Federally Leased Vehicles: Agencies Should Strengthen Assessment Processes to Reduce Underutilized Vehicles
Released: 2016-01-14T00:00:00


Highlights: section_title: Why GAO Did This Study
paragraphs: Federal agencies spent about $1 billion in fiscal year 2014 to lease about 186,000 vehicles from GSA. Assessing the utilization of leased vehicles is important to agency efforts to manage their fleet costs.

GAO was asked to examine federal processes for assessing the utilization of leased vehicles. This report addresses, among other objectives, (1) GSA's role in identifying and reducing underutilized leased vehicles and (2) the extent to which the processes used by selected federal agencies facilitate the identification and removal of underutilized leased vehicles, and any cost savings that could be achieved by reducing underutilized vehicles. GAO selected five agencies using factors such as fleet size, and analyzed over 15,500 fiscal-year 2014 vehicle records. At the five agencies, GAO surveyed fleet managers with at least 20 leased vehicles; reviewed fleet policies and guidance; and interviewed federal officials. These findings are not generalizable to all agencies or fleet managers.

section_title: What GAO Found
paragraphs: The General Services Administration (GSA) provides guidance to agencies to assist them in reducing underutilized leased vehicles. This guidance can be written (such as bulletins) or advice from GSA's fleet service representatives (FSR) to agency fleet managers. FSRs assist agencies with leasing issues, and GSA expects its FSRs to communicate with fleet managers about vehicle utilization at least annually. However, 18 of 51 fleet managers GAO surveyed reported that they had never spoken to their FSR about vehicle utilization. GSA has no mechanism to ensure these discussions occur and therefore may miss opportunities to help agencies identify underutilized vehicles.

While the selected agencies—the Air Force, the Bureau of Indian Affairs (BIA), the National Aeronautics and Space Administration (NASA), the National Park Service (NPS) and the Veterans Health Administration (VHA)—took steps to manage vehicle utilization, their processes did not always facilitate the identification and removal of underutilized vehicles. Certain selected agencies (1) could not determine if all vehicles were utilized, (2) could not locate justifications for vehicles that did not meet utilization criteria, or (3) kept vehicles that did not undergo or pass a justification review. These agencies paid GSA about $8.7 million in fiscal year 2014 for leased vehicles that were retained but did not meet utilization criteria and did not have readily available justifications (see table).

Of the selected agencies, NASA and VHA did not apply their utilization criteria to nearly 400 vehicles, representing about $1.2 million paid to GSA in fiscal year 2014. However, these agencies have taken steps to rectify the issue. The Air Force, BIA, NPS, and VHA could not readily locate justifications for over 1,500 leased vehicles that did not meet utilization criteria, representing about $5.8 million. BIA and NPS are planning action to ensure justifications are readily available in the future. As of May 2015, NPS and VHA had retained more than 500 vehicles—costing $1.7 million in fiscal year 2014—that were not subjected to or did not pass agency justification processes. While costs paid to GSA may not equal cost savings associated with eliminating vehicles, without justifications and corrective actions, agencies could be spending millions of dollars on vehicles that may not be needed.

section_title: What GAO Recommends
paragraphs: GAO recommends, among other things, that GSA develop a mechanism to help ensure that FSRs speak with fleet managers about vehicle utilization, that the Air Force and VHA modify their processes for vehicle justifications, and that NPS and VHA take corrective action for vehicles that do not have readily accessible written justification or did not pass a justification review. Each agency concurred with the recommendations and discussed actions planned or underway to address them.

section_title: Letter
paragraphs: In fiscal year 2014, federal agencies paid over $1 billion to lease over  186,000 vehicles from the General Services Administration’s (GSA) Fleet  Leasing program to carry out agencies’ missions. Ranging from busses to  compact sedans, these vehicles transport personnel, haul equipment, and  ferry clients to agency-provided service locations, among other activities.  GSA’s Fleet Leasing Program (GSA Fleet) is responsible for meeting the  vehicle leasing needs of federal agencies. As the lessor, GSA Fleet  collects information on leased vehicles—such as fuel use, vehicle type,  and mileage—from a variety of sources, including vehicle manufacturers  and fleet cards (i.e., credit cards used by agencies to purchase fuel and  other services). This information is offered to federal agencies to help  them make critical fleet management decisions, including whether or not  to eliminate vehicles. From fiscal year 2013 to fiscal year 2014, the total  amount paid by agencies for GSA-leased vehicles decreased from $1.06  billion to $1.03 billion, but the actual number of leased vehicles grew  slightly. In recent years, Members of Congress and the President have  raised questions about the size and cost of the federal fleet, and  legislative proposals have been aimed at reducing the size and cost of  agencies’ fleets.

As agencies continue to seek opportunities to reduce costs associated  with their vehicle fleets, it is important to understand the practices used to  assess the utilization of leased vehicles and the ways in which those  practices may hinder or enhance opportunities for agencies to reduce  costs associated with their fleet sizes. You asked us to review federal  leased-vehicle data and agencies’ efforts to measure vehicle utilization.  This report addresses: (1) the extent to which GSA data on leased  vehicles are reliable, (2) GSA’s role in identifying and reducing  underutilized leased vehicles, and (3) the extent to which the assessment  processes used by selected federal agencies facilitate the identification  and removal of underutilized leased vehicles, and any cost savings that  could be achieved by reducing any underutilized vehicles.

To determine the extent to which GSA’s data on leased vehicles are  reliable, we reviewed documentation of GSA’s efforts to ensure the  reasonableness of data in two databases: Drive-thru and FAST (Federal  Automotive Statistical Tool). For the purposes of this review, reliability is  defined by two key components: reasonableness and indications of  accuracy. While there is no single federal criterion for determining  reasonableness, we assessed reasonableness by comparing GSA  practices against federal internal control standards; Office of  Management and Budget (OMB) guidance; and GAO standards for  assessing data reliability set forth in prior GAO work. See appendix I for  more details on how we defined reasonableness. We also evaluated  Drive-thru for indications of accuracy. Specifically, we analyzed  approximately two dozen Drive-thru data elements from May 2015—such  as odometer readings, vehicle identification numbers (VINs), and type of  fuel purchased.

To determine GSA’s role in identifying and reducing underutilized leased  vehicles, we reviewed applicable federal laws, fleet management  regulations, GSA’s fleet guidance, and other pertinent GSA  documentation and described GSA’s role based on the responsibilities  delineated in these documents. We also administered a survey regarding  the frequency and helpfulness of utilization-related conversations held  between GSA Fleet Service Representatives (FSR) and leasing  customers (i.e., agency fleet managers or personnel with similar  responsibilities) to a non-generalizable selection of 68 leasing customers  from five agencies. More details on our selection process are included in  appendix I. We received 51 responses (a 75 percent response rate).  While not generalizable to all of GSA’s leasing customers or the five  agencies that we reviewed, the survey responses provide insight into  interactions between agency officials and FSRs. These were the same  five agencies that we selected to examine agencies’ utilization processes:  the Bureau of Indian Affairs (BIA), the National Aeronautics and Space  Administration (NASA), the National Park Service (NPS), the U.S. Air  Force (Air Force), and the Veterans Heath Administration (VHA). BIA and  NPS are both sub-agencies under of the Department of the Interior  (Interior), and VHA is a sub-agency under the Department of Veterans  Affairs (VA). We selected these five agencies to include a mix of: (1) fleet  sizes, but none smaller than 1,000 vehicles, (2) military and civilian fleets,  (3) fleets with varying annual mileage compared to federal miles-traveled  guidelines, and (4) agencies’ use of telematics, among other  considerations.

To determine the extent to which the selected agencies’ assessment  processes facilitate the identification and removal of underutilized leased  vehicles, we analyzed the agencies’ regulations and other relevant  documentation on their utilization review processes. We compared  agency processes to the Standards for Internal Control in the Federal  Government (Green Book).We also obtained fiscal year 2014 data from  Drive-thru for a selection of vehicles from each of the five agencies under  this review, and asked each agency to identify whether or not the vehicles  had justification documentation or had passed a justification review,  among other categorization requests. We analyzed the costs paid to  GSA for any selected vehicles where agency processes did not facilitate  the identification and removal of potentially underutilized vehicles.

To address all of our objectives, we interviewed officials from GSA and  each of the selected five agencies. For more information about our scope  and methodology, please see appendix I.

We conducted this performance audit from February 2015 to January  2016 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: Agencies use vehicles in many ways, as vehicles support agency efforts  to achieve various mission needs. These needs can be diverse, as  demonstrated by the vehicle uses of the five agencies we selected for  review: ferrying clients, conveying repair equipment, hauling explosive  materials, and transporting employees, among others (see table 1.)

Agencies may own or lease the vehicles in their fleets and are  responsible for managing their vehicles’ utilization in a manner that allows  them to fulfill their missions and meet various federal requirements. For  example, agencies determine the number and type of vehicles they need  to own or lease and when a vehicle is no longer needed to achieve the  agency’s mission. Statutes, executive orders, and policy initiatives direct  federal agencies to, among other things, collect and analyze data on  costs and eliminate non-essential vehicles from their fleets. For example,  every year agencies provide an update on their progress in achieving the  inventory goals determined by their Vehicle Allocation Methodology  (VAM), such as the type and number of vehicles in their fleets. These  updates are reviewed by GSA’s Office of Government-wide Policy (OGP),  which provides feedback on agencies’ submissions.

