Department of Education: Status of Achieving Key Outcomes and Addressing Major Management Challenges
Released: 2001-07-30T00:00:00

Letter

Background

GPRA is intended to shift the focus of government decisionmaking, management, and accountability from activities and processes to the results and outcomes achieved by federal programs. New and valuable information on the plans, goals, and strategies of federal agencies has been provided since federal agencies began implementing GPRA. Under GPRA, annual performance plans are to clearly inform the Congress and the public of (1) the annual performance goals for agencies’ major programs and activities, (2) the measures that will be used to gauge performance, (3) the strategies and resources required to achieve the performance goals, and (4) the procedures that will be used to verify and validate performance information. These annual plans, issued soon after transmittal of the President’s budget, provide a direct linkage between an agency’s longer-term goals and mission contained in its strategic plan and its day-to-day activities. Annual performance reports are to subsequently report on the degree to which performance goals were met. The issuance of the agencies’ performance reports, due by March 31, represents a newer and potentially more substantive phase in the implementation of GPRA— the opportunity to assess federal agencies’ actual performance for the prior fiscal year and to consider what steps are needed to improve performance and reduce costs in the future.

Education’s mission is to ensure equal access to education and to promote educational excellence throughout the nation. This year’s interim performance report listed the following four department-wide strategic goals: (1) help all children reach challenging academic standards so that they are prepared for responsible citizenship, further learning, and productive employment; (2) build a solid foundation for learning for all children; (3) ensure access to postsecondary education and lifelong learning; and (4) make Education a high-performance organization by focusing on results, service quality, and customer satisfaction. For each goal, Education has established various objectives, and for each objective there were indicators with which to measure its progress. Additionally, in the interim fiscal year 2000 program performance report, Education presents program data for about 180 Education programs. This program report includes some information on planned fiscal year 2002 performance (e.g., program-level targeted goals) and a section explaining how Education plans to address some of the management challenges identified by GAO and others. Where applicable, in addition to the information in the interim performance report, we used indicator data from the interim program performance report to help assess Education’s progress in achieving the selected outcomes. Additionally, we used the management challenges section to help identify progress and planned activities in this area.

Assessment of the Department of Education’s Progress in Accomplishing Selected Key Outcomes

This section discusses our analysis of Education’s performance in achieving the six selected key outcomes. We will not be able to discuss strategies that Education has in place to achieve these outcomes because Education has not yet provided this information. Education officials told us that these strategies will be included in the fiscal year 2002 department- wide performance plan scheduled to be issued by September 30, 2001. In discussing the extent to which the agency provided assurance that the performance information it is reporting is credible, we have drawn information from our prior work.

Additionally, due to the nature of the performance information it was difficult to assess Education’s progress for some outcomes. To measure success in some areas, Education relied on long-term trend data that is collected only every 2, 3, 4, or 6 years. These gaps in data make a full analysis of Education’s progress difficult. In January of this year, we reported that Education needed to improve the quality and timeliness of the data on which its programs are evaluated. Without taking this step, Education will continue to be challenged in assessing its progress for the selected outcomes on an annual basis.

Challenging Academic Standards That Prepare Students For Responsible Citizenship, Further Learning, And Productive Employment

The interim report showed that Education made little progress in achieving this outcome. Education has seven performance objectives and 35 indicators to measure progress toward achieving this outcome. Of the 35 indicators related to this outcome, fiscal year 2000 data were only available for nine indicators. Due to the lack of fiscal year 2000 data for this outcome, we limited our analysis to these nine indicators and found that Education made little progress toward this outcome.

Specifically, Education reported that it had not met two goals related to challenging content and student performance standards—goals that are directly related to the achievement of the outcome. As a first step, before all students can reach challenging standards that prepare them for responsible citizenship, further learning, and productive employment, challenging content and student performance standards must be in place. One of the 35 performance indicators, “by the end of the 1997-98 school year, all states will have challenging content and student performance standards in place for two or more core subjects,” focuses on this prerequisite, which had not been achieved by the end of 2000. Twenty- seven states and Puerto Rico had demonstrated to Education that they had completed the development of both content and student performance standards. Education had approved the content standards development process for the District of Columbia, Puerto Rico, and all states, except one. In its assessment of progress for this indicator, Education explains that rather than developing student performance standards as a template for assessments, which were not scheduled to be in place until the 2000-01 school year, many states are developing their assessment instruments first and then constructing performance standards on the basis of pilot tests of their assessments.

