Coast Guard: Station Spending Requirements Met, but Better Processes Needed to Track Designated Funds
Published: 2004-05-28T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Coast Guard conducts homeland security and search and rescue operations from nearly 200 shoreside stations along the nation's coasts and waterways. After several rescue mishaps that resulted in the deaths of civilians and station personnel, Congress recognized a need to improve performance at stations and appropriated additional funds to increase stations' readiness levels. For fiscal year 2003, the Coast Guard received designated funds of $15.7 million specifically to increase spending for stations' staffing, personal protection equipment (such as life vests and cold weather protection suits), personnel retention, and training needs. Congress directed GAO to determine if the Coast Guard's fiscal year 2003 outlays for stations increased by this amount over fiscal year 2002 expenditure levels. GAO also assessed the adequacy of the processes used by the Coast Guard to account for the expenditure of designated funds.
section_title: What GAO Found
paragraphs: According to our analyses of available data, and anecdotal and other information, it appears that the Coast Guard spent at least $15.7 million more to improve readiness at its multimission stations in fiscal year 2003 than it did the previous year. However, this statement cannot be made with certainty, because the Coast Guard's databases do not fully identify expenditures at the station level. GAO worked with the Coast Guard to develop expenditure estimates for the stations, using budget plans and available expenditure data, and this effort produced full or partial estimates for three of the four categories--staffing, personal protection equipment, and personnel retention efforts. For these three categories, fiscal year 2003 expenditure estimates were at least $20.5 million more than the previous year, or about $4.8 million more than the $15.7 million designated appropriation. Although estimates could not be developed for training expenditures, other available information indicates that training levels increased in fiscal year 2003. Taken together, these results suggest that the Coast Guard complied with Congress' direction to increase spending for stations by $15.7 million. Federal management guidelines and internal control standards call for greater accountability for designated--earmarked--appropriations than was provided by the processes the Coast Guard had in place to track these funds. The purpose of an earmark is to ensure agencies spend a certain amount of their appropriated funds for a specific purpose. Guidelines and standards indicate that agencies should account for the obligation and expenditure of earmarked appropriations--a step the Coast Guard thoroughly implemented only for personal protection equipment. Coast Guard officials developed a plan showing how they planned to spend the earmark, but such a plan, while useful as an indication of an agency's intentions, is not sufficient to show that the earmark was expended in accordance with congressional direction.

section_title: Letter
paragraphs: The nearly 200 Coast Guard multimission stations that dot the nation’s  coastline and interior waterways play an important role in two main Coast  Guard missions—finding and rescuing mariners in danger on the water  and protecting the nation’s coastline as part of the overall homeland  security effort. In 2001, a review conducted after a series of search and  rescue mishaps found that readiness at these stations was decreasing. In  response, Congress began a multiyear funding effort designed to increase  staffing, training, and equipment levels at the stations. As part of this  effort, Congress provided a $15.7 million earmark in the Coast Guard’s  fiscal year 2003 appropriation specifically to support multimission station  operations. In doing so, Congress also directed us to review Coast Guard  expenditures to determine if fiscal year 2003 outlays (levels of effort) for  stations had increased compared with fiscal year 2002 levels by this  amount. This report discusses the results of our analysis of Coast Guard  spending in four categories of station activity—staffing, personal  protection equipment, personnel retention efforts, and training. It also  provides our assessment of the adequacy of the processes used by the  Coast Guard to account for earmarked expenditures. This report is the  first of two reviews looking at multimission station operations. The  second, which focuses on station readiness issues, will be issued in the  summer of 2004.
Our work is based on an analysis of Coast Guard budget and expenditure  data, including special data runs prepared by the Coast Guard, surveys of  field units, and verification of supporting information from a selected  sample of multimission stations. As discussed below, the resulting data  were limited in a number of respects. However, we did determine that,  where available, the data were sufficiently reliable for the purpose of  providing general estimates of expenditures. Appendix I explains in more  detail the scope of our work, the methodology we used, and the ways in  which we went about assessing the reliability of the data. We conducted  our work from August 2003 to April 2004 and did so in accordance with  generally accepted government auditing standards.
subsections: section_title: Background
paragraphs: Multimission stations, formerly referred to as small boat stations, are  involved in all Coast Guard missions, including search and rescue,  recreational and commercial fishing vessel safety, marine environmental  response, and law enforcement activities such as drug and migrant  interdiction. Search and rescue has traditionally been the stations’ top  priority. However, after the terrorist attacks of September 11, 2001, the  Coast Guard elevated the maritime homeland security mission to a level  commensurate with the search and rescue mission.
