AOC is responsible for the operation, maintenance, renovation, and new construction of the buildings and grounds of the Capitol Hill complex. Organizationally, AOC consists of nine separate jurisdictions responsible for the day-to-day operations of the U.S. Capitol Building, Capitol Grounds, Senate Office Buildings, House Office Buildings, Library of Congress Buildings and Grounds, Supreme Court Buildings and Grounds, CPP, Botanic Garden, and Security Programs. AOC also has centralized staff that perform administrative and project management functions. AOC has managed major projects throughout the Capitol Hill complex and is currently managing the construction of the CVC. The historic nature and high profile of many of these buildings create a complex environment for AOC to carry out its mission; AOC must balance the diverse and sometimes divergent needs of congressional leaders, committees, members, and staffs as well as the visiting public. Congress has raised concerns about management shortcomings at AOC. For example, in 2001, the Senate Appropriations Committee cited several management issues, including a lack of strategic planning, inadequate financial and project management controls, and an unacceptably high level of worker injuries. Congress subsequently directed GAO to conduct a review of the management of AOC’s operations and, later, to monitor AOC’s progress in addressing recommendations that arose from the review. Our January 2003 report contained 35 recommendations designed to assist AOC in transforming itself into a more strategic and accountable organization. The recommendations were in seven areas, including strategic management, human capital management, financial management, project management, IT management, worker safety, and recycling. The report recognized this transformation as a long-term effort that involves a fundamental change in AOC’s culture. For example, AOC faces the challenge of how best to marshal its jurisdiction-based resources to address the strategic planning and other functional issues that cut across the organization. Changes of this magnitude require the sustained commitment of the agency’s top leadership. Subsequent reports on AOC’s progress that we issued in 2004 and 2006 concluded that, while AOC was making progress on all recommendations, substantial work remained to achieve the goal of becoming more strategic and accountable, and that sustained commitment and assertive involvement by AOC’s leadership would be key to instilling long-term management improvements. Specifically, our last report in this series, issued in February 2006, concluded that the agency had not addressed two issues—communication with external stakeholders and development of internal controls—that affect a wide range of AOC operations, including cost accounting, procurement, and information security. Furthermore, leadership support is vital to ensure that needed improvements are implemented and sustained, but key leadership positions—including those of the COO, CFO, Chief Administrative Officer, and Director of CPP—were vacant and the term of the agency head, the Architect, was due to expire in less than a year. Therefore, it was critical for AOC to quickly fill the vacant management positions with qualified people so AOC would have a cohesive management team in place in preparation for a change in the agency’s top leadership. These reports and two others on the CPP included assessments of two additional areas—facilities management and the CPP—and 29 additional recommendations for AOC, bringing the total number of recommendations to 64. In addition, we and AOC recently worked together to identify lessons learned from the ongoing CVC project, including practices that could be applied to AOC’s future projects and practices that could have been done better or differently. The lessons covered four areas—acquisition planning and policy; decision making, coordination, and communication; project and contract management; and worksite safety and security—and included such lessons as the importance of communicating and coordinating with all relevant stakeholders and identifying and mitigating risks early in the development of a major construction project. During the last year, AOC has filled nine key leadership positions, revised its strategic plan to better align its activities with its mission and goals, and continued initiatives to improve internal controls and accountability. These actions have furthered AOC’s progress in establishing a foundation for becoming a more strategic and accountable organization. It is now important for AOC to continue to build on this foundation by transitioning to new management; determining how best to provide services to AOC’s customers; and making further improvements in communication, financial management, IT management, and project management. The nine leadership positions that AOC has filled during the last year are vital to sustain improvements that have already been achieved, support further transformation efforts, and maintain operations during the transition to a new Architect. These new managers comprise 9 of the 20 managers that report directly to the Architect or the COO. (See fig. 1.) Most of these positions, including those of the CFO and the Chief Administrative Officer, were vacant because of retirements and resignations. To help AOC better meet the needs of its customers, AOC also created and filled two new leadership positions—the Director of Congressional and External Relations and the Director of Planning and Project Management. In addition to these nine positions, AOC has filled seven other management positions over the past year, such as the Deputy Director for the Office of the Chief Administrative Officer, Deputy Director of the Project Management Division, and Director of the Information Technology Division. While these new managers can bring new energy and ideas to the agency, the introduction of so many new managers within a short period makes it challenging to integrate them into AOC while sustaining the progress made thus far. The turnover in AOC’s senior leadership over the past year resulted in a loss of leadership continuity, institutional knowledge, and expertise—a loss that could adversely affect AOC’s ability to continue its progress, at least in the short term. AOC has taken steps to mitigate these factors and integrate the new managers into the agency by, for example, holding weekly senior leadership meetings and monthly detailed briefings on various AOC construction projects. These managers are also part of AOC’s senior executive