Federal provisions on vehicle justifications and determining what makes a  vehicle “utilized” are detailed in the Federal Property Management  Regulations (FPMR). Specifically, the FPMR provide how agencies can  define utilization criteria for the vehicles that they use. According to  GSA’s OGP, the only requirement in the utilization portion of the  regulations is for agencies to justify every full-time vehicle in their  respective fleets, though the regulations do not specify how these  justifications should be conducted. The FPMR recommend—but do not  require—that the annual mileage minimum for passenger vehicles be  12,000 miles, and 10,000 miles for light trucks. However, according to  GSA officials, mileage is not the only appropriate indicator of utilization for  some vehicles’ missions. For example, GSA officials stated that it would  be inappropriate to set a mileage expectation for an emergency  responder vehicle or a vehicle that supports national security  requirements because those vehicles are only needed in specific  circumstances and may not accrue many miles. Thus, the FPMR state  that the aforementioned mileage guidelines “may be employed by an  agency… other utilization factors, such as days used, agency  mission, and the relative costs of alternatives to a full time vehicle  assignment, may be considered as justification where miles traveled  guidelines are not met.” Therefore, according to GSA officials, agencies  are allowed to define their own utilization criteria, which may include  adopting the miles-traveled guidelines from the FPMR, using mileage  minimums above or below the FPMR, or employing other metrics.

According to GSA officials, agencies may choose to define their selected  utilization criteria in their internal policies, and vehicles meeting those  criteria would be considered justified under the regulations. However, if a  vehicle does not meet the utilization criteria specifically described in  agency policy, the FPMR permit agencies to individually justify a vehicle  using criteria the agency finds appropriate for that specific vehicle. The  regulations do not specify the frequency with which the justifications  (either as determined by agency policy or individually determined) must  be conducted, updated, or reviewed. Agencies decide what vehicles are  needed to help the agency meet their mission at any given point in time.  While GSA provides guidance, the ultimate decision-making power lies  with the agency leasing the vehicle.

Federal agencies can use GSA Fleet to acquire leased vehicles.  According to GSA, under this arrangement an agency informs GSA Fleet  what kind of vehicle is necessary for its mission. GSA Fleet fulfills the  agency’s request by either purchasing a new vehicle (owned by GSA but  leased to the agency), or providing a vehicle from GSA’s existing  inventory (owned by GSA and previously leased to another agency). GSA  Fleet’s primary mission is to provide the “best value” to its customers and  the American people. GSA Fleet’s leasing rates are designed to recover  all costs of its leasing program, but the exact cost of a lease depends on  the type of vehicle and the number of miles traveled during the lease  period, among other factors. For example, a conventionally fueled  subcompact sedan has a 2015 fixed rate of $153 per month and mileage  rate of $0.13 per mile traveled. GSA Fleet’s fixed rate is designed to  cover fixed costs such as GSA Fleet staff and vehicle depreciation,  whereas the mileage rate is designed to cover variable costs such as fuel  and maintenance. Agencies are responsible for any costs associated with  damage or excessive wear and tear over the course of the lease— typically 3-7 years for a passenger vehicle. We previously reported that,  according to GSA officials and fleet managers from military and civilian  fleets, GSA Fleet’s vehicle lease rates are typically lower than the  commercial sector and provide a more economical choice for federal  agencies.

GSA Fleet collects data on leased vehicles to assist with billing as well as  help agencies manage their leased-vehicle fleets. GSA Fleet’s Fleet  Management System (FMS) contains most of this data. The portal used  by agencies to access the data in GSA’s FMS is called Drive-thru. Drive- thru offers a suite of applications, including tools to analyze crash data  and report mileage. As Drive-thru is the primary portal through which  customers can access GSA’s leasing data, some customers refer to the  underlying database as Drive-thru as well. While Drive-thru is the name of  the exterior-facing access portal rather than the database itself, we will  refer to the database as Drive-thru for the purposes of this report to reflect  the language commonly used by GSA’s leasing customers.

Drive-thru stores hundreds of data elements on each vehicle, including  manufacturer-provided information such as make, model, and fuel  efficiency; agency-reported data such as monthly mileage; and data  obtained through fleet cards (charge cards) such as quantity and type of  fuel purchased. Agencies can import information from Drive-thru into their  own internal fleet management systems and, according to multiple  agency officials, generally rely on GSA Fleet to ensure Drive-thru’s  accuracy, as identifying and correcting erroneous data can be time  consuming and difficult. However, agencies can change the data they  receive from Drive-thru after data enter an agency’s internal fleet  management system but before they are externally reported.

GSA’s OGP co-manages and co-funds a web-based reporting tool—the  Federal Automotive Statistical Tool (FAST)—with the Department of  Energy (DOE). FAST gathers data from federal agencies about their  owned and leased vehicles to satisfy a variety of federal-reporting  requirements, including the annual Federal Fleet Report. According to  the Office of Management and Budget (OMB), it is the leasing agencies,  not GSA or DOE, which are responsible for the accuracy of the data  agencies report to FAST. As a result, while GSA’s OGP helps compile the  information from FAST that populates the Federal Fleet Report, the  accuracy of the Federal Fleet Report is dependent on the accuracy of the  data that agencies report to FAST.

The Federal Fleet Report provides an overview of federal motor vehicle  data, such as number of vehicles and related costs. A comparison of the  reports from fiscal years 2012 through 2014 shows that the overall  quantity of leased vehicles varies slightly from year to year, but the costs  have consistently decreased. For example, in fiscal year 2013, federal  agencies leased 183,989 vehicles at a cost of approximately $1.06 billion.  In fiscal year 2014, federal agencies leased slightly more vehicles— 186,214—but the costs dropped to $1.03 billion, as shown in table 2.  GSA officials explained that the cost reduction is attributable in part to  agencies’ decisions to lease smaller, less expensive vehicles.

Although GSA collects and reports information on leased vehicles, GSA  does not have responsibility for tracking how agencies use vehicles or  identifying underutilized vehicles. Nevertheless, some of the services  that GSA Fleet provides are related to utilization. For example, to help  streamline customers’ vehicle leasing experiences, in 2014 GSA  employed approximately 330 liaisons called Fleet Service  Representatives (FSR). FSRs are expected to answer local customers’  questions about vehicle acquisition, provide assistance when vehicles  need services, and help customers understand the various leasing terms  and products offered by GSA Fleet. According to GSA Fleet, FSRs should  discuss utilization with leasing customers at least annually as part of other  business discussions.

section_title: GSA Data on Selected Leased Vehicles Are Generally Reliable
paragraphs: We found the data we reviewed in Drive-thru to be generally reliable as  GSA has taken steps to ensure that the data are reasonable, although a  few data elements have indications that those data could be more  accurate.  While GSA is not responsible for the accuracy of data in  FAST, it has taken appropriate steps to ensure the data are reasonable.
subsections: section_title: GSA’s Efforts Support the Reliability of Selected Drive-thru Data
paragraphs: GSA is responsible for ensuring that the information that it is providing to  customers in Drive-thru is reliable (i.e., both reasonable and accurate). It  is important that data in Drive-thru are reliable because reports that are  generated via Drive-thru represent a service that GSA is directly providing  to customers to help them manage their fleets. Agencies also use Drive- thru when fulfilling federal fleet reporting requirements. For example,  agencies can download a report about their leased vehicles from Drive- thru. The report then can be directly uploaded into FAST to meet annual  reporting requirements on the leased fleet’s size and costs. Incorrect data  in Drive-thru can therefore hinder agencies’ abilities to manage their  leased fleets or could compromise the integrity of federal reports.
subsections: section_title: Reasonableness of Selected Drive-thru Data
paragraphs: A basic test of reliability is whether the data are reasonable. Using the  guidance provided in three key sources, we developed an analytical  framework for measuring the “reasonableness” of data, as there is  currently no universally accepted standard for such a measurement.  Each of these key sources discusses three topics, which we use as our  standard for reasonableness of data: (1) electronic safeguards, such as  error messages for out-of-range or inconsistent entries; (2) a review of  data samples to ensure that key fields are non-duplicative and sensible;  and (3) clear guidance to ensure consistent user interpretation of data  entry rules.

Based on the data we reviewed, we found that GSA has taken  appropriate steps to ensure the selected Drive-thru data are reasonable.  Specifically, GSA uses electronic safeguards when data are entered into  Drive-thru. For example, error messages appear if a user enters an  odometer reading such as 12345, 99999, 00000, 654321 or a reading  that differs 9,999 or more miles from the previous month’s entry. Similarly,  GSA uses a validation program to catch vehicle identification number  (VIN) entry errors. VIN barcodes are scanned into GSA’s system unless  they must be manually entered due to barcode damage. For both scans  and manual entries, software validates that the entered VIN meets the  check digit calculation.

