U.S. Postal Service: Agencies Distribute Fund-raising Stamp Proceeds and Improve Reporting
Published: 2007-10-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: As required by Congress, the U.S. Postal Service (Service) has issued three fundraising stamps--also called semipostals--which are sold at a higher price than First-Class stamps, with the difference distributed to designated federal agencies for specific causes. The proceeds from the three stamps are to fund breast cancer research, assistance to families of emergency relief personnel killed or permanently disabled in the terrorist attacks of September 11, and services to children exposed to domestic violence. Of the three stamps, the Breast Cancer Research stamp is the only semipostal currently being sold. GAO has issued three prior reports on semipostals. To provide Congress updated information, GAO examined (1) the amount of money that has been raised through the sale of semipostals, and (2) how the designated federal agencies have used the proceeds and reported the results.
section_title: What GAO Found
paragraphs: As of June 2007, more than$68 million has been raised through semipostal sales. Of the three semipostals, the Breast Cancer Research stamp had proceeds totaling approximately $54.6 million, the Heroes of 2001 stamp had proceeds totaling about $10.6 million, and the Stop Family Violence stamp had proceeds totaling about $3.2 million. The authorized sale period for each semipostal affected the funds raised. In discussions with relevant agencies, advocacy groups and fund-raising organizations, several factors were identified that affected semipostal sales. These factors include public awareness about the charitable cause that a stamp represents, the stamp's design, and confusion about how the proceeds will be used. All four of the designated federal agencies have distributed proceeds from their respective semipostals. Both the Department of Defense (DOD) and National Institutes of Health (NIH) continue to award grants and fund programs for research with proceeds from the Breast Cancer Research stamp, and have added new programs to distribute the proceeds. The Administration for Children (ACF) within Department of Health and Human Services (HHS) used the proceeds from the Stop Family Violence stamp to award nine grants to programs that support children who have been exposed to domestic violence. Also, the Federal Emergency Management Administration (FEMA) recently distributed the last of the proceeds from the Heroes of 2001 stamp to the families of emergency relief personnel who were either killed or permanently disabled while serving in the line of duty in connection with the terrorist attacks of September 11, 2001. In September 2005, GAO recommended that the designated federal agencies annually report to Congress on their use of semipostal proceeds. DOD and ACF have submitted reports to Congress, and FEMA plans to report in the near future. NIH does not plan to prepare a report for Congress, but offers information on NIH's use of Breast Cancer Research stamp proceeds on its public website. But, NIH's website did not provide detailed information on proceeds received, how proceeds were used and related achievements.

section_title: Letter
paragraphs: In this country, a woman is reportedly diagnosed with breast cancer every  three minutes, and the disease claims another life every 13 minutes. Breast  cancer is the most common nonskin cancer and the second leading cause  of cancer-related deaths in women. Each year, about $8.1 billion is spent in  the United States to treat this disease. In light of these statistics, finding a  cure for breast cancer is vitally important. In fiscal year 2007, federal  agencies reportedly spent an estimated $1.4 billion on breast cancer  research. To supplement these federal funds, Congress passed legislation  to establish the Breast Cancer Research stamp, called a fund-raising stamp  or “semipostal”, to heighten public awareness of the disease and give the  public an opportunity to participate directly in raising funds for breast  cancer research. A semipostal is a First-Class postage stamp that is sold at  a premium over the postage value to provide funding for a designated  charitable cause. The semipostal proceeds are transferred from the U.S.
Postal Service (Service) to designated federal agencies that administer the  funds.
Since 1998, Congress has required the Service to issue the nation’s first  three fund-raising stamps—the Breast Cancer Research stamp, the Heroes  of 2001 stamp, and the Stop Family Violence stamp. First, the Breast  Cancer Research stamp, which was issued in 1998, funds breast cancer  research at the National Institutes of Health (NIH) and the Department of  Defense (DOD). Second, the Heroes of 2001 stamp was issued in 2002  (sold through 2004) to assist the families of emergency relief personnel  who were either killed or permanently disabled while serving in the line of  duty in connection with the terrorist attacks of September 11, 2001. The  Federal Emergency Management Agency (FEMA) administers this  program. Third, the Stop Family Violence stamp was issued in 2003 (sold  through 2006) to fund domestic violence prevention programs at the  Administration for Children and Families (ACF) within the Department of  Health and Human Services (HHS).
This report, a follow-up to our September 2005 report on fund-raising  stamps, examines (1) the amount of money which has been raised through  the sale of the semipostals and (2) how the designated federal agencies  have used the proceeds and reported the results.
In conducting this review, we obtained sales and cost data from the  Service for each of the three semipostals and gathered additional  information from federal officials, fund-raising experts, and advocacy  groups about each of the semipostals and the related charitable causes.
We interviewed officials from the Service and the designated federal  agencies that received semipostal proceeds. In addition, we gathered and  examined agency documents related to the semipostal programs. We also  interviewed experts from fund-raising organizations, such as the  Association of Fundraising Professionals, the American Red Cross, and the  Better Business Bureau’s (BBB) Wise Giving Alliance, about factors that  influence fund-raising efforts for different charitable causes. We consulted  key national advocacy groups affiliated with breast cancer, emergency  personnel affected by the terrorist attacks of September 11, and domestic  violence prevention for their opinions about and experiences with the  semipostals. As a part of our review, we assessed the reliability of the data  needed for this engagement and determined that the data were sufficiently  reliable for our purposes. We conducted our review from June 2007  through September 2007 according to generally accepted government  auditing standards. A more detailed discussion of our scope and  methodology is included in appendix I. We requested comments on a draft  of this report from the Service, ACF, DOD, FEMA, HHS, and NIH.
subsections: section_title: Background
paragraphs: To date, three stamps have been issued in the nation’s semipostal  program: the Breast Cancer Research, Heroes of 2001, and Stop Family  Violence stamps. Semipostals are stamps sold at a premium above the  First-Class postage rate; the net premium amount supports a designated  cause. The semipostal proceeds are transferred from the Service to the  designated federal agencies. The three semipostals were authorized  through separate congressional acts relating to each stamp. The Stamp  Out Breast Cancer Act required that the Service issue the Breast Cancer  Research stamp. The Heroes of 2001 and Stop Family Violence stamps  were mandated by Congress in the 9/11 Heroes Stamp Act of 2001 and the  Stamp Out Domestic Violence Act of 2001, respectively. Figure 2  illustrates the three semipostals.
