oversight

Results Act: Observations on the Department of Transportation's Draft Strategic Plan

Published by the Government Accountability Office on 1997-07-30.

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

                     United States
GAO                  General Accounting Office
                     Washington, D.C. 20548

                     Resources, Community, and
                     Economic Development Division

                     B-277533

                     July 30, 1997

                     The Honorable Richard K. Armey
                     Majority Leader
                     House of Representatives

                     The Honorable John R. Kasich
                     Chairman, Committee on the Budget
                     House of Representatives

                     The Honorable Dan Burton
                     Chairman, Committee on Government Reform
                       and Oversight
                     House of Representatives

                     The Honorable Bob Livingston
                     Chairman, Committee on Appropriations
                     House of Representatives

                     Subject: Results Act: Observations on the Department of Transportation’s
                     Draft Strategic Plan

                     On June 12, 1997, you asked us to review the draft strategic plans
                     submitted by the Cabinet departments and selected major agencies for
                     consultation with the Congress as required by the Government
                     Performance and Results Act of 1993 (the Results Act). This report is our
                     response to that request concerning the Department of Transportation
                     (DOT).


                     Specifically, you asked us to review DOT’s draft plan and assess
Objectives, Scope,   (1) whether it fulfills the requirements of the Results Act and to provide
and Methodology      our views on its overall quality; (2) whether it reflects DOT’s key statutory
                     authorities; (3) whether it reflects interagency coordination for
                     crosscutting programs, activities, or functions that are similar or
                     complementary to other agencies; (4) whether it addresses management
                     problems we have previously identified; and (5) whether DOT’s data and
                     information systems are adequate for providing reliable information for
                     measuring results.

                     We reviewed the draft strategic plan that DOT provided to congressional
                     committees on July 2, 1997. It is important to recognize that the final plan




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             is not due to the Congress and the Office of Management and Budget (OMB)
             until September 30, 1997. Thus, our findings reflect a “snapshot” of DOT’s
             plan at this time. We recognize that developing a strategic plan is a
             dynamic process and that DOT is continuing to revise the draft.
             Furthermore, the Results Act anticipated that it may take several planning
             cycles to perfect the process and that the final plan would be refined in
             future planning cycles.

             To address the five objectives, we interviewed DOT officials involved in
             preparing the plan, reviewed supporting documents that DOT used to
             prepare the plan, and relied on our knowledge of DOT’s operations and
             programs from our numerous reviews of the Department. Additionally, we
             reviewed the Results Act to determine whether DOT’s draft strategic plan
             complied with its requirements. To assess the overall quality of the plan
             and its components, we used OMB’s guidance on developing strategic plans1
              and our May 1997 guidance for congressional review of the plans.2 In
             determining whether DOT’s draft strategic plan reflects the Department’s
             major statutory responsibilities, we reviewed material in the explanatory
             notes in DOT’s 1998 budget for an overview of the Department’s functions
             and activities. In addition, we reviewed a compilation of statutory
             authorities prepared for the strategic planning process by DOT’s Office of
             the General Counsel. We also consulted with the Office of the General
             Counsel, and as you requested, we coordinated our review with the
             Congressional Research Service. To determine whether DOT had adequate
             systems in place to provide reliable information on performance, we relied
             on our prior reports and those from the Department’s Office of Inspector
             General (OIG).


             Created in 1966 from eight other major departments and agencies, DOT
Background   implements the nation’s overall transportation policy and oversees federal
             transportation programs. With a budget of about $39 billion in fiscal year
             1997, DOT includes the Federal Aviation Administration (FAA), Federal
             Highway Administration (FHWA), Federal Railroad Administration, Federal
             Transit Administration (FTA), Maritime Administration, National Highway
             Traffic Safety Administration (NHTSA), Research and Special Programs
             Administration, Bureau of Transportation Statistics, St. Lawrence Seaway
             Development Corporation, Surface Transportation Board, Transportation

             1
              Preparation and Submission of Strategic Plans and Annual Performance Plans (OMB Circular A-11,
             Part 2, May 1997).
             2
              Agencies’ Strategic Plans Under GPRA: Key Questions to Facilitate Congressional Review
             (GAO/GGD-10.1.16, May 1997, version 1).



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                                      Administrative Services Center, U. S. Coast Guard, and Office of the
                                      Secretary.

                                      The Results Act is the legislative framework through which agencies are
                                      required to set strategic goals, measure performance, and report on the
                                      degree to which goals were met. The act requires federal agencies to
                                      develop strategic plans by September 30, 1997, that cover a period of at
                                      least 5 years. The Results Act requires that an agency’s strategic plan
                                      contain six key components: (1) a comprehensive agency mission
                                      statement; (2) agencywide long-term goals and objectives for all major
                                      functions and operations; (3) approaches (or strategies) and the various
                                      resources needed to achieve the goals and objectives; (4) a description of
                                      the relationship between the long-term goals and objectives and the
                                      annual performance goals; (5) an identification of those key factors,
                                      external to the agency and beyond its control, that could significantly
                                      affect the achievement of its strategic goals; and (6) a description of how
                                      program evaluations were used to establish or revise strategic goals and a
                                      schedule for future program evaluations.

                                      DOT provided the Congress with a Department-wide draft strategic plan for
                                      consultation on July 2, 1997. The plan’s vision, mission statement, and five
                                      strategic goals are listed in table 1.

Table 1: Summary of Vision and
Mission Statements and Strategic                             A visionary and vigilant DOT leading the way to transportation
Goals in DOT’s Draft Strategic Plan   Vision statement       excellence in the 21st century.
                                      Mission statement      Serve the United States by ensuring a transportation system that
                                                             meets our vital national interests and enhances the quality of life of
                                                             the American people today and into the future.
                                      Strategic, long-term   Safety: Promote the public health and safety by working toward the
                                      goals                  elimination of transportation-related deaths, injuries, and property
                                                             damage.
                                                             Mobility: Shape America’s future by ensuring a transportation
                                                             system that is accessible, seamless, and efficient and offers
                                                             flexibility of choices.
                                                             Economic growth and trade: Advance America’s economic growth
                                                             and competitiveness domestically and internationally through
                                                             efficient and flexible transportation.
                                                             Human and natural environment: Protect and enhance
                                                             communities and the natural environment affected by
                                                             transportation.
                                                             National security: Advance the nation’s vital security interests by
                                                             ensuring that the transportation system is secure and available for
                                                             defense mobility, ensuring that our borders are safe from illegal
                                                             intrusion, and promoting worldwide economic growth and stability.