performance management system, which links the managers’ performance plans to AOC’s mission-critical goals and holds the managers accountable for results. AOC officials also noted that 4 of the 9 new managers have been promoted from within the agency and have the institutional knowledge and expertise gained from several years of experience at AOC. The current vacancy in the Architect’s position further challenges AOC’s ability to sustain progress. The process for hiring the new Architect is in the early stages, and according to the COO, hiring the previous Architect took over a year. Until a new Architect is in place, the COO is authorized to act as the Architect and is assuming the Architect’s duties along with his own. In general, the Architect’s responsibilities include overall management of AOC, support and representation on boards and commissions—including the Capitol Police Board—and management of the CVC project, while the COO’s responsibilities involve developing the agency’s strategic and performance plans, proposing organizational and staffing changes needed to carry out AOC’s mission, and reviewing and directing the operational functions of AOC. The COO identified the management of the CVC project as one of the agency’s major challenges to becoming more strategic and accountable, because the CVC requires significant management attention that could otherwise be focused on AOC’s transformation initiatives. The management responsibilities for the CVC project could increase if, as scheduled, the CVC reaches a critical juncture in the next year as the construction phase ends and operations begin. For example, before the CVC becomes operational, the roles and responsibilities for managing CVC operations, including those of AOC, will need to be determined. Furthermore, the CVC project executive is planning to leave the agency in March 2007, which is likely to place additional responsibilities on the COO. Given these factors, it will be challenging for one person to fulfill the critical roles of the Architect and the COO in completing the CVC and continuing AOC’s progress in becoming more strategic and accountable. AOC has begun preparing for the transition to a new Architect by determining how to support the COO in the absence of an Architect and establishing a transition team for bringing in a new Architect. To support the COO, AOC has begun identifying individuals to assist the COO in managing various areas, such as project management and facilities management. While this strategy will provide support to the COO, it remains to be seen whether the strategy will provide the necessary support during the transition. AOC has also established a transition team that is chaired by the Director of Congressional and External Relations and that includes the COO and the Chief Administrative Officer, among others. This team has begun to prepare background materials for quickly bringing the new Architect up to speed on the agency and its initiatives, once a new Architect has been selected. The team also plans to be involved in preparing potential candidates for the confirmation hearings by providing the candidates with information on AOC’s responsibilities and structure, including its strategic plan. Over the past year, AOC has revised its strategic plan to better focus on its mission and provide a means to demonstrate results. In January 2007, AOC issued the revised plan, which sets forth AOC’s mission—to provide Congress and the public with a wide range of professional expertise and services to preserve and enhance the Capitol complex and related facilities. The revised plan also has three strategic goals—congressional and Supreme Court operations support, heritage asset stewardship, and leadership and administrative support—which cover all of AOC’s operations. The plan includes performance measures that allow AOC to regularly monitor progress in achieving its strategic goals and convey the results of its activities in its annual performance and accountability report. AOC’s revised strategic plan is an important building block in the agency’s efforts to become more strategic and accountable and provides a framework for assessing and prioritizing the agency’s activities. While AOC has defined its mission and goals in its revised strategic plan, the agency has not identified how best to deliver the services—through outsourcing or in-house resources—that support the mission and goals and has not determined whether its workforce has the skills and capacity to deliver those services. These two initiatives—identifying how best to deliver services and developing a workforce plan—are interrelated. For example, contracting out for a service requires a different set of skills to manage the contract than to conduct the work. While AOC has included both initiatives in its strategic plan and COO action plan and recognizes that coordinating these initiatives is important, the agency’s workforce planning efforts do not include an analysis of potential outsourcing opportunities that may arise as the result of AOC’s identification of how best to deliver services. Given recent trends and long-range fiscal challenges, we have reported the need for the federal government to engage in a fundamental review, reassessment, and reprioritization of what the government does, how the government does business, and who does the government’s business. In fiscal year 2005, AOC outsourced about 23 percent of the agency’s operations and maintenance expenditures; this percentage was within the range of operations outsourced by similar organizations (12 to 41 percent). However, AOC has not comprehensively reviewed all the services it provides to determine whether the services could better be provided through outsourcing or in-house resources. Consequently, few activities are outsourced consistently throughout AOC, and contracts are seldom consolidated to obtain similar services across jurisdictions. In 2006, the House Appropriations Committee instructed AOC to develop a plan that analyzes the costs, cost-effectiveness, benefits, and feasibility of the Architect’s entering into contracts with private entities for managing and operating its facilities. AOC submitted a plan to Congress that outlines a long-term strategy for comprehensively reviewing operations and identifying opportunities for additional contracting; however, the plan does not provide time frames for executing this strategy. AOC officials told us that the time frames for the long-term strategy depend on coordination with the new congressional leadership to brief them on