oversight

Climate Change: Observations on the April 1999 Report on Climate Change Programs

Published by the Government Accountability Office on 1999-05-20.

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

                    United States General Accounting Office

GAO                 Testimony
                    Before the Subcomm. on Energy Research, Development,
                    Production and Regulation, Senate Comm. on Energy and
                    Natural Resources, and the Subcomm. on National
                    Economic Growth, Natural Resources and Regulatory
                    Affairs, House Comm. on Government Reform
For Release
on Delivery
Expected at
                    CLIMATE CHANGE
2:30 p.m. EDT
Thursday
May 20, 1999
                    Observations on the
                    April 1999 Report on
                    Climate Change Programs
                    Statement of Peter F. Guerrero, Director,
                    Environmental Protection Issues,
                    Resources, Community, and Economic
                    Development Division




GAO/T-RCED-99-199
             Messrs. Chairmen and Members of the Committees:

             Our testimony today discusses activities relating to climate change
             programs. Specifically, it responds to your request that we comment on
             (1) the administration’s April 20, 1999, report1 on federal expenditures for
             climate change activities and (2) a limitation—set forth in the
             Environmental Protection Agency’s appropriations act for fiscal year
             1999—that was designed to prevent the agency from taking specified
             regulatory actions to implement the Kyoto Protocol on climate change.

             In summary, we found the following:

             The administration’s report, as required by law, provides multiyear
             spending data and describes climate change programs and activities.
             However, it was delivered to the Congress on April 20, 1999, about 2-1/2
             months after the specified due date. Also, the report did not always link its
             discussion of activities and performance goals to the specific line items
             shown in the President’s budget. Finally, the report did not always provide
             a clear picture of intended performance across federal climate change
             activities, for example, by specifying—in measurable and quantifiable
             terms—the outcomes expected to be achieved by federal spending.

             A provision in the Environmental Protection Agency’s appropriations act
             for fiscal year 1999 prohibited the agency from taking certain regulatory
             actions—for example, proposing regulations—to implement the Kyoto
             Protocol on climate change. To assess the scope of the prohibition, we
             reviewed the legislative history of the provision. Based on this review, we
             believe that the provision does not limit the agency’s ability to undertake
             activities that are otherwise authorized by law. (See the appendix for an
             analysis of this issue.)


             Climate change policy has been a key congressional concern recently,
Background   focusing especially on the Kyoto Protocol, which was agreed to—in
             principle—by the United States and 37 other countries in December 1997.
             Under the protocol, the United States agreed to substantially reduce its
             greenhouse gas emissions during the 5-year period beginning in 2008. The
             protocol will become binding upon the United States only if the Senate
             ratifies it. The protocol would amend the United Nations Framework
             Convention on Climate Change, which was agreed to in 1992 and ratified
             by the Senate in the same year. Under the convention, the voluntary goal

             1
              Report to Congress on Federal Climate Change Expenditures, Apr. 20, 1999.



             Page 1                                                                       GAO/T-RCED-99-199
for the United States is to reduce greenhouse gas emissions by 2000 to
their 1990 level. Under the Kyoto Protocol, the requirement for the United
States would be to reduce emissions to 7 percent below their 1990 level.
Meeting this target would require a reduction of 30 percent relative to the
level of emissions that would otherwise be anticipated in 2010, the
midpoint of the 5-year period (2008-12), according to the Energy
Information Administration.2

In February 1998, as part of the fiscal year 1999 budget submission, the
President proposed a Climate Change Technology Initiative, designed to
reduce greenhouse gas emissions. Among other things, the initiative
proposed additional funding primarily for (1) the Department of Energy’s
research and development activities; (2) tax credits—to be administered by
the Department of the Treasury—to encourage the purchase of certain
energy-efficient cars and houses, among other things; and (3) the
Environmental Protection Agency’s (EPA) voluntary programs to
encourage businesses and others to conserve energy. The President also
proposed increased funding for the U.S. Global Change Research Program,
which includes efforts by the National Aeronautics and Space
Administration and other agencies to study climate change.