The sales period for the three semipostals has varied. Initially, the Breast  Cancer Research stamp was authorized for 2 years in 1998. Since then, it  has been reauthorized four times and there are currently proposals in  Congress to further extend the sales period for either two or four  additional years beyond the current expiration date of December 31, 2007.  The Breast Cancer Research stamp raises money for breast cancer  research programs supported by NIH and DOD, with NIH receiving 70  percent of the funds available and DOD receiving the remaining 30  percent. The Heroes of 2001 stamp was offered for sale from June 7, 2002,  to December 31, 2004, and funds raised were transferred to FEMA to assist  the families of emergency relief personnel who were killed or permanently  disabled in the line of duty in connection with the terrorist attacks against  the United States on September 11, 2001. The Stop Family Violence stamp  was offered for sale from October 8, 2003, to December 31, 2006. Proceeds  from the Stop Family Violence stamp were transferred to ACF for  domestic violence prevention programs. Between October 8, 2003, and  December 31, 2004—a period of just over 1 year—the three semipostals  were on sale simultaneously. Currently, however, the Breast Cancer  Research stamp is the only semipostal still being sold.
Previously, we reported that the Breast Cancer Research stamp has been  an effective fund-raiser and that funds raised through sales of the stamp  had contributed to key insights and approaches for the treatment of breast  cancer. Most of the key stakeholders we spoke with and, according to a  survey we conducted in 2003, members of the public viewed the stamp as  an appropriate way to raise funds for a nonpostal purpose. With some  concerns, however, about the Service’s identification and recovery of  costs associated with carrying out the act, we recommended that the  Service reexamine and, as necessary, revise its Breast Cancer Research  stamp cost recovery regulations. The Service implemented our  recommendation by revising its regulations. We also suggested that  Congress consider establishing annual reporting requirements for NIH and  DOD. In addition, we recommended that the Secretaries of Defense,  Homeland Security, and Health and Human Services annually issue reports  to the Congressional committees with jurisdiction over the Service and  that these reports, among other things, should include information on the  amount of funding received from semipostal sales and accounting for how  the funds were allocated or otherwise used.
section_title: Semipostals Have Collectively Raised Over $68 Million, but the Breast Cancer Research Semipostal Has Raised the Most
paragraphs: As of June 30, 2007, more than $68 million has been raised through the sale  of semipostals. The amounts raised and the number of stamps sold has  varied among the three semipostals. Also, based on our discussions with  various agencies, organizations, advocacy groups, and fund-raising  experts, we identified a number of factors that affected semipostal sales,  including public awareness, stamp design, and confusion about how the  proceeds will be used.
subsections: section_title: Breast Cancer Research Stamp
paragraphs: The Breast Cancer Research stamp has raised about $54.6 million, which  dwarfs the funds raised by the other semipostals. Of the funds raised, the  Service transferred a total of $38.2 million and $16.4 million to NIH and  DOD, respectively, for breast cancer research. Similarly, among the  semipostals, the Breast Cancer Research stamp had the highest level of  sales with 777.8 million stamps sold as of June 30, 2007. One explanation  for the higher Breast Cancer Research stamp sales is the length of time  that each stamp was sold. The Breast Cancer Research stamp—the only  semipostal still on sale today—has sold for the past 9 years while the  Heroes of 2001 and the Stop Family Violence stamps sold for 2.5 and just  over 3 years, respectively. Although Breast Cancer Research stamp sales  have fluctuated since the semipostal’s issuance in 1998, sales have been  relatively high over time compared to the other semipostals (see fig. 1).  For example, sales of the Breast Cancer Research stamp have averaged  nearly 22 million semipostals per quarter since issuance.
Several factors affected Breast Cancer Research stamp sales to date. As  we reported in 2005, public awareness about the fund-raising causes  represented by the semipostals—or an issue often in the public eye— affected sales levels. For example, an official from Susan G. Komen for  the Cure told us that, with one in eight women being affected by breast  cancer, the subject is always in the public spotlight. Likewise, an official  from the American Cancer Society told us that public awareness of breast  cancer, coupled with the outreach efforts of several organizations, such as  the Avon Foundation’s breast cancer fund-raising events, increased Breast  Cancer Research stamp sales.
Another factor that could affect Breast Cancer Research stamp sales is the  stamp’s recent price increase. In May 2007, the price of the Breast Cancer  Research stamp increased from 45 cents to 55 cents. This marks the first  time that this stamp’s price has increased by as much as 10 cents (see  table 1). The Service’s Governors established the new price in January  2007—with knowledge that the Service had proposed an increase of the  First-Class postage rate from 39 cents to 42 cents. By law, the Governors  are required to set postage rates for the Breast Cancer Research stamp.  The price must be an amount evenly divisible by five and at least 15  percent more than the First-Class postage rate. The Service refers to this  difference in price as the differential revenue.