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                   To its credit, DOT has undertaken a significant amount of work collecting
Results in Brief   and analyzing information while preparing its draft strategic plan. The
                   plan, however, does not reflect enough of this information and, overall, is
                   so general that clearly identifying the Department’s priorities is difficult.
                   Moreover, the plan does not fulfill all of the requirements of the Results
                   Act. The draft plan meets the act’s requirements for (1) a mission
                   statement, (2) long-term goals, and (3) a description of program
                   evaluations; however, each of these elements has weaknesses, some more
                   significant than others. In addition, the plan does not meet the act’s
                   requirements to describe (1) strategies for achieving the goals, (2) a
                   linkage between DOT’s long-term goals and annual performance goals, and
                   (3) those key external factors that could significantly affect DOT’s
                   achieving its goals. The overall quality of the plan could be improved by
                   adhering more closely to OMB’s guidance for preparing strategic plans and
                   including more detailed information, such as descriptions of the
                   processes, the skills, the technology, and the resources required to meet
                   the goals and time frames for initiating or completing significant actions.

                   DOT’sdraft strategic plan appears to reflect the Department’s key statutory
                   authorities, which are contained in an appendix to the plan. The plan is
                   expansive enough to encompass almost all of the Department’s statutory
                   authorities. However, because the plan lacks precision, these statutory
                   authorities are reflected at a very high level of generality. The plan would
                   be enhanced by clearly linking the goals to the particular programs
                   supported by the statutory authorities contained in its appendix.

                   The draft strategic plan does not show evidence that the Department
                   coordinated with other agencies that have programs and activities that are
                   crosscutting or similar to DOT’s. The plan recognizes that there are other
                   stakeholders for DOT’s long-term goals and provides for building or
                   establishing partnerships with these federal, state, and local governments
                   and the transportation industry. However, except for the Department of
                   Defense (DOD), the plan does not identify specific stakeholders. In
                   addition, the plan does not identify the crosscutting or overlapping
                   programs, explain how the activities and programs of other stakeholders
                   could affect DOT’s achieving the goals, and describe how DOT plans to
                   coordinate with other stakeholders.

                   DOT’s draft strategic plan does not adequately address major management
                   challenges and high-risk areas that we have previously identified in our
                   reports and testimonies. Addressing these issues is critical to ensuring that
                   strategies are in place to meet the Department’s goals. In the critical issue



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                          of transportation safety and security, the plan addresses some of our
                          specific concerns about aviation security but does not mention other
                          important transportation safety concerns. Furthermore, the plan does not
                          mention challenges we identified to (1) improve the management of
                          aviation, highway, and transit programs and (2) meet the long-term
                          funding needs of FAA and Amtrak. Finally, the plan does not provide
                          sufficient details on the improvements needed in its management and
                          financial data or in its organizational structure.

                          DOT’s ability to produce reliable performance information is uncertain. The
                          plan is unclear about what information DOT will need to measure its
                          performance. Furthermore, our previous work has indicated that DOT has
                          difficulty producing reliable data to document performance and support
                          decision-making at the program level. Similarly, DOT’s pilot projects under
                          the Results Act have acknowledged data limitations.


                          Overall, DOT’s draft strategic plan does not fulfill all of the requirements of
DOT’s Strategic Plan      the Results Act. The plan meets the requirements for three critical
Does Not Fulfill All      components—a mission statement, long-term goals, and a description of
the Requirements of       program evaluations. The remaining three key components—strategies for
                          achieving the goals, the relationship between long-term goals and annual
the Results Act           performance goals, and the identification of key external factors that
                          could significantly affect the achievement of the goals—do not meet the
                          act’s requirements. In addition, the plan is so general that it is difficult to
                          clearly identify the Department’s priorities. Furthermore, although the
                          Results Act requires that the plans cover a minimum of 5 years, the plan
                          does not specify the period of time covered. The overall quality of DOT’s
                          plan, including the sections that meet the act’s requirements, could be
                          improved by adhering more closely to OMB’s guidance for preparing
                          strategic plans and, in some cases, incorporating summaries of the
                          information that DOT considered in developing the plan but did not include
                          in the July 2 draft.


Mission Statement Meets   DOT’s  plan meets the Results Act’s requirement that a strategic plan
Requirement               contain a comprehensive mission statement that covers the major
                          functions and operations of the agency. The mission statement (see table
                          1) is broad enough to encompass all of the major functions and operations
                          of the Department and, in addition, it is results-oriented. OMB’s guidance
                          states that the mission statement (1) should focus on the agency’s core
                          programs and activities and (2) may include a discussion of enabling or



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                       authorizing legislation and an identification of issues that the Congress
                       specifically charged the agency to address. For example, DOT’s enabling
                       legislation describes the Department’s purpose as developing
                       transportation policies and programs that, among other things, “contribute
                       to providing fast, safe, efficient, and convenient transportation at the
                       lowest cost.”3 The mission statement could be improved by including such
                       language from the Department’s enabling legislation, which would focus
                       the mission statement more directly on the Department’s core activities.