AOC’s outsourcing plan. In 2002, the Commercial Activities Panel issued guiding principles for federal agencies to follow when making decisions on whether to outsource services. In briefings to congressional committees, we have reported that these principles could guide AOC in determining how best to deliver its services. For example, the panel recommended that the decision on whether to outsource services should support agency missions, goals, and objectives (as defined in the agency’s strategic plan); be based on a clear, transparent, and consistently applied process; avoid arbitrary full-time equivalent or other arbitrary numerical goals; ensure that competitions involve a process that considers both quality and cost factors; and provide for accountability in connection with all decisions. In addition, AOC has not assessed its current workforce to determine whether it has the appropriate balance of skills needed to provide services and manage contracts for services that are outsourced. An assessment of AOC’s workforce can help AOC leadership further refine their decisions on whether to deliver AOC’s services with outsourcing or in-house resources. As we recommended, AOC has taken steps to identify current and future workforce needs and address potential skill gaps by hiring a contractor to assist in the development of a strategic workforce plan. Although the scope of the contractor’s work will include collecting and analyzing data on AOC’s workforce, it does not include an analysis of potential outsourcing opportunities that may arise as the result of AOC’s identification of how best to deliver services. Furthermore, the COO requested that the workforce planning efforts include an analysis of potential outsourcing opportunities, but the COO’s guidance came after AOC had finalized its workforce planning contract. An AOC official responsible for the contract stated that this level of analysis either would require additional resources for the current contract or would need to be incorporated into a second phase of its workforce planning efforts. Another initiative in AOC’s workforce planning efforts—the implementation of a skills assessment survey—has been delayed to revise the survey instrument and make a more useful tool for collecting data on AOC’s current workforce. An official stated that AOC does not expect the skills assessment survey to be completed in the near future. Consequently, data from the skills assessment survey will not be taken into account in the work being done by AOC’s contractor responsible for developing the strategic workforce plan. AOC took several steps over the past year to improve communication with its external stakeholders, and stakeholders are responding positively to these efforts. To improve communication with congressional stakeholders, AOC hired a Director of Congressional and External Relations. The director is responsible for developing and maintaining positive relations with congressional stakeholders, and she regularly provides them with updates on AOC issues. Other AOC officials, including the COO and the Director of Planning and Project Management, also periodically brief congressional stakeholders on a variety of issues, such as revisions to the strategic plan, the COO’s action plan, and AOC’s budget submission and the status of projects. As a result of these efforts, the COO believes that AOC better understands what Congress wants and is able to set expectations, obtain feedback, and make changes on the basis of that feedback. Congressional stakeholders we spoke with generally agree that AOC’s outreach efforts have improved, and they said that the addition of the Director of Congressional and External Relations has improved AOC’s responsiveness to congressional questions and requests for information. Although AOC has taken steps to improve communication with its congressional stakeholders, it is critical for these improvements to be formalized and sustained. AOC is finalizing written procedures for communicating with congressional and other external stakeholders and plans to brief congressional leadership on these procedures. In instituting these procedures, AOC is working to establish “one voice” for the agency and set expectations for AOC’s response time to stakeholder inquiries. Although congressional stakeholders generally agree that communication has improved, documentation of AOC’s communication procedures can help ensure that AOC deals with its congressional customers using clearly defined, consistently applied, and transparent policies and procedures. AOC also has taken actions to improve communication with its employees, but the effectiveness of these efforts remains to be seen. AOC recently revised its process for collecting and assessing data on employee satisfaction to address our recommendations on systematically collecting and communicating employee feedback. AOC continues to distribute newsletters to its employees; hold biannual town hall meetings and monthly, small-group sessions with the COO; and address issues that were identified in employee focus groups, first held in 2004. AOC also contracted for an ombudsperson to serve as a confidential resource for responding to employee complaints, concerns, and questions on employment-related matters. Although these are positive steps, AOC will not be able to determine the extent to which communication has been improved until the next round of employee focus groups is completed and compared with the results of the 2004 focus groups. AOC originally planned to conduct the next round of focus groups in fiscal year 2007; however, because of fiscal constraints and ongoing transformation efforts, AOC is considering the possibility of conducting focus groups in fiscal year 2008. The effectiveness of AOC’s communication improvements also depends on how well AOC can identify and address issues that may arise as well as communicate the actions that are being taken to address the issues. For example, in 2006, employees involved in repairing AOC’s utility tunnels expressed concerns over how AOC management communicated with them. Although AOC developed a plan to address problems in the utility tunnels, the tunnel workers expressed concern that they had no clear idea of when the problems would be solved. To improve communication, AOC began holding weekly meetings with the tunnel shop workers in April 2006 to discuss tunnel issues and the actions being taken, but workers continued to express frustration about the lack of progress in addressing their safety and health concerns. As issues such as worker safety