The Governors decided on a 10-cent price increase because the differential  revenue of 34 percent, according to the Service, was historically in line  with past differential revenue amounts. For example, in March 2002, when  First-Class postage was 34 cents and the Breast Cancer Research stamp  was 45 cents, the differential revenue was 32 percent, and this, according  to Service officials, did not negatively impact Breast Cancer Research  stamp sales. However, an increase to 50 cents would have yielded a  differential revenue of 22 percent—also in line with past amounts (see  table 1). In addition, Service officials told us that when the decision was  being made as to whether the Breast Cancer Research stamp price should  be 50 cents or 55 cents, the Governors agreed with postal management  that 55 cents would be more appropriate. The Service believes that an  increase to 55 cents would not deter customers who were passionate and  supportive of the cause. With the Postal Accountability and Enhancement  Act effectively allowing annual postage rate increases not to exceed the  annual change in the Consumer Price Index, several years could pass with  possible increases in the First-Class postage rate. Under this scenario,  setting the Breast Cancer Research stamp price at 55 cents will allow for  greater price stability in the event Congress further extends the stamp’s  sales period beyond 2007.
With only a few months passing since this increase, we were unable to  determine what impact, if any, this increase had on sales. However, fund- raising experts that we spoke with generally agreed that consumers with  an affinity—or positive response—toward the Breast Cancer Research  stamp would most likely continue to purchase the stamp. For example,  breast cancer survivors and consumers with close family members who  have battled the disease will probably continue to purchase the stamp,  despite the 10-cent-price increase, to support breast cancer research.  Likewise, one fund-raising expert from the BBB Wise Giving Alliance told  us that, even with the 10-cent price increase, the Breast Cancer Research  stamp price is still relatively low. According to this official, doubling the  price, on the other hand, would probably negatively impact sales, but it is  difficult to determine at which point an increase in price will negatively  affect sales for any given item. Two of the three advocacy groups that we  spoke with and that are affiliated with breast cancer said they could not  say what impact, if any, the price increase may have on Breast Cancer  Research stamp sales, while the third group believed a decline in sales  would result.
section_title: Heroes of 2001 Stamp
paragraphs: During its sales period, a total of 132.9 million Heroes of 2001 stamps were  sold. From the stamp sales, the Service transferred about $10.6 million to  FEMA for distribution to the families of emergency relief personnel who  were either killed or permanently disabled while serving in the line of duty  in connection with the terrorist attacks of September 11, 2001. Sales of the  Heroes of 2001 stamp were initially high after June 2002 when it went on  sale, and over 50 percent of the stamp’s sale (see fig. 1) occurred in the  two-quarters following issuance. However, shortly thereafter, sales began  to decline. In our 2005 report, we attributed this decline to the stamp’s  inability to maintain steady sales over time—or lack of staying power.  Sales of the Heroes of 2001 stamp reflected the dramatic emotional spike  typically associated with episodic events, such as a disaster, with fund- raising efforts building quickly and then declining as events begin to  retreat from the public spotlight. In contrast, ongoing causes, such as  finding a cure for breast cancer, are more likely to maintain staying power  overtime, according to fund-raising experts. While the postage rate for the  Heroes of 2001 stamp did not change during its sales period, the postage  rate for a First-Class stamp did increase—also causing the differential  revenue percentage to decline. Table 2 illustrates these changes.
section_title: Stop Family Violence Stamp
paragraphs: The Service sold 45.4 million Stop Family Violence stamps during its sales  period—the lowest sales of the three semipostals. Similar to the sales  patterns for the Heroes of 2001 stamp, sales for the Stop Family Violence  stamp were highest during the initial two quarters following issuance (see  fig. 1) and then declined. Sales fell from 6.6 million sold in the first quarter  of fiscal year 2004—when the sales period began—to 2.8 million sold in  the first quarter of fiscal year 2007—when the sales period ended. The  Stop Family Violence stamp raised about $3.2 million, which the Service  transferred to ACF to fund domestic violence prevention programs.
This review reconfirmed our previous findings regarding the factors that  likely affected Stop Family Violence semipostal sales. In 2005, we reported  that factors such as stamp design, confusion about how the proceeds  would be used, and limited advertising were factors that likely affected  sales. For this review, four of the five advocacy groups we spoke with  about the Stop Family Violence stamp told us that the stamp’s design—an  image of a crying child—played a key role in low stamp sales (see fig. 2).  Several advocacy group officials commented that as a result, postal  customers were not likely to use the stamp on wedding invitations or  holiday mail. At least two officials told us that the Service should have  consulted with the domestic violence community before selecting the  stamp’s final design. One official told us that in so doing, the Service  would have immediately learned that a different design would have been  more appropriate. Another advocacy group official told us that because  domestic violence is an emotionally charged issue, a softer image was  needed for the stamp to have been more effective. This official suggested,  for example, that a purple ribbon—often associated with domestic  violence, would have been a more appropriate design.
In contrast, the Service felt that the design of the Stop Family Violence  stamp was not a key factor in the stamp’s lower sales. The Service noted  that there are few subjects that will garner the same level of support as the  Breast Cancer Research stamp. The Service also noted that it rarely  consults with advocacy groups regarding the stamp design because it is  difficult to gain consensus.
In 2005, we also reported that support may be further enhanced if the  semipostal or available marketing information clearly indicated how the  proceeds will be used. During this review, three of the five advocacy  groups affiliated with preventing domestic violence told us that confusion  about how proceeds would be used also affected stamp sales. One  advocacy group specifically described this confusion as concern in the  domestic violence community that proceeds from the Stop Family  Violence stamp might go to children’s programs in general—and not  specifically to enhance services for children exposed to domestic violence.
According to officials from this advocacy group and another, had it been  known early on how the proceeds would be used, the domestic violence  community would have given the stamp its full support and would have  been more likely to advertise it. Both of these efforts could have resulted  in higher Stop Family Violence stamp sales—as, according to the  American Red Cross and the BBB Wise Giving Alliance officials, advocacy  groups are the most useful tool for getting the word out about charitable  causes and fund-raising efforts.
