different from the military; and what savings, if any, might result from not using uniformed personnel to carry out current Corps functions.
To gather the information on the continuing need for the Corps, we reviewed NOAA Corps historical material and interviewed and obtained documentation from officials of NOAA, including the Office of NOAA Corps Operations; the Department of Defense (DOD), including the Department of the Army and the Navy; Woods Hole Oceanographic Institute; the National Science Foundation; the National Transportation Safety Board; the Federal Emergency Management Agency; and the Environmental Protection Agency.
To compare the costs of using uniformed personnel or civilian employees to carry out Corps duties, we reviewed the findings in an August 1995 report prepared by Arthur Andersen LLP under a contract with NOAA. We examined the contractor’s approach and methodology and generally found them to be similar to those we would have used. Other than making an adjustment we believed was appropriate to reflect the estimated tax advantages Corps officers receive through their nontaxable housing and subsistence allowances, we accepted the contractor’s findings as valid estimates of the comparative costs of using Corps officers and civilian employees.
It should be noted that we did not examine whether the Corps’ functions or the number of persons used to accomplish those functions were necessary or could be changed as the result of civilianization. Thus, the report does not address issues such as whether civilianization of the Corps could present opportunities for possible savings through restructuring or consolidating NOAA operations. Neither did we examine the possibility of contracting with private companies, rather than using civilian employees, to carry out the Corps’ current functions.
We did our work in Washington, D.C.; Narragansett, Rhode Island; and Woods Hole, Massachusetts, between November 1994 and January 1996. Our work was done in accordance with generally accepted government auditing standards.
The Department of Commerce provided written comments on a draft of this report. A copy of the letter is included as appendix II. The Department of Defense also reviewed a draft of the report and had no comments.
section_title: Comments From the Department of Commerce
section_title: Major Contributors to This Report
subsections: section_title: General Government Division, Washington, D.C.
paragraphs: Robert E. Shelton, Assistant Director, Federal Management and Workforce     Issues Nancy A. Patterson, Assignment Manager Philip Kagan, Technical Advisor Steven J. Berke, Evaluator-in-Charge Marlene M. Zacharias, Evaluator Assistant The first copy of each GAO report and testimony is free. Additional copies are $2 each. Orders should be sent to the following address, accompanied by a check or money order made out to the Superintendent of Documents, when necessary. VISA and MasterCard credit cards are accepted, also. Orders for 100 or more copies to be mailed to a single address are discounted 25 percent.
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