Congress’s actions to provide the Coast Guard with an additional $15.7  million for these stations in fiscal year 2003 was part of a longer-standing  effort to address readiness concerns. In 2001, Congress directed the  Department of Transportation’s Office of Inspector General (OIG) to  conduct a thorough review of the operational readiness capability of  stations, following a series of accidents involving search and rescue efforts  initiated at these stations. The OIG reported that readiness levels at  stations had been deteriorating for more than 20 years and were  continuing to decline. In response, Congress provided an earmarked  appropriation in fiscal year 2002 and directed the Inspector General to  review the use of the earmarked funds. The OIG found that the Coast  Guard generally complied with the intent of the earmark but also  concluded that improving operational readiness at stations would require  a substantial and sustained investment. The OIG also recommended that  to improve congressional oversight of expenditures, the Coast Guard  should make improvements to its accounting system to allow for the  tracking of certain station expenditures.
Since the additional funding efforts began, in fiscal year 2002, Coast Guard  officials told us they have, among other actions, added approximately  1,100 personnel to stations, increased levels of personal protection  equipment for station personnel, and started to replace old and  nonstandard boats with new standard boats. In December 2002 the Coast  Guard also developed, in response to a recommendation from the OIG in  its 2001 report and at the direction of the Senate Appropriations  Committee, a draft strategic plan to guide the recruiting and hiring of  personnel. In its 2002 report, the OIG criticized the plan for being too  general in nature, specifically regarding how and when the Coast Guard  will increase staffing, training, equipment, and experience levels at  stations.
section_title: Expenditures for Stations Cannot Be Fully Determined, but Estimates Appear to Exceed the Required Increase
paragraphs: Because the Coast Guard’s automated databases are not set up in such a  way that they can fully identify expenditure data at the station level, we  were unable to fully determine expenditures for all four categories.  However, through a combination of data runs and unit surveys performed  at our request, the Coast Guard was able to estimate staffing and  personnel retention expenditures, and develop actual expenditure data for  personal protection equipment (PPE). Within these three categories, the  Coast Guard estimates it spent at least $291 million in fiscal year 2003. The  information available by category was as follows:    Staffing: The Coast Guard incurred estimated costs of $277.6 million  for 5,474 active duty personnel assigned to stations during fiscal year  2003.
This figure does not include costs for the 1,657 reserve personnel assigned  to stations, or an unknown number of auxiliary personnel.
PPE: Reported expenditures for this category totaled $7.5 million.
Personnel retention: Expenditure data for all aspects of this category  are not available. However, in one specific category—reenlistment  bonuses—the Coast Guard expended $5.9 million for bonuses to  boatswain’s mates and machinists assigned to stations.
Training: Coast Guard officials attempted to identify estimated costs  of training station personnel at national training centers during fiscal  year 2003 but could not provide reliable data for this category. Officials  told us the Coast Guard has separate databases that track costs  incurred by the national training centers, but do not have a database  that can identify training costs expended on personnel after they have  been assigned to stations. Further, expenditures incurred by stations in  providing on-the-job training (a significant component of total training  provided to station personnel) were not available because the Coast  Guard, like many agencies, does not track time spent on this type of  training.
Using fiscal year 2002 data derived through similar analyses, we  determined that estimated station expenditures for fiscal year 2003  exceeded fiscal year 2002 levels by at least $20.5 million—or $4.8 million  more than the $15.7 million earmarked appropriation. Table 1 shows the  differences in estimated expenditures (levels of effort) by fiscal year for  the three categories that had available data. Only partial data were  available on personnel retention, and no data were available on training  expenditures. Although expenditure data for all personnel retention efforts  were not available, the Coast Guard was able to provide annual  expenditure data for reenlistment bonuses offered to selected  multimission station personnel. Other information we gathered in  discussions with Coast Guard personnel indicates that the Coast Guard’s  levels of effort in station training also increased during fiscal year 2003. In  fiscal year 2003, the Coast Guard increased the number of instructors and  classrooms at two national training centers, which provide training to  station and other personnel, in order to increase the number of total  students graduated. Appendix I describes our methodology for developing  these estimates, and appendix II contains a more detailed description of  the data in each category.