In addition, GSA verifies some data during reconciliations and other post- entry checks. For example, customer mileage entries are routinely  monitored by GSA’s Loss Prevention Team (LPT) for abnormal inputs. If  entries for a specific vehicle are consistently nonsensical, the LPT  reviews the activity for signs of fraud and, if likely fraudulent, forwards to  the appropriate Inspector General’s office for investigation. For entries  that are consistently nonsensical but are not likely fraudulent, the LPT  notifies the designated FSR for follow-up with the customer. The FSR is  then tasked with emphasizing to the customer the importance of entering  valid odometer readings in the future.

Lastly, GSA reported that it provides guidance on how to enter vehicle- related information into Drive-thru to the people who are responsible for  entering different types of data. Generally, information about the vehicle  itself is the responsibility of GSA or its agents (such as contractors— known as “marshallers”—who enter manufacturer-provided data at the  time GSA receives the vehicle). GSA provides a handbook to marshallers  that explains how the marshallers should use the software that collects  information and transmits it to GSA’s system. Similarly, GSA provides a  Drive-thru guide to customers that explains how customers should enter  certain types of information into Drive-thru;  however, GSA does not  provide instructions regarding how customers should inform GSA if their  contact information will change. The lack of such guidance may have  been a contributing factor in the inaccuracies we found in the customer  contact data, as discussed in the next section on indications of accuracy  in Drive-thru data; however, according to GSA officials, planned changes  to GSA’s customer ID protocols will remove the need for such guidance in  the future.

section_title: Indications of Accuracy in Selected Drive-thru Data
paragraphs: A second test of data reliability is accuracy; however, we tested for  indications of accuracy in the data, as verifying the data accuracy itself  would have required extensive examination of individual vehicles, which  was beyond the scope of this review. We performed tests on a selection  of nearly two dozen Drive-thru data elements from May 2015 for selected  vehicles and determined that there are numerous indications of accuracy  associated with the data we reviewed. For example:

Almost 100 percent of 9 vehicle inventory fields, including make,  manufacturer name, fuel type, VIN, and model year, have no missing  data. One vehicle was missing the manufacturer name.

Three entries indicated the presence of a luxury manufacturer entry  (all for Audi), an error rate of less than one hundredth of one  percent.  .07 percent of records for sedan fuel tank sizes exceeded 20  gallons. Although sedan fuel tank sizes vary and can change from  year to year, few midsize sedans have 20 gallon tanks. Therefore, fuel  tanks larger than 20 gallons might indicate a data error.

Despite the overall indications that the selected Drive-thru data are  accurate, there are three areas where we found indications that the data  may be less accurate than the other information we studied: fuel type  coding, odometer entries, and customer contact data. According to  federal internal controls standards, data collection applications—including  electronic safeguards such as logic and edit checks—should ensure that  all inputs are correct in order to facilitate accountability and effective  stewardship of government resources.

First, we found that while most fuel-type-coding data appear to be  accurate, gas stations coded pumps incorrectly in at least some cases  from January through April 2015, and possibly in as high as 46 percent  of cases. For example, drivers of vehicles with E-85 fuel types were  reported to have purchased compressed natural gas or biodiesel. We  were not able to determine the precise number of instances where fuel  had been miscoded; however, because some vehicles use more than one  type of fuel—for example, “flex fuel” vehicles can operate on either  regular gasoline or an alternative fuel known as E-85, which is a blend of  gasoline and ethanol. Given the data available, we were not able to  determine which fuel the user actually selected and were thus unable to  determine which purchases were coded incorrectly by the gas station.  The high end of the error range (46 percent) would mean that each  uncertainty was resolved as a fuel-pump-coding error by the gas station,  an error that GSA officials said was extremely improbable. These officials  noted that they believed the actual error rate was substantially lower.  However, GSA officials agreed that pump miscodings compromise data  accuracy and noted that GSA has worked with fueling station owners and  relevant associations to reduce fuel pump miscodings. However, GSA  officials stated their ability to affect change is highly limited, as the  miscodings occur at the point of sale and there is no incentive for the  fueling stations to correct the miscodings.

In addition to fuel type miscodings, we found that 3 percent of monthly  odometer entries in May 2015 were lower than the previous month’s  odometer reading. An odometer reading that decreases from one month  to the next indicates that there was an error at some point in time—either  the previous month’s entry was too high, or the current month’s entry is  too low. Monthly odometer readings are supplied by agencies as part of  the billing process, and odometer errors result in temporary billing errors  as agencies pay additional fees based on mileage. GSA officials stated  that they cannot be certain of a vehicle’s odometer reading until the  vehicle is returned to them at the end of the leasing period and that they  typically depend on the leasing agency to correctly report the odometer  readings. According to GSA officials, as part of the monthly odometer- data collection process GSA’s system warns users that they may have  entered incorrect data if the reported odometer reading is 9,999 miles  greater than or less than the previous month’s odometer reading. Users  would then be able to correct the data before submitting it to GSA.

GSA officials stated that they chose the 9,999 mile warning point because  they did not want the system to generate cautionary messages to  customers when there was a valid reason for the mileage difference. The  officials explained that there are legitimate reasons why the previous  month’s odometer reading might be higher than the current month’s  reading. For example, if the agency relied on GSA to estimate mileage in  the previous month and the estimate was too high, the agency’s  correction in the current month could result in a lower odometer reading.  GSA officials said that they did not want the system to incorrectly flag  these instances, and that they have no plans to evaluate the current  safeguard. However, using such a large mileage difference to trigger a  warning means that GSA may be unlikely to catch the majority of errors.  We found 52 cases where the mileage difference was 9,999 miles or  greater, but more than 4,800 cases where the previous month’s odometer  reading exceeded the current month’s reading. We also found that the  average monthly odometer difference for our selected vehicle data is 564  miles per month, with 95 percent of vehicles driving less than 2,482 miles  per month, as shown in table 3.

Although the resulting billing errors can be resolved the following month  and the overall error rate is low, resolutions take time and resources for  both GSA and the customer. Evaluating the current warning and adjusting  it accordingly could help improve the accuracy of the data and therefore  help reduce these costs, and GSA officials stated that changing the  existing safeguard would not be costly. Further, GSA’s edit check for  odometer readings is not consistent with federal internal control standards  that call for agencies to pursue data accuracy when possible and cost- effective.

Lastly, we found that customer contact data, such as the name and e-mail  of the individual whom GSA should contact for vehicle-related services, is  not always correct. As mentioned previously, GSA’s customer-leasing  guide does not provide guidance regarding how customers should  proceed if the vehicle’s point of contact will change. In addition, according  to GSA officials, the customer ID number—which is how customers sign  in to Drive-thru—is associated with the customer’s fleet, not the customer  points of contact themselves. As a result, customer contact data are  updated manually by FSRs after FSRs detect a problem, such as a  returned e-mail after the previous point of contact leaves the agency.  Several FSRs stated that the manual updates are time-consuming.  Moreover, one FSR we interviewed stated that the current process relies  on the initiative of FSRs to ensure accuracy. Without accurate customer  contact data, it is more difficult for FSRs to communicate with agencies  about vehicles, including whether certain vehicles are still needed. Two  FSRs stated that turnover in customer agency fleet management is high.  Such turnover exacerbates the difficulty associated with maintaining the  accuracy of these data. According to GSA officials, planned changes to  Drive-thru in 2016 will resolve this issue, as customer IDs will no longer  be assigned to a fleet. Rather, each customer will have that individual’s  own individual user account, profile, and password. In addition, the  customer ID will be the individual customer’s e-mail address instead of a  number, a step that GSA officials anticipate will resolve the difficulties  associated with updating the user contact information.

section_title: GSA Takes Steps to Ensure the Reasonableness of FAST Vehicle Data
paragraphs: GSA is not responsible for the accuracy of data reported to FAST, a data  collection system that GSA co-manages with DOE. Rather, OMB’s  Circular A-11 provides that agencies are responsible for reviewing and  correcting fleet data prior to submitting them through FAST. However,  GSA’s OGP has a role in ensuring the reasonableness of FAST data as a  partner in the FAST management team. In this role, GSA focuses on data  relevant to fleet management, such as overall inventory, cost, and  utilization metrics. We found that GSA’s OGP has taken appropriate steps  to ensure the fleet management data reported to FAST are reasonable.  Specifically, (1) GSA is aware of the electronic safeguards built into FAST  for fleet management data; (2) GSA examines some of the data after it is  submitted by agencies and flags entries for correction; and (3) GSA  provides guidance to agencies on how to properly enter information into  FAST.

According to GSA, it shares responsibility with DOE for implementing and  managing electronic safeguards for FAST. GSA and DOE collaborate to  implement logic checks, which both parties use to determine the  reasonableness of the data. We also found that GSA has a process for  reviewing data after they are entered by an agency. If, for example, a  significant increase in a specific type of fuel use is not matched by a  similar increase in inventory, mileage, or cost, then GSA flags the data for  verification with the agency. While it is not known how often GSA finds  entries that it recommends for agency review, GSA reported that during  both the 2013 and 2014 FAST reporting cycles, a few agencies  experienced difficulties that required GSA to help resolve data issues (for  example, re-opening FAST after the close of the data call). Lastly, we  found that GSA provides guidance to agencies on how to properly enter  information into FAST in a variety of formats, including (1) written  instructions to users, (2) written instructions to administrators, (3)  presentations at quarterly meetings, (4) one-on-one sessions with  individual agencies upon request, (5) online demonstrations, and (5)  official guidance in the form of Federal Management Regulation (FMR)  bulletins.

section_title: GSA’s Role Focuses on Providing Guidance and Advice to Agencies on Identifying and Reducing Underutilized Vehicles
paragraphs: GSA has a limited role in identifying and reducing underutilized leased  vehicles, as agencies are responsible for managing their vehicle fleets.  GSA is not responsible for monitoring agencies’ vehicle utilization  policies. Rather, according to GSA officials, GSA focuses on providing  guidance and advice to federal agencies on utilization by (1) developing  written guidance and reviewing agencies’ Vehicle Allocation Methodology  (VAM) update submissions and (2) holding conversations with federal  agencies’ fleet managers about vehicle utilization at least annually.