arise, it is important for employees to see that AOC’s leadership not only listens to their concerns, but also takes action and makes appropriate adjustments in a visible and timely way. AOC has made progress in financial management, IT management, and project management, but sustained commitment is required to continue progress on the long-term efforts in these areas, many of which are needed to improve AOC’s internal controls and accountability. Internal control and accountability are critical elements in managing an organization. Internal control involves the plans, methods, and procedures used to meet missions, goals, and objectives and, in doing so, to support performance- based management. Accountability represents the processes, mechanisms, and other means by which AOC managers demonstrate their stewardship and responsibility for resources and performance. Internal control and accountability initiatives require sustained and committed leadership to ensure successful implementation. While AOC has made progress in all nine areas that are important to a strong strategic management and accountability framework, work remains to develop significant and lasting internal control and accountability improvements in the areas of financial management, IT management, and project management. (See app. I for more information on the status of recommendations in all nine areas, including strategic management, human capital management, facilities management, worker safety, CPP management, and recycling.) AOC has made progress in preparing its financial statements and implementing a new financial management system, but significant work remains to establish an effective internal control framework and cost accounting system. AOC achieved its goal of preparing auditable comprehensive agencywide financial statements with the successful audit of its fiscal year 2005 and 2006 financial statements. To a significant extent, these achievements reflect the increased focus and attention by AOC’s senior management on financial accountability and control. For example, AOC’s senior management regularly meets with the AOC Audit Committee and its internal and external auditors to discuss the status of the financial statement audits, any related findings, and AOC’s corrective plans. In 2006, AOC also implemented the final phase of its new financial management system. AOC has begun efforts to establish a risk-based internal control framework, although progress has been impacted by staffing shortages and limited resources. To improve accountability across the agency, AOC has begun the implementation of its cost accounting system, including working to get employees to charge their time to specific activities and project codes in the time and attendance system and working to develop reporting formats that demonstrate the types of information that can be generated when the system is fully implemented. Although these are important steps, the system will have to be further developed to link AOC’s cost information to the strategic plan, performance measures, and performance-based budgeting—actions that are important to producing reliable information for decision making and performance evaluation. AOC officials noted that further progress in implementing the internal control framework and the cost accounting system will be limited by current resource constraints. Implementing this key effort impacts other AOC initiatives. For example, while AOC has taken steps to improve its cost and timeliness measures for facilities management, it will not be able to accurately and routinely track or benchmark these measures until the cost accounting system is further developed and linked with the facilities management information system. AOC officials noted that it will take several years for the systems and processes to evolve to the point that the system can be fully implemented. Successful implementation of these systems and processes that impact all of AOC’s operations will require sustained organizational commitment to ensure these efforts are appropriately funded, staffed, and monitored. Until these efforts are implemented and operating effectively, AOC continues to face substantial risk in the area of linking cost and financial information to organizational performance. AOC has made progress in improving IT management controls and accountability, but work remains to fully implement an effective agencywide approach to IT management. To improve management controls in AOC’s IT investment management process, AOC developed and approved an IT investment management policy that describes the agency’s investment management process and the roles and authorities of the boards involved in overseeing IT investments. AOC also has begun to plan for and implement the practices in our IT investment management guide associated with corporate, portfolio-based investment decision making. However, AOC has yet to prioritize all IT investments, develop an IT investment portfolio, and oversee each investment from a portfolio approach to ensure that it achieves its cost, benefit, schedule, and risk expectations. According to AOC officials, AOC has begun the process of establishing an IT portfolio management program that will arrange IT investment into a single portfolio and provide visibility, control, and decisions based on project objectives such as costs, resources, and risks. However, until AOC fully institutes these practices, it cannot ensure that the investments address the agency’s strategic goals, objectives, and mission. AOC also took actions to improve internal controls and accountability in the area of project management, but sustained commitment is needed to continue progress in managing project costs and developing a project information system to help manage and track projects. For example, AOC made internal control and accountability improvements by developing and tracking project-management-related performance measures, clarifying the roles and responsibilities of staff in the Project Management Division, and revising its project management manuals. However, AOC’s lack of accurate cost data for the Construction Division—the division that provides construction services in-house (rather than by contractors)— hampers its efforts to fully account for the costs of projects. In April 2006, a peer review group within AOC issued recommendations designed to better track cost data for the division, including standardizing the cost estimating process. AOC is taking steps to address the peer review recommendations, such as developing centralized planning and estimating