In looking at the remaining seven indicators with data, Education reported that the goal was met in three instances and not met in the other four. All three of the indicators with goals met are linked to the outcome, but provide only limited information with which to judge progress. For all six indicators with unmet goals, there was minimal discussion of why the goals were not met.

A Solid Foundation For Learning

The interim report showed that little progress has been demonstrated for this outcome. Education established 18 indicators to address the goal of building a solid foundation for learning for all children. According to the interim performance report, data for fiscal year 2000 were only available for two indicators—for both of which the goals were met. According to Education officials, 2000 data will be provided in the future as data become available from the states. However, these two indicators alone, “number of tutors in the America Reads program” and “that more than 35 percent of Title I schools adopt a researched-based way to improve curriculum,” do not provide sufficient information with which to gauge progress toward meeting the outcome. As with of some of the other outcomes, data necessary to evaluate progress is not collected annually, making an annual assessment of progress difficult.

Public School Choice

According to the interim report, Education’s performance objective to have greater public school choice available to students and families has been at least partially met. The interim fiscal year 2000 performance report indicated that the interim target for one of the three indicators—that by 2002, there will be 3,000 charter schools in operation around the nation— was exceeded. The interim target for fiscal year 2000 relating to this indicator was 2,060 charter schools; 2,110 were actually in operation. However, the report notes that the majority of the charter schools are located in only seven states.

According to the interim performance report, data for fiscal year 2000 are not yet available for one indicator—that by 2003, 25% of all public school students in grades K-12 will attend a school that they or their parents have chosen.

For the third indicator—that by 2000, a minimum of 40 states will have charter school legislation—the goal was not met. From 1991, when Minnesota became the first state to enact charter school legislation, other states joined steadily until 1999, when the list totaled 38 and remained at 38 through 2000. There was no discussion on why the goal was not met, or why only 40 states are included in the goal.

Strong, Safe, Disciplined, And Drug-Free Schools

According to the interim report, there was limited progress in meeting this outcome. Education measures progress for this outcome by looking at the national trends in student drug and alcohol use, including in-school use, and national trends in student victimization and violent incidents in schools. Of the four indicators, Education expects progress in three based on national drug use and violent crime trends, and the goal was partially met for one—reducing the prevalence of past-month use of illicit drugs. Specifically, we have the following comments on these indicators: Of the four indicators, two are for measuring violent behavior and two are for drug and alcohol use. For both violent behavior indicators, data is not available for fiscal year 2000; however, Education has concluded that progress is likely. In making this determination, Education is using national statistics demonstrating that there has been a decrease in the overall juvenile crime and violence rates since the mid-1990s. The data for one indicator—the level of disorder in schools—tracks only physical fights on school property; no reasons were given as to why other disciplinary problems were not tracked. However, our recent report on discipline showed that fistfights are the most prevalent form of serious misconduct and, therefore, probably the best proxy measure to use when only one behavior is being tracked. According to Education, data should be available within the next few years to measure actual progress for both indicators for this outcome.

From the indicators on drug and alcohol use, it appears that progress is mixed. Education did not meet its goal for past-month alcohol and illicit drug use for 2000; however, Education reports that alcohol use levels have remained relatively steady for years and stated that illicit drug use may have leveled off in recent years, according to national trend data. For the second indicator—rates of in-school alcohol and drug use will begin to fall by 2001—Education reports that progress toward this goal is likely. It based its estimation of success on the fact that the goals for both alcohol and drug use for 1999 were exceeded (even beyond the 2000 goal level) and that overall alcohol and drug use rates have remained steady for years. However, as we noted in last year’s report, Education is using alcohol and marijuana use by 12th graders as a proxy for all alcohol and drug use, respectively. Education does not provide an explanation as to why only marijuana was used for this indicator. In response to our report last year, Education acknowledged that we were correct in our observation that the indicator is narrow in scope and stated that it intended to address this in its fiscal year 2002 plan.

Fraud, Waste, Mismanagement, And Error In Student Financial Assistance Programs

Education did not establish a fiscal year 2000 performance goal or objective to specifically address this outcome. In a section designed to address management challenges facing Education, the interim performance report does report progress towards achieving a related objective: management of department programs and services ensures financial integrity. This is presented as a department-wide objective and does not discuss progress or performance for any specific programs. The discussion of this objective lists several actions Education’s Office of the Chief Financial Officer is taking to accomplish it. These actions include implementing a new general ledger software system; enhancing internal controls, reconciliation, and reporting processes; and improving acquisition systems. According to Education officials, future performance plans may include goals and measures to specifically address this outcome. Additionally, Education has revised its strategic plan to include an objective of ensuring financial integrity within the department.

