oversight

Information Technology: HUD's Fiscal Year 2011 Expenditure Plan Satisfies Statutory Conditions

Published by the Government Accountability Office on 2012-05-24.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

             United States Government Accountability Office

GAO          Report to Congressional Committees




May 2012
             INFORMATION
             TECHNOLOGY
             HUD’s Fiscal Year
             2011 Expenditure Plan
             Satisfies Statutory
             Conditions




GAO-12-654
                                                 May 2012

                                                 INFORMATION TECHNOLOGY
                                                 HUD’s Fiscal Year 2011 Expenditure Plan Satisfies
                                                 Statutory Conditions
Highlights of GAO-12-654, a report to
congressional committees




Why GAO Did This Study                           What GAO Found
The Department of Housing and Urban              HUD’s fiscal year 2011 expenditure plan, which seeks to obligate about $114
Development (HUD) relies extensively             million for seven modernization projects (see table), along with enterprisewide
on information technology (IT) in                services and program management, satisfies both sets of statutory conditions
carrying out its home-ownership and              contained in the 2011 appropriations act. Specifically, for the first set of statutory
community development missions.                  conditions, the plan identified the functional and performance capabilities,
Despite this role, HUD’s IT                      mission benefits, lifecycle costs, and key milestones for each of the projects. For
environment has not effectively                  example, the plan described specific and measurable mission benefits
supported its business operations, and           associated with HUD’s Place-Based Performance Management System project,
the department has been working to               such as reducing the time to compile performance information from 50 hours to
modernize its IT infrastructure and              20 hours. In addition, the plan described costs associated with the lifecycle of
systems through its Transformation               each project, providing details on funds needed for major work activities.
Initiative. In addition, HUD has been
working to institutionalize key IT               The plan also satisfied the second set of statutory conditions by describing how
management controls to help ensure               each project is supported by an adequately staffed project office, conforms to
the success of these efforts. To                 capital planning and investment control requirements, complies with the
provide oversight and inform decision            department’s enterprise architecture, and is being managed in accordance with
making, Congress established                     applicable lifecycle management policies and guidance. For example, the plan
limitations on funding for HUD’s                 categorized each project according to a segment of the department’s evolving
modernization efforts. Specifically, the         enterprise architecture (e.g., grants management and financial management).
2011 appropriations act required HUD             As a result, HUD’s plan provides key information that should help congressional
to submit an expenditure plan that               appropriations committees to oversee the department’s modernization projects
satisfied two sets of statutory                  and hold it accountable for project outcomes. However, understanding the extent
conditions before obligating more than           to which HUD is following through on the cost, schedule, and performance goals
35 percent of the funds available.               set forth in the plan requires additional review. Toward this end, GAO has
To satisfy the first set of conditions, the      received congressional direction to evaluate HUD’s implementation of project
plan had to identify for each of HUD’s           management practices such as contractor management and cost estimation for
seven modernization projects,                    selected IT modernization projects. This work should provide more specific
functional and performance                       insight regarding HUD’s overall management of its modernization projects and
capabilities, expected mission benefits,         determine the extent to which project benefits are being achieved.
estimated lifecycle costs, and planned
key milestones. For the second set of
                                                  Project                                 Purpose
conditions, the plan had to
                                                  Electronic Grants Management            Reengineer processes and implement an automated
demonstrate that each project is                                                          system for managing grants
supported by an adequately staffed                Place-Based Performance Management      Provide business intelligence and geospatial tools for
project office, conforms to capital               System                                  assessing progress toward achieving strategic goals
planning and investment control                   Federal Housing Administration          Implement a commercially available industry-standard
requirements, complies with HUD’s                 Transformation                          financial infrastructure for housing insurance
                                                                                          programs
enterprise architecture, and is being
                                                  HUD Integrated Acquisition Management   Integrate an acquisition management system that is
managed in accordance with                        System                                  compliant with federal regulations
applicable lifecycle policies. Congress           HUD Integrated Financial Management     Deploy a commercial off-the-shelf integrated financial
also required that GAO review the                 Improvement Project                     management system to enable compliance with
plan. To do this, GAO reviewed the                                                        relevant financial management laws and regulations
plan and supporting documentation                 Human Resources End-to-End              Integrate human resources systems and tools to
                                                                                          allow for automated recruitment and hiring
and determined whether it contained                                                       documentation
information to address both sets of               Next Generation Management System       Reengineer management processes to establish a
statutory conditions.                                                                     technical infrastructure to integrate disparate systems
                                                 Source: GAO analysis of HUD data.
View GAO-12-654. For more information,
contact Valerie C. Melvin at (202) 512-6304 or   HUD reviewed a draft of this report and stated that the department’s position had
melvinv@gao.gov.
                                                 been adequately represented.
                                                                                            United States Government Accountability Office
Contents