capabilities to provide better cost estimates for all Construction Division projects, but, according to AOC officials, the agency will not be able to fully account for project costs until the cost accounting system is in place. In addition, AOC plans to modify its project information system to improve AOC’s ability to manage, track, and communicate the status of projects. AOC has developed the requirements for this system, which includes the automation of AOC’s quarterly construction projects progress report. AOC plans to begin modifications to the current system with available in-house resources in fiscal year 2007 and requested funding for further modifications in its fiscal year 2008 budget. Sustained support of these project management initiatives is critical to improving AOC’s efforts to manage projects, identify reasons for project cost and schedule changes, and report to the stakeholders. On the basis of our ongoing work and issued testimonies on AOC’s management of the CVC project, we and AOC worked together to identify lessons learned from the ongoing CVC project, some of which are also relevant for project management across AOC. For example, one lesson suggests the importance of establishing and maintaining a detailed, realistic, and complete project schedule and ensuring that the schedule sufficiently reflects the impact of problems and changes and the likely impact of known risks. Another lesson suggests the importance of clearly identifying qualifications and limitations associated with cost and schedule estimates; understanding risks and uncertainties; and providing Congress with accurate, timely updates on the project’s status, completion date, and costs. Recognizing the need to improve how AOC manages large projects, the agency is adding capital project administrators to its Project Management Division to lead the design and construction activities of larger projects. In responding to a draft of this report, AOC generally agreed with our assessment of the agency’s overall progress, but noted that 2 additional recommendations—1 on institutionalizing financial management practices to support budgeting, financial, and program management and 1 on developing a rigorous approach for collecting worker safety data—should be considered implemented. According to AOC officials, the agency has made significant progress over the past year and installed a solid foundation for further improvements. The officials also recognized that continued focused attention to the agency’s improvement initiatives is essential to maintaining progress. For our recommendation on financial management practices, AOC suggested that the two remaining actions for this recommendation—fully developing and implementing an appropriate risk-based internal control framework and cost accounting and management reporting initiatives—are addressed in the other financial management recommendations. In our August 2004 report, we noted the AOC’s limited progress on the financial management initiatives, which lead us to make additional recommendations calling for senior management to provide strong and visible support and commitment to helping ensure that these important initiatives are successfully implemented. While some progress has been made on these initiatives, AOC officials noted that further progress will be limited by staffing shortages and resource constraints. The potential limited, near-term progress leads us to observe in this report that successful implementation of these systems and processes, which impact all of AOC’s operations, will require sustained organizational commitment to ensure these efforts are appropriately funded, staffed, and monitored. We maintain that full implementation of these initiatives is necessary for institutionalizing internal control and accountability and strengthening and supporting effective budgeting, financial, and performance management at AOC. For the recommendation on collecting worker safety data, AOC officials noted that they believe their current practices—including conducting biennial focus groups, conducting daily shop safety meetings, and establishing a safety hazards hotline—sufficiently meet the requirements of this recommendation. While we recognize that these initiatives provide the agency with some information on worker safety, these initiatives do not provide a rigorous and confidential approach for collecting employee perceptions of AOC’s safety climate, such as perceptions of management commitment, discipline policies, and hazard corrections. This lack of confidentiality can impede the quality of information collected. Furthermore, although AOC established a schedule to collect employee feedback every other year, AOC has not conducted focus groups since fiscal year 2004 and does not have plans to do so until possibly fiscal year 2008. AOC’s recently revised employee feedback manual specifies that AOC can use other means or tools to collect and provide employee feedback information. This would allow AOC to pursue another, more rigorous and confidential method for collecting worker safety data. AOC also made clarifying and technical comments that we addressed in the text of this report. We are sending copies of this report to the appropriate congressional committees. We are also sending this report to the Acting Architect of the Capitol. We will make copies available to others upon request. In addition, this report will be available at no cost on the GAO Web site at http://www.gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. If you or your staffs have any questions about this report, you may contact me at (202) 512-6923 or at dornt@gao.gov. Major contributors to this report are listed in appendix II. Since January 2003, we have made 64 recommendations in nine areas to improve the Architect of the Capitol’s (AOC) strategic management and accountability framework, which is needed to drive the agency’s transformation effort and address long-standing program issues. These nine areas are strategic management, human capital management, financial management, information technology (IT) management, project management, facilities management, worker safety, Capitol Power Plant (CPP) management, and recycling. Over the past year, AOC has implemented 21 recommendations, bringing the total number of implemented or closed recommendations to 43 out of 64, or 67 percent. This appendix provides (1) the overall progress and remaining actions in each of the nine issue areas and (2) details on the status of the recommendations made in each area (see tables 1 through 9). For the