In addition, we reported in 2005 that, comparatively speaking, a limited  amount of advertising was performed to promote sales of the Stop Family  Violence stamp. The Breast Cancer Research and Heroes of 2001 stamps  had extensive Service advertising campaigns, as the Service spent nearly  $900,000 to advertise the Breast Cancer Research stamp and over $1.1  million for the Heroes of 2001 stamp. However, due to an overall reduction  in the Service’s budget, since 2003 advertising for all stamps, including  semipostals, were limited to in-store messaging. Consequently, when the  Stop Family Violence stamp was issued, the Service had established a  policy that all costs incurred for advertising semipostals would be  recovered from the semipostal’s proceeds. As a result, the advertising  costs incurred for this stamp were deducted from its proceeds.
When the Service met with ACF before the Stop Family Violence stamp  was issued, the Service proposed spending $1.5 million or more on an  advertising campaign to be funded by future Stop Family Violence stamp  proceeds. Because of the uncertainty about how much money would be  raised through sales of the stamp, ACF decided not to pursue the proposed  advertising campaign. Instead, the Service and ACF looked to the  advocacy groups to promote the semipostal. However, as discussed above,  uncertainty about how the proceeds would be used was one reason why  the domestic violence community did not fully support the semipostal.  Through May 1, 2007, the Service spent about $78,000 to advertise the Stop  Family Violence stamp, and about $77,000 was recovered from the stamp’s  proceeds. The postage rate for the Stop Family Violence stamp did not  change during its sales period, but the postage rate for a First-Class stamp  did increase—causing the differential revenue percentage to decline. Table  3 illustrates these changes.
section_title: Designated Agencies Have Distributed Semipostal Proceeds, but Only DOD and ACF Have Reported Their Use of the Proceeds to Congress
paragraphs: All of the designated federal agencies have distributed proceeds from the  sale of semipostals to their respective causes. Both NIH and DOD have  started to use proceeds from the sale of the Breast Cancer Research stamp  to fund new programs. ACF has used proceeds from the Stop Family  Violence stamp to award nine grants under a program that provides funds  to organizations that deliver services to children who have been exposed  to domestic violence. Finally, FEMA has recently distributed the remaining  proceeds from the Heroes of 2001 stamp to the families of emergency  relief personnel who were either killed or permanently disabled while  serving in the line of duty in connection with the terrorist attacks of  September 11, 2001. Of the four designated agencies, only DOD and ACF  have submitted to Congress a GAO-recommended report on the agency’s  use of semipostal proceeds.
subsections: section_title: Breast Cancer Research Stamp Proceeds Used to Fund New Programs at NIH and DOD
paragraphs: Proceeds from the sale of the Breast Cancer Research stamp fund breast  cancer research grants and programs supported by NIH and DOD. NIH,  which began receiving proceeds from the Breast Cancer Research stamp  in 1998, has distributed its share of the proceeds through four different  programs. Initially, NIH used the proceeds to award high-risk research  grants through the Insight Awards to Stamp Out Breast Cancer initiative.  This program was administered by the National Cancer Institute (NCI). In  2003, NIH created the Exceptional Opportunities in Breast Cancer  Research initiative, which grants stamp proceeds to more traditional, well- established research projects that would not have been otherwise funded.  In 2006, NIH started using Breast Cancer Research stamp proceeds for the  Trial Assigning Individualized Options for Treatment (TAILORx) and the  Breast Pre-Malignancy Program. TAILORx is designed to determine which  patients with early stage breast cancer are most likely to benefit from  chemotherapy and, therefore, to reduce the use of chemotherapy in  patients that are unlikely to benefit. The Breast Pre-Malignancy Program is  an NCI-wide program in breast cancer research that includes the areas of  prevention, etiology, biology, diagnosis and molecular epidemiology. This  program was created in the fall of 2005 when NCI leaders recommended  that the Breast Cancer Research stamp proceeds be used to fund a  program addressing multiple aspects of breast cancer pre-malignancy.  They hoped that linking NCI’s research programs with research programs  underway at universities, medical schools, hospitals, and research  institutions, would create a collaborative and integrated program that  would result in new discoveries and interventions.
As previously discussed, NIH received approximately $38 million from the  Service from the sale of the Breast Cancer Research stamp. Of this  amount, NIH has spent nearly $26 million and has set aside an additional  $8 million to cover the remainder of the Exceptional Opportunities in  Breast Cancer Research initiative and the Breast Pre-Malignancy program.  NIH has not yet determined whether it will use the remaining $4 million  for an existing or new breast cancer research program. NIH has not used  any of the stamp proceeds to manage these programs; and as a result, the  proceeds available for breast cancer research were not reduced.
DOD also began receiving Breast Cancer Research stamp proceeds in  1998. Initially, DOD’s share of the proceeds from the Breast Cancer  Research stamp funded grants under its Idea Awards Program, which  funds innovative approaches to breast cancer research. In 2007, DOD  began using stamp proceeds to fund Synergistic Idea Awards. This  program, which is designed to promote new ideas and collaborations, is  similar to the Idea Awards Program in that it funds innovative, high-risk,  high-reward breast cancer research but differs in that it requires two  researchers to work synergistically on a research project. Both programs  are administered by the Office of the Congressionally Directed Medical  Research Programs, which is part of the U.S. Army Medical Research and  Materiel Command. DOD received approximately $16.4 million from the  Service from the sale of the Breast Cancer Research stamp. DOD has spent  its share of the stamp’s proceeds for grants, except for approximately  $608,000, or about 4 percent, which has been used for overhead costs  related to managing the grants. Table 4 contains information about NIH  and DOD grants, including the size and number of grants awarded.