Letter                                                                                                   1

Appendix I    Briefing for Staff Members of the Subcommittees on Transportation,
              Housing and Urban Development, and Related Agencies, Senate and
              House Committees on Appropriations                                                         6



Appendix II   GAO Contact and Staff Acknowledgments                                                     35




              Abbreviations

              CIO               Chief Information Officer
              EA                enterprise architecture
              FHA               Federal Housing Administration
              HEARTH            Homeless Emergency Assistance and Rapid Transition to
                                Housing
              HUD               Department of Housing and Urban Development
              IT                information technology
              OCIO              Office of the Chief Information Officer




              This is a work of the U.S. government and is not subject to copyright protection in the
              United States. The published product may be reproduced and distributed in its entirety
              without further permission from GAO. However, because this work may contain
              copyrighted images or other material, permission from the copyright holder may be
              necessary if you wish to reproduce this material separately.




              Page i                                             GAO-12-654 HUD Information Technology
United States Government Accountability Office
Washington, DC 20548




                                   May 24, 2012

                                   The Honorable Patty Murray
                                   Chairman
                                   The Honorable Susan M. Collins
                                   Ranking Member
                                   Subcommittee on Transportation, Housing
                                    and Urban Development, and Related Agencies
                                   Committee on Appropriations
                                   United States Senate

                                   The Honorable Tom Latham
                                   Chairman
                                   The Honorable John W. Olver
                                   Ranking Member
                                   Subcommittee on Transportation, Housing
                                     and Urban Development, and Related Agencies
                                   Committee on Appropriations
                                   House of Representatives

                                   The Department of Housing and Urban Development’s (HUD) mission is
                                   to create strong, sustainable, inclusive communities and quality,
                                   affordable homes for all. Information technology (IT) plays a critical role in
                                   HUD’s ability to carry out its mission. For instance, the department reports
                                   that its business operations rely on IT to process over 50,000 loan
                                   requests per week, over 12,000 service calls per month, and more than
                                   7,000 grant requests annually for each of its major grant programs.
                                   Despite this role, HUD’s current IT environment has not effectively
                                   supported its business operations. We have previously reported that its
                                   information systems were overlapping and duplicative, not integrated,




                                   Page 1                                     GAO-12-654 HUD Information Technology
necessitated manual workloads, and employed antiquated technologies
that were costly to maintain. 1

The department has been working to modernize its IT infrastructure and
systems through its Transformation Initiative. This initiative represents a
strategy for reforming the way the department does business, and
comprises four components: (1) research, evaluation, and program
metrics; (2) program demonstrations; (3) technical assistance and
capacity building; and (4) information technology. To provide oversight
and inform decision making, Congress established limitations on funding
for the Transformation Initiative IT modernization projects. Specifically,
the appropriations act for fiscal year 2011 stated that the department may
not obligate more than 35 percent of the funds made available until the
Secretary submitted to the Senate and House Committees on
Appropriations an expenditure plan that satisfied two sets of statutory
conditions and was reviewed by GAO. 2

To satisfy the first set of statutory conditions, the plan had to identify for
each modernization project the functional and performance capabilities to
be delivered, expected mission benefits, estimated lifecycle costs, and
planned key milestones. To satisfy the second set of statutory conditions,
the plan had to demonstrate that each project is supported by an
adequately staffed project office, conforms to capital planning and
investment control requirements, complies with the department’s
enterprise architecture, and is being managed in accordance with
applicable lifecycle management policies and guidance.




1
 GAO, Information Technology: HUD Needs to Strengthen Its Capacity to Manage and
Modernize Its Environment, GAO-09-675 (Washington, D.C.: July 31, 2009); Information
Technology: HUD Needs to Better Define Commitments and Disclose Risk for
Modernization Projects in Future Expenditure Plans, GAO-11-72 (Washington, D.C.: Nov.
23, 2010); Information Technology: HUD’s Expenditure Plan Satisfies Statutory
Conditions, and Implementation of Management Controls Is Under Way, GAO-11-762
(Washington, D.C.: Sept. 7, 2011); and HUD Information Technology: More Work
Remains to Implement Necessary Management Controls, GAO-12-580T (Washington,
D.C.: March 29, 2012).
2
 Department of Defense and Full-Year Continuing Appropriations Act, 2011, Pub. L. No.
112-10, § 2259, 125 Stat. 38, 197-98 (April 15, 2011).