recommendations that have been implemented, the “status” column in the tables includes the month and year of the GAO report that acknowledges the completion of that recommendation. Recommendations implemented since our February 2006 report were given an implementation date of February 2007. AOC has made progress in improving its strategic planning and organizational alignment, establishing meaningful performance measures, improving the process to obtain feedback from employees and customers, and strengthening the relationship between AOC and congressional stakeholders. As a result, AOC has implemented 6 of our strategic management recommendations over the year. Specifically, AOC has issued its revised strategic plan and the Chief Operating Officer (COO) action plan and provided periodic briefings to update congressional stakeholders on these plans and related organizational changes. To improve communication with its employees, AOC revised its employee feedback process manual to establish a process for regularly collecting and reporting employee feedback information. Finally, to improve communication with its external stakeholders, AOC is establishing procedures for communicating with congressional and other external stakeholders and has taken a more proactive approach to communicating with these stakeholders. Although AOC has made progress in the area of strategic management, sustained commitment from the agency’s new leaders is necessary to build upon this progress. To ensure that the strategic plan is current and useful to the agency, AOC leadership should review and update the strategic plan regularly and incorporate any changes that may result from AOC’s review of options and strategies for delivering its services and operations. Furthermore, AOC should continue to work with congressional stakeholders to develop and report key measures that are meaningful to AOC’s customers and reflect the agency’s day-to-day operations. See table 1 for more information on the implementation status of our recommendations on strategic management. AOC has taken steps to strengthen performance management and strategic human capital management by implementing our recommendation to develop the capacity for collecting and analyzing workforce data. Additionally, AOC has hired a contractor to begin developing a strategic workforce plan intended to provide AOC with information on its current and future workforce as well as recommendations on how AOC could meet its strategic goals. Although hiring the contractor is an important step, AOC’s current effort to develop a strategic workforce plan will not include an assessment of how best to deliver (either through outsourcing or in-house resources) the services it provides. Without this type of assessment, AOC’s strategic workforce plan will not provide AOC leadership with the appropriate set of strategies to acquire, develop, and retain its current and future workforce. See table 2 for more information on the implementation status of our recommendations on human capital management. Since our initial follow-up effort in January 2004, AOC has made progress—to varying degrees—on key control and accountability initiatives. AOC has developed agencywide audited financial statements, implemented a new financial management system, and continued to develop and implement a risk-based internal control framework and a cost accounting system that, when fully implemented, should generate meaningful cost and performance reporting information for managers. However, AOC’s senior management needs to continue supporting the full implementation of key financial management and accountability efforts that are critical to AOC’s operations. Although AOC senior management has helped to strengthen AOC’s financial accountability by regularly monitoring and overseeing AOC’s efforts to prepare agencywide comprehensive financial statements and have them audited, it needs to increase focus and attention on completing the development and implementation of the other three key financial management improvement initiatives—an internal control framework, a cost accounting system, and a management reporting system. According to AOC officials, current staffing shortages and funding constraints will likely limit meaningful near- term progress on these efforts. To continue AOC’s progress, it will be essential for AOC’s senior management to provide the commitment, attention, and resources needed to ensure the successful implementation of these important control and accountability initiatives. See table 3 for more information on the implementation status of our recommendations on financial management. AOC continues to make progress toward adopting an agencywide approach to information management and has implemented 2 IT recommendations over the year. Specifically, AOC has developed, approved, and implemented a process, including those practices in our IT investment management guide, for controlling existing projects. AOC also has established the management structure for developing, implementing, and maintaining an enterprise architecture (EA) and has made significant progress toward planning for and implementing the practices in our architecture management guide. These practices include ensuring that adequate resources (i.e., funding, people, tools, and technology) are devoted to the program and developing a written policy for architecture development and maintenance. In addition, AOC has made progress toward addressing our remaining recommendations. For example, it has developed a policy that describes the procedures, practices, and guidelines that govern the management of its IT systems and the required processes that are to be followed when acquiring and developing these systems. Furthermore, AOC has taken steps toward establishing and implementing an effective information security program by designating a chief information security officer with the authority to implement an agencywide security program and by certifying and accrediting its general support systems and major applications. However, more work remains to fully implement our recommendations. For example, AOC has yet to prioritize all IT investments, develop an IT investment portfolio, and oversee each investment using a portfolio approach to ensure that AOC achieves its cost, benefit, schedule, and risk expectations. Until AOC completes these activities, it cannot ensure that the investments address not only the agency’s mission and strategic goals and objectives, but also the impact of the investments on each other. Moreover, AOC has yet to fully implement