Long-Term Goals Meet   The Results Act requires strategic plans to contain long-term goals and
Requirement            objectives for the major functions and operations of an agency. DOT’s draft
                       strategic plan meets this requirement—it contains five long-term goals
                       (see table 1) that encompass the Department’s major functions and
                       operations and a set of outcome goals for each long-term goal. The
                       long-term goals are within the Department’s span of influence as called for
                       in OMB’s guidance. In addition, in discussing the human and natural
                       environment goal, the plan acknowledges the Department’s responsibility
                       to mitigate and reduce the negative environmental effects of
                       transportation facilities. To address this issue, the plan includes an
                       outcome goal to “reduce the adverse effects of siting, construction and
                       operation of transportation facilities on the natural environment and
                       communities.”

                       However, DOT’s long-term goals could be improved by following OMB’s
                       guidance to state all goals in a manner that (1) allows a future assessment
                       of whether they are achieved and (2) is sufficiently precise to direct and
                       guide an agency’s staff toward fulfilling its mission. In some cases, it is
                       clear how success in achieving a goal will be determined. For example, the
                       plan explains that success in achieving the safety goal will be measured by
                       six quantitative outcome goals, such as “reduce the number of
                       transportation-related fatalities.” In other cases, however, how success
                       will be measured is unclear. For example, success in achieving the
                       mobility goal will be measured by such outcome goals as “improve the
                       structural integrity and operational efficiency of the nation’s
                       transportation infrastructure,” and success in achieving the human and
                       natural environment goal will be measured by such outcome goals as
                       “improve the livability of communities through investments in
                       transportation facilities.” The latter two outcome goals do not indicate
                       how the long-term goals are to be measured and what results will
                       demonstrate their achievement.

                       3
                        Section 101 of Title 49, United States Code.



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                           Although the supporting documents that DOT used to prepare its draft
                           strategic plan indicate that the Department developed additional
                           information on how to measure each outcome goal, this information is not
                           included. For example, DOT has identified more than 10 possible measures
                           for the outcome goal to “improve the structural integrity and operational
                           efficiency of the nation’s transportation infrastructure.” These possible
                           measures include the percentage of the National Highway System in good
                           or better condition, the percentage of deficient bridges, and the
                           percentage of transit facilities in standard or better condition. Including
                           examples of such information in DOT’s strategic plan would clarify the
                           meaning of the Department’s goals and allow it and the Congress to assess
                           whether those goals are being achieved.

                           OMB’s guidance also calls for goals to be sufficiently precise to direct and
                           guide staff toward actions that fulfill DOT’s mission. In that connection,
                           DOT’s plan would be strengthened if it specified which agencies or
                           programs are expected to contribute to achieving each of DOT’s five
                           strategic goals. For the most part, the plan discusses how the Department
                           will achieve its goals in very general terms. For example, the plan states
                           that DOT will achieve its safety goal by having “all DOT activities intended to
                           reduce or eliminate transportation related incidents . . . (1) incorporate
                           human factors considerations; (2) develop, deploy, and promote
                           cost-effective technology; (3) build partnerships to fully integrate safety as
                           a basic business principle; and (4) enhance delivery of services through
                           improved communications with our customers.” This statement does not
                           contain enough detail to clarify the activities required to attain DOT’s
                           long-term goals.


Strategies for Achieving   While DOT’s plan lists six corporate management strategies for achieving
Goals Do Not Meet          its long-term goals, it does not fulfill the requirements of the Results Act to
Requirements               describe the operational processes, the skills, the technology, and the
                           resources required to meet them. DOT’s plan could be improved by
                           including this information in the discussion of corporate management
                           strategies. For example, although one corporate management strategy is to
                           foster a diverse, highly skilled workforce, the plan does not describe any
                           specific skills needed or gaps in the workforce that must be addressed for
                           the plan to succeed. According to a senior Department official, during the
                           process of preparing the plan, DOT identified the need for staff with
                           regulatory negotiations skills and bilingual capabilities. This information is
                           not contained in the draft plan. Including such details would help DOT to
                           meet the act’s requirements. Similarly, the corporate strategy for



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information technology calls for DOT to be “a recognized leader in using
state-of-the-art information technologies across the broad spectrum of
transportation.” The strategy does not explain what technologies are being
referred to or the resources required to enable DOT to be a recognized
leader in their use.

DOT’s plan could also be improved by following OMB’s guidance for
strategies. First, the guidance calls for the strategies to provide additional
detail when achieving a goal is predicated on a significant change in
resource or technological levels or capacities. DOT’s plan does not provide
such additional detail. In several cases, we believe that such a discussion
is warranted. For example, the plan says that DOT will implement the
recommendations of the President’s Commission on Critical Infrastructure
Protection and the White House Commission on Aviation Safety and
Security. We have reported that the successful implementation of these
recommendations is contingent upon resolving a key issue—who will
finance additional security improvements—and developing the needed
technology.4 A brief discussion of this constraint, including DOT’s strategy
for obtaining the required financing and technology, would help readers
assess how realistic or likely the goal’s achievement is.

As previously mentioned, the plan calls for “incorporating human factors
considerations” in all of DOT’s activities that are intended to reduce or
eliminate transportation-related incidents. However, implementing this
element of the plan may require a difficult shift from past priorities. In
1996, we found that human factors work within FAA lacked effective
coordination.5 Furthermore, FAA’s fiscal year 1998 budget request for
research on human factors represents a decrease from the fiscal year 1997
budget and less than half of what was appropriated for fiscal year 1995. A
brief discussion of the resources for and priority of human factors
activities would be helpful.

Second, OMB’s guidance states that the strategies for achieving goals
should include a description of the process for communicating goals
throughout an agency and for assigning accountability to managers and
staff to achieve them. DOT’s draft strategic plan does not address how its
goals will be communicated to employees or how managers and staff will
be assigned accountability. Assigning clear expectations and

4
  Aviation Security: Technology’s Role in Addressing Vulnerabilities (GAO/T-RCED-NSIAD-96-262, Sept.
19, 1996).
5
 Human Factors: Status of Efforts to Integrate Research on Human Factors Into FAA’s Activities
(GAO/RCED-96-151, June 27, 1996).