Grants awarded under the NIH Insight Awards and Exceptional  Opportunities programs and DOD Idea Awards program have resulted in  significant accomplishments in breast cancer research, according to  agency officials. The TAILORx and Breast Pre-Malignancy programs first  received funding in 2006 and, according to NIH, it is too soon to identify  major accomplishments from these initiatives. Table 5 provides some  examples of research findings from NIH’s Insight Awards and Exceptional  Opportunities programs and DOD’s Idea Awards that were funded with  proceeds from the Breast Cancer Research stamp.
section_title: ACF Uses Stop Family Violence Stamp Proceeds for Grant Program
paragraphs: ACF is using the proceeds from the Stop Family Violence stamp to fund a  discretionary grant program called Demonstration of Enhanced Services  to Children and Youth Who Have Been Exposed to Domestic Violence that  supports children who have been exposed to domestic violence. This grant  program is administered under the Family Violence Prevention and  Services Act Program (FVPSA). Stop Family Violence stamp proceeds  have temporarily increased FVPSA’s budget for discretionary grants from  $2.4 million per year to approximately $3.5 million per year. This grant  program was created to increase the availability of child-centered services,  develop and test new interventions and identify promising practices, and  to expand the capacity of domestic violence shelters and community  programs to effectively serve children exposed to violence. Some of the  eligible activities covered under the grant program include providing  services to children exposed to domestic violence, developing processes  to ensure confidentiality of information shared by adult victims of  domestic violence and their children, providing training to service  providers, and developing educational materials for delivering intervention  and prevention services to children who have been exposed to domestic  violence.
The Service distributed about $3.2 million in stamp proceeds to ACF from  May 2004 to May 2007. In June 2005, ACF published the grant opportunity  announcement. ACF received 65 applications and selected nine applicants  to receive 3-year grants. In fiscal years 2005 and 2006, each grantee  received approximately $130,000 per year. In fiscal year 2007, ACF  distributed about $96,000 to each of the grantees, to expend the balance of  stamp proceeds. ACF is distributing all stamp proceeds under the grants  program. ACF has absorbed the costs of managing the grant program by  managing the program with existing staff. Also, ACF has funded the peer  review of grant applications and supported an annual training and  technical assistance meeting for grant recipients. Table 6 provides  information about grants awarded by ACF with Stop Family Violence  stamp proceeds.
The projects funded by this grant program are still underway, and ACF has  not yet evaluated its accomplishments. According to ACF, several grantees  are evaluating the effectiveness of their efforts and have reported  significant progress in achieving their project goals. For example, one goal  is to expand the capacity of domestic violence prevention programs to  address the needs of children and families in and out of emergency  shelters. Another goal is to develop and enhance community-based  interventions for children exposed to domestic violence whose parents  have not sought the services of a domestic violence prevention program.  During the final year of program funding, ACF plans to initiate an effort to  identify, describe, and disseminate promising practices that emerge from  the projects.
section_title: FEMA Recently Distributed Proceeds from Heroes of 2001 Stamp
paragraphs: FEMA has received over $10.5 million from Heroes of 2001 stamp  proceeds for distribution to the families of emergency relief personnel  who were either killed or permanently disabled while serving in the line of  duty in connection with the terrorist attacks against the United States on  September 11, 2001. The Service transferred the proceeds to FEMA in six  disbursements from November 2002 to May 2005. Once all of the proceeds  were received, FEMA published an Interim Rule in the Federal Register on  July 26, 2005, that established the program to be used to distribute the  stamp proceeds. This rule established that the funds would be distributed  equally among all of those deemed eligible. A notice announcing the  application period for the program was published in December 2005, and  FEMA accepted applications from December 2, 2005, until April 3, 2006.  The first payment of funds was distributed to eligible applicants in  November 2006 and FEMA made the final payments in August 2007.  Because the total amount available and the number of eligible recipients  was unknown, FEMA decided to wait until the end of the Heroes of 2001  stamp sales period before finalizing this program and beginning the  process of identifying recipients. Table 7 provides information about  FEMA’s distribution of Heroes of 2001 stamp proceeds.
FEMA conducted outreach efforts prior to and early into the application  process to inform potential applicants about the program and its  requirements. These efforts included face to face briefings with relevant  New York City area emergency relief agencies and their labor unions, as  well as discussions with emergency relief agencies in Shanksville, PA, and  areas surrounding the Pentagon in Washington, D.C. Broadcast e-mails  were forwarded to all of the urban search and rescue teams that assisted  at the locations of the attacks. In addition, agency and union newsletters  and other media in the New York City area carried stories regarding the  availability of the program and how to apply.
Specifically, as it related to assisting families of deceased emergency relief  workers, the New York City Police Department, New York City Fire  Department, and the Port Authority of New York and New Jersey all  cooperated and coordinated with FEMA by providing special assistance  and directly notifying the families of the deceased about how to avail  themselves of the program. In addition, these agencies assisted applicants  by completing the appropriate sections of the applications, as required.  However, assisting the large number of applicants in preparing their  paperwork placed an unexpected burden on these agencies, according to  FEMA and officials from these agencies. When we discussed the process  for distributing the stamp proceeds with FEMA and these agencies, all  officials agreed that the process was collaborative and successful.  According to officials from the emergency relief agencies, the application  process required an extensive amount of work, but ultimately grant  recipients were grateful to receive the funds and generally were not  concerned about the length of time it took FEMA to disburse the stamp  proceeds.
FEMA received a total of 1,945 applications and determined that 1,377  applicants were eligible to receive funds. To apply for Heroes of 2001  stamp proceeds, victims or their families had to complete the application  and submit supporting documentation. This documentation had to  demonstrate that the individual was present at an eligible site—World  Trade Center, Pentagon, or Shanksville, PA— during the 96 hour period  required for eligibility and confirm that the individual was deceased or  living with a permanent physical disability as a result of the attacks.  Examples of documents used to ascertain eligibility included, among other  things, death certificates, worker compensation agency decisions, Social  Security Administration disability documents, and affidavits from  employers and co-workers. Once FEMA received the application and  required documentation, a staff attorney and the project manager  reviewed the applicant’s file. If they agreed that all elements necessary to  qualify for the grant were clearly present and documented, they  recommended the application for approval on a consent agenda for the  next meeting of the Heroes Stamp Review Panel, which consisted of staff  from FEMA, the National Fire Academy, and the Emergency Management  Institute. Any questionable applications were reviewed and evaluated  individually by the Heroes Stamp Review Panel. Applicants who were  determined to be ineligible through this process were allowed an  opportunity to appeal the decision.
