Continuing to build on progress made under FDCCI, agencies have reported significant data center closures—totaling more than 4,300 through August 2016—and current plans identify more than 1,200 additional centers planned for closure through fiscal year 2019. If executed as planned, such closures will help agencies continue to increase their operational efficiency and achieve savings. Agencies have also reported significant consolidation and optimization cost savings and avoidances. However, agencies’ total planned cost savings are $3.3 billion less than what we reported in 2015. In the absence of planned savings that remain consistent and fully reported, total planned savings are likely to continue to be understated. OMB’s recent guidance on data center optimization was a positive step forward in providing agencies with the detailed guidance to establish their required strategic plans to optimize their data centers and achieve cost savings. However, not all agencies have submitted their plans and only seven of the plans submitted addressed all the key elements required by FITARA and OMB. Moreover, significant inconsistencies in agencies’ reported savings raise further questions regarding the accuracy of agency reporting and OMB’s oversight of this initiative. Addressing these inconsistencies and expeditiously completing these plans is increasingly important in order to meet the federal requirements. Until OMB improves its oversight of the information in agencies’ strategic plans, and agencies complete the missing elements, they may be challenged in fully implementing the data center consolidation and optimization provisions of FITARA. Further, until OMB improves it oversight of agencies’ reporting of cost savings and agencies address inconsistencies in their reporting, savings will likely continue to be underreported. To better ensure that federal data center optimization efforts improve governmental efficiency and achieve cost savings, we are making two recommendations to OMB. Specifically, we recommend that the Director of OMB direct the Federal CIO to provide the necessary oversight to ensure that each agency completes their DCOI strategic plan in accordance with OMB’s guidance implementing FITARA and ensure that agency reporting of achieved data center consolidation and optimization cost savings and avoidances is consistent across all reporting mechanisms, including quarterly data submissions and agency DCOI strategic plans. We also recommend that the following 17 agencies (the Secretaries of the Departments of Commerce, Defense, Energy, Health and Human Services, Interior, Labor, State, Transportation, Treasury, and Veterans Affairs; the Attorney General; and the Administrators of the Environmental Protection Agency, National Aeronautics and Space Administration, Small Business Administration, and U.S. Agency for International Development; the Chairman of the Nuclear Regulatory Commission; and the Commissioner of the Social Security Administration) each take action to complete the missing elements in their respective DCOI strategic plan, including addressing any identified challenges, and submit their completed strategic plan to OMB. Finally, we recommend that the following 11 agencies (the Secretaries of the Departments of Commerce, Education, Health and Human Services, Interior, Labor, State, Transportation, and Treasury; the Administrators of the Environmental Protection Agency, General Services Administration, and the U.S. Agency for International Development) also each take action to ensure that the amounts of achieved data center cost savings and avoidances are consistent across all reporting mechanisms, including the quarterly data submissions and DCOI strategic plans. We received comments on a draft of this report from OMB and from the 24 agencies that we reviewed. Of these, 12 stated they agreed with our recommendations, 2 (the Department of Housing and Urban Development and the Nuclear Regulatory Commission) did not agree, and 11 (including OMB) did not state whether they agreed or disagreed. Multiple agencies also provided technical comments, which we have incorporated as appropriate. The following discusses each agency’s comments. In an e-mail received on April 5, 2017, a staff member from OMB’s Office of General Counsel did not agree or disagree with our recommendation, and offered several comments on our findings. Specifically, the staff member stated that OMB was unable to replicate our totals of the number of data centers closed and remaining. The staff member also noted that we did not include agency cloud service providers or data centers with no closing date in our totals, whereas OMB includes such instances in its counts. In conducting our analysis, we did not count cloud service providers because OMB’s guidance specifically states that such providers are not to be considered as data centers. In regard to data centers identified as planned for closure, but without a closing date, we did not count such facilities as closures because the lack of a date suggested only a tentative plan, rather than a firm commitment. The staff member further stated that OMB could not replicate our cost savings estimates and noted that while OMB relied solely on information reported by agencies to the IT Dashboard, we also had access to contextual information about the data, provided to us by the agencies. The staff member asserted that OMB did not have access to that same information. However, the contextual information referenced by the staff member is only amplifying information we obtained from the agencies through