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                            accountability to employees so that they see how their jobs relate to the
                            Department’s mission and goals can be useful in implementing a strategic
                            plan. According to a senior DOT official, the Department already has a
                            mechanism that partly addresses this issue—DOT’s modal Administrators
                            have annual performance plans and target performance levels that are
                            aligned with DOT’s mission. DOT’s Deputy Secretary tracks the
                            Department’s progress through monthly meetings with the Administrators.
                            A brief explanation of how this process will be refined in the light of the
                            new strategic plan would help DOT staff understand how DOT plans to
                            assign accountability for implementing its strategic plan.

                            Finally, OMB’s guidance states that the strategies for achieving goals should
                            contain time frames for initiating or completing significant actions and any
                            assumptions or projections. The plan does not include such information. It
                            would be helpful, for example, for the plan to include time frames for
                            completing the air traffic control (ATC) modernization program and
                            improvements along Amtrak’s Northeast Corridor, both of which are
                            long-term, multibillion-dollar infrastructure projects.

                            In several cases, the draft plan provided more specific information on how
                            DOT will achieve its long-term goals. For example, DOT intends to achieve
                            the national security goal by implementing the recommendations of the
                            President’s Commission on Critical Infrastructure Protection and the
                            White House Commission on Aviation Safety and Security. As another
                            example, DOT intends to achieve the mobility goal by promoting,
                            developing, and implementing solutions using innovative technology to
                            improve communications, infrastructure, and operational efficiencies,
                            such as intelligent transportation systems, global-positioning satellites, the
                            Internet, and new pavement and bridge designs. Including this type of
                            information throughout the plan would help DOT to direct or guide its staff
                            to accomplish its goals.


Plan Does Not Link          The plan does not describe how performance goals in the annual
Long-Term Goals to Annual   performance plan will be related to the long-term goals in the strategic
Performance Goals and       plan, as required by the Results Act.6 OMB’s guidance further states that the
                            strategic plan is to briefly outline the type, nature, and scope of the
Programs                    performance goals and the relationship between the annual performance
                            goals and the long-term goals. The Results Act requires the performance
                            goals to cover each program activity listed in the agency’s budget, and by

                            6
                             The Results Act requires OMB to have agencies prepare annual performance plans beginning for fiscal
                            year 1999. This plan is to contain annual performance goals and identify the performance measures
                            that an agency will use to assess its progress.



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                           doing so, the performance goals provide a direct link to an agency’s
                           day-to-day activities. DOT’s plan does not describe performance goals or
                           link them to the long-term goals. The plan states that DOT has not
                           developed its performance goals yet but intends to identify the goals in its
                           fiscal year 1999 annual performance plan due in September 1997. The
                           strategic plan would be improved by providing examples of possible
                           performance goals and indicating their relationship to specific goals. By
                           omitting this information, DOT’s strategic plan does not link the long-term
                           strategic goals to the Department’s programs.


Identification of Key      Recognizing that achieving a goal can be influenced by or predicated on
Factors External to the    external conditions prevailing over the time period covered by the plan,
Department Does Not Meet   the Results Act requires strategic plans to identify those key external
                           factors beyond an agency’s control that could significantly affect the
Requirements               achievement of its long-term goals. The draft plan does not meet this
                           requirement. The plan identifies four external factors—significant shifts in
                           demographics, accelerated economic growth and globalization, increasing
                           concerns for safety and security, and changing technological trends—but
                           does not include other key factors. For example, we have identified
                           several major issues facing the Department that are significantly affected
                           by factors outside its control. As discussed later, critical problems in the
                           long-term financing for FAA and Amtrak need to be addressed. Although
                           successfully addressing these issues will require action by the Congress,
                           the plan does not identify this critical factor.

                           This component of the plan could be improved by following OMB’s
                           guidance, which calls for plans to contain a brief discussion of how each
                           key factor links to a particular goal and how the achievement of that goal
                           could be affected by the factor. DOT’s draft plan discusses only one of the
                           four key external factors it identifies—demographics. The plan describes
                           some demographic trends, such as the aging population and population
                           growth, that could affect DOT’s ability to accomplish its safety and mobility
                           goals. However, the plan does not discuss how these goals could be
                           affected by the demographic trends identified.

                           As previously mentioned, the plan provides no discussion of the other
                           three key factors it identifies. A discussion of each factor would help
                           readers understand what assumptions DOT made in developing its goals
                           and how their attainment might be affected. For example, a discussion of
                           changing technological trends would be helpful. Satellite navigation,
                           intelligent highway systems, and the increasing availability of



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                     telecommunications alternatives to transportation could have enormous
                     implications for the degree to which the Department is able to accomplish
                     its strategic goals. The plan alludes to this in a discussion of strategies for
                     accomplishing the goals when it states that DOT “will explore the cyber
                     frontier, crossing old boundaries to discover new, virtual modes of
                     transporting people and information that transcend time and space.” The
                     meaning of this statement, however, is not clear and requires more
                     discussion.

                     The supporting documents that DOT used to prepare the plan indicate that
                     the Department analyzed six external factors—political, economic, social,
                     environmental, security, and technology trends—in terms of their impact
                     on transportation and on the Department. Some demographic information
                     from this analysis was included in the plan, but information on other
                     factors was not. In its analysis of five technology areas—(1) information
                     and communication; (2) advanced materials for constructing, maintaining,
                     and repairing transportation infrastructure and vehicles; (3) energy and
                     environment; (4) human factors; and (5) modeling, simulation, and
                     industrial design—DOT identified the technology areas’ possible effects on
                     DOT, such as the need to place greater emphasis on specialized or
                     customized transportation as the population of elderly persons increases
                     and the need to revisit and tighten some safety and fuel economy
                     standards as a result of new power systems and lighter-weight cars and
                     trucks being developed to improve energy efficiency and environmental
                     compatibility. The plan could be improved by including summaries of such
                     information for each key factor.