Page 2                                          GAO-12-654 HUD Information Technology
In January 2012, HUD submitted its expenditure plan for fiscal year
2011. 3 The plan seeks to obligate a total of $114.1 million and includes
seven modernization projects ($81.1 million), 4 a group of enterprisewide
services ($21.0 million), and support for program management ($12.0
million).

Our objective was to determine whether HUD’s 2011 expenditure plan
satisfied the statutory conditions. On March 27, 2012, we provided your
offices with briefing slides and met with your staff to discuss the results of
our review. The purpose of this report is to provide the published briefing
slides to you and to officially transmit our study’s results to the Secretary
of Housing and Urban Development. The slides, which discuss our scope
and methodology, are included in appendix I.

We performed our work in support of this performance audit at HUD
headquarters in Washington, D.C., from January 2012 to May 2012, in
accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objective. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objective.

In summary, our review highlighted the following:

HUD’s fiscal year 2011 expenditure plan satisfied the statutory conditions
contained in the appropriations act. Specifically, for the first set of
statutory conditions, the plan identified the functional and performance
capabilities, mission benefits, lifecycle costs, and key milestones for each
of the seven IT modernization projects. For example, in describing key
milestones for the Next Generation Management System project, 5 the


3
 Transformation Initiative appropriations made available in fiscal year 2011 are authorized
for obligation by the department through September 30, 2013.
4
 The seven projects are Electronic Grants Management, Federal Housing Administration
Transformation, HUD Integrated Acquisition Management System, HUD Integrated
Financial Management Improvement Project, Human Resources End-to-End Solution,
Next Generation Management System, and Place-based Performance Management
System.
5
 The purpose of the Next Generation Management System is to reengineer management
processes to establish a technical infrastructure that will integrate disparate systems and
provide consistent information in order to support rental housing assistance services.




Page 3                                             GAO-12-654 HUD Information Technology
plan stated that its budget forecasting tool, which is intended to support
the end-to-end lifecycle of financial management, was expected to be
delivered by May 2012. In addition, HUD’s plan described costs
associated with the lifecycle of each project by providing details on funds
needed for major work activities and deliverables.

The plan also satisfied the second set of conditions by demonstrating that
each project is supported by an adequately staffed project office;
conformed to capital planning and investment control requirements;
complied with the department’s enterprise architecture; and had been
managed in accordance with applicable lifecycle management processes.
For example, the plan categorized each project by segment architecture
(e.g., grants management and financial management) relative to HUD’s
evolving architecture.

As a result, HUD’s expenditure plan provides key information that should
help the appropriations committees to oversee the seven modernization
projects and hold the department accountable for project results.
However, understanding the extent to which HUD is following through on
the cost, schedule, and performance goals set forth in the plan requires
additional review. Accordingly, the fiscal year 2012 appropriations
conference report has directed us to evaluate HUD’s implementation of
project management practices, including contractor oversight and cost
estimation for selected IT modernization projects. We have also been
directed to assess HUD’s institutionalization of IT governance. 6 This work
should allow additional and more specific insight regarding the overall
management and oversight of the department’s IT modernization projects’
governance and facilitate efforts to determine the extent to which project
benefits are being achieved.

HUD’s Acting Deputy Chief Information Officer for Business and IT
Modernization provided comments via e-mail on a draft of this report. In
those comments, the official stated that the agency comments on the
briefing slides incorporated into this report (see appendix I) adequately
represented the department’s position.



6
 This direction is contained in the Senate Appropriations Committee report, S. Rep. No.
112-83, at 141-42 (2011), as approved by the conference committee in the Explanatory
Statement, H.R. Conf. Rep. No. 112-284, at 286 (2011), accompanying the Consolidated
and Further Continuing Appropriations Act, 2012, Pub. L. No. 112-55, 125 Stat. 552, 691-
92 (Nov. 18, 2011).