Because complete comparative data could not be identified for all four  categories, we cannot say with certainty that Coast Guard expenditures  for multimission stations in fiscal year 2003 were at least $15.7 million  above fiscal year 2002 levels. However, we believe this is a reasonable  conclusion based on the following:    Although the staffing data provided to us are based on budget cost  formulas, we determined that the data are sufficiently reliable for the  purpose of demonstrating increases in staffing levels between the two  years.
Discussions with station officials indicate that station personnel have  sufficient levels of PPE. In its fiscal year 2002 audit, the OIG reported  that the Coast Guard did not provide PPE for 69 percent of the  personnel added to stations during fiscal year 2002. Our visits to a  limited number of stations—8 out of 188 stations—and discussions  with station personnel, indicated that all active and reserve personnel  assigned to these stations—even newly assigned personnel—had  received what they considered to be an appropriate level of PPE (basic  and cold weather).
Although available quantitative data were limited for this category, over  the past few years the Coast Guard has implemented a variety of  financial incentives aimed at improving personnel retention.
Training officers at the 8 stations we visited indicated that training for  station personnel did not decrease in fiscal year 2003 compared with  the prior year. In addition, in fiscal year 2003 the Coast Guard  increased training resources in two areas—the boatswain’s mate  training school increased its training output by over a third, and unit  training provided by headquarters to station personnel also increased.
section_title: Better Accountability of Expenditures Is Needed to Ensure That Earmarks Are Appropriately Spent
paragraphs: The Coast Guard did not have adequate processes in place to sufficiently  account for the expenditure of the entire $15.7 million earmarked fiscal  year 2003 appropriation or to provide assurance that these earmarked  funds were used appropriately, as set forth by federal management and  internal control guidelines. The purpose of an earmark is to direct an  agency to spend a certain amount of its appropriated funds for a specific  purpose. Federal guidelines and government internal control standards  indicate that agencies should account for the obligation and expenditure  of earmarked appropriations both as a sound accounting practice and to  demonstrate compliance in the event of an audit. The expectation that  agencies will be able to effectively demonstrate compliance in their use of  earmarked funds stems from the following:    Office of Management and Budget Circulars: These circulars hold that  agencies’ management controls should reasonably ensure that laws and  regulations are followed.
The Federal Managers’ Financial Integrity Act: This act establishes  specific requirements regarding management controls and directs  agency heads to establish controls to reasonably ensure that  obligations and costs comply with applicable laws.
Standards for Internal Control in the Federal Government: These  standards specify that internal controls should provide reasonable  assurance that an agency is in compliance with applicable laws and  regulations. They also direct that internal controls and transactions  should be clearly documented and the documentation should be readily  available for examination.
Further, the Department of Homeland Security (DHS), the parent agency  for the Coast Guard, recently issued budget execution guidance that  encourages component agencies to identify the obligation and expenditure  of earmarked funds separately from other appropriated funds. (This  guidance was issued in fiscal year 2004 after the Coast Guard had  obligated the fiscal year 2003 earmark.) In response to a recommendation  made in our recent report on the reprogramming of Federal Air Marshal  Service funds, DHS has agreed to make this a requirement.
The Coast Guard told us at the onset of our review that it did not have  adequate processes in place to collect data with respect to earmarked  expenditures. Although officials had taken steps to account for PPE  expenditures (because purchase receipts could be easily tracked), they  did not have adequate processes in place to account for earmarked funds  spent on staffing and training needs at the station level. Consequently, the  Coast Guard could not demonstrate conclusively that it was complying  with the earmark. Basically, the Coast Guard’s databases were not  designed for this purpose and would have to be modified to provide actual  expenditure data for stations, according to Coast Guard officials. On the  basis of lessons learned from the OIG’s audit in fiscal year 2002, which  faulted the Coast Guard for not having cost accounting systems in place to  allow for the tracking of certain multimission station expenditures, Coast  Guard officials developed a plan to show how various allocations would  add up to $15.7 million if expended. The plan, although useful as an  indicator of the Coast Guard’s intentions, is not sufficient to show that the  Coast Guard had expended the earmarked appropriation as directed.  Coast Guard officials also told us that, in response to the OIG’s 2002  recommendation to allow for the tracking of certain station expenditures,  they are assisting DHS in developing a new enterprise-wide financial  system called “electronically Managing enterprise resources for  government effectiveness and efficiency” (eMerge). As part of the overall  system requirements, the Coast Guard expects that eMerge and the Coast  Guard was unable to provide us with system specifications prior to the  issuance of this report.