Program Evaluation   DOT’s  draft strategic plan discusses the program evaluations used in
Component Could Be   establishing the goals and a schedule for future evaluations, as required by
Improved             the Results Act. This component of the plan, however, could be improved
                     by following OMB’s guidance, which calls for including (1) the general
                     scope of and methodology for planned evaluations, (2) the key issues to be
                     addressed, and (3) a schedule for future evaluations. DOT’s plan lists only
                     titles for the evaluations scheduled for 1997 and 1998 for NHTSA, FHWA, FTA,
                     and FAA. For example, NHTSA’s evaluations include “motor vehicle content
                     labeling” and an “evaluation of passenger air bag cutoff switches.” Such
                     information is insufficient to determine the scope and methodology or the
                     key issues to be addressed. Furthermore, without this additional
                     information, it is difficult to determine how or if some scheduled
                     evaluations—such as motor vehicle content labeling, the odometer fraud




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                              study, and the theft prevention report to the Congress—relate to DOT’s
                              goals.


Observations on the           We recognize that DOT’s strategic plan is a draft that the Department
Overall Quality of the Plan   expects to revise before submitting it to OMB and the Congress in
                              September 1997. However, the draft we reviewed is so general that almost
                              any activity the Department undertakes could be considered to fit in the
                              strategic plan. As a result of this generality, the plan does not clearly set
                              priorities for the activities or chart a clear course for accomplishing the
                              Department’s mission. Our work has shown that when DOT was preparing
                              elements of the plan, it collected and analyzed information in significantly
                              greater detail than the plan reflects. While extensive details would detract
                              from the plan by making it overly lengthy, summaries of what DOT
                              considered in preparing the plan and specific examples of what programs
                              and actions DOT intends to undertake would greatly enhance the plan’s
                              usefulness.

                              Furthermore, DOT’s draft plan does not identify the time frames for
                              accomplishing the long-term goals. The Results Act requires a strategic
                              plan to cover a minimum of 5 years. OMB’s guidance calls for descriptions
                              of how the plan will be achieved, including schedules for initiating or
                              completing significant actions. The plan lacks this information, as we
                              mentioned previously. Without knowing the time frame or the schedule for
                              completing activities, it is difficult to assess whether the plan is reasonable
                              or realistic. Furthermore, without an ending date, the Congress and the
                              public do not know when they can expect to hold the Department
                              accountable for accomplishing the long-term goals in its plan.


                              DOT’s strategic plan, with limited exceptions, appears to reflect the
Plan Reflects Key             statutory authorities contained in the compilation attached as an appendix
Statutory Authorities         to the plan. The plan is expansive enough to encompass almost all of DOT’s
                              statutory authorities. However, because of the plan’s lack of precision,
                              these statutory authorities are reflected at a very high level of generality.
                              Furthermore, the plan does not appear to reflect the Department’s
                              authorities in connection with commercial space transportation and fuel
                              efficiency standards.

                              The draft plan could be improved by linking its stated strategic or outcome
                              goals to the particular programs supported by the statutory authorities
                              contained in the appendix. For example, one of the outcome goals under



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                       DOT’s  safety goal is to reduce the number of transportation-related
                       fatalities. However, the plan contains no explicit references to the
                       programs administered by NHTSA or the statutory provisions authorizing
                       such programs, despite the fact that the vast majority of
                       transportation-related fatalities occur on the nation’s highways. Similarly,
                       one of the outcome goals under the Department’s mobility goal is to
                       “improve the structural integrity and operational efficiency of the nation’s
                       transportation infrastructure.” However, the plan contains no explicit
                       references to such major infrastructure initiatives as the National Highway
                       System or ATC modernization or the statutory provisions related to these
                       initiatives. The Results Act does not require such linkages, but we believe
                       that including such linkages in the plan may help explain the Department’s
                       mission and goals.7

                       The appendix on statutory authorities does not include any reference to
                       the Surface Transportation Board or the Commercial Space Program. An
                       official from DOT’s Office of the General Counsel stated that the statutes
                       related to the Surface Transportation Board were omitted from that
                       appendix because the Board operates as an entity independent of DOT.
                       However, the body of the strategic plan lists the Surface Transportation
                       Board as one of the organizations that operates collaboratively under a
                       departmental mission. Therefore, it is not clear whether DOT’s strategic
                       plan encompasses the Surface Transportation Board. That official also
                       acknowledged that the Commercial Space Program is a major program
                       and that relevant statutes should have been included in the compilation of
                       statutory authorities.


                       The draft strategic plan does not show evidence that DOT coordinated with
Plan Does Not          other agencies that have programs and activities that are crosscutting or
Address Crosscutting   similar to DOT’s. According to a senior DOT official, coordination is an
Activities             ongoing activity and no specific coordination was done in preparing the
                       draft plan. The plan recognizes that there are other stakeholders for DOT’s
                       long-term goals and provides for building or establishing partnerships with
                       federal, state, and local governments and the transportation industry.
                       However, except for DOD, the plan does not identify specific stakeholders.
                       In addition, the plan does not identify (1) which programs are crosscutting
                       or overlapping, (2) how the programs and activities of the stakeholders
                       could affect the goals’ achievement, and (3) how DOT expects to coordinate
                       with its stakeholders. For example, the plan does not mention such other

                       7
                        OMB Circular A-11 states that an agency’s mission statement may include a brief discussion of the
                       agency’s enabling or authorizing legislation; this suggestion, however, does not extend to the
                       statement of goals.



                       Page 13                                           GAO/RCED-97-208R DOT’s Draft Strategic Plan
                         B-277533




                         important stakeholders as the Environmental Protection Agency (EPA),
                         which has responsibilities that affect DOT’s human and natural
                         environment goal. A page is reserved in the draft plan for stakeholders’
                         comments, which may contain this kind of information.

                         The plan includes the following three outcome goals for its national
                         security goal that specifically support DOD’s needs:

                     •   Ensure the readiness and capability of commercial transportation to meet
                         national defense needs.
                     •   Ensure that transportation infrastructure and technology are adequate to
                         facilitate military logistics during mobility, training exercises, and
                         mobilization.
                     •   Maintain the readiness of resources owned, managed, or coordinated by
                         DOT that are necessary to support the President’s National Security
                         Strategy and other defense-related plans.