GSA’s OGP provides written guidance in the form of bulletins to federal  agencies to implement legislation, executive orders, and other directives,  but agencies are not legally required to follow this guidance. For example,  in May 2011, a Presidential Memo (implementing a 2009 Executive  Order) required GSA to develop and distribute VAM guidance to federal  agencies for determining their optimum fleet inventory. In response,  GSA provided such guidance to agencies in August 2011. Specifically,  the guidance directed agencies to survey the utilization of vehicles each  year, but agencies were not required to follow the guidance and some  agencies chose to continue using their existing processes even though  those processes differed from the GSA guidance. For example, some  agencies’ fleet managers (including those from NASA, according to NASA  officials, and those from the U.S. Navy, according to GSA officials)  believed that the processes they already had in place fulfilled the intention  of the guidance. In addition to providing written guidance, GSA has  voluntarily reviewed utilization information covered in agencies’ VAM  update submissions and has sometimes made broad recommendations  to agencies based on those reviews. For example, in the 2014 VAM  review, GSA recommended that all executive federal agencies establish  and document specific vehicle utilization criteria for motor vehicle  justification, that the criteria be reviewed at least annually, and that action  be taken when underutilized vehicles are identified.

GSA officials told us that another aspect of the agency’s role in identifying  and reducing underutilized leased vehicles is to provide advice to federal  agencies’ fleet managers at least annually through conversations about  utilization. According to GSA officials, this advisory role is intended to  help the federal government save money by providing agencies with  support needed to make wise business decisions. In addition, GSA  officials explained that during conversations with fleet managers, FSRs  might discuss the agency’s overall fleet size, vehicle replacement options,  or may suggest that a larger vehicle is no longer needed when a smaller  one will suffice.  For example, one NASA fleet manager told us that his  FSR coordinated the exchange of two larger vehicles in his fleet for two  smaller vehicles for the purposes of downsizing and reducing fuel  consumption.

To improve our understanding of these utilization conversations and to  examine their usefulness, we sent a non-generalizable survey to 68 fleet  managers for our five selected federal fleets. While the responses are  not representative of either the experiences among our five selected  agencies or the federal fleet as a whole, they do provide insight into  activities that are otherwise undocumented. Fifty one fleet managers  responded, with the majority of them (41) reporting either having decision- making authority or collaborating with their supervisor to make decisions  about vehicle acquisition and disposal. Of the 41 respondents with a role  in the vehicle’s acquisition and disposal decision-making process, 27  responded that their FSR has communicated with them about leased- vehicle utilization based on mileage. The majority of those decision- makers—25 of the 27—said that these communications were moderately  to extremely useful in helping them to manage their leased-vehicle  utilization based on mileage. However, 18 of the 51 overall respondents  (including 14 of the 41 respondents with an acquisition and disposal  decision-making role) said that they had never discussed utilization based  on mileage with their FSR.

GSA’s management told us that it believes these conversations are  occurring, but may not include the word “utilization,” a situation that could  explain, in part, why some of our survey respondents reported never  having discussed utilization with their FSR. According to GSA officials,  the expectation is inherent to the role of the FSR and is made clear to  them through training. However, we found indications that not all FSRs  are discussing utilization with agency fleet managers. GSA’s  management does not have a mechanism to help ensure that these  conversations are occurring as expected. As a result, GSA may not be  able to identify opportunities for FSRs to better assist agencies in  identifying and managing their underutilized leased vehicles. Establishing  such a mechanism would be consistent with federal internal control  standards, which state that agencies should have reasonable assurance  that employees are carrying out their duties and that feedback is provided  in the event that expectations are not met.

While GSA generally focuses on providing guidance and advice, it has  regulatory authority to repossess federal agencies’ leased vehicles in  some instances, including cases where agencies cannot produce  justification for the vehicle. Specifically, the FPMR state that if GSA  requests justification for a vehicle, agencies must provide it. If the agency  does not provide justification for that leased vehicle, GSA may withdraw  the vehicle from further agency use. GSA officials told us that it does not  exercise this authority because it would be a significant cost and time  burden for GSA to review these justifications.

section_title: Some Agencies’ Processes Do Not Always Facilitate the Identification and Removal of Underutilized Leased Vehicles, Which May Hinder Cost Savings
paragraphs: Some of the agencies we reviewed could not determine if vehicles met  utilization criteria, could not provide justifications for vehicles, or kept  vehicles that had been determined were not needed. In total, we identified  shortcomings in agency processes that affected leased vehicles with an  annual cost of approximately $8.7 million.
subsections: section_title: Agencies Use a Variety of Utilization Criteria, and Two Agencies That Could Not Determine if Some Vehicles Met These Criteria in Fiscal Year 2014 Have Taken Steps to Address the Issues
paragraphs: While the FPMR provide general mileage guidelines that can be used as  criteria for vehicle utilization—12,000 miles per year for passenger  vehicles and 10,000 miles per year for light trucks—it also authorizes  agencies to develop their own criteria to determine vehicle utilization  where miles-traveled guidelines are not appropriate. GSA officials stated  most vehicles will not meet these guidelines and that agencies are  expected to adopt criteria that reflect the vehicles’ mission. The agencies  in our review used a wide variety of utilization criteria, as shown in table  4.

One of the five agencies—BIA—uses the FPMR mileage guidelines as its  criteria. Three other agencies—Air Force, NPS, and VHA—use the FPMR  mileage guidelines for some (but not all) vehicles. NASA does not use the  FPMR guidelines as criteria; NASA uses miles-traveled criteria that are  lower than the FPMR guidelines. Analyzing the appropriateness of each  utilization criteria was beyond the scope of this report. According to GSA  officials, all utilization criteria—including mileage criteria below FPMR  guidelines—are allowed under the FPMR. While three of our five selected  agencies use mileage criteria below FPMR guidelines for at least some  vehicles, they are not the only agencies doing so. For example, in fiscal  year 2013, the Inspector General (IG) for the Department of Energy  (DOE) found one DOE facility used 2,460 miles per year, an average of  205 miles per month, as its utilization criteria.

Agencies provided a variety of explanations for the utilization criteria they  selected:

Air Force officials stated their vehicles serve very diverse mission  needs. In order to ensure they have the right vehicle for each mission  need, they developed a software algorithm with over 2,600 criteria  that are not all utilization-based. Some criteria include the cost of  alternatives and the criticality of a vehicle’s contribution to the mission.

According to BIA officials, the FPMR’s miles-traveled guidelines are  appropriate utilization criteria for their fleet because their vehicles  typically travel long distances across remote areas to meet their  mission.

NPS officials stated they used the FPMR’s miles-traveled guidelines  as criteria for leased vehicles because the criteria provide the right  metrics to meet department needs.

VHA uses the FPMR’s miles-traveled guidelines as well as other  miles-traveled metrics and days per month as utilization criteria, which  an official said reflects the agency mission of delivering health care.  Vehicles only need to meet one criterion to be considered utilized.

NASA uses miles-traveled utilization criteria that are lower than the  FPMR miles-traveled guidelines. NASA policy requires each NASA  center to set utilization criteria at 25 percent of the average miles  traveled for each vehicle type at their center (see app. II for a list of  NASA utilization measurements by center). NASA officials stated they  believe this approach is an acceptable business practice, which the  agency has used for more than 20 years.

We found 71 percent of the vehicles we selected from the five agencies  met these agency-defined criteria, as shown in table 4.

For two agencies—NASA and VHA—we found that the agencies’  processes for managing utilization data did not always facilitate the  identification of underutilized leased vehicles, although both agencies  have taken steps to rectify the identified issues. Specifically, we found:

NASA did not apply its utilization criteria to 41 vehicles at its  Armstrong Flight Research Center because, according to NASA  officials, the center’s transportation officer retired in 2013 and the  replacement did not apply utilization criteria in fiscal year 2014.  Without utilization criteria, the center could not determine which  vehicles from this center were utilized in fiscal year 2014. The  agency paid approximately $137,000 for these vehicles in fiscal year  2014. According to NASA officials, the center’s transportation officer  conducted a utilization analysis for these vehicles in fiscal year 2015  and the center will continue to follow NASA policy in the future.