key architecture practices, such as defining “as is” and “to be” architecture descriptions in terms of performance. Without instituting these practices, AOC risks limiting the quality and utility of its architecture and may not realize the benefits of a well-managed architecture program. In addition, the agency has not consistently demonstrated quality assurance, configuration management, and contract tracking and oversight processes. Until AOC consistently demonstrates these key acquisition processes, the agency runs the risk of projects not performing as intended, being delivered late, and not meeting estimated cost and schedule goals. AOC also has yet to develop system contingency plans for all of its systems and implement a security process to monitor and evaluate policy and control effectiveness. Without instituting these practices, AOC’s data and systems are at risk of inadvertent or deliberate misuse, fraud, improper disclosure, or destruction, possibly without detection. See table 4 for more information on the implementation status of our recommendations on IT management. AOC has made progress on several initiatives that should improve project management and accountability and has implemented 7 project management recommendations over the year. For example, AOC has established performance measures, including measures to track the quality and costs of projects. AOC also has clarified the roles and responsibilities for staff in the Project Management Division and updated guidance for managing projects. In addition, AOC is continuing efforts on longer-term initiatives to improve project management and accountability. For example, AOC plans to modify its project information system to assist managers in more proactively managing projects, provide needed cost and schedule data on projects, and track reasons for changes across all projects. AOC has developed the requirements for this system, which includes the automation of AOC’s quarterly construction projects progress report, and plans to begin modifications with available in-house resources in fiscal year 2007. Additionally, AOC has conducted a review of Construction Division operations and management in 2006 and is currently implementing the recommendations from that review, including recommendations to improve project cost estimating and tracking. However, the new cost accounting system—a system that will be phased in over several years—must be completed before AOC can implement all of the recommendations intended to improve accountability for the Construction Division. Furthermore, AOC is reviewing its methods for estimating Construction Division project costs, including contingency costs and allocations for construction management and administration, to improve the accuracy of project cost estimates. AOC also is finalizing the Capitol complex master plan and anticipates that a draft of the plan will be ready for congressional review in the spring of 2007. See table 5 for more information on the implementation status of our recommendations on project management. AOC has taken steps to improve how it measures performance and tracks demand work orders. For example, in May 2006, AOC began implementing a new facilities management information system that will enhance its tracking and reporting capabilities. Currently, all jurisdictions are using the new system to track demand work orders. As implementation continues, AOC plans to continue analyzing its workload data to develop metrics for the new system. Additionally, AOC officials plan to benchmark AOC’s performance measures with peer organizations. These officials said that they used the International Facilities Management Association’s key performance indicators to develop performance measures for AOC’s revised strategic plan. While these are important steps, AOC must complete the development of its metrics and input its preventive maintenance work orders before it can more accurately track performance. Furthermore, the new facilities management information system must be used in conjunction with the new cost accounting system—a system that will be phased in over several years—before AOC will be able to fully use data provided by the new facilities management information system. See table 6 for more information on the implementation status of our recommendations on facilities management. AOC has taken steps to improve worker safety and has implemented 1 worker safety recommendation over the past year. Specifically, AOC has implemented 7 of 34 specialized safety policies, completed a job hazard analysis process to identify hazards, and implemented a system to track investigations of incidents and follow-up. AOC also has selected a data management system that will track and record employee training, licensing, and certification and clarified the role of the Office of the Attending Physician (OAP), including having OAP provide reports to AOC jurisdictions when employees are due or past due for their medical surveillance examinations. Overall, AOC’s injury and illness rate declined from 17.9 in fiscal year 2000 to 4.9 in fiscal year 2006. However, several critical actions remain to further improve worker safety. For example, AOC will not be able to fully achieve its goal of long-term cultural change until it fully implements the specialized safety policies, which current draft plans indicate will not occur until the end of fiscal year 2009. AOC also needs to align its training system with its system to track and identify corrective actions for hazards and incidents in order to target training needs to address high-risk areas. Finally, although AOC added worker safety as a standard topic in its biennial employee focus group script, AOC needs a more rigorous (and anonymous) approach to measuring employee’s perceptions of AOC’s safety climate, which may identify successful strategies to expand and areas that need focused attention to improve. See table 7 for more information on the implementation status of our recommendations on worker safety. While AOC is making progress in improving worker safety, in March 2006, the utility tunnel workers sent a letter to Congress complaining of unsafe working conditions in the tunnels, including falling concrete, asbestos, and extreme heat. In February 2006, the Office of Compliance (OOC) filed a complaint against AOC concerning hazards in the tunnels, including falling concrete, an inadequate communication system for these confined spaces, and inadequate escape exits. AOC has taken steps to address these issues—including establishing safety and access procedures