                         However, the plan does not explain what DOD’s needs are and the
                         implications for DOT’s programs. In supporting documents, DOT observed
                         that DOD may increase its reliance on commercial transport of personnel
                         and equipment and identified a number of implications for DOT’s programs.
                         The plan does not mention this issue. A brief discussion of DOD’s programs
                         and their requirements and how they affect DOT’s strategic plan would help
                         explain the linkage between the two Departments’ programs and activities
                         and how changes in the way DOD operates will affect DOT.

                         The supporting documents that DOT used to prepare the plan indicate that
                         the Department considered several other crosscutting issues. For example,
                         these documents mentioned EPA’s revisions to the ozone and particulate
                         matter standards proposed in December 1996 and identified the potential
                         effect on transportation and the implications for DOT’s programs. This
                         issue was not mentioned in DOT’s plan. DOT’s plan would benefit from a
                         brief discussion of how its programs and goals relate to other agencies and
                         how it ensured that the goals in the plan complement, rather than conflict
                         with, other federal agencies’ programs and activities.


                         DOT’s draft strategic plan does not adequately address the major
Plan Does Not            management challenges and high-risk areas that we and others have
Adequately Address       identified. Addressing these issues is critical to ensuring that strategies are
Major Management         in place to meet DOT’s goals. Earlier this year, we testified on four critical
                         management issues facing the Department: (1) enhancing transportation
Challenges

                         Page 14                               GAO/RCED-97-208R DOT’s Draft Strategic Plan
    B-277533




    safety and security; (2) improving the management of aviation, highway,
    and transit programs; (3) meeting the long-term funding needs of FAA and
    Amtrak; and (4) having an appropriate organizational structure and
    adequate financial and other management information.8 We also identified
    critical information technology management issues facing DOT and other
    agencies. While we recognize that adequately addressing many of these
    problems will take concerted action by the Department, the Congress, and
    other affected parties, the Department’s strategic plan can do more to
    make clear its priorities and its commitment to meeting these challenges.

    First, a critical issue facing the Department is ensuring the safety and
    security of travelers on the nation’s airways, highways, and waterways.
    DOT’s strategic plan reflects this issue in two goals—safety and national
    security. While the plan addresses some of our specific concerns about
    aviation security, it does not mention our specific concerns about overall
    transportation safety. Over the years, we have identified areas in which
    DOT can do more to improve the efficiency and effectiveness of its
    transportation security and safety programs:

•   We have made recommendations about security vulnerabilities in the
    aviation system—checked and carry-on baggage, mail, and cargo—and
    steps that could be undertaken to improve security.9 The White House
    Commission on Aviation Safety and Security (the Gore Commission),
    formed after the crash of TWA Flight 800, made more than 30 security
    recommendations in February 1997. We believe that the Gore
    Commission’s recommendations are a good start toward an evolutionary
    process of reaching agreement on the goals and objectives for improving
    our aviation security system. Effective implementation of these
    recommendations requires the various federal agencies, local authorities,
    and the aviation industry—most importantly, airlines and airports—to
    work together. DOT’s draft plan discusses several activities to achieve its
    national security goal that reflect our concerns. These activities include
    (1) developing and implementing security enhancements;
    (2) implementing the Gore Commission’s recommendations;
    (3) completing vulnerability assessments and implementing
    recommendations; and (4) developing and maintaining partnerships with
    other federal agencies, state/local governments, the transportation
    industry, and foreign governments.

    8
     Federal Management: Addressing Management Issues at the Department of Transportation
    (GAO/T-RCED/AIMD-97-172, May 21, 1997).
    9
     See, for example, Aviation Security: Additional Actions Needed to Meet Domestic and International
    Challenges (GAO/RCED-94-38, Jan. 27, 1994) and Aviation Security: Technology’s Role in Addressing
    Vulnerabilities (GAO/T-RCED-NSIAD-96-262, Sept. 19, 1996).



    Page 15                                          GAO/RCED-97-208R DOT’s Draft Strategic Plan
    B-277533




•   To enhance transportation safety, we have consistently identified the need
    to improve federal oversight of air travel by (1) targeting FAA’s inspections
    to the areas of highest risk, (2) enhancing the reliability of safety data, and
    (3) improving the training of inspectors. Over the years, we have suggested
    that FAA focus its resources on such areas of concern as new entrant and
    commuter airlines and aging aircraft. In addition, improving safety on the
    nation’s highways, where over 40,000 people are killed annually, requires
    strong, effective partnerships among federal, state, and local governments.
    We have pointed out that increasing the use of safety belts is the most
    effective way to lower the nation’s death toll from highway accidents.10 We
    have suggested that the Congress consider encouraging the states to enact
    primary enforcement laws that allow police officers to stop and ticket a
    vehicle’s operator solely because the occupants are not using their safety
    belts. We also believe that such laws should cover all of the occupants of
    all the vehicles having safety belts. We also recommended that the
    Secretary of Transportation provide special emphasis and targeted
    programs for increasing the use of safety belts by the occupants of light
    trucks. DOT’s strategic plan is vague on how the Department will achieve
    its safety goal and does not mention these related issues.