Even though FEMA conducted outreach efforts in metropolitan  Washington, D.C., and Shanksville, PA, no applications were received from  these areas. All of the applicants and recipients were emergency relief  workers from the attacks in New York. A large majority of applicants and  recipients were emergency relief personnel that are permanently disabled  as a result of serving in the line of duty in connection with the terrorist  attacks. Table 8 provides additional information about the recipients of  stamp proceeds.
The majority of recipients of Heroes of 2001 stamp proceeds were  firefighters involved in rescue efforts related to the terrorist attacks. The  firefighters included members of the New York City Fire Department,  volunteer firefighters from other fire departments in the area, and  members of urban search and rescue teams. Other recipients included law  enforcement, Emergency Medical Services (EMS), and other safety  personnel who were involved in the rescue efforts. Table 9 below lists the  number of applicants and recipients in each of these categories.
FEMA distributed the entire amount of the stamp’s proceeds to the 1,377  eligible recipients. FEMA decided to distribute an equal portion of the  proceeds to each eligible recipient and each one received $7,672.53. It  was initially unclear how many of the applicants would be deemed eligible  to receive the stamp proceeds, so FEMA distributed the proceeds using a  three-stage approach. This allowed some of the funds to be distributed to  the recipients while the remaining eligibility decisions and appeals  processes were still in progress.
According to FEMA, several factors contributed to the length of time it  took to distribute the funds. First, FEMA decided that each recipient  would receive an equal amount of the proceeds, which meant that all of  the recipients had to be identified and all appeals had to be completed  before the final dollar amount of each award could be determined. Second,  the majority of the applicants and recipients were permanently disabled as  a result of serving in the line of duty in connection with the terrorist  attacks. Some of these disabilities did not surface until well after the  attacks, and the process to determine which applicants met the criteria  was complicated. For example, if a firefighter claimed eligibility based on  suffering from respiratory disease, it could be difficult to prove that their  injuries resulted from involvement in the rescue efforts following the  terrorist attacks and not from his entire firefighting career. Third,  verification of these injuries required extensive paperwork, which had to  be completed, in part, by the emergency relief agencies with the use of  existing personnel. According to officials from some of these agencies, it  took considerable effort to complete the paperwork. When these agencies  became backlogged, FEMA allowed applicants to submit partial  paperwork, as long as all required documentation was received by the  deadline.
Although the enabling legislation authorized the Service to recover  administrative and related costs for selling the stamp, FEMA was not  authorized to recover its administrative costs for the actual operation of  the program to distribute the proceeds. FEMA estimates that it cost about  $383,000 to administer the program. This sum includes the salary and  benefits of U.S. Fire Administration staff responsible for the day to day  management of the program, postage, travel costs, setting up a toll free  hotline, and supplies.
section_title: Some Agencies Report on Use of Stamp Proceeds
paragraphs: In our 2005 report, we recommended that the designated agencies issue  reports to Congress on their use of semipostal proceeds. Program  reporting is important because it ensures accountability and provides  information to Congress and other interested parties regarding the use of  proceeds. The designated agencies have varied in their response to our  recommendation. DOD issued a report to Congress in July 2007 on its use  of proceeds from the Breast Cancer Research stamp and plans to report  annually as part of its report on Congressionally Directed Medical  Research Programs. In addition, DOD provides information about the use  of Breast Cancer Research stamp proceeds through information papers  and its website. ACF prepared a report on its use of proceeds from the  Stop Family Violence stamp and issued it to Congress in August 2007. The  report includes information on the use of the proceeds and the related  accomplishments achieved to date. Since 2007 is the final year for funding  the grant program that uses Stop Family Violence stamp proceeds, the  grantees will be preparing reports on the effectiveness of their efforts and  the lessons learned. Using these reports, ACF anticipates preparing a final  report for Congress on the grant program for release in 2009. FEMA plans  to issue a report on its distribution of Heroes of 2001 stamp proceeds in  the fall of 2007. NIH does not have any plans to report to Congress on its  use of proceeds from the Breast Cancer Research stamp, but NIH officials  noted that information on the breast cancer stamp is available to the  public on its website and, occasionally, through the NCI newsletter. We  found that NIH’s website and NCI newsletter do provide useful overview  information about NIH’s use of Breast Cancer Research stamp proceeds.  However, NIH’s website did not provide detailed information on the  amount of proceeds received to date, how the proceeds were used and any  related accomplishments resulting from the use of these proceeds.
While we are not making any new recommendations in this report, we  reaffirm our prior recommendation aimed at ensuring greater  accountability and greater support for the Breast Cancer Research stamp.  Specifically, in our September 2005 report, we recommended that the  Secretary of Health and Human Services submit to the congressional  committees with jurisdiction over the Service annual reports on the  amount of funding received from the Breast Cancer Research stamp, how  these funds were used, and accomplishments achieved with these funds.
section_title: Agency Comments
paragraphs: We provided a draft of this report to the Service, ACF, DOD, FEMA, HHS,  and NIH for review and comment. These organizations did not offer  overall comments on the draft report. They provided technical comments,  which we incorporated where appropriate.
We are sending copies of this report to Senators Dianne Feinstein and Kay  Bailey Hutchison and Representatives Joe Baca and Wm. Lacy Clay  because of their interest in the Breast Cancer Research stamp; Senators  Hillary Rodham Clinton and Charles E. Schumer because of their interest  in the Heroes of 2001 stamp; the Postmaster General; the Chairman of the  Postal Regulatory Commission; and other interested parties. We will make  copies available to others upon request. This report will also be available  on our Web site at no charge at http://www.gao.gov.