Based on the two indicators identified for the financial integrity objective, progress in achieving this objective is mixed. The first indicator, that Education will receive an unqualified opinion on its fiscal year 2000 financial statement audit, was unmet. However, because the auditors identified fewer material weaknesses and reportable conditions related to Education’s internal control systems than they found in last year’s audit, Education states that it is making progress. For the second indicator, Education reported that it achieved its target for increasing the use of performance contracts.

In the management challenges section of the interim report, Education established a target to remove the student financial assistance programs from GAO’s high-risk list. Education lists several actions, such as developing a corrective action plan, to address program weaknesses. There were, however, no specific goals or measures for this challenge. As we reported to you last year in our assessment of Education’s fiscal year 2001 performance plan, we continue to believe the department should have a goal or objective to specifically address this outcome. The student aid programs remain on GAO’s high risk-list, and we recently testified on serious internal control weaknesses we identified in a review of the department’s payment practices. For example, we stated Education had poor segregation of duties for making payments because some individuals at the department could control the entire payment process—leaving Education at risk for fraud. Also, we cited the need for Education to have better controls over its process for reviewing and approving purchases made with government purchase cards.

In addition to establishing the target of getting off of GAO’s high-risk list, Education created a task force—or Management Improvement Team—to achieve this result. Among other things, the task force is charged with (1) obtaining a clean audit opinion, (2) removing the student financial aid programs from GAO’s high-risk list, (3) putting in place an effective system of internal controls to protect against waste, fraud, and abuse, and (4) continuing to modernize student aid delivery and management.

Access To A High-Quality Postsecondary Education And Lifelong Learning

The interim report shows that Education’s progress in meeting this goal was mixed. One of Education’s four strategic goals is to ensure access to postsecondary education and lifelong learning. We examined the four objectives and 16 indicators for this goal to determine progress in meeting this outcome. Education used a combination of enrollment rates, amount of unmet financial need, customer satisfaction, and rates of employment to measure its progress for this goal. Of the 16 indicators, we found that Education had met or exceeded its targets for five. For the remaining 11 indicators, however, there were no fiscal year 2000 data available to measure actual progress. We have the following observations on the indicators: Education had two objectives and nine indicators to measure progress in the areas of ensuring access to postsecondary education. Indicators include enrollment rates, rates at which parents and students request/receive information on admission standards and financial aid, and the amount of unmet financial need that exists for students. In general, the indicators present a mixed picture of Education’s success in achieving this outcome. Of the nine indicators, the goal was met or exceeded for two; no data were available for the remaining seven indicators. Additionally, in looking specifically at the indicators, we found for one indicator classified as goal met—participants receiving support services—the data were from 1997 and the report did not discuss any planned updates for more current data.

For Education’s objective of delivering student aid in an efficient, financially sound, and customer-responsive manner, there were no unmet indicators. For this objective’s three indicators, Education reported that the Office of Student Financial Assistance (OSFA) either met or exceeded its target. For example, in measuring customer satisfaction with OSFA’s products and services, Education found that, not only was the indicator of improving OSFA’s rating met, but the office was only one percentage point away from meeting its multi-year target of a customer satisfaction rating comparable to the private financial services sector average.

Education used four indicators to measure its progress toward meeting the objective that all educationally disadvantaged adults can strengthen their literacy skills and improve their earning power over their lifetime through lifelong learning. No fiscal year 2000 data were available for these indicators. In addition to the lack of current data, the data for all four were limited because information is collected and reported by state and local service providers and in some instances, there is no independent verification of the data.

Comparison of the Department of Education’s Interim Fiscal Year 2000 Performance Report With the Prior Year Report for Selected Key Outcomes

For the selected key outcomes, this section describes major improvements or remaining weaknesses in Education’s interim fiscal year 2000 performance report in comparison with its fiscal year 1999 report.

One prominent weakness in last year’s performance report—a lack of data for the reporting period—continues in the interim fiscal year 2000 report. Specifically, Education did not have fiscal year 2000 performance data for over three-fourths of the goals associated with the outcomes we looked at. According to Education officials, 2000 data will be provided in the future as data become available.