    Second, DOT can do more to improve its management of aviation, highway,
    and transit programs to ensure that limited funds are effectively and
    efficiently used. DOT’s plan includes infrastructure in its mobility goal but
    provides too few details to fully address our concerns. For example, FAA’s
    multibillion-dollar program to modernize the ATC system has been plagued
    with cost overruns, schedule delays, and shortfalls in performance.
    Because of the size, complexity, cost, and problem-plagued past of the ATC
    modernization, we designated it as a high-risk information technology
    initiative in 1995 and again in 1997.11 DOT’s strategic plan does not mention
    the ATC modernization. As another example, major surface transportation
    projects, each costing hundreds of millions to billions of dollars, are
    continuing to incur cost increases, experience delays, and have difficulties
    acquiring needed funding commitments. We believe that FHWA can do more
    to address the problem of cost growth by working with the states to
    improve the cost management of large-dollar highway construction
    projects. Some of our concerns are reflected in the plan’s discussion of the
    mobility goal, which lists such activities to achieve this goal as
    (1) developing and promoting innovative financing techniques and

    10
     Motor Vehicle Safety: Comprehensive State Programs Offer Best Opportunity for Increasing Use of
    Safety Belts (GAO/RCED-96-24, Jan. 3, 1996).
    11
     High-Risk Series: An Overview (GAO/HR-95-1, Feb. 1995) and High-Risk Series: Information
    Management and Technology (GAO/HR-97-9, Feb. 1997).



    Page 16                                         GAO/RCED-97-208R DOT’s Draft Strategic Plan
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increasing flexible funding and (2) “maximizing the benefits of the
planning process to improve project selection by techniques such as
cost-benefit analysis.” However, the list of activities provides no details on
how they will be accomplished or what programs and modes of
transportation will be affected.

Third, critical transportation financing issues—meeting the long-term
funding needs of FAA and Amtrak—face DOT and the Congress. Each issue
presents formidable challenges that will stretch limited resources and will
require long-term strategies to successfully address. DOT’s strategic plan
does not raise these issues. FAA estimates that its needs will exceed
projected funding levels by about $13 billion over the next 5 years. We
believe that determining how best to finance FAA is a complex problem
that requires careful study and good cost data. To assist in finding
solutions to FAA’s long-term financing needs, the Congress formed the
National Civil Aviation Review Commission, which is scheduled to make
its recommendations by August 1997. Deciding among various financing
alternatives for FAA will involve trade-offs among such factors as the
efficient use of the airport and airway system, fairness to system users,
and the effect on competition. To effectively design any new financing
system, FAA needs better cost data to appropriately allocate costs among
users.12 With respect to Amtrak, we recently reported that its financial
condition is very precarious and that as currently constituted and funded,
Amtrak will continue to require substantial federal financial support well
into the next century.13 Amtrak is not mentioned in DOT’s plan.

Fourth, DOT’s ability to effectively address many of these aforementioned
issues depends on having a supportive organizational structure,
implementing information management technology reforms, and
improving its management and financial data. The plan does not provide
sufficient details for addressing our concerns in these areas. DOT can do
more to develop an appropriate organizational structure to achieve the
most cost-effective delivery of services and ensure the proper use of
federal funds. We have reported that opportunities exist to achieve these
objectives by (1) examining the appropriateness of reorganizing the
surface transportation administrations and their field office structures,
(2) making changes to FAA’s management structure and organizational

12
  Air Traffic Control: Improved Cost Information Needed to Make Billion-Dollar Modernization
Investment Decisions (GAO/AIMD-97-20, Jan. 22, 1997).
13
 See, for example, Transportation Financing: Challenges in Meeting Long-Term Funding Needs for
FAA, Amtrak, and the Nation’s Highways (GAO/T-RCED-97-151, May 7, 1997) and Intercity Passenger
Rail: The Financial Viability of Amtrak Continues to Be Threatened (GAO/T-RCED-97-94, Mar. 13,
1997).



Page 17                                          GAO/RCED-97-208R DOT’s Draft Strategic Plan
B-277533




culture, and (3) identifying additional opportunities to streamline the
Coast Guard’s operations. The plan mentions the need for the appropriate
organizational infrastructure and processes to achieve DOT’s strategic goals
but does not explain what constitutes an appropriate infrastructure and
processes or how they will be established.

Moreover, while DOT’s plan highlights information technology as a critical
component of its corporate management strategy, the plan does not
clearly discuss how the Department intends to implement the information
management technology reforms called for in the Paperwork Reduction
Act of 1995 and the Clinger-Cohen Act of 1996. These acts direct agencies
to implement a framework of modern technology management based on
practices followed by leading private and public organizations that have
successfully used technology to improve performance and help meet
strategic goals. Furthermore, DOT, like many other agencies, will face
emerging management challenges in implementing modern technology and
resolving the need for computer systems to be changed to accommodate
dates beyond the year 1999, the “year 2000 problem.” Yet DOT’s plan does
not discuss how it intends to address the “year 2000 problem” as well as
any significant information security weaknesses—two issues that we have
identified as high-risk across the government.14

In addition, DOT lacks the fully reliable financial management information
necessary to ensure that federal funds are properly managed and reliable
financial reports are prepared. The lack of such information could affect
the implementation of the Department’s strategic plan. For fiscal year
1996, DOT prepared its first Department-wide financial statement. DOT’s
OIG undertook an audit of the Department-wide balance sheet but was
unable to provide an opinion about its reliability because of inadequate
records and other deficiencies. Specifically, the OIG was unable to
validate the value of property, equipment, operating materials, and
supplies reported to be worth $25.8 billion because of inadequacies in the
supporting documentation and unreconciled discrepancies between the
summary accounts and their supporting details. In evaluating DOT’s
internal controls, the OIG identified 11 significant internal control
weaknesses and 13 additional conditions deemed important for reporting.
Overall, the OIG made 72 recommendations to strengthen DOT’s internal
controls and improve the accuracy of its financial reporting. DOT’s plan
does not address these issues.



14
  GAO High-Risk Series (GAO/HR-97-20SET, Feb. 1997).



Page 18                                        GAO/RCED-97-208R DOT’s Draft Strategic Plan
                   B-277533




                   DOT  faces several important challenges in addressing its financial
                   management problems, including (1) correcting the known weaknesses so
                   that it can produce reliable, auditable financial statements; (2) fully
                   implementing new federal accounting standards to meet federal financial
                   management goals; (3) implementing and maintaining financial
                   management systems that comply substantially with the federal
                   requirements for financial management systems, applicable federal
                   accounting standards, and the U.S. Government Standard General Ledger
                   at the transaction level; and (4) submitting fully audited financial
                   statements that cover all accounts and associated activities. DOT’s plan
                   does not address these financial management issues.


