[Senate Hearing 116-]
[From the U.S. Government Publishing Office]



 
         LEGISLATIVE BRANCH APPROPRIATIONS FOR FISCAL YEAR 2020

                              ----------                              


                       WEDNESDAY, APRIL 10, 2019

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.

    The subcommittee met at 3:23 p.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Cindy Hyde-Smith (Chairman) 
presiding.
    Present: Senators Hyde-Smith, Lankford, and Murphy.

    GOVERNMENT ACCOUNTABILITY OFFICE AND CONGRESSIONAL BUDGET OFFICE

             OPENING STATEMENT OF SENATOR CINDY HYDE-SMITH

    Senator Hyde-Smith. Good afternoon. The subcommittee will 
come to order. I appreciate your attendance, and because we're 
in between votes right now, we may have to recess, but we are 
going to get as far as we can and then go make the second vote.
    I'd like to welcome everyone to our third fiscal year 2020 
budget hearing for the Legislative Branch Appropriations 
Subcommittee. Today we have with us the Comptroller General of 
the United States and head of the Government Accountability 
Office, the Honorable Gene Dodaro, and the Director of the 
Congressional Budget Office, Dr. Keith Hall.
    Thank you for being here today to provide testimony to the 
subcommittee regarding your fiscal year 2020 budget requests. 
I'd also like to thank both of you for taking time to meet with 
me before this hearing, and I greatly appreciate those 
conversations and the opportunity to learn more about you and 
your agencies.
    Both GAO and CBO provide Congress with valuable information 
that we, as lawmakers, use to make informed decisions to better 
serve our constituents and this Nation. We appreciate and 
recognize the time and resources which inform the analyses you 
provide to us.
    The total budget request for GAO is $647.6 million. This 
represents an increase of $57.8 million, or 9.8 percent, above 
the fiscal year 2019 enacted level. The increases would allow 
GAO to reach its optimal staffing level of 3,250 FTE and 
provide for investments in physical infrastructure and 
Information Technology modernization.
    The CBO request for fiscal year 2020 totals $53.6 million, 
an increase of $2.8 million, or 5.6 percent, above the fiscal 
year 2019 enacted level. This increase includes funding for 
staff hired throughout fiscal year 2019 to improve transparency 
as well as funding for new hires in fiscal year 2020. It also 
would provide funds to maintain further development of critical 
IT infrastructure.
    I look forward to our discussion today and learning more 
about the requests from each of your agencies.
    Right now Senator Murphy is still voting, so when he gets 
here, I will certainly turn to him for his opening statement.
    I'm going to defer to Senator Lankford for any opening 
statements you may have.
    Senator Lankford. No, I'll just say thank you to both of 
you and the work that you've already done, and grateful to be 
able to receive your testimony today and look forward to 
ongoing dialogue. Thank you.
    Senator Hyde-Smith. Great. I will recognize each of you now 
to make your statements.
    And I will start with you, Mr. Dodaro.
STATEMENT OF HON. GENE DODARO, COMPTROLLER GENERAL OF 
            THE UNITED STATES AND HEAD OF THE U.S. 
            GOVERNMENT ACCOUNTABILITY OFFICE
    Mr. Dodaro. Thank you very much, Chairman Hyde-Smith.
    Good afternoon to you, Senator Lankford.
    Nice to see both of you again.
    I appreciate the opportunity to talk about our request for 
fiscal year 2020.
    First, I want to thank this subcommittee for the support 
that you've given GAO in the past. We have provided a good 
return on that investment. Last year, actions on our 
recommendations saved over $75 billion, which is $124 back for 
every dollar invested in GAO. This builds on a long track 
record of producing financial benefits for the country.
    When I testified last month before Congress on our latest 
high-risk list update I mentioned that since 2006, actions on 
our recommendations in the high-risk area saved over $350 
billion.
    Next month I will testify on our ninth annual report on 
overlap duplication of fragmentation in the Federal Government. 
I expect to announce that the financial benefits through 
actions there, by both the Congress and the executive branch 
have well exceeded the $178 billion that we mentioned last 
year.
    In addition to these financial benefits, we have other 
actions on the recommendations that help improve the operations 
and activities of a range of Federal agencies across the entire 
Federal Government including public safety and security. We 
have done work on elder abuse issues, lead in drinking water 
for our schools, K-12 schools, and suicide prevention for 
veterans. We've made recommendations on the opioid crisis, how 
to strengthen security around airports, and a wide range of 
other areas. It's important to note that we are not just about 
producing financial benefits, we are helping improve government 
performance and accountability.