Page 4                                           GAO-12-654 HUD Information Technology
We are sending copies of this report to interested congressional
committees. We are also sending copies to the Secretary of the
Department of Housing and Urban Development and the Director of the
Office of Management and Budget. Copies of this report will also be
available at no charge on GAO’s website at http://www.gao.gov.

If you or your staffs have any questions on matters discussed in this
report, please contact me at (202) 512-6304 or melvinv@gao.gov.
Contact points for our Offices of Congressional Relations and Public
Affairs may be found on the last page of this report. GAO staff who made
significant contributions to this report are listed in appendix II.




Valerie C. Melvin
Director, Information Management
   and Technology Resources Issues




Page 5                                  GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
               Appendix I: Briefing for Staff Members of the
               Subcommittees on Transportation, Housing
               and Urban Development, and Related

Subcommittees on Transportation, Housing and
               Agencies, Senate and House Committees on
               Appropriations


Urban Development, and Related Agencies, Senate
and House Committees on Appropriations




               Page 6                                          GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 7                                          GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 8                                          GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 9                                          GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 10                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 11                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 12                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 13                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 14                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 15                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 16                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 17                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 18                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 19                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 20                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 21                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 22                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 23                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 24                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 25                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 26                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 27                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 28                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 29                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 30                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 31                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 32                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 33                                         GAO-12-654 HUD Information Technology
Appendix I: Briefing for Staff Members of the
Subcommittees on Transportation, Housing
and Urban Development, and Related
Agencies, Senate and House Committees on
Appropriations




Page 34                                         GAO-12-654 HUD Information Technology
Appendix II: GAO Contact and Staff
                  Appendix II: GAO Contact and Staff
                  Acknowledgments



Acknowledgments

                  Valerie C. Melvin at (202) 512-6304 or melvinv@gao.gov
GAO Contact
                  In addition to the contact named above, Shannin O’Neill (Assistant
Staff             Director), Kami Corbett, Lee McCracken, and Teresa M. Neven made key
Acknowledgments   contributions to this report.




(310989)
                  Page 35                                GAO-12-654 HUD Information Technology
GAO’s Mission         The Government Accountability Office, the audit, evaluation, and
                      investigative arm of Congress, exists to support Congress in meeting its
                      constitutional responsibilities and to help improve the performance and
                      accountability of the federal government for the American people. GAO
                      examines the use of public funds; evaluates federal programs and
                      policies; and provides analyses, recommendations, and other assistance
                      to help Congress make informed oversight, policy, and funding decisions.
                      GAO’s commitment to good government is reflected in its core values of
                      accountability, integrity, and reliability.

                      The fastest and easiest way to obtain copies of GAO documents at no
Obtaining Copies of   cost is through GAO’s website (www.gao.gov). Each weekday afternoon,
GAO Reports and       GAO posts on its website newly released reports, testimony, and
                      correspondence. To have GAO e-mail you a list of newly posted products,
Testimony             go to www.gao.gov and select “E-mail Updates.”

Order by Phone        The price of each GAO publication reflects GAO’s actual cost of
                      production and distribution and depends on the number of pages in the
                      publication and whether the publication is printed in color or black and
                      white. Pricing and ordering information is posted on GAO’s website,
                      http://www.gao.gov/ordering.htm.
                      Place orders by calling (202) 512-6000, toll free (866) 801-7077, or
                      TDD (202) 512-2537.
                      Orders may be paid for using American Express, Discover Card,
                      MasterCard, Visa, check, or money order. Call for additional information.
                      Connect with GAO on Facebook, Flickr, Twitter, and YouTube.
Connect with GAO      Subscribe to our RSS Feeds or E-mail Updates. Listen to our Podcasts.
                      Visit GAO on the web at www.gao.gov.
                      Contact:
To Report Fraud,
Waste, and Abuse in   Website: www.gao.gov/fraudnet/fraudnet.htm
                      E-mail: fraudnet@gao.gov
Federal Programs      Automated answering system: (800) 424-5454 or (202) 512-7470

                      Katherine Siggerud, Managing Director, siggerudk@gao.gov, (202) 512-
Congressional         4400, U.S. Government Accountability Office, 441 G Street NW, Room
Relations             7125, Washington, DC 20548

                      Chuck Young, Managing Director, youngc1@gao.gov, (202) 512-4800
Public Affairs        U.S. Government Accountability Office, 441 G Street NW, Room 7149
                      Washington, DC 20548




                        Please Print on Recycled Paper.