The biggest difference in the reports is the lack of a discussion on how Education plans to achieve its objectives and unmet goals. Additionally, only limited explanations were given as to why goals were unmet. Education officials told us that they did not want to pursue a planning effort—including activities related to how the department plans to achieve its objectives—until senior leadership has been appointed and the President’s education proposal is passed into law. Instead, as stated earlier, Education wants to wait and incorporate any changes in departmental strategies in the final fiscal year 2002 performance plan scheduled to be issued by September 30, 2001.

The biggest improvement to this year’s report is the addition of a section dealing with some of the major management challenges. In this section, Education discussed over half of the 14 major management challenges facing the department as identified by GAO and Education’s OIG. According to Education officials, it decided not to report on those management challenges for which plans from the new administration might affect the strategy for addressing the challenge. More specifically, Education addressed those challenges for which the course of action would be the same regardless of the department’s leadership or the contents of new education legislation. For example, one management challenge that Education addressed was to ensure financial integrity; this needed to be addressed no matter who leads the agency or what is included in the President’s education proposal. Conversely, Education wanted to wait to address the management challenge to promote coordination with other federal agencies and school districts to help build a solid foundation of learning for all children. According to a departmental official, Education plans on integrating actions needed to address this challenge with actions needed to address other proposed initiatives from the new administration.

In general, the section was helpful in that it outlined the scope of the challenges, identified some performance indicators to be used to assess progress in meeting the challenges, and detailed some strategies to address the challenges. Of the eight challenges discussed in the section, there was a range of thoroughness with which the challenges were addressed. For example, some challenges were mentioned briefly with a short discussion of the status of the challenge and no discussion of goals or measures; other challenges were discussed in-depth with comprehensive discussions of strategies and detailed goals and measures set out. Education officials told us that they plan on addressing more of the challenges in the department-wide performance plan scheduled to be issued September 30, 2001.

The Department of Education’s Efforts to Address the Major Management Challenges Identified by GAO

GAO has identified two governmentwide high-risk areas: strategic human capital management and information security. Regarding strategic human capital management, we found that Education’s interim performance report did have some limited data related to human capital, but that the interim report did not explain its progress in resolving human capital challenges. For example, Education reported on the percentage of managers who believe their staff possess adequate skills for their jobs; however, there was no broader discussion of strategic human capital management such as leadership continuity and succession planning. There was no discussion of strategic human capital management in last year’s performance report or plan—no specific goals, measure, or strategies. While noting that the department has addressed strategic human capital management issues to a limited extent in the agency’s revised strategic plan, Education officials told us that more needs to be done by the department to address this serious issue.

With respect to information security, we found that Education’s performance report noted that the department had recently updated security plans and performed security reviews on almost all mission critical systems. Additionally, in the management challenges section of the interim program performance report, Education included management and performance goals for completing specific security activities. For example, the report states that 100 percent of the department’s mission critical systems will have security plans and tested contingency backup plans; however, no dates were associated with these measures.

In addition to these governmentwide challenges, GAO has identified four major management challenges facing Education, that generally encompass some of the outcomes discussed in this report: improving financial management to help build a high-performing agency; ensuring access to postsecondary education while reducing the vulnerability of student aid to fraud, waste, error, and mismanagement; encouraging states to improve performance information; and promoting coordination with other federal agencies and school districts to help build a solid foundation of learning for all children. Education’s performance report discussed the department’s progress in meeting the first two of these challenges. Additionally, Education officials told us that the Secretary established the Management Improvement Team to develop a plan to address Education’s management challenges. Further, these officials said that the department has discussed some of these issues in its revised strategic plan.

Conclusions

Education will continue to be challenged to improve its performance. In general, given the lack of performance data, explanations, and strategies to meet unmet goals in the future, it was difficult to assess progress. Also, we could not assess planned progress given the lack of a performance plan.

Specifically, we found that it was difficult to assess Education’s progress in achieving the six outcomes due to the lack of fiscal year 2000 data for many of its indicators. The non-annual reporting structure of many studies used for Education’s goals make the lack of fiscal year data a perennial problem in addressing Education’s progress on an annual basis. Education will continue to have difficulty in fulfilling its task of annual reporting given the large gaps in reportable annual data.