section_title: Conclusions
paragraphs: On the basis of available data and other information, the Coast Guard  appears to have met the Congress’s requirement to spend at least $15.7  million more on multimission stations in fiscal year 2003 than in fiscal year  2002. However, the Coast Guard does not have adequate processes in  place to track actual expenditures related to earmarks. Rather, agency  officials could provide only estimates for much of the station  expenditures. Without the ability to accurately and completely account for  these expenditures, the Coast Guard cannot assure that it complied with  the earmark. Moreover, Congress’s ability to hold the Coast Guard  accountable for future earmarks is seriously diminished. In light of our  recent recommendation to DHS on the need to track earmarks—and its  subsequent concurrence—we believe the Coast Guard should take  immediate steps to ensure that future accounting systems include the  capability to track earmarks.
section_title: Recommendation for Executive Action
paragraphs: To improve the Coast Guard’s ability to respond to congressional  oversight and to provide greater assurance that earmarked funds are used  appropriately, we recommend that the Secretary of Homeland Security  direct the Commandant of the Coast Guard to develop, in accordance with  the fiscal year 2004 departmental guidelines, processes to accurately and  completely account for the obligation and expenditure of earmarked  appropriations.
section_title: Agency Comments and Our Evaluation
paragraphs: We requested comments on a draft of this report from the Secretary of  Homeland Security or his designee. On May 14, 2004, Coast Guard  officials, including the Chief, Office of Budget and Programs, provided us  with oral comments, with which the DHS GAO Liaison concurred. Coast  Guard officials generally agreed with the facts and our recommendation to  better track earmarked expenditures. We did not review the Coast Guard’s  financial databases to determine if modifications to them would be  necessary to better track earmarked expenditures (obligations). Coast  Guard officials, however, expressed concern that developing better  procedures to track some station expenditures (obligations), such as those  for staffing or training, will prove challenging and could be costly due to  the need to significantly modify their financial systems. Officials stated  that accounts are centrally managed and specific expenditures would not  be easily tracked at the station level. The Coast Guard officials said they  plan to explore this issue more thoroughly and to examine how  organizations with comparable activities have overcome similar obstacles  to tracking earmarked funds.  The officials also provided a number of  technical clarifications, which we incorporated where appropriate.
We will send copies of this report to interested congressional committees  and subcommittees. We will also make copies available to others on  request. In addition, the report will be available at no charge on GAO’s  Web site at http://www.gao.gov.
If you or your staffs have any questions about this report or wish to  discuss the matter further, please contact me at (415) 904-2200 or  Randall B. Williamson at (206) 287-4860. Additional contacts and key  contributors to this report are listed in appendix III.
section_title: Appendix I: Scope and Methodology
paragraphs: We used a variety of approaches in our work to determine the amount of  the general appropriation the Coast Guard expended on multimission  stations in fiscal year 2003 across the four areas covered by the earmark— staffing, personal protection equipment (PPE), personnel retention and  training—and whether this amount exceeded by $15.7 million the level of  effort expended in fiscal year 2002. Because Congress directed that we  review the amount of general appropriations expended on station  readiness needs, we did not review expenditures of funds received  through supplemental appropriations. We determined at the outset of our  work that Coast Guard databases did not contain information that would  allow us to fully report on station expenditures for the four earmark  categories. To identify available information and possible limitations of  the information, we worked extensively with Coast Guard headquarters  officials from the Offices of Budget and Programs; Financial Analysis; Boat  Forces; Resource Management; Workforce Management; Personnel  Command; and Workforce Performance, Training and Development. We  also obtained documentation from headquarters, stations, groups, and  districts.
After reviewing the reliability of available data and the feasibility of Coast  Guard officials’ proposals for gathering additional data, we agreed on a  combination of expenditure and allocation data, which would be collected  through special data runs, analyses, and unit surveys. Coast Guard officials  provided data for three of the four categories. Although officials attempted  to develop information on training costs, they were not able to produce  reliable data. Some of the information we needed was obtained not at  headquarters but at specific Coast Guard sites, which we judgmentally  selected according to size, location, and type.