                   DOT’s ability to produce reliable data to measure its progress in achieving
DOT’s Ability to   the plan’s long-term goals is uncertain. The plan is unclear about what
Produce Reliable   information will be needed to measure performance. However, we have
Performance        reported serious problems with DOT’s information resources and database
                   management and identified these problems as one of several top
Information Is     management issues facing the Department.15 These problems adversely
Uncertain          affect the Department’s ability to monitor and evaluate the performance of
                   U.S. transportation systems as well as identify and set priorities for the
                   investment needs for the infrastructure.

                   Producing reliable data to document performance and support
                   decision-making at the program level will be a challenge for DOT. For
                   example, over the years we have reported on the limitations of aviation
                   safety databases. In 1991, FAA began developing the Safety Performance
                   Analysis System (SPAS), which draws on information from several
                   safety-related databases to establish better priorities for FAA’s inspections.
                   However, SPAS is not expected to be fully operational until 1999.
                   Furthermore, some databases that may provide source data for SPAS
                   contain incomplete, inconsistent, and inaccurate data. FAA has recently
                   developed and is implementing a strategy to improve the quality of data to
                   ensure that these source databases provide more reliable information. The
                   success of this strategy is critical to SPAS’ becoming an effective tool for
                   focussing on outcomes by targeting resources to high-risk activities.

                   We also reported on the limitations in the National Transportation Safety
                   Board’s (NTSB) information on airline accidents, upon which FAA relies. In
                   examining the safety performance of new airlines, we found that NTSB, the

                   15
                    Federal Management: Addressing Management Issues at the Department of Transportation
                   (GAO/T-RCED/AIMD-97-172, May 21, 1997).



                   Page 19                                       GAO/RCED-97-208R DOT’s Draft Strategic Plan
B-277533




official source of information on airline accidents, defines accidents as
events in which individuals are killed or suffer serious injury or in which
the aircraft is substantially damaged. By NTSB’s definition, accidents can
range from fatal crashes in which the aircraft is destroyed and all crew and
passengers aboard are killed, to events in which only one person suffers a
broken bone and the aircraft is not damaged, to still others in which the
aircraft is substantially damaged, but no fatalities or serious injuries
occur.16

DOT’s pilot projects under the Results Act have acknowledged limitations
with their data. For example, NHTSA uses the General Estimates System for
statistics on motor vehicle accidents. This database contains information
from a nationally representative sample of police-reported accidents.
Various sources, however, suggest that about half of the motor vehicle
crashes in the country are not reported to police and that the majority of
these unreported crashes involve minor property damage and no
significant personal injury. A NHTSA study of injuries from motor vehicle
accidents estimated the total count of nonfatal injuries at over 5 million
compared with the General Estimates System’s estimate of 3.2 million for
the same year. NHTSA intends to study the unreported injury problem.

Another DOT pilot project under the Results Act—the U.S. Coast Guard’s
Marine Safety, Security, and Environmental Protection program—also
reported similar limitations with its data. For its goal related to deaths and
injuries, the Coast Guard found problems with the reliability of reporting
injuries. The Coast Guard reported that less serious injuries, in particular,
were substantially underreported and that the agency lacked data to
determine the severity of injuries.17

Once DOT develops its final performance measures, it may need to consider
appropriate modifications to its database systems to ensure that they
include the needed data. In addition, as required by the Chief Financial
Officers Act of 1990, program, accounting, and budget systems should be
integrated to facilitate the systematic measurement and reporting of
performance data.




16
 Aviation Safety: New Airlines Illustrate Long-Standing Problems in FAA’s Inspection Program
(GAO/RCED-97-2, Oct. 17, 1996).
17
 R. Kowalewski, “Using Outcome Information to Redirect Programs: A Case Study of the Coast
Guard’s Pilot Project Under the Government Performance and Results Act” (U.S. Coast Guard, Office
of Marine Safety, Security and Environmental Protection, Apr. 1996).



Page 20                                          GAO/RCED-97-208R DOT’s Draft Strategic Plan
                  B-277533




                  We provided copies of a draft of this report to DOT for review and
Agency Comments   comment. (DOT’s comments are in the enclosure.) DOT agreed with our
                  observations and pointed out that it will consider our comments along
                  with those from stakeholders when revising its draft strategic plan.
                  Specifically, DOT agreed with our observations that the strategic plan could
                  be strengthened by (1) identifying the scope and methodology of future
                  program evaluations, (2) specifying the time period covered by the plan,
                  and (3) including information on coordination with other federal agencies.
                  DOT stated that it intends to include such information in the next draft of
                  the plan. While not disagreeing with our observations concerning major
                  management issues and the Department’s data, DOT pointed out that these
                  issues might be more appropriately addressed outside of the strategic
                  plan. DOT provided several technical comments that we included as
                  appropriate.


                  We are sending copies of this report to the Minority Leader of the House of
                  Representatives; the Ranking Minority Members of your committees; the
                  Chairman and Ranking Minority Members of the House Committee on
                  Transportation and Infrastructure; the Secretary of Transportation; and
                  the Director, OMB. Copies will be made available to others on request.

                  Please call me at (202) 512-2834 if you or your staff have any questions
                  about this report. Major contributors to this report are Phyllis Scheinberg,
                  Janet Barbee, Helen Desaulniers, Sharon Dyer, David Hooper, Teresa
                  Spisak, and John Thomson.




                  John H. Anderson, Jr.
                  Director, Transportation Issues

                  Enclosure




                  Page 21                              GAO/RCED-97-208R DOT’s Draft Strategic Plan
Enclosure I

Comments From the Department of
Transportation




              Page 22     GAO/RCED-97-208R DOT’s Draft Strategic Plan
           Enclosure I
           Comments From the Department of
           Transportation




(348034)   Page 23                           GAO/RCED-97-208R DOT’s Draft Strategic Plan
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