VHA did not safeguard vehicle utilization data at one VHA medical  center, as a new employee deleted vehicle utilization data from 2008- 2014. This prevented the agency from presently determining whether  343 vehicles had met the utilization criteria in fiscal year 2014. The  agency paid more than $1.1 million to GSA in fiscal year 2014 for  these vehicles. A VHA official said the agency was previously  unaware vehicle utilization data from that medical center had been  deleted from the Fleet Management Information System (FMIS) and  have counseled the employee responsible regarding the error to  ensure that the data are retained in the future.

section_title: Four Agencies in Our Review Could Not Determine If They Justified Some Vehicles, but Two Have Plans to Address the Identified Issues
paragraphs: If vehicles do not meet utilization criteria defined in agency policy, the  FPMR provides that agencies must justify vehicles in another manner.  The FPMR do not specify how agencies should conduct these  justifications or how the justifications should be documented. While the  FPMR state that agencies may be required to provide written justification,  the regulations do not require agencies to clearly document the  justifications before a request to provide such documentation is made.  Federal internal control standards state that all transactions and  significant events need to be clearly documented and that the  documentation should be readily available for examination.

Four of the five agencies in our review could not readily provide  justifications for vehicles that had not met utilization criteria defined in  agency policy. Cumulatively, these agencies spent approximately $5.8  million in fiscal year 2014 on vehicles where individual justifications could  not be located in a timely manner, as shown in table 5 below. Without  readily available documentation, the agencies could not determine  whether they had justified these vehicles, and whether any of these  vehicles should be eliminated from agency fleets.

Air Force officials could not readily provide the justifications for 413  vehicles that did not meet the utilization criteria in its software algorithm.  The agency paid $1.5 million to GSA in fiscal year 2014 for these  vehicles. According to officials, vehicles that do not meet the utilization  criteria in the Air Force’s algorithm are subject to the agency’s justification  process, the results of which are stored in the agency FMIS. However, we  found that the Air Force’s FMIS does not include information on all  agency vehicles. Agency officials said justifications for these 413 vehicles  are not stored in the Air Force’s FMIS and would be difficult to locate  because these vehicles are used by the Air National Guard, which has its  own justification process. However, Air Force is administratively  responsible for these vehicles, according to agency officials.

BIA officials could not readily provide the justifications for 282 vehicles  that did not meet utilization criteria. The agency paid $1.2 million to GSA  in fiscal year 2014 for these vehicles. According to these officials,  justifications are documented via e-mail, and it would be very challenging  to search e-mail for these records as there was no universal format.  Moreover, BIA officials said some of the justifications were reviewed by a  fleet manager who left the agency, and they were unsure how to retrieve  records from that individual’s e-mail account. Interior officials stated they  will replace BIA’s e-mail process with a standardized form accessible  through Interior’s FMIS in fiscal year 2016.

NASA was able to provide the justifications for all of its vehicles where it  applied utilization criteria and the criteria were not met. NASA policy  requires NASA centers to use Vehicle Utilization Review Boards  (VURB) to approve or deny justifications for vehicles that do not meet  utilization criteria. All vehicles that are reviewed by VURBs have an  individual justification form, and all VURBs submit a summary document  of their reviews to headquarters officials.

NPS officials could not readily provide justifications for 645 vehicles  because those justifications were not stored within the agency’s FMIS.  The agency paid $2.5 million to GSA in fiscal year 2014 for these  vehicles. While NPS designed its justification forms to be stored within  Interior’s FMIS, we found none of these forms had been uploaded to the  system. In order for NPS officials to determine which of its vehicles had  been justified, they would need to locate these 645 forms, which officials  said were stored in field offices. Interior officials told us they were unsure  why some of NPS’ forms were not stored in the agency’s FMIS but they  plan to upload the forms to the system.

VHA was unable to locate justifications for 181 vehicles for which it had  data indicating that the vehicle had not met VHA’s utilization criteria. The  agency paid $0.6 million to GSA in fiscal year 2014 for these vehicles.  According to VHA officials, justifications are stored with local fleet  managers and are not readily accessible to headquarters officials.  Agency officials said that the justification system was developed to assist  local fleet managers and that previously, it was not necessary for  headquarters to access these records.

The finding that four of the selected agencies’ processes did not allow  them to consistently determine which of their vehicles are justified is  consistent with the findings of other agencies that have examined their  vehicle fleets. For example, in 2014 the Inspector General (IG) for the  Department of Homeland Security (DHS) reported that DHS could not  determine whether or not certain vehicles that did not meet the agency’s  utilization criteria were justified. The IG estimated DHS’s cost to operate  these vehicles in fiscal year 2012 was between $35.3 and $48.6 million.  As a result of our review, two of the selected agencies—BIA and NPS— have plans to modify their systems accordingly to provide accessible  justification documentation. Without readily available justification  documentation, agencies are limited in their ability to exercise oversight  over vehicle retention decisions, including how many vehicles—if any—  should be eliminated.

Further, the FPMR do not specifically require that agencies document all  of their justifications in writing or store the justifications in a readily  accessible location. Federal internal control standards on record keeping  and management call for the accurate and timely recording of  transactions, such as justification decisions and call for the  documentation to be readily available for examination. We found that  without such readily available documentation, four of the five selected  agencies in our review could not determine whether they had justified  some of their vehicles and whether any of those vehicles should be  eliminated from agency fleets. According to GSA officials, the agency has  not reviewed the FPMR to determine if the regulations should be  amended to be more specific about vehicle justification documentation,  and they have no plans to do so. As a result, GSA may be missing an  opportunity to help ensure that agencies are appropriately justifying all  vehicles in their fleet and determining if their leased-vehicle fleets contain  vehicles that should be eliminated.

section_title: Three Agencies in Our Review Kept Vehicles They Identified as Unjustified
paragraphs: In addition to the vehicles where agencies could not locate justifications in  a timely manner, three agencies kept vehicles that did not pass their  justification process. The FPMR do not require agencies to take any  action for unjustified vehicles, which are vehicles that neither meet the  agency’s utilization criteria nor pass the justification process. However,  federal internal control standards call for agencies to be accountable for  stewardship of government resources. All five selected agencies have  established approaches to address unjustified vehicles, which can include  placing them into a shared pool, transferring them to a new mission,  rotating them with higher-mileage vehicles, or eliminating them from their  fleet. All five selected agencies took actions to reduce vehicles that did  not meet utilization criteria or pass the justification process; yet three  agencies cumulatively retained over 500 such vehicles, paying GSA $1.7  million for these vehicles in fiscal year 2014. See table 6.

Specifically, we found that:

NPS retained 109 vehicles that did not meet agency-defined utilization  criteria and did not pass the agency’s justification process. The  agency paid GSA $0.4 million in fiscal year 2014 for these vehicles.

VHA retained 393 vehicles that did not meet agency-defined utilization  criteria and did not pass the agency’s justification process. The  agency paid $1.3 million to GSA in fiscal year 2014 for these vehicles.  VHA policy does not require justification for all vehicles that do not  meet utilization criteria. As a result, these 393 vehicles were never  subject to a justification process even though they did not meet  utilization criteria. VA officials said that returning vehicles to GSA  would not lead to cost savings because GSA will continue to charge  the agency for the vehicle until a new lessee is found. GSA officials  said that only in cases where a large number of vehicles are  prematurely returned at once does GSA continue to charge the  leasing agency for the vehicles.  VA officials stated that they do not  believe that this policy is applied consistently.

NASA retained one vehicle that did not meet agency-defined  utilization criteria in fiscal year 2014 and did not pass the agency’s  justification process. NASA officials explained that the vehicle was  incrementally removed from service in fiscal year 2015 to ensure that  mission requirements would not be negatively impacted. NASA has  since returned its unjustified vehicle to GSA.

While these findings are not generalizable, they are consistent with  several findings from agency inspectors general that have reported  agencies keeping vehicles even though they did not meet agency’s  utilization criteria or pass the agency’s justification process. For example,  in 2013 the DOE IG found one DOE component retained 234 vehicles— 21 percent of the component’s fleet—even though the vehicles did not  meet utilization criteria and users had not submitted justification for their  retention. Similarly, in 2015 the DHS IG found that the Federal  Protective Service had not properly justified administrative vehicles and  spare law enforcement vehicles in its fleet, valued at more than $1 million  fiscal year 2014.

Internal controls call for agencies to be accountable stewards of  government resources. However, agency processes do not always  require that every vehicle undergo a justification review or that vehicles  are removed if they do not pass a justification review. Agency processes  that do not facilitate the removal of underutilized vehicles hinder agencies’  abilities to maintain efficient vehicle fleets. Without processes to ensure  that underutilized vehicles are consistently removed, agencies may be  foregoing opportunities to reduce the costs associated with their fleets.  The cost savings achieved by eliminating unjustified vehicles may be less  than the cost paid to GSA because agencies may need to spend  resources on alternative means to accomplish the work performed by  these vehicles. For example, while an agency would save the monthly  cost of leasing an eliminated vehicle, another vehicle in the agency’s fleet  may need to travel more miles if it performs functions previously  performed by the eliminated vehicle. This may increase leasing costs for  the remaining vehicle. Nonetheless, by not taking corrective action,  agencies could be spending millions of dollars on vehicles that may not  be needed.

section_title: Conclusions
paragraphs: Given the approximately $1 billion dollars that are spent annually on  leased federal vehicles and the government-wide emphasis on good fleet  management, it is critical for agencies to have reliable data and sound  management practices. While GSA has taken a number of positive steps  to assist agencies in managing their fleets, there are more actions it can  take. For example, GSA’s current 9,999 odometer reading warning allows  for large odometer discrepancies before warning users of a potential  error, leading to potentially inaccurate odometer readings that can result  in potentially inaccurate billing and additional staff time for subsequent  correction. Evaluating the current warning and adjusting it accordingly  could help improve data accuracy and therefore help reduce these costs.

