The FTR, issued by GSA, implements statutory and OMB requirements and policies for most federal civilian employees and others authorized to travel at government expense. The purpose of the FTR is to ensure that official travel is conducted responsibly and at minimal administrative expense. Unless exempt by specific legislation, executive agencies, wholly owned government corporations, and independent establishments are expected to follow the FTR, including its promulgation related to premium class travel. DOD’s uniformed servicemembers and State employees exempt from the FTR are covered by their agencies’ travel regulations. OMB’s general policy related to travel is that the taxpayers should pay no more than necessary to transport government officials. Consistent with this principle, the FTR states that with limited exceptions, travelers must use coach class accommodations for both domestic and international travel. Premium class travel can occur only when the traveler’s agency specifically authorizes the use of such accommodations (authorization) and only under specific circumstances (justification). Specifically, the FTR states that first class accommodation is authorized only when at least one of the following conditions exists: coach class airline accommodations or premium class other than first class airline accommodations are not reasonably available, when use of first class is necessary to accommodate a disability or other special need that is substantiated in writing by a competent medical authority, when exceptional security circumstances require first class travel, or when required because of agency mission. The FTR authorizes premium class accommodations other than first class (business class) when at least one of the following conditions exists: regularly scheduled flights between origin/destination points provide only premium class, and this is certified on the travel voucher; coach class is not available in time to accomplish the mission, which is urgent and cannot be postponed; premium class travel is necessary to accommodate the traveler’s disability or other physical impairment, and the condition is substantiated in writing by competent medical authority; premium class travel is needed for security purposes or because exceptional circumstances make its use essential to the successful performance of the mission; coach class accommodations on authorized/approved foreign carriers do not provide adequate sanitation or meet health standards; premium class accommodations would result in overall savings to the government because of subsistence costs, overtime, or lost productive time that would be incurred while awaiting coach class accommodations; transportation is paid in full by a nonfederal source; travel is to or from a destination outside the continental United States, and the scheduled flight time (including stopovers) is in excess of 14 hours (however, a rest stop en route or a rest period upon arrival is prohibited when travel is authorized by premium class accommodations); or when required because of agency mission. As specified above, employees traveling in premium class have to meet both authorization and justification requirements to qualify, meaning that employees who, for example, traveled premium class on a trip exceeding 14 hours would violate the FTR if they traveled premium class without receiving specific authorization to do so. Agencies subject to the FTR have generally issued internal policies and procedures to clarify the premium class travel provisions of the FTR, implement these provision, or both. When issuing implementing policy, agencies have to follow executive branch policy, which specifies that a subordinate organization seeking to establish implementing regulation or guidance may make the regulations more stringent but not relax the rules established by higher-level guidance. For example, an agency’s implementing policy related to premium class travel because of disability can require that the traveler provides medical certification that is updated annually, but cannot waive the requirement that a certification by a competent medical authority be provided. DOD and State have also issued their own detailed implementing policies and procedures that cover all aspects of travel, from authorization to reimbursement to regulations for premium class. DOD issues the Joint Federal Travel Regulations (JFTR) for uniformed service members not covered by the FTR, and also updates the Joint Travel Regulations (JTR), which implements the FTR for DOD civilian employees. Similarly, State’s Foreign Affairs Handbook and Foreign Affairs Manual (FAM) represent major sets of policies and procedures related to travel reimbursements to Foreign Service employees pursuant to the Foreign Service Act of 1980. With respect to premium class travel, the regulations contained in the JTR, the JFTR, and the FAM are generally consistent with the FTR. For 12 months of travel from July 1, 2005, through June 30, 2006, the government spent more than $230 million on over 53,000 airline tickets that contained at least one leg of premium class travel. Using statistical sampling, we estimated that at least $146 million of this premium class travel was unauthorized or unjustified. In addition, our statistical sample population contained a number of flights taken by government executives. Specifically, we found that senior executives (senior-level executives and presidential appointees with Senate confirmation), who constituted about one-half of 1 percent of the