The specific data and analyses used to develop estimates on each of the  four categories, were as follows:    Staffing: To determine the number and cost of personnel assigned to  multimission stations, we requested Coast Guard personnel  expenditure data for fiscal years 2002 and 2003, but we were told that  expenditure data were not available at the station level. To develop  estimated staffing costs, Coast Guard officials merged information  from personnel and position databases to identify the number of  personnel assigned to stations and then applied a personnel cost  formula to arrive at total estimated costs. Developing estimates was  complicated because the fiscal year 2002 data were developed from a  different database than the fiscal year 2003 data, and because the Coast  Guard has more personnel assigned to stations than actual authorized  (or funded) positions, a variance that requires periodic adjustment of  the databases. However, after discussing these factors at length with  Coast Guard officials, we determined that the data developed by the  Coast Guard were sufficiently reliable for the purpose of providing  estimates of expenditures for fiscal years 2002 and 2003. The  methodology and process for developing the data were contributed to  by the following Coast Guard offices: Budget and Programs, Resource  Management, Workforce Management, and Personnel Command.
PPE: To obtain fiscal year 2003 expenditure data for this category, we  asked the Coast Guard to survey all 188 stations and their oversight  units. Each station and unit was asked to provide the total amount of  fiscal year 2003 funds spent on PPE for personnel assigned to the  station during the year. These totals included expenditures made for  station personnel at the group and district levels as well. To verify the  accuracy of these data, we reviewed original expenditure  documentation for a judgmentally selected sample of 29 stations. On  the basis of this documentation, we independently quantified PPE  expenditures for each station. Our count of total PPE purchases at the  29 stations was 9 percent higher than the total provided by the Coast  Guard (our count was 4 percent less than the Coast Guard’s after  removing expenditures for one outlier station). Coast Guard officials  attributed the difference to errors made by station personnel when  compiling the expenditure data. As a result of these differences,  however, we refer to the total expenditure for fiscal year 2003 as an  estimate. Because Coast Guard officials considered gathering  expenditure data for fiscal year 2002 as too labor intensive for station  personnel, given their current workloads, we used the Coast Guard’s  data on planned PPE expenditures for fiscal year 2002. After reviewing  possible limitations in the PPE data provided, we determined that the  data provided were sufficiently reliable for the purpose of providing  estimates of expenditures. The PPE planning data were provided to us  by the Offices of Boat Forces and Budget and Programs.
Personnel retention: We were not able to determine total retention  expenditures because the Coast Guard does not specifically track these  costs, and retention efforts encompass a diverse array of direct and  indirect activities. We were able to identify certain direct activities— selective reenlistment bonus expenditures for multimission stations  and various financial incentives available to Coast Guard personnel— and some indirect incentives. After reviewing how data provided by the  Personnel Services Center on selective reenlistment bonus  expenditures were collected and maintained, we determined that the  data were sufficiently reliable for the purposes of this report. The  personnel retention expenditure data were provided to us by the Office  of Budget and Programs.
Training: The Coast Guard was unable to provide actual or estimated  expenditure data for training multimission station personnel in fiscal  years 2002 and 2003. Officials from the Office of Budget and Programs  and the Office of Workforce Performance, Training, and Development  told us at the outset of our review that they would not be able to  identify total training costs because the Coast Guard does not track the  amount of time station personnel devote to on-the-job training (which  accounts for a significant amount of total training). Headquarters  officials attempted to obtain data on the estimated annual costs for  training station staff at the Coast Guard’s national training centers by  cross-referencing data from multiple databases and applying a cost  formula. However, Coast Guard officials identified a number of serious  anomalies in the data and concluded the data were too unreliable to be  used.