Additionally, while customers report that utilization-related conversations  with FSRs are helpful, GSA does not have a mechanism to know the  extent to which these conversations are taking place as expected. As a  result, GSA may be missing a potential opportunity to help agencies  ensure that their leased fleet is the optimum size.

Furthermore, while the FPMR provide some guidance to federal agencies  on how to justify vehicle utilization, they do not require agencies to have  clearly-documented justifications available for examination or to have any  mechanism for ensuring that these justifications take place. We found  shortcomings for almost all of the agencies in our review in these areas.  Additionally, findings from Inspectors General have identified similar  concerns at other agencies, indicating that a lack of readily available  justifications may extend beyond the agencies covered under this review.  GSA has not examined these regulations. As a result, GSA may be  missing an opportunity to help ensure that agencies are appropriately  justifying all vehicles in their fleet and determining if their leased vehicle  fleet contains vehicles that should be eliminated.

In the absence of an FPMR requirement, federal internal control  standards can help agencies use their authority to be responsible  stewards of government resources. However, because some agencies’  processes do not consistently facilitate the identification of underutilized  vehicles, these agencies may not know which vehicles should be  eliminated. Specifically, without readily accessible written justification,  agencies are limited in their ability to exercise oversight over key vehicle  retention decisions for vehicles that cost millions of dollars annually.  Additionally, some agencies have not eliminated or reassigned vehicles  that did not meet utilization criteria or pass a justification review. By not  taking corrective action, agencies could be spending millions of dollars on  vehicles that may not be needed.

section_title: Recommendations for Executive Action
paragraphs: To help improve the accuracy of Drive-thru data to allow agencies to  better manage their leased-vehicle fleet data, we recommend that the  Administrator of GSA evaluate the 9,999-mile/month electronic safeguard  for Drive-thru odometer readings to determine if a lower threshold could  improve the accuracy of customer data and adjust this safeguard  accordingly.

To provide better assurance that Fleet Service Representatives (FSR) are  having conversations with leasing customers about utilization in  accordance with GSA expectations, we recommend that the Administrator  of GSA develop a mechanism to help ensure that these conversations  occur.

To help strengthen the leased-vehicle justification processes across  federal agencies, we recommend that the Administrator of GSA examine  the FPMR to determine if these regulations should be amended to require  that vehicle justifications are clearly documented and readily available,  and adjust them accordingly.

To improve the justification process, we recommend that the Secretary of  the Department of Defense should direct the Secretary of the Air Force to  modify the current process to ensure that each leased vehicle in the  agency’s fleet meets the agency’s utilization criteria or has readily  available justification documentation.

To improve their justification process, we recommend that the Secretary  of the Department of Veterans Affairs should direct the Under Secretary  for Health to modify the current process to ensure that each leased  vehicle in the agency’s fleet meets the agency’s utilization criteria or has  readily available justification documentation.

To facilitate the elimination of unnecessary vehicles, we recommend that  the Secretary of the Department of the Interior should direct the NPS  Director to take corrective action to address each leased vehicle that has  not met the agency’s utilization criteria or passed the justification process.  This corrective action could include (1) reassigning vehicles within the  agency to ensure they are utilized or (2) returning vehicles to GSA.

To facilitate the elimination of unnecessary vehicles, we recommend that  the Secretary of the Department of Veterans Affairs should direct the  Under Secretary for Health to take corrective action to address each  leased vehicle that has not met the agency’s utilization criteria or passed  the justification process. This corrective action could include (1)  reassigning vehicles within the agency to ensure they are utilized or (2)  returning vehicles to GSA.

section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to GSA; to the Departments of Defense,  Interior, and Veterans Affairs; and to NASA for review and comment. GSA  and the Departments of Defense, Interior, and Veterans Affairs provided  written comments in which they concurred with our recommendations.   These comments are reproduced in appendixes III-VI.  NASA provided no  comments.

In written comments, GSA stated that it agreed with the three  recommendations directed to it and is developing a comprehensive plan  to address them.

In written comments, the Department of Defense (DOD) concurred with  the recommendation directed to it and stated that it would publish a policy  memorandum in the second quarter of fiscal year 2016 that will direct  DOD fleet managers to ensure that each leased vehicle in the agency’s  fleet meets agency utilization criteria or has readily-available justification  documentation. If implemented as planned, this action should meet the  intent of the recommendation.

In written comments, Interior concurred with the recommendation for NPS  to take corrective action to address each leased vehicle that has not met  the agency’s utilization criteria or successfully passed the utilization  justification process and specified the actions that NPS, as well as BIA,  are implementing or planning to enhance their leased-vehicle programs.   For example, Interior stated that NPS is implementing actions to ensure  vehicle justifications reside in the Department’s Financial and Business  Management System and plans to review the current guidelines to  establish reliable and consistent utilization metrics.  In addition, Interior  stated that NPS plans to develop processes to ensure justifications are on  file and rotate underutilized vehicles to locations to increase the efficiency  and effectiveness of its fleet.  If implemented as planned, these actions  should meet the intent of the recommendation. Interior also stated that  BIA is establishing an electronic document repository to ensure  accessibility of fleet management documents, transitioning to standard  fleet-utilization forms, and conducting a leased-vehicle miles-driven  utilization analysis to determine an annual mileage minimum requirement.

In written comments, VA concurred with the two recommendations  directed to it and specified the actions it has taken or plans to take to  address them. Related to the recommendation to modify their current  process to ensure that each leased vehicle in the agency’s fleet meets  the agency’s utilization criteria or has readily-available justification  documentation, VA stated in its letter that VHA agrees that GSA-leased  vehicles should either be used frequently enough to achieve the agency’s  utilization criteria or have readily-available justification documentation.   VA stated that, subsequent to our review, VHA’s fleet program took action  to ensure local fleet management programs correct deficient  documentation on vehicles identified in our review that did not meet the  agency’s utilization criteria.  Specifically, VA stated that VHA’s fleet  program requested Veterans Integrated Service Networks to solicit local  fleets to justify any vehicles that had insufficient justifying documentation  during our review. In addition, to help ensure that local fleet management  programs are complying with current documentation requirements and to  improve oversight of the programs, VA stated that the Office of Capital  Asset Management Engineering and Support would issue written  reminders to local fleet programs and monitor and audit utilization reports.   VA included a target completion date of January 2017.  If implemented as  planned, these actions should meet the intent of the recommendation.

Related to the recommendation to take corrective action to address each  leased vehicle that has not met the agency’s utilization criteria or passed  the justification process, VA concurred and stated that this corrective  action could include reassigning vehicles within the agency to ensure they  are utilized or returning the vehicles to GSA.  VA stated that VHA would  take corrective action and included a target completion date of January  2017.  If implemented as planned, these actions should meet the intent of  the recommendation.

While VA agreed with our recommendations to address underutilized  vehicles, it disagreed with our conclusion that 14 percent of VHA’s leased  fleet is “unneeded, costing taxpayers an unnecessary $3 million.”  Based  on our analysis of VA data, our report found that VHA paid $3 million in  fiscal year 2014 for leased vehicles that did not meet utilization criteria  and did not have readily available justifications.  These vehicles  accounted for 14 percent of the selected vehicles in VHA’s leased fleet.   We did not state that these vehicles were unneeded.  We did state,  however, that without justifications or corrective actions, agencies could  be spending money on vehicles that may not be needed.

As discussed above, VA described actions taken subsequent to our  review to address some of the issues we identified, and also reported in  its written comments that the most recent data show that less than 1  percent of VHA’s total current leased vehicle fleet may not be fully  utilized.  This number reflects two differences from our calculation. First,  in general comments on the draft report, VA stated that there are now 381  vehicles for which it cannot determine if the vehicle met utilization criteria,  if the vehicle had a justification, or if VA is aware that the vehicle did not  meet utilization criteria or have a justification.  Based on our analysis, we  found 917 such vehicles among VHA’s selected leased vehicle fleet in  fiscal year 2014, a difference of 536 vehicles.  As described in the report,  we analyzed fiscal year 2014 data for five selected agencies because it  was the latest completed fiscal year at the time of our review.  We agree  that the actions taken subsequent to our review, as well as VHA’s  planned actions, should address the issues we identified and should meet  the intent of the recommendations.  However, we have not reviewed the  documentation nor verified the data on which VA’s new percentage is  based. Second, VA’s new percent is the percentage of all of VHA’s  leased vehicle fleet, not the percentage of selected leased vehicles that  were part of our review. For the five agencies in our review, all of our  percentages were calculated as a percentage of the number of leased  vehicles that were selected for review, not of the agency’s entire leased  vehicle fleet. As discussed in more detail in the report, we did this to  consistently exclude vehicles such as tactical or law-enforcement  vehicles.  Thus, we continue to believe that our conclusion is valid.

GSA, Interior, and VA also provided technical comments, which we  incorporated as appropriate.