As part of the fiscal year 1999 appropriations process, the Congress
included a number of mandates (in laws) and directives (in committee
reports) to various executive agencies. One law, enacted in October 1998,
required the President to provide detailed information on climate change
programs and activities. The law also stated that this should be provided in
conjunction with the President’s budget submission for fiscal year 2000.
That budget was transmitted to the Congress on February 1, 1999. A
complementary Senate committee report directed the administration to
provide the Congress with a detailed plan for implementing key elements
of the President’s proposal on climate change. In response to the law and
committee report, the President transmitted a report to the Congress on
April 20, 1999. Another law—providing appropriations for EPA for fiscal
year 1999—was designed to prevent EPA from taking certain regulatory
actions, for example, proposing regulations, to implement the Kyoto
Protocol.

To assess the April 20 report, we reviewed agencies’ budget documents.
We also compared the report with an August 1998 report by the
Congressional Budget Office (CBO), which was prepared, in part, to



2
 Energy Information Administration, International Energy Outlook—1999, 1999, Table 20.



Page 2                                                                       GAO/T-RCED-99-199
                      document current U.S. efforts in the area of global climate change.3 We did
                      not independently verify the expenditure information or performance
                      measures in the April 20 report. To assess the spending limitation, we
                      reviewed the provision and its legislative history and discussed these
                      matters with officials at EPA. We performed our work in April and
                      May 1999 in accordance with generally accepted government auditing
                      standards.


                      The administration’s April 20 report, as required, provides detailed
The Report Provided   information on climate change programs and activities. In addition, as
the Information       directed in a Senate committee report, the April 20 report, in some but not
Required by Law but   all cases, (1) linked its discussion of activities and performance goals to
                      the specific line items shown in the President’s budget, and (2) provided a
Only Some             clear picture of intended performance across federal global climate
Information on        change activities.
Performance Goals     The requirement for the report is contained in the Omnibus Consolidated
                      and Emergency Supplemental Appropriations Act, enacted in
                      October 1998.4 That act required the administration to provide a detailed
                      accounting of federal obligations and expenditures for climate change
                      programs and activities. The report was to cover domestic and
                      international activities for fiscal years 1998 and 1999 and any plan for
                      programs thereafter related to the Kyoto Protocol. The report was also
                      required to include an accounting of expenditures by agency, with each
                      agency identifying climate change activities and associated costs by line
                      item, as presented in the President’s budget.

                      In addition, a Senate report directed the administration to provide the
                      Congress with a detailed plan for implementing key elements of the
                      President’s proposal on climate change.5 The plan was to include
                      performance goals for the reduction of greenhouse gases that had
                      objective, quantifiable, and measurable target levels and was to provide
                      evidence on the effectiveness of these programs in meeting the
                      performance goals. In setting out this directive, the report said that the
                      administration must do a better job of explaining the components of the
                      programs, their anticipated goals and objectives, the justification for any
                      funding increases, a discussion of how success would be measured, and a


                      3
                       CBO, Climate Change and the Federal Budget, Aug. 1998.
                      4
                       P. L. 105-277, Oct. 21, 1998, sec. 573(b).
                      5
                       S. Rept. 105-251, “Treasury and General Government Appropriation Bill, 1999,” July 15, 1998, p. 6.



                      Page 3                                                                           GAO/T-RCED-99-199
                            clear definition of how these programs were justified by goals and
                            objectives that were not linked to implementing the Kyoto Protocol.6


The Report, as Required,    The administration’s report provides a detailed accounting of domestic
Provides Detailed           and international expenditures on climate change. It does so in several
Information on Programs     ways. For example, it distinguishes activities that are directly related to
                            climate change, such as the U.S. Global Change Research Program, from
                            activities that are not directly related, such as the Department of Energy’s
                            weatherization and state energy grant programs. It also lists programs and
                            tax policies related to climate change, by appropriation account. This
                            listing shows line items for 14 departments or agencies, including the
                            Department of Energy, EPA, and 12 others.

                            To check the completeness of the administration’s report, we compared it
                            against a similar CBO report, prepared at the request of Senate Committee
                            on the Budget and issued in August 1998. We found that the two reports
                            generally identified the same programs as being directly related to climate
                            change. One exception is that CBO included activities under the Montreal
                            Protocol because of the “close link” between ozone-depleting gases
                            (addressed by the Montreal Protocol) and greenhouse gases (addressed by
                            climate change programs), but the administration’s report does not
                            include those activities.