To determine whether the Coast Guard had adequate processes in place to  account for the expenditure of the $15.7 million earmarked appropriation,  we interviewed and obtained documentation from stations, groups, and  districts. We also interviewed and obtained documentation from officials  in the following headquarters offices: Boat Forces, Budget and Programs,  and Financial Analysis. Further, we studied the Coast Guard’s funding  plan, which showed how the earmark was intended to be spent. We also  reviewed federal management guidelines and government internal control  standards to identify earmark accountability requirements that apply to  agencies.
section_title: Appendix II: Estimated Costs and Fiscal Year Differences for Stations by Earmark Category
paragraphs: The $15.7 million earmark presented to the Coast Guard in its fiscal year  2003 appropriation called for funds to be spent across four categories of  multimission station needs—staffing, PPE, personnel retention, and  training. In determining the amount of funds spent by the Coast Guard in  2003 on station needs and whether this amount exceeded the fiscal year  2002 level of effort by $15.7 million, we also developed cost information  for three of the four categories. Coast Guard officials attempted but were  unable to develop reliable data on the cost of training station personnel  during fiscal years 2002 and 2003. This appendix has two main sections.  The first presents additional information about estimated station  expenditures in the areas of staffing, PPE, and personnel retention in fiscal  year 2003, and the second contains additional information about the  changes that occurred between fiscal years 2002 and 2003.
subsections: section_title: Fiscal Year 2003 Station Estimated Expenditures by Category
paragraphs: Using a combination of estimated and actual expenditure data, we  determined that estimated fiscal year 2003 costs for staffing, PPE, and  personnel retention efforts at stations amounted to at least $291 million.
subsections: section_title: Staffing
paragraphs: The Coast Guard could not provide us with the actual amount of fiscal  year 2003 appropriation funds spent on station staffing because the  agency’s automated databases do not fully identify personnel expenditures  at the station level.  However, using a combination of budget and  personnel data, officials were able to estimate that in fiscal year 2003 the  Coast Guard incurred costs of $277.6 million to support 5,474 active duty  station personnel. This estimate does not include costs for the 1,657  reserve personnel assigned to stations in fiscal year 2003, nor does it  include the costs of volunteer auxiliary personnel who assisted in station  operations during the year. The Coast Guard did not calculate estimated  expenditures for reservists because of the complex and labor-intensive  nature of the analysis.
section_title: Personal Protection Equipment
paragraphs: Coast Guard officials determined that the agency spent approximately $7.5  million in fiscal year 2003 on PPE for station personnel. As shown in table  2, the cost of a total basic PPE outfit in fiscal year 2003 was $1,296. The  cost of a cold weather PPE outfit, which is used by personnel working at  stations where the outdoor temperature falls below 50 degrees Fahrenheit,  was $1,431. (Figure 1 shows a station crew member in cold weather PPE.)  A May 2002 Coast Guard Commandant directive emphasized the  importance of proper supplies and use of PPE as one of the top priorities  of Coast Guard management. In this directive, the Commandant cited an  internal research report that attributed 20 percent of the total risk facing  boat personnel to exposure to extreme weather conditions. The directive  also states that the use of appropriately maintained PPE could improve  Coast Guard’s operational capability.
section_title: Personnel Retention
paragraphs: The Coast Guard provided data demonstrating how it promotes personnel  retention through a variety of direct and indirect incentives. Direct  incentives include financial benefits that personally benefit the individual,  while indirect incentives include projects, such as facility improvements,  that may indirectly contribute to retention by increasing staff morale.  Coast Guard officials provided expenditure data for selected direct  incentives provided to station personnel in fiscal year 2003 because  officials could not quantify the total amount of funds expended on direct  incentives. Likewise, the total amount expended on indirect incentives  cannot be readily identified because of the numerous and varied nature of  the efforts.
Coast Guard’s direct financial incentives include selective reenlistment  bonuses. During fiscal year 2003, the Coast Guard spent $5.9 million on  312 selective reenlistment bonuses for station personnel—$4.2 million of  this went to boatswain’s mates while the remaining $1.7 million went to  machinery technicians. A variety of other financial benefit improvements  were also recently implemented:    Between fiscal year 2003 and fiscal year 2004 the Coast Guard  increased the surfman pay premium by 33 percent.
Since fiscal year 2000 the average portion of housing costs paid by  personnel has decreased annually, going from 18.3 percent in fiscal  year 2000 to 3.5 percent in 2004; in 2005 this expense will be reduced to  zero.
Since fiscal year 2002 enlisted personnel have been entitled to a basic  allowance for food. Before fiscal year 2002 they received no funds for  food purchased outside of a Coast Guard galley (kitchen).
Since fiscal year 2002 first-term enlisted personnel have received a  “dislocation allowance” that provides funds for rental deposits and  other incidentals that may occur when personnel are required to move.
Since fiscal year 2003 junior personnel have been able to ship greater  weights of household goods when transferring stations.