federal workforce, accounted for 15 percent of premium class travel. The government bought more than 53,000 premium class tickets totaling over $230 million during a 12-month period from July 1, 2005, to June 30, 2006. We identified premium class tickets as any ticket that contained at least one leg of travel in first or business class. Since the government did not maintain centralized data on premium class travel, we extracted ticket information from the government credit card banks’ databases of government individually and centrally billed account travel, which included over 6.1 million transactions for airline tickets valued at almost $3.4 billion. Although premium class travel represented less than 1 percent of the total flights taken governmentwide, the high cost of premium class tickets meant that premium class travel accounted for nearly 7 percent of total dollars spent on government airline travel. In some instances, the price difference between a business class and comparable coach class ticket may be negligible—particularly if the traveler traveled within Europe. However, on routes where GSA had awarded a government fare for economy and business classes, an average business class ticket in fiscal year 2006 cost more than 5 times the cost of a coach class ticket. For example, a traveler’s one-way business class ticket from Madrid to Washington, D.C., was over 7 times the price of a coach class ticket. First class tickets can be even more costly. For example, another traveler from the Federal Reserve Board (FRB) flew first class between Washington, D.C., and London for more than $12,000, or more than 16 times the price of a coach class flight. To put the total amount spent on premium class travel into perspective, the over $230 million the government spent on premium class travel during these 12 months exceeded the travel expenses on the government travel cards of most individual government agencies, including major executive agencies such as the Departments of Agriculture, Energy, Health and Human Services, Labor, Transportation, and the Treasury. Premium class travel usage also varied significantly across federal agencies, both in the total amount and frequency with which premium class travel was used. Some agencies spent only a fraction of total airline expenditures on premium class, while premium class travel at other agencies was substantial. Data provided by the travel card banks showed that while DOD was the second largest user of premium class travel based on total dollars, it had substantially reduced its use of premium class travel charged to the government credit cards since 2004, following our DOD premium class audit.Specifically, DOD’s premium class charges decreased from more than $124 million over fiscal years 2001 and 2002, or more than $60 million annually, to slightly over $23 million in the 12-month period ending June 30, 2006—about 1 percent of its air travel expenditures. In contrast, tickets bought by State for foreign affairs agency travelers continued to account for the largest portion of governmentwide premium class travel. Our data showed that the over $140 million that State spent on nearly 30,000 premium class tickets for foreign affairs agency travelers represented over 60 percent of its total air expenditures during this period. This amount, which is comparable to our previous finding at State, could decrease in the future based on actions taken by State based on our previous audit findings and subsequent to the data period we audited. For detailed breakdown of agencies’ overall use of premium class travel, see appendix II. Table 1 shows the results of our analysis of the frequency at which selected agencies purchased premium class tickets for flights involving airports in the United States and locations in Africa, the Middle East, and parts of Europe that likely lasted more than 14 hours. As shown, large differences existed in agencies’ use of premium class flights to these locations. For example, 3 percent of DOD and Department of Homeland Security travelers flying to these locations flew premium class. In contrast, 72 percent of State’s foreign affairs agency travelers and 83 percent of MCC’s travelers flying to these same locations flew premium class. Of the over $230 million in governmentwide premium class travel, we estimated that 67 percent of trips were improperly authorized, justified, or both. In all, the government likely spent at least $146 million on premium class travel that was improper. As shown in table 2, we selected two key transaction-level controls—proper authorization and proper justification— for statistical sampling. Using these attribute tests, we estimated that 28 percent of governmentwide premium class travel was not properly authorized. Because premium class travel must first be authorized before it can be justified, transactions that failed authorization also failed justification. We also estimated, based on statistical sampling, that another 38 percent (a total of 67 percent) of premium class travel was not properly justified. As shown in table 2, 28 percent of governmentwide premium class travel was not properly authorized. Authorization failures fell into the following categories: Blanket travel authorizations. According to the FTR, premium class travel has to be specifically authorized. Consequently, blanket premium class authorization did not pass the specific authorization test. Subordinate authorizations. The FTR does not forbid subordinates from approving their superior’s premium class travel.