                            For programs that are classified in both reports as indirectly related to
                            climate change, there are similarities and differences between the reports.
                            For example, both reports include the Department of Energy’s
                            weatherization and state energy grant programs. But only CBO includes the
                            Department of Transportation’s Congestion Mitigation and Air Quality
                            Improvement Program.


The Report Was Not Issued   The act required the report to be provided with the President’s submission
on Time                     of the fiscal year 2000 federal budget, which occurred on February 1, 1999.7
                            The accompanying Senate report stated that the administration’s report
                            was expected to be included as part of the affected agencies’ fiscal year

                            6
                             Language about the need to improve budget submissions appears in two other congressional reports.
                            See H. Rept. 105-769, “Making Appropriations for the Department of Veterans Affairs and Housing and
                            Urban Development, and for Sundry Independent Agencies, Boards, Commissions, Corporations, and
                            Offices for the Fiscal Year Ending September 30, 1999, and for Other Purposes,” Oct. 5, 1998, p. 274.
                            Also, see S. Rept. 105-227, “Department of the Interior and Related Agencies Appropriations Bill,
                            1999,” June 26, 1998, p. 7.
                            7
                             Because the law requiring this report was enacted on Oct. 21, 1998, the administration had less than
                            3-1/2 months to prepare the report.



                            Page 4                                                                          GAO/T-RCED-99-199
                             2000 budget submissions, which also occurred in early February 1999.
                             Because the report was issued on April 20, 1999, it was not available to the
                             Congress for the first 2-1/2 months of annual budget process, although it
                             was available for the balance of the process.


The Report Was Not           As required by law, the administration’s report provides a detailed
Always Linked to the         accounting of federal spending for climate change programs and activities,
President’s Budget           both domestic and international. In a series of tables, it provides this
                             information by agency and by line item in the President’s budget, as
                             specifically required by the act. It also provides the information by
                             program or program element. However, the report’s discussion of climate
                             change activities and the performance goals set out in the report are
                             organized by program or group of programs. This organization does not
                             correspond to either the line items in the President’s budget nor
                             completely to the tables in the report itself on spending by program or
                             program element.

                             For example, the discussion of EPA’s activities and performance goals is
                             organized by program or group of programs as follows: (1) buildings
                             programs; (2) transportation programs; (3) industry programs; (4) carbon
                             removal programs; (5) management, planning, analysis, and outreach
                             programs; and (6) Clean Air Partnership Program. The report presents
                             three line items for EPA: (1) environmental programs and management;
                             (2) science and technology; and (3) state and tribal assistance
                             grants—Clean Air Partnership Fund.

                             This organizational inconsistency limits the report’s usefulness. For
                             example, congressional and other users of the report cannot identify line
                             items in the President’s budget—for example, those with large dollar
                             amounts or those for which an increase in funding is being requested. Nor
                             can users easily identify in the report what activities are planned and what
                             performance goals have been established. Including a crosswalk, or a
                             connection, between the programs as discussed in the report and the
                             budget line items would have made the report more useful.


The Report Did Not Always    The administration’s report sets out 78 performance goals for its climate
Provide a Clear Picture of   change activities across the various programs discussed in the report. In
Intended Performance         covering this wide range of activities, the report did not provide complete
                             information to congressional decisionmakers on the results to be achieved
                             for the proposed level of resources. Specifically, the report did not



                             Page 5                                                     GAO/T-RCED-99-199
•   explain why certain programs were discussed, even though no
    performance goals were established for them;
•   establish quantifiable goals in all cases;
•   establish results-oriented goals in all cases; and
•   provide baseline and trend data to support these goals.

    However, we recognize that establishing useful performance goals for
    research programs can be especially challenging.

    Lack of performance goals was not always explained. The administration’s
    report organizes its discussion of climate change activities around 32
    programs or groups of programs—17 under the Climate Change
    Technology Initiative, 7 under the U.S. Global Change Research Program,
    2 under international assistance, and 6 that are indirectly related to climate
    change. In some cases, individual programs under the groups of programs
    are briefly discussed. However, the performance goals set out in the report
    generally apply to the groups of programs.

    We found that the report contained performance goals for 19 of the 32
    programs or groups of programs, but not for the 13 others. Among the
    programs lacking performance goals are the Department of Housing and
    Urban Development’s Partnership for Advancing Technology in Housing
    program, Energy’s fossil energy programs, and the six programs indirectly
    related to climate change.8 The report does not explicitly state why
    performance goals were not provided or were not considered appropriate
    for these programs.