the normal course of our audit work, as we interviewed agency officials in order to verify the information reported by the agencies to OMB and to verify the results of our analyses. On multiple occasions, our work has pointed out the differences in what agencies are reporting to OMB and what they are reporting to us, and we have made multiple recommendations for OMB and agencies to address these discrepancies. For this reason, we requested and received agencies’ validation of the results of our analysis of agency closures and cost savings on multiple occasions. As such, we stand by the results of our analysis and the data center closures and cost savings estimates that we are reporting. Additionally, the staff member stated that grouping together in one category the agencies that had not fully completed all the required elements of their DCOI strategic plans ignored significant quality differences between the plans, as well as shared problems with each of them. Our report currently summarizes that seven agencies addressed all required plan elements, but that 17 other agencies either partially met or did not meet the requirements. Our report also provides a graphic that illustrates the number of agencies that met, partially met, or did not meet each requirement. Further, the briefing slides that we are transmitting with this report (found in appendix I) detail the extent to which individual agencies completed their strategic plans and also discuss reasons why agencies were unable to complete their plans, including shared challenges. As such, we maintain that the statement in our report appropriately summarizes the findings detailed in our briefing. In an e-mail received on April 3, 2017, a senior advisor in the Department of Agriculture’s Office of the CIO stated that the CIO concurred with our recommendation that the department had taken action to complete the missing elements in its strategic plan, including addressing any identified challenges, and submitted the completed strategic plan to OMB. The advisor noted that the department had updated its DCOI strategic plan to include fiscal year 2016 achievement information and posted its revised plan. In addition, the advisor said that the department had posted its CIO statement asserting that the agency has complied with all reporting requirements in OMB’s memorandum and the data center requirements of FITARA. Our analysis of the department’s updated DCOI strategic plan concluded that the plan included the missing elements we identified during our review. We also confirmed that the department’s CIO statement was available publicly on the department’s website. As a result, we have removed this recommendation from our report. In addition, the department provided technical comments, which we have incorporated as appropriate. In written comments, the Department of Commerce agreed with our recommendations and described planned actions to address them. Specifically, the department stated that it will continue to aggregate its data center inventory and update its DCOI strategic plan by OMB’s April 17, 2017, submission deadline. The department also stated that it will, through the integrated data collection process, continue to collect and report all initiatives resulting in cost savings and avoidances to ensure IT savings are being captured and realized. The Department of Commerce’s comments are reprinted in appendix II. In an e-mail received on March 27, 2017, a Department of Defense CIO audit liaison stated that the department had no comment on the draft report, and did not state whether the department agreed or disagreed with the recommendations. The department provided technical comments, which we have incorporated as appropriate. In written comments, the Department of Education did not agree or disagree with our recommendations but acknowledged that the department had not included historical cost savings and avoidance information in its DCOI strategic plan, as required. The department attributed the omission to its interpretation of DCOI strategic plan guidance, and provided a life cycle cost estimate, rather than the required historical cost savings through 2015. The department stated that it has subsequently corrected its strategic plan, and it provided us with a copy of the plan. Our draft report provided to the department for comment included a recommendation that the department take action to complete the missing elements in its strategic plan, including addressing any identified challenges, and submit the completed strategic plan to OMB. Our analysis of the department’s updated DCOI strategic plan states that it includes the missing elements we identified during our review. We also confirmed that the department’s CIO statement was available publicly on the department’s website. As a result, we have removed this recommendation from our report. The Department of Education’s comments are reprinted in appendix III. In written comments, the Department of Energy concurred with our recommendation that it take action to complete the missing elements in its DCOI strategic plan, including addressing any identified challenges, and submit the completed strategic plan to OMB. The department stated that it had submitted its fiscal year 2016 DCOI strategic plan to OMB in February 2017 and posted a copy on an agency web site. The department further said that in the plan, it reported meeting or exceeding all fiscal year 2016 goals and established performance targets for fiscal years 2017 and 2018, and that the plan included all past and present cost savings and avoidances achieved.