If you have any questions about this report, please contact me at (202) 512- 2834 or siggerudk@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. Key contributors to this report included Gerald P. Barnes,  Assistant Director; Jennifer Clayborne; Colin Fallon; Kathleen Gilhooly;  Brandon Haller; Josh Ormond; and Stephanie Purcell.
section_title: Appendix I: Scope and Methodology
paragraphs: To determine the amount of money raised through the sale of the  semipostals, we analyzed semipostal sales data that the U.S. Postal Service  (Service) provided to us. These data included the amount of quarterly  stamp sales and the amount of proceeds that the Service transferred to the  four federal agencies designated for each semipostal. We also interviewed  officials from the designated federal agencies to confirm the amount of  proceeds each received from the Service. The four designated federal  agencies are the National Institutes of Health (NIH) and the Department of  Defense (DOD) for the Breast Cancer Research semipostal; the  Department of Homeland Security (DHS) for the Heroes of 2001  semipostal; and the Administration for Children and Families (ACF) within  the Department of Health and Human Services for the Stop Family  Violence semipostal. In addition, we obtained stakeholders’ views on what  factors affected semipostal sales. For example, we spoke with Service  officials; professional fund-raising organizations; and national advocacy  groups affiliated with breast cancer, emergency relief personnel affected  by the terrorist attacks of September 11, and domestic violence. Also, we  interviewed Dr. Ernie Bodai, who is credited with conceiving the idea for  the Breast Cancer Research stamp, and Ms. Betsy Mullen, who lobbied  Congress for the stamp along with Dr. Bodai. Table 10 identifies the  stakeholders whom we spoke with. To determine the reliability of the data  we received, we obtained and reviewed specific information on the  Service’s data collection and processing system. We determined that the  data were sufficiently reliable for the purpose of this report.
To determine how the designated federal agencies have used semipostal  proceeds and reported results, we interviewed key officials from each  agency that receives these funds. These agencies included the National  Cancer Institute within NIH, the U.S. Army Medical Research and Materiel  Command within DOD, the Federal Emergency Management Agency  within DHS, and ACF. In addition, we obtained and reviewed agency  documentation pertaining to grant programs funded with semipostal  proceeds, including grant program development, purpose and goals, award  and program guidelines, the number and amounts of awards, reporting  requirements, and grant outcomes.
Finally, to describe the monetary and other resources expended by the  Service in operating and administering the semipostal program, we  obtained and analyzed the Service’s data on costs of administering  semipostals as well as what costs the Service has recovered. We also  discussed the design of the semipostals, advertising, and postage rate  increases with officials in the Service’s Office of Stamp Services.
section_title: Appendix II: Postal Service Semipostal Costs Recovered
paragraphs: According to the Postal Service (Service), cost items recoverable from the  funds raised by semipostals include, but are not limited to, packaging  costs in excess of those for comparable stamps, printing costs for flyers or  special receipts, costs of changes to equipment, costs of developing and  executing marketing and promotional plans in excess of those for  comparable stamps, and other costs that would not normally have been  incurred for comparable stamps. Specifically, the Service has identified 13  cost categories that it uses to track semipostal costs.
USPS, United States Postal Service: Response to the General Accounting Office  Recommendations on the Breast Cancer Research Stamp (June 25, 2004).
Costs reported by the Service totaled nearly $18.2 million through June 30,  2007 (see table 11). Costs for the Breast Cancer Research stamp accounted  for $12.7 million of this amount. The Service determined that about $1.9  million of the total costs related to the three stamps represented costs that  were attributable specifically to the semipostals, would not have been  incurred for comparable stamps, and therefore, needed to be recovered.  The recovered amounts varied from $1.2 million for the Breast Cancer  Research stamp to just over $200,000 for the Stop Family Violence stamp.  The Service reported that the majority of costs incurred by the semipostals  were covered by the First-Class postage rate, and not recovered from the  proceeds. Table 11 describes the semipostal costs incurred and recovered  by the Service.
The specific costs recovered from surcharge revenue varied by amount  and type of expenditure for each semipostal (see tables 12 to 14, which  show costs for each semipostal). As we explained in our September 2005  report, one of the differences is advertising. The Breast Cancer Research  and Heroes of 2001 stamps incurred advertising costs of about $1 million,  but when they were issued, the Service had a budget to advertise stamps.  Because advertising costs would be incurred for comparable stamps, the  Service did not recover these costs. When the Stop Family Violence stamp  was issued, the Service had, among other things, eliminated all stamp  advertising except for in-store messaging, as previously discussed.  Subsequently, the Service established a policy that all costs incurred for  advertising semipostals would be recovered from the semipostal’s  surcharge revenue. Therefore, the advertising costs incurred for this stamp  were deducted from the surcharge revenue.
section_title: Appendix III: NIH Breast Cancer Research Awards Funded with Breast Cancer Research Stamp Proceeds
paragraphs: In November 1998, National Institutes of Health (NIH) began receiving  Breast Cancer Research stamp proceeds from the Postal Service. Since  then, NIH has distributed the proceeds—totaling nearly $31 million— through four different mechanisms. Initially, proceeds from the stamp  were used to award 87 grants under the Insight Awards to Stamp Out  Breast Cancer initiative. Since 2003, NIH used the proceeds to award 31  grants under the Exceptional Opportunities in Breast Cancer Research  initiative. In recent years, the agency has used its share of the proceeds to  fund the Trial Assigning Individualized Options for Treatment (TAILORx)  and the Breast Pre-Malignancy Program. Grants awarded under each  program are listed below.
subsections: section_title: Insight Awards
paragraphs: The Insight Awards were designed to fund high-risk exploration by  scientists who are employed outside the federal government and who  conduct breast cancer research at their institutions. Since fiscal year 2000,  NCI distributed 87 Insight Awards totaling about $9.4 million. Most of the  awards were for 2-year periods. Table 15 provides information about each  Insight Award funded with Breast Cancer Research stamp proceeds,  including the fiscal year of the award, sponsoring institution, principal  investigator, research area, and the amount of the award.
section_title: Exceptional Opportunities in Breast Cancer Research
paragraphs: The Exceptional Opportunities in Breast Cancer Research were designed  to advance breast cancer research by funding high-quality, peer-reviewed,  breast cancer grant applications that are outside the current funding  ability of the National Cancer Institute (NCI). In total, NCI awarded 31  Exceptional Opportunities Awards totaling nearly $10.8 million. Each  grant is for a maximum of four years. Table 16 provides information about  each Exceptional Opportunities award, including the fiscal year of the  award, sponsoring institution, principal investigator, research area, and  amount of the award.