    The report does note that the six programs indirectly related to climate
    change exist primarily for another purpose, such as energy conservation,
    or have multiple environmental benefits, but have the additional effect of
    reducing fossil fuel use. For these programs, it is understandable that the
    performance goals would have been expressed in terms of their primary
    purpose, such as energy conservation, and not necessarily included in this
    report. For the other programs, the rationale for omitting performance
    goals is not as clear.

    About one-third of performance goals were expressed in quantifiable
    terms. Performance goals help translate agencies’ uses of resources into
    results by establishing target levels for performance expressed as tangible,

    8
     Other programs for which no goal was established are the National Institute of Standards and
    Technology’s industry programs; the carbon sequestration or removal programs of the departments of
    Agriculture and Energy and EPA; and Energy’s programs related to the management, planning, and
    analysis of its climate change activities.



    Page 6                                                                      GAO/T-RCED-99-199
measurable objectives against which actual achievement can be
compared. If performance goals and measures include a quantifiable,
numerical target level or other measurable value, they more easily allow
for progress toward the goal to be assessed. An example of a quantifiable
goal would be reducing by 80 percent the amount of lead in the air or
reducing by 15 percent the number of children with dangerous levels of
lead in their blood.

About two-thirds of the performance goals were not expressed in
quantifiable terms. For example, one goal for fiscal year 2000 is to “use
ecosystem-scale experiments involving increased CO2 [carbon dioxide]
and other environmental factors to determine how atmospheric change
and potential climatic change may affect forest productivity, forest health,
and species distributions.” Another goal for the same year is to
“document land-use and land-cover change in regions where rapid change
could potentially alter the sensitivities/vulnerabilities of the region to
climate change.” Although it may be possible to determine whether these
goals actually occurred, they are difficult to use to assess the programs’
progress toward achieving their longer-term goals and overall purposes.
Because such goals would involve different events each year, overall
progress may be hard to measure.

About one-seventh of goals are results-oriented. Performance goals are
most useful to congressional and other decisionmakers in judging the
results to be achieved for a proposed level of resources if they are
expressed as program outcomes and are quantifiable. Outputs are the
direct products and services delivered by a program, such as a regulation,
inspection, or enforcement action. Outcomes are the results of these
products and services.

Outcome goals could be expressed in terms such as reductions in the
number of people developing respiratory diseases or cancers or dying as a
result of being exposed to pollutants in the air. Performance goals based
on target levels of reductions in air pollutants would also be outcome
goals. These intermediate outcome goals are not as reflective of the
program’s ultimate purpose, but may be the best an agency can do if
sufficient data on health and environmental effects are not available.

While it is appropriate to have a mixture of outcome- and output-oriented
performance goals, the administration’s report contains a relatively small
percentage of outcome-oriented performance goals. By our count, 11 (or
14 percent) of the 78 performance goals set out in the report are



Page 7                                                     GAO/T-RCED-99-199
outcome-oriented. All of these are goals for intermediate outcomes—such
as reduced emissions of greenhouse gases believed to contribute to or
cause global climate change—rather than ultimate outcomes—such as
effects on health and the environment. However, given the state of our
understanding of climate change science, these intermediate outcome
goals may be appropriate at this time. In addition, five of the goals are for
the year 2010, which may be too far away for congressional
decisionmakers to judge the intended performance for the funds that are
being requested for fiscal year 2000.

Baseline and trend data were not provided. Baseline and trend data also
provide a basis for comparing the actual results of a program with the
performance goals. These data would provide a context for drawing
conclusions about whether performance goals are reasonable and
appropriate. Decisionmakers could also use such data to gauge how the
programs’ anticipated performance levels compare with past performance.
The administration’s report, however, does not include either baseline or
trend data.

An example of the usefulness of such data is the Department of
Transportation’s fiscal year 2000 performance plan under the Government
Performance and Results Act. That plan includes graphs that show
baseline and trend data, as well as the targets for fiscal years 1999 and
2000, for nearly all of its performance goals and measures. For instance,
the performance goal for hazardous materials incidents is to reduce the
number of serious hazardous materials incidents in transportation to 411
or fewer in 2000 from a peak of 464 in 1996. The goal has a graph that
shows the number of serious hazardous materials incidents in
transportation from 1985 through 1997 and target levels for fiscal years
1999 and 2000.