We are sending copies of this report to interested congressional  committees, the Administrators of GSA and NASA, and the Secretaries of  the Departments of Defense, Interior, and Veterans Affairs. In addition,  this report will be available for no charge on GAO’s website at  http://www.gao.gov.

If you or your staff have any questions about this report, please contact  me at 202-512-2834 or rectanusl@gao.gov. Contact points for our Office  of Congressional Relations and Public Affairs may be found on the last  page of this report. GAO staff who made major contributions to this report  are listed in appendix VII.

section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: We conducted a review of the utilization of GSA’s leased vehicles. This  report assesses: (1) the extent to which GSA data on leased vehicles are  reliable, (2) GSA’s role in identifying and reducing underutilized leased  vehicles, and (3) the extent to which the assessment processes used by  selected federal agencies facilitate the identification and removal of  underutilized leased vehicles, and any cost savings that could be  achieved by reducing any underutilized vehicles.

To determine the extent to which GSA’s data for leased vehicles are  reliable, we examined the reasonableness of data contained in GSA’s  internal fleet management database (Drive-thru) and the Federal  Automotive Statistical Tool (FAST), a web-based reporting tool co- sponsored by GSA and the Department of Energy. For the purposes of  this review, reliability is defined by two key components: reasonableness  and indications of accuracy. We also tested a selection of Drive-thru data  (reflecting approximately 162,000 vehicles) for indications of accuracy.

GSA is responsible for the reasonableness of data in Drive-thru and  FAST. We used three key sources to develop a standard for  reasonableness, as there is currently no single federal criterion for a  measurement of reasonableness. The three key sources included (1)  prior GAO work that provided guidance on how to assess the reliability of  data; (2) OMB’s Circular A-123, which defines management’s  responsibility for internal controls in the federal government; and (3)  GAO’s Green Book, which provides standards for internal control in the  federal government. The key practices surrounding the standard of  measurement that we developed for reasonableness are: electronic safeguards, such as error messages for out of range entries  or inconsistent entries;  the extent to which GSA reviews data samples to ensure that key data  fields are non-duplicative and sensible; and  the clarity of the guidance that GSA provided to ensure consistent  user interpretation of data entry rules.

As agencies are responsible for the accuracy of data in FAST, not GSA,  we only examined Drive-thru for indications of accuracy. We focused on  approximately two dozen data elements contained in the Fuel Use Report  and the Inventory Report as these related most to costs associated with  utilization and federal fleet reporting. To this end, we requested data from  GSA for all GSA-leased vehicles that were continuously leased by the  same agency from January 1, 2015, through May 21, 2015. We  requested continually leased vehicles because we anticipated making  month-to-month data comparisons. However, this historical comparison  was not feasible as GSA does not store some historical data in its Fleet  Management Information System database, which provides information to  Drive-thru. Therefore, the inventory data pulled from GSA’s database  were a “snapshot” of the federal fleet as of May 21, 2015, although the  fuel data reflected the months of January-April 2015. Once the data were  obtained, we conducted a variety of logic checks to locate any anomalies  that might provide insight into the extent which GSA ensures the accuracy  of Drive-thru data. For example, one of the logic checks we performed on  these data included counting vehicles and determining whether at least  one purchased fuel type over a 4-month time period failed to match the  vehicle’s fuel type (accounting for vehicles that could potentially use more  than one fuel type). This logic check was performed to determine how  often, if at all, fuel was erroneously coded at the fuel pump.

For objectives 2 and 3, we judgmentally selected five federal vehicle  fleets from five federal agencies, including the U.S. Air Force (Air Force);  U.S. Department of the Interior’s National Park Service and Bureau of  Indian Affairs; National Aeronautics and Space Administration; and U.S.  Department of Veterans Affairs’ Veterans Health Administration. We  made our selection based on the following criteria: (1) varying fleet sizes,  but none smaller than 1,000 vehicles; (2) a combination of military and  civilian fleets; (3) a combination of fleets with mileage-based utilization  levels above and below federal mileage-based utilization guidelines; (4)  fleets that had not been audited by an organization other than GAO within  the last 3 years; and (5) other considerations such as use of telematics  and adoption of utilization criteria other than the mileage guidelines in  GSA regulations. We selected these fleets, which according to GSA in  2014 ranged in size from 1,574 to 13,954 vehicles to broadly discuss the  experiences and practices across a section of the federal fleet. These  results are not generalizable to their overarching agencies or other  federal agencies.

To determine what GSA’s role is in identifying and reducing underutilized  leased vehicles, we reviewed and analyzed relevant federal laws,  regulations, executive orders, and GSA guidance to federal agencies for  preparing VAM submissions. We described GSA’s role based on the  responsibilities delineated in those documents. We also interviewed GSA  officials, including Fleet Service Representatives (FSR) to better  understand the role they play when working with federal agency fleet  managers to identify underutilized leased vehicles. To corroborate  information that GSA officials told us about FSRs speaking with their  agency fleet managers at least once a year to assist in identifying  underutilized leased vehicles and to determine any value that fleet  managers assign to these conversations, we administered a non- generalizable, mixed-method questionnaire to 68 federal agency fleet  managers. To ensure that our questions were meaningful and that we  received accurate survey data, we pre-tested our survey with four  representatives from four of our selected agencies. Using GSA’s Drive- thru data, we selected fleet managers for our five selected federal  agencies who were responsible for at least 20 GSA leased vehicles.  Through interviews with agency officials and FSRs, we learned that the  contact information in Drive-thru was not sufficiently reliable for our  purposes. Specifically, two of four FSRs that we spoke with and officials  from two selected agencies reported that Drive-thru does not contain  reliable contact information for individuals who would have conversations  with FSRs. These officials reported that some of the contacts in Drive-thru  were actually end-users, such as contractors. In other cases, the contact  information was outdated. To address this, we requested that the  selected federal agencies provide us with lists of current fleet managers  within their agencies, and we matched those names to the list of fleet  managers from the Drive-thru data. Agencies that were unable to provide  independent lists of fleet managers verified which individuals from the  Drive-thru data were in the fleet manager’s role at their agency and would  be the appropriate individuals with whom to discuss utilization. This  matching and verification process brought the survey selection pool to  114 fleet managers, yielding a reasonable number of contacts for BIA,  NASA, and NPS—given their respective fleet sizes. However, our  matching and verification process resulted in four fleet managers for Air  Force and 80 for VHA. Since other fleet managers on Air Force’s list of  current fleet managers met our survey pool parameters, we took a  random sample of 16 fleet managers to add to the four we identified  during the matching and verification process. Also, to avoid over- representing VHA, we randomly chose one fleet manager from 19  Veterans Affairs’ regions. We sent the survey to a total of 69 fleet  managers as follows:

12 at BIA;

12 at NPS;

6 at NASA;

20 at Air Force ; and

19 at VHA.

However, during the survey period, Air Force informed us that one of the  selected fleet managers’ roles no longer included responsibilities for  GSA-leased vehicles. Therefore, the total number of selected fleet  managers in the survey pool totaled 68. Fifty one of the 68 fleet managers  completed our survey, yielding a 75 percent response rate. As noted in  our report, findings from this survey effort are not generalizable.

To determine the extent to which the assessment processes used by  selected federal agencies facilitate the identification and removal of  underutilized leased vehicles, we reviewed and analyzed: pertinent  federal laws and regulations; GSA guidance that described the VAM  process; and internal policies and procedures that the selected federal  agencies use to identify underutilized vehicles in five fleets, such as fleet  handbooks; and interviewed officials from GSA and the five federal  agencies about the agencies’ responsibilities in identifying underutilized  leased vehicles. We then compared these processes to federal internal  control standards related to record keeping and management as well as  stewardship of government resources, as described in the 1999 Green  Book.

To calculate the costs of the vehicles involved in these processes, we  conducted a multi-step analytical process. First, we asked GSA to provide  data on passenger vehicles and light trucks that were continuously leased  from GSA during fiscal year 2014 (i.e., from October 1, 2013-September  30 2014, inclusive) for the five selected federal fleets. Table 7 shows how  we defined passenger vehicles and light trucks for the purposes of this  review.

We focused on vehicles that GSA leased on a continuous basis (i.e., to a  single agency) for at least fiscal year 2014 so that the agencies were fully  accountable for the selected vehicles’ mileage over the entire fiscal year  2014 time period. We scoped our work to include light trucks and  passenger vehicles because they comprise the majority of GSA’s  continuously leased fleet at 65 percent and 27 percent, respectively. We  also asked GSA to exclude tactical, law-enforcement and emergency- responder vehicles from the selected vehicle population, as well as  vehicles located outside of the continental U.S. We made these  exclusions because, according to GSA officials, some agencies did not  want law enforcement data, for example, released outside of GSA  because it could be considered sensitive. In addition, we needed to  develop a manageable, selected population given the time resources  needed to investigate each vehicle.

After receiving the data from GSA, we conducted various analytical tests  to develop a dataset that was free from detectable errors. For example,  we examined data on current and previous monthly odometer readings.  We then determined which vehicles in the dataset had a current monthly  odometer reading that was lower than the previous month’s odometer  reading. This allowed us to determine which vehicles likely had errors  associated with their end-of-fiscal year mileage—allowing us to remove  them from the population of analysis. We also analyzed over 15,500 fiscal  year 2014 vehicle records from the five agencies that we reviewed. In  total, selected vehicles from these agencies accounted for about 8  percent of the federally leased fleet, although the findings associated with  this selection are not generalizable.