                              GAO REQUEST

    As you mentioned, Chairman Hyde-Smith, we're asking for 
$647 million for next year. This will provide the full 
complement of staff at 3,250 FTE, which we think we need in 
order to meet the highest priority needs of the Congress. We 
continue to serve over 90 percent of the standing committees 
and most of the subcommittees by providing assistance. This 
request will enable the GAO to meet the highest priority needs 
across the committees and the Congress. I meet on a regular 
basis with the Chair and Ranking Members of each of these 
committees to make sure the GAO is addressing their highest 
priority needs.
    There are four areas in particular that the GAO would like 
to continue to build our capacities on. The first is science 
and technology issues. The emergence of science and technology 
issues is transforming the way that we are learning, 
communicating, educating, and changing the very face of warfare 
in the future, whether you are talking artificial intelligence 
or quantum computing.
    Cryptocurrencies and blockchains are changing the nature of 
how financial transactions are conducted and financial advice. 
GAO has been asked by the Congress since 2002 to produce 
technology assessments to advise the Congress on some of the 
legal, ethical, regulatory, and other practical policy 
implications of these new developing technologies.
    Our work also requires that we look at weapons systems, 
whether it's a Columbia-class nuclear submarine or the Joint 
Strike Fighter. The GAO looks at space programs, satellite 
programs, and healthcare, including technologies to more 
rapidly detect infectious diseases. The GAO is looking at 
antibiotic-resistance bacteria now.
    In order to do our work, it is very important that we have 
this capability. I have submitted to the subcommittee a plan 
that it requested last year, last month, to establish a science 
technology assessment and analysis group in GAO that builds 
upon the groups that we already have. The plan also outlines 
how GAO would propose to grow that team into the future because 
these issues are going to be requiring Congress to respond 
faster and faster. This evolution is going a lot faster than 
the agrarian society to the Industrial Revolution. We are on a 
new pace here.
    Second is cybersecurity. It permeates everything across the 
Federal Government. This year, based on the subcommittee's 
help, the GAO expanded its team from 140 to 175 people. We are 
able to hire people with these skills. We are undertaking a lot 
of work. There needs to be a more comprehensive national and 
global cybersecurity strategy that deals with supply chain 
issues. I can talk more about this in the Q&A session if you 
would like, but we have outlined 4 areas and 10 actions in the 
cybersecurity area that our country needs to take. I am very 
concerned that our country is not acting with the same sense of 
urgency commensurate with the threat in the cybersecurity 
realm. The issue with these advancements in technologies, will 
get more complicated, not less.
    The last two areas are the biggest spending areas in the 
Federal Government. Defense, there's significant work that 
we're doing there. I've been concerned about readiness levels. 
Congress has required DOD to act on our recommendations and 
readiness. They required us over the next several years to 
assess their plan for rebuilding readiness.
    Healthcare is the final area. It's the fastest growing area 
of the Federal Government except perhaps for interest on our 
debt, which is a separate discussion. We need to do more. Right 
now, Medicare and Medicaid combined are over a trillion dollars 
of the Federal Government's budget. By 2026, they are likely to 
each be a trillion dollars over that amount, particularly 
Medicaid if you count State funding as well.
    These programs are growing rapidly. Medicare and Medicaid 
have a high rate of improper payments. The GAO has made several 
recommendations about payment policies that could save the 
government money and not affect the healthcare that we provide 
our citizenry under these two programs.
    I know that you will give careful consideration to our 
request. I thank you for holding this hearing, giving us the 
opportunity. I will be prepared to answer questions at the 
appropriate time.
    [The statement follows:]
               Prepared Statement of Hon. Gene L. Dodaro
(See  in its original format the full report GAO-19-451T and statement 
    of Gene L. Dodaro, Comptroller General of the United States, in 
    Appendix A at the end of the hearing.)