Establishing useful performance goals for research programs can be
especially challenging. More than half of the performance goals are for
activities related to research and development. During our reviews of the
implementation of the Government Performance and Results Act, we have
found that federal agencies have had difficulty measuring research
annually and providing quantitative measures of the useful outcomes of
research. Earlier this year, the Committee on Science, Engineering, and
Public Policy issued a report that may be helpful to the agencies as they
work to develop more useful performance goals and measures for their




Page 8                                                      GAO/T-RCED-99-199
research activities.9 The study’s purpose was to identify and analyze the
most effective ways of assessing the results of research and to help the
federal government determine how its agencies can better incorporate
research activities into strategic and performance plans and improve the
management and effectiveness of research programs.

After holding a series of workshops, the committee concluded that
research programs, no matter what their character and goals, can be
evaluated meaningfully on a regular basis in accordance with the spirit and
intent of the Results Act. The committee said that, if, for example, Energy
adopted the goal of producing cheaper solar energy, it could annually
measure the results of the research designed to decrease the cost of solar
cells against specific milestones. Basic research, on the other hand,
requires a different method of assessment since the ultimate outcomes are
seldom identifiable while the research is in progress. For this reason, the
committee suggested a three-pronged expert review process that may
apply to many of the climate change research programs. We anticipate that
the guidance provided by this report will help agencies develop more
meaningful performance goals and measures for research programs and
activities.


This concludes our prepared statement. We would be pleased to respond
to questions from you or Members of the Committees.




9
 Committee on Science, Engineering, and Public Policy of the National Academy of Sciences, National
Academy of Engineering, and Institute of Medicine, Evaluating Federal Research Programs: Research
and the Government Performance and Results Act, 1999.



Page 9                                                                       GAO/T-RCED-99-199
Appendix I

Analysis of the Limitation on EPA
Expenditures

               A proviso in the appropriations act that provides fiscal year 1999 funds for
               EPA states that those funds may not be used for certain purposes related to
               the Kyoto Protocol.10 Specifically, the law says that funds shall not be used
               “to propose or issue rules, regulations, decrees or orders for the purpose
               of implementation, or in preparation for implementation” of the Kyoto
               Protocol.

               The scope of the proviso was both clarified and narrowed during the
               legislative process. First, the scope of the proviso was clarified in the
               conference report discussion, to make it clear that the limitation applies to
               those activities of EPA that are predicated “solely” on implementing, or
               preparing to implement, the Kyoto Protocol.11 Thus, an EPA activity
               justified by some other authority, even if it also facilitated the
               implementation of the protocol, would not be covered by this proviso.

               Also, the scope was narrowed during the legislative process. The
               House-passed version would have prohibited EPA from using funds to
               “develop, propose, or issue” rules “in contemplation of implementation”
               of the Kyoto Protocol. However, the law, as enacted, prevents EPA only
               from using funds to “propose or issue” rules whose purpose is
               implementation, or “preparation” for implementation, of the protocol.
               The law, as enacted, is thus narrower in two respects. First, it prohibits
               EPA from proposing or issuing rules, rather than more broadly preventing
               EPA from developing rules. Second, the prohibition extends only to
               “preparation” for implementing the Protocol, rather than
               “contemplation” of its implementation. Accordingly, the final statutory
               language would apply only to proposing or issuing rules or similar
               requirements having a demonstrable relationship to implementing the
               protocol.

               In summary, in light of the clarification and narrowing of the proviso’s
               scope during congressional consideration, we conclude that the limitation
               does not preclude EPA from engaging in activities that are otherwise
               authorized by law.




               10
                 P. L. 105-276, “Departments of Veterans Affairs and Housing and Urban Development, and
               Independent Agencies Appropriations Act, 1999,” Oct. 21, 1998.
               11
                H. Rept. 105-769, Conference Report, “Making Appropriations for the Department of Veterans Affairs
               and Housing and Urban Development, and for Sundry Independent Agencies, Boards, Commissions,
               Corporations, and Offices for the Fiscal Year Ending September 30, 1999, and For Other Purposes,”
               Oct. 5, 1998, pp. 273 and 274.



(160482)       Page 10                                                                      GAO/T-RCED-99-199
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