In 2006, NIH began funding the Trial Assigning Individualized Options for  Treatment (TAILORx) with proceeds from the Breast Cancer Research  stamp. The trial is designed to determine which patients with early stage  breast cancer would be more likely to benefit from chemotherapy and,  therefore, reduce the use of chemotherapy in those patients who are  unlikely to benefit. TAILORx seeks to incorporate a molecular profiling  test (a technique that examines many genes simultaneously) into clinical  decision making and, thus, spare women unnecessary treatment if  chemotherapy is not likely to be of substantial benefit to them. The goal of  TAILORx is to determine the most effective current approach to cancer  treatment, with the fewest side effects, for women with early-stage breast  cancer by using a validated diagnostic test developed by Genomic Health,  Inc. in collaboration with the National Surgical Breast and Bowel Project,  a network of cancer research professionals. The test is provided free to all  patients that meet the eligibility requirements for the study.
In fiscal year 2006, NIH awarded $4,500,000 to Genomic Health, Inc. to  offset the costs of testing. As of the middle of May 2007, there were 1,459  patients who were preregistered and had their tumors tested. The number  of patients to be tested during the trial is unknown, but NIH anticipates  that it will range from approximately 6,000 to 10,000, depending on the  preliminary results of the trial.
section_title: NCI Breast Pre- Malignancy Program
paragraphs: The NCI Breast Pre-Malignancy Program represents a comprehensive  program in breast cancer pre-malignancy research that includes the areas  of prevention, etiology, biology, diagnosis, and molecular epidemiology. In  fiscal year 2006, NCI awarded 6 grants under the program for a total of  $853,000 and funded research projects at NCI totaling $371,000. The Breast  Pre-Malignancy Program began in the fall of 2005 when NCI leadership  recommended that stamp funds be used to address multiple aspects of  breast cancer around a unifying theme—breast pre-malignancy. In  addition, they recommended that the program be supported via NCI-wide  programs, which support federal researchers located on the NIH campuses  in Bethesda and Frederick, Maryland, and extramural research programs,  which support research underway in universities, medical schools,  hospitals, and research institutions across the country. This provided an  opportunity to create a collaborative and integrated scientific program  across NCI divisions and centers and to synergistically reach new  discoveries and interventions. The NCI Breast Pre-Malignancy Program  consists of six research components supporting research on pre-malignant  lesions, cancer prevention techniques, and methods for detecting breast  cancer or pre-cancers earlier. The program involves work on breast cancer  stem cells, pathways, the microenvironment, molecular target  identification (biomarkers), imaging, drug recovery, and prevention and  translational research. Table 17 provides information about each Breast  Pre-Malignancy award, including the fiscal year of the award, sponsoring  institution, principal investigator, and amount of the award.
section_title: Appendix IV: DOD Breast Cancer Research Awards Funded with Breast Cancer Research Stamp Proceeds
paragraphs: As of September 2007, The Department of Defense (DOD) has awarded 39  breast cancer research grants totaling about $15.8 million using proceeds  from the Breast Cancer Research stamp. From 1999 to 2006, DOD applied  Breast Cancer Research stamp proceeds to its Idea Awards, which are  funded under the Breast Cancer Research Program. These grants focus on  innovative approaches to breast cancer research and cover research areas,  such as genetics, biology, imaging, epidemiology, immunology, and  therapy. In 2007, DOD started using Breast Cancer Research stamp  proceeds to fund the Synergistic Idea Awards. These awards support  innovative, high-risk, high-rewards breast cancer research collaborations  between two independent researchers. Grant proposals must demonstrate  the synergistic aspects of the collaboration. According to DOD officials,  about $608,000 of the transferred funds had been used for overhead costs  related to managing the grants. Table 18 provides information about each  Idea Award funded with Breast Cancer Research stamps proceeds,  including the fiscal year of the award, sponsoring institution, principal  investigator, research area, and the amount of the award.
Table 19 provides information about the Synergistic Idea Awards funded  with proceeds from the stamp, including the fiscal year of the award,  sponsoring institution, principal investigator, research area, and the  amount of the award.
section_title: Appendix V: ACF Awards Funded with Stop Family Violence Stamp Proceeds
paragraphs: As of June 2007, The Administration for Children and Families (ACF)  awarded approximately $2.3 million of the proceeds from the Stop Family  Violence stamp under the Demonstration of Enhanced Services to  Children and Youth Who Have Been Exposed to Domestic Violence grants  program. These grants support efforts to identify, design, and test  approaches for providing enhanced and direct service for the children of  abused parents being served in prevention programs or to develop an  expanded capacity to work within community collaborations and systems  responding to children exposed to domestic violence. In fiscal years 2005  and 2006, ACF awarded nine grantees approximately $130,000 each year.  In fiscal year 2007, the final year of the program, ACF awarded about  $96,000 to each grantee, to expend the balance of the Stop Family Violence  stamp proceeds. Table 20 contains information about each grant funded  with Stop Family Violence stamp proceeds, including the name of the  grantee, the location of the organization, and total amount awarded.