Consistent with our findings in reviewing Education’s performance report from last year, we found that Education had no goals or measures associated with the outcome of preventing fraud, waste, mismanagement, and error in the student financial assistance programs. We put the student financial assistance programs on our high-risk list because they are vulnerable to fraud, waste, abuse, and mismanagement. While OSFA has established a target of being removed from GAO’s high-risk list, there were no corresponding goals or measures in the department’s interim report. However, Education has revised its strategic plan to incorporate an objective of ensuring financial integrity within the department. Education officials also told us that they may include in future performance plans specific goals and measures related to this outcome.

Finally, in last year’s assessment of Education’s performance plan and report, we noted that there was no discussion of how human capital would have supported achievement of the outcomes. We found that similarly for this year, there was no discussion in the interim report on strategic human capital management.

Recommendations for Executive Action

To improve Education’s future performance reports and plans, we recommend that the Secretary of Education take the following actions: Initiate a dialogue with the appropriate congressional committees to discuss the lack of annual reporting data and what this means with respect to how management at the department is most appropriately assessed and how Education could be more responsive to Congress in fulfilling its annual GPRA reporting requirements.

Develop performance goals and measures to address the outcome of less fraud, waste, mismanagement, and error in student financial assistance programs.

Develop specific goals and measures to be included in future performance reports and plans to address the issue of strategic human capital management.

Scope and Methodology

As agreed, our evaluation was generally based on the requirements of GPRA, the Reports Consolidation Act of 2000, guidance to agencies from the Office of Management and Budget (OMB) for developing performance plans and reports (OMB Circular A-11, Part 2), previous reports and evaluations by us and others, our knowledge of Education’s operations and programs, GAO’s identification of best practices concerning performance planning and reporting, and our observations on Education’s other GPRA-related efforts. We also discussed our review with agency officials in the department and with the department of Education’s OIG. The agency outcomes that were used as the basis for our review were identified by the Ranking Minority Member, Senate Governmental Affairs Committee as important mission areas for the agency and generally reflect the outcomes for all of Education’s activities. The major management challenges confronting Education, including the governmentwide high-risk areas of strategic human capital management and information security, were identified by GAO in our January 2001 performance and accountability series and high risk update, and were identified by the Department of Education’s OIG in December 2000. We did not independently verify the information contained in the performance report and plan, although we did draw from other GAO work in assessing the validity, reliability, and timeliness of Education’s performance data. We conducted our review from April 2001 through June 2001 in accordance with generally accepted government auditing standards.

Agency Comments

On June 28, 2001, we obtained written comments on our draft report from the Deputy Secretary of Education. Education generally agreed with our conclusions and recommendations. The Deputy Secretary said that he and the Secretary share many of our concerns about the Department's strategic planning process and management challenges and that Education has taken steps to tackle these issues, including a top-to-bottom review of its strategic planning process and the formation of a team of senior staff to fix the department's management and fiscal accounting problems. In addition, the Deputy Secretary cited anticipated sweeping changes to America's schools and the Department resulting from the reauthorization of the Elementary and Secondary Education Act and other reauthorizations as the rationale for not including strategies for achieving its objectives in the interim fiscal year 2000 performance report. Education also provided oral technical comments on our draft report, which we incorporated when appropriate. Education's written comments are printed in appendix II.

As arranged with your office, unless you publicly announce its contents earlier, we plan no further distribution of this report until 30 days after the date of this letter. At that time, we will send copies to appropriate congressional committees; the Secretary of Education; and the Director, Office of Management and Budget. Copies will be made available to others on request.

If you or your staff have any questions, please call me at (202) 512-7215. Key contributors to this report were David Alston, Jeff Appel, Kelsey Bright, Cheryl Driscoll, Joy Gambino, Eleanor Johnson, Gilly Martin, Joel Marus, and Glenn Nichols.

Appendix I: Observations on the Department of Education’s Efforts to Address Its Major Management Challenges

The following table identifies the major management challenges confronting the Department of Education, which include the governmentwide high-risk areas of strategic human capital management and information security. The first column lists the challenges identified by our office and/or the Department of Education’s Office of Inspector General (OIG). The second column discusses what progress, as discussed in its fiscal year 2000 interim performance report, Education made in resolving its challenges. As mentioned in the body of this report, new to Education’s performance reporting this year was a section entitled: “Management Challenges: Successes and On-going Efforts.” We found this to be a helpful tool for tracking Education’s progress in addressing some of the management challenges.

We found, either in the management challenges section or elsewhere in the report, that Education discussed the agency’s progress in resolving more than half of the identified challenges.

Appendix II: Comments From the Department of Education