Next, we determined which selected passenger vehicles and light trucks  at each agency did not meet the miles-traveled guidelines in the Federal  Property Management Regulations in fiscal year 2014 (12,000 miles and  10,000 miles, respectively). We then sent a list of the selected vehicles  that had not met the miles-traveled guidelines to each agency and  requested that they group the vehicles into one of the categories  described below and depicted in figure 1:

Group 2: No longer leased by the agency as of May 21, 2015;

Group 4: Met a mileage-based utilization criteria defined by the

Group 5: Met a non-mileage-based utilization criteria defined by the

Group 6: Had a written justification in lieu of meeting the utilization  criteria that the agency defined;

Group 8: Was repurposed, given additional tasks, or reassigned within  the agency during fiscal year 2015; and

Group 9: Was retained beyond May 21, 2015, despite not meeting  agency-defined utilization criteria, possessing a written justification for  retention, or being given other tasks.

We also asked agencies to identify vehicles that they could not categorize  and reasons why—such as vehicles’ lacking readily auditable  documentation, including information on whether the vehicle met the  agency-defined utilization criteria in fiscal year 2014 (Group 3) and written  justification for retaining vehicles that did not meet the agency-defined  utilization criteria (Group 7). As these two groups—and vehicles in Group  9—stem from insufficient agency processes to identify and remove leased  vehicles, we focused on determining the costs associated with the  vehicles in these groups.

Agencies were responsible for categorizing each of the vehicles that GAO  provided to them. We provided the agencies with each vehicle’s license  plate number, VIN number, make, model, and other identifying  information to assist in this process. We did not verify whether agencies  categorized vehicles correctly, as some of the information necessary for  these categorizations was contained within agency systems and records  (for example, if the vehicle met an agency-defined criteria or if the vehicle  was repurposed). However, to evaluate the overall reliability of agencies’  vehicle justification, we selected a small sample of vehicles from each  agency and then requested written justifications from each of those  agencies that reported that they had written justifications for vehicles. We  removed vehicles from the selected population if agencies reported that  the vehicle should have been excluded from the review (for example,  vehicles that agencies reported were law enforcement vehicles but not  labeled as such in GSA’s system). We also removed vehicles if the VIN  number that the agency provided did not match the VIN from the original  information that GSA provided and vehicles that agencies categorized in  more than one group, among other data-cleaning efforts.

We determined the cost paid to GSA for each vehicle in each of the 9  groups using data from GSA. For each vehicle, we summed the following:  the vehicle’s fiscal year 2014 mileage rate multiplied by the total  number of miles the vehicle traveled in fiscal year 2014; per-mile costs for additional equipment multiplied by the total number  of miles the vehicle traveled in fiscal year2014;  the fixed monthly mileage rate for additional equipment multiplied by  12 (for the 12 months of the fiscal year); and any flat monthly rate charges multiplied by 12 (for the 12 months of  the fiscal year).

These costs represent the amount an agency paid to GSA for each  vehicle in fiscal year 2014. However, these costs do not include other  costs incurred by the leasing agency, such as the salaries of their fleet  managers or the costs to garage the vehicles. Also, we did not have  information on the opportunity costs of alternatives to replacing these  leased vehicles. For example, if a vehicle is removed from an agency’s  fleet and another vehicle is used more frequently as a result, the agency  would still pay for miles traveled or trips made by the other mode of  transportation. Therefore, the costs associated with the groups are annual  costs paid to GSA, and an undetermined percentage of these costs would  reflect actual cost savings if vehicles were removed.

We conducted this performance audit from February 2015 to January  2016 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.

section_title: Appendix II: NASA Utilization Criteria by Vehicle Type and Center in Fiscal Year 2014
paragraphs: According to NASA policy, each NASA center should conduct an annual  review of fleet utilization during the third quarter of each fiscal year. The  review first identifies vehicles that fail to meet the minimum utilization  goals, also called the “utilization target point.” The target point is  calculated by multiplying the average usage by 25 percent (0.25) for each  vehicle type, such as sedans/station wagons, ambulances, intercity  busses, and trucks with a gross vehicle weight of less than 12,500  pounds. In fiscal year 2014, sedans and trucks less than 12,500 pounds  were required to meet the mileage target points shown in table 9 at their  respective centers:  According to NASA policy, individual vehicles within each vehicle type  whose range falls below the utilization target point will be added to the  “utilization target list”. Programs, missions or departments with vehicles  on the target list are required to submit a new justification form for each  individual vehicle on the list for center review and retention approval.  These justifications are then evaluated during the annual review process,  with possible outcomes including reassignment within the center,  exchanging the vehicle for a different type of vehicle that better suits the  mission, or returning the vehicle to GSA.

section_title: Appendix III: Comments from the General Services Administration

section_title: Appendix IV: Comments from the Department of Defense

section_title: Appendix V: Comments from the Department of the Interior

section_title: Appendix VI: Comments from the Department of Veterans Affairs

section_title: Appendix VII: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contact

section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, John W. Shumann (Assistant  Director), Melissa Bodeau, Jennifer Clayborne, Monika Jansen, Davis  Judson, Terence Lam, Malika Rice, Jerome Sandau, Alison Snyder,  Michelle Weathers, Crystal Wesco, and Elizabeth Wood made key  contributions to this report.


Question-summary annotations: questions: question: What assistance does the GSA provide to agencies?
answer: The General Services Administration (GSA) provides guidance to agencies to assist them in reducing underutilized leased vehicles.
child_questions: question: How is this assistances distributed?
answer: This guidance can be written (such as bulletins) or advice from GSA's fleet service representatives (FSR) to agency fleet managers.

question: What does GSA expect from FSR communication?
answer: FSRs assist agencies with leasing issues, and GSA expects its FSRs to communicate with fleet managers about vehicle utilization at least annually.
child_questions: question: What did GAO find regarding this expectation?
answer: However, 18 of 51 fleet managers GAO surveyed reported that they had never spoken to their FSR about vehicle utilization.

question: To what extent does GSA enforce this expectation?
answer: GSA has no mechanism to ensure these discussions occur and therefore may miss opportunities to help agencies identify underutilized vehicles.

questions: question: What characterized the vehicle utilization processes of the selected agencies?
answer: While the selected agencies—the Air Force, the Bureau of Indian Affairs (BIA), the National Aeronautics and Space Administration (NASA), the National Park Service (NPS) and the Veterans Health Administration (VHA)—took steps to manage vehicle utilization, their processes did not always facilitate the identification and removal of underutilized vehicles.
child_questions: question: What specific issues did selected agencies have?
answer: Certain selected agencies (1) could not determine if all vehicles were utilized, (2) could not locate justifications for vehicles that did not meet utilization criteria, or (3) kept vehicles that did not undergo or pass a justification review.
child_questions: question: What were the financial implications of these issues?
answer: These agencies paid GSA about $8.7 million in fiscal year 2014 for leased vehicles that were retained but did not meet utilization criteria and did not have readily available justifications (see table).

questions: question: To what extent did NASA and VHA apply their utilization criteria?
answer: Of the selected agencies, NASA and VHA did not apply their utilization criteria to nearly 400 vehicles, representing about $1.2 million paid to GSA in fiscal year 2014.
child_questions: question: What action has been taken to address this issue?
answer: However, these agencies have taken steps to rectify the issue.

question: What justifications for leased vehicles were missing from agencies?
answer: The Air Force, BIA, NPS, and VHA could not readily locate justifications for over 1,500 leased vehicles that did not meet utilization criteria, representing about $5.8 million.
child_questions: question: How have BIA and NPS responded to this problem?
answer: BIA and NPS are planning action to ensure justifications are readily available in the future.

question: What is the financial implication of NPS and VHA's actions?
answer: As of May 2015, NPS and VHA had retained more than 500 vehicles—costing $1.7 million in fiscal year 2014—that were not subjected to or did not pass agency justification processes. While costs paid to GSA may not equal cost savings associated with eliminating vehicles, without justifications and corrective actions, agencies could be spending millions of dollars on vehicles that may not be needed.

questions: question: What was the GAO asked to review?
answer: GAO was asked to examine federal processes for assessing the utilization of leased vehicles.

question: What does this report cover?
answer: This report addresses, among other objectives, (1) GSA's role in identifying and reducing underutilized leased vehicles and (2) the extent to which the processes used by selected federal agencies facilitate the identification and removal of underutilized leased vehicles, and any cost savings that could be achieved by reducing underutilized vehicles.

question: What records did the GAO select to analyze?
answer: GAO selected five agencies using factors such as fleet size, and analyzed over 15,500 fiscal-year 2014 vehicle records.
child_questions: question: What else from these agencies did the GAO review?
answer: At the five agencies, GAO surveyed fleet managers with at least 20 leased vehicles; reviewed fleet policies and guidance; and interviewed federal officials.

question: How generalizable are GAO's findings?
answer: These findings are not generalizable to all agencies or fleet managers.