During fiscal year 2004 the death gratuity issued to assist survivors of  deceased Coast Guard active personnel doubled.
Multiple indirect Coast Guard efforts also serve as personnel retention  tools by improving staff morale. At our request, Coast Guard officials  asked 29 (15 percent) of the 188 multimission stations to provide data on  estimated expenditures incurred for projects that indirectly contributed to  staff retention. For the 24 stations that responded, infrastructure and  lifestyle improvements totaled over $350,000 in fiscal year 2003.  Improvements cited by multimission stations include such items as new  furniture, sports equipment, televisions, satellite TV service, and  entertainment systems. According to a Coast Guard official, the source of  funds for these improvements can be station, group, or district operating  budgets or donations by Coast Guard support groups. Table 3 shows  examples of some of the projects cited by the 24 survey respondents.
section_title: Increases in Levels of Effort from Fiscal Year 2002 to Fiscal Year 2003 Indicate Earmark Compliance
paragraphs: While we could not determine with certainty the difference in estimated  expenditures (levels of effort) expended on stations between fiscal years  2002 and 2003 because of financial system limitations, the information  available suggests that the difference amounted to at least $20.5 million.  The following discusses estimated differences in fiscal year 2002 and 2003  staffing, PPE, and personnel retention costs for multimission stations.
subsections: section_title: Staffing
paragraphs: As shown in Table 4, the Coast Guard increased staffing at multimission  stations by an estimated 466 personnel (9.3 percent) in fiscal year 2003.  The estimated cost of this staffing increase was $14.4 million above the  level of effort expended for staffing in fiscal year 2002.
section_title: Personal Protection Equipment
paragraphs: According to the Coast Guard, the agency estimates it spent approximately  $5 million more for PPE than it planned to spend during fiscal year 2002.  We used fiscal year 2002 planned allocation data for this expenditure  comparison because Coast Guard officials considered a survey of stations  to collect fiscal year 2002 expenditure data—similar to the survey  conducted for the fiscal year 2003 expenditure data—too burdensome for  station personnel, given their current workload.
Coast Guard officials told us that historically the amount of funds  allocated for station PPE at the beginning of a fiscal year is not enough to  fund PPE for all station personnel estimated to need it during the year.  The Coast Guard’s method for allocating PPE funds to stations uses the  number of positions authorized to stations as a primary factor in  determining the amount of funds allocated to individual stations. Because  Coast Guard stations have more personnel assigned to them than  authorized positions, in the past personnel not assigned to an authorized  position were typically not included in PPE allocation calculations. To  address this shortfall, the Coast Guard initially planned to allocate $3  million of the earmarked funds in fiscal year 2003. During 2003 the Coast  Guard had added another $2.6 million of the earmarked funds, bringing the  total to $5.6 million.
section_title: Personnel Retention
paragraphs: Reenlistment bonuses issued to boatswain’s mates and machinery  technicians assigned to stations increased by $1.1 million from fiscal year  2002 to fiscal year 2003. During fiscal year 2002, the Coast Guard issued  $4.8 million in bonuses to the two classes of station personnel; the amount  issued in fiscal year 2003 rose to $5.9 million. Expenditures for other, more  indirect, forms of retention activities, such as station infrastructure  improvements, are not tracked annually and therefore are not available for  comparative purposes.
section_title: Training
paragraphs: The Coast Guard was not able to identify training costs for multimission  station personnel for fiscal year 2002 or fiscal year 2003 despite extensive  efforts. Officials told us the Coast Guard has separate databases in place  to track training costs by national training center, but it does not have a  database that identifies costs for station personnel. The Coast Guard  conducted several queries from available databases but the resulting data  were not accurate. The lack of available training cost data precluded us  from making a comparison of annual expenditure data in this area.  However, some information indicates that levels of effort expended on  training station personnel increased in fiscal year 2003. For example,  Coast Guard’s boatswain’s mate training school increased its training  output by over a third in fiscal year 2003.
section_title: Appendix III: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
section_title: Staff Acknowledgments
paragraphs: In addition to those named above, Cathleen A. Berrick, Barbara A. Guffy,  Dorian R. Dunbar, Ben Atwater, Joel Aldape, Marisela Perez,  Stan G. Stenersen, Michele C. Fejfar, Casey L. Keplinger,  Denise M. Fantone, and Shirley A. Jones made key contributions to this  report.