for the tunnels and upgrading 15 tunnel entry and exit points—and continues to work with the tunnel workers and the OOC to address these issues. AOC has made progress in improving CPP management and efficiently staffing the modernized power plant, but more work remains. For example, AOC took interim steps to modify existing positions—as they have been vacated—to reflect the additional skill sets required to successfully operate and maintain the modernized plant. Since October 2005, AOC has been working with a consultant to develop a new workload analysis and staffing implementation plan and received the results of the analysis and recommendations in November 2006. On the basis of these results, AOC is developing a reorganization plan to reflect the recommendations, which it expects to submit to Congress for approval in March 2007. In anticipation of the staffing changes, AOC has been using attrition to reduce and realign the CPP workforce and is currently keeping seven vacated positions vacant, four of which will be filled by internal candidates and will not impact the staffing numbers. See table 8 for more information on the implementation status of our recommendations on CPP management. AOC has implemented the recommendations related to developing a strategic approach to recycling. In January 2006, AOC finalized its recycling program mission, goals, and performance measures. The performance measures are also in AOC’s revised strategic plan and the Senate and House business plans. To monitor performance, AOC reports on the status of its recycling performance measures in the quarterly Safety, Health, and Environmental Council meetings. Additionally, AOC formed a Legislative Branch recycling group that met for the first time in September 2006. This group plans to meet quarterly to discuss common issues and best management practices. To clarify responsibilities and hold staff accountable for achieving recycling goals, AOC has included recycling tasks in its position descriptions and included recycling responsibilities for recycling managers and supervisors in its evaluation system. For example, the performance evaluation system includes recycling objectives in the ratings of Senate and House recycling managers to hold them accountable for program results. See table 9 for more information on the implementation status of our recommendations on recycling. In addition to the individual named above, key contributors to this report were Shirley L. Abel, Mark Bird, John C. Craig, Elizabeth Curda, Amr Desouky, Elizabeth R. Eisenstadt, Elena P. Epps, Brett S. Fallavollita, Jeanette M. Franzel, Mary Hatcher, Randolph C. Hite, Heather Krause, Neelaxi Lakhmani, Steven G. Lozano, Valerie Melvin, David Merrill, Susan Michal-Smith, Sara Ann Moessbauer, Stephanie Sand, Natalie Schneider, Bernice Steinhardt, John J. Reilly, Jr., Sarah E. Veale, Sara Vermillion, and Merry Woo.

Summary: The Architect of the Capitol (AOC) is responsible for the operation, maintenance, renovation, and new construction of the Capitol Hill complex, including the U.S. Capitol, the Library of Congress, and the Senate and House Office Buildings. In 2003, at the request of Congress, GAO issued a management review of AOC that contained recommendations designed to help AOC become more strategic and accountable. Subsequently, Congress directed GAO to monitor AOC's progress in implementing recommendations. This is the fourth status report on AOC's progress and summarizes GAO's assessment of AOC's overall progress and remaining actions in becoming more strategic and accountable, including AOC's responses to specific recommendations GAO made in January 2003 and subsequently. To assess AOC's progress, GAO analyzed AOC documents; interviewed AOC officials; and relied on the results of related GAO reviews, including reviews of the Capitol Visitor Center (CVC). AOC generally agreed with GAO's assessment of its progress, but noted that 2 additional recommendations--1 on financial management practices and 1 on collecting worker safety data--should be considered implemented. GAO acknowledges AOC's efforts in these areas, but maintains that further steps are necessary to fully implement these recommendations. AOC has made progress in becoming more strategic and accountable, but critical actions are needed to sustain and build on this progress. To date, AOC has filled key leadership positions, revised its strategic plan, improved communication, and continued initiatives to improve internal controls and accountability. AOC is thus establishing a foundation for becoming more strategic and accountable. However, completing the transition to new leadership--including the transition to a new Architect of the Capitol (a position that is now vacant)--and other actions remain to bring about lasting improvements in performance. For example, AOC must integrate nine new managers into the agency while ensuring its continued progress. In addition, the Chief Operating Officer faces the challenge of performing the Architect of the Capitol's responsibilities and his own during the CVC project's completion and AOC's management transition. Furthermore, although AOC has revised its strategic plan to better focus on its mission and goals, it has not determined whether it can better deliver the services that support its mission and goals through outsourcing or in-house resources. Finally, a continued focus on communication and other areas that are key to greater internal control and accountability--including financial, information technology, and project management--is needed to sustain and further AOC's progress to date. For example, full implementation of AOC's cost accounting system--a key financial management initiative--is needed to more accurately track facilities management cost measures. Improvements in project management could be achieved, in part, by applying lessons learned in managing the CVC project. Appendix I of this report summarizes AOC's progress on recommendations that GAO has made since January 2003 to help AOC establish a strong strategic management and accountability framework. This year, AOC has implemented 21 recommendations. For example, AOC implemented 6 of the strategic management recommendations, including the development of congressional protocols and the involvement of stakeholders in developing the revised strategic plan. For project management, AOC implemented 7 recommendations, including the development of performance measures. Implementing these 21 recommendations brings the total number of implemented or closed recommendations to 43 out of 64.