                    FISCAL YEAR 2020 BUDGET REQUEST

                 U.S. Government Accountability Office

                             gao highlights
    Highlights of GAO-19-451T, a report to Subcommittee on the 
Legislative Branch, Committee on Appropriations, U.S. Senate.
Background
    GAO's mission is to support Congress in meeting its constitutional 
responsibilities and to help improve the performance and ensure the 
accountability of the Federal Government for the benefit of the 
American people. We provide nonpartisan, objective, and reliable 
information to Congress, Federal agencies, and to the public, and 
recommend improvements across the full breadth and scope of the Federal 
Government's responsibilities.
    GAO responded to requests from 90 percent of the standing full 
committees of the Congress in fiscal year 2018. GAO issued 633 reports, 
1,650 new recommendations, and testified before 48 congressional 
committees 98 times. Congress used our work extensively to inform its 
decisions on key fiscal year 2018 and 2019 legislation. Since fiscal 
year 2000, GAO's work has resulted in:

  --nearly $1 trillion dollars in financial benefits; and
  --over 23,000 program and operational benefits that helped to change 
        laws, improve public services, and promote sound management 
        throughout government.

    GAO remains an employer of choice in the public sector. The 
Partnership for Public Service announced again in 2018 that GAO one of 
the top places to work in the Federal Government, placing fourth 
position among mid-size agencies and first for supporting diversity.
------
    View GAO-19-451T. For more information, contact Gene L. Dodaro at 
(202) 512-5500 or [email protected].
                    fiscal year 2020 budget request
    Chairman Hyde-Smith, Senator Murphy, and Members of the 
subcommittee, thank you for the opportunity to discuss our fiscal year 
2020 budget request. I greatly appreciate the subcommittee's support of 
our efforts to serve the Congress and improve government performance, 
accountability, and transparency.
    Since 2014, this subcommittee has provided funding that has 
resulted in our work achieving over $340 billion in financial benefits 
and more than 6,300 other improvements in Federal programs and 
operations for our government. In fiscal year 2018, GAO's work yielded 
a record $75.1 billion in financial benefits, a return of about $124 
for every dollar invested in GAO. We also identified 1,294 other 
benefits that led to improved services and public safety for the 
American people and program and operational improvements across the 
government.
    For fiscal year 2020, GAO is requesting $647.6 million in 
appropriated funds, and authority to use $38.3 million in offsetting 
receipts and reimbursements, a 9.8 percent increase. These resources 
will fund 3,250 full-time equivalents (FTE). The funding requested will 
also allow us to continue to make investments in our information 
technology and infrastructure, security requirements, as well as 
address long deferred building maintenance needs.
    This level of funding will enable GAO to meet the highest priority 
needs of the Congress, as we remain committed in helping Congress meet 
its constitutional responsibilities for the benefit of the American 
people. In fiscal year 2018, for example, we received 786 requests, 
including hundreds of statutory requirements, for work from 90 percent 
of the standing committees of Congress supporting a broad range of 
oversight and legislative priorities. The activities planned for fiscal 
year 2020 will better position GAO to assist the Congress in meeting 
its legislative and oversight responsibilities, accomplish our mission 
objectives and goals, and improve government performance and 
accountability.
    In fiscal year 2020, we will continue to support congressional 
oversight across the wide array of government programs and operations. 
We also will continue to increase our capabilities to review the 
opportunities and challenges associated with evolving science and 
technology issues; the risks and management needs to address complex 
and growing cyber security developments; increased investments in the 
Department of Defense; and rising healthcare costs.
    In January, we established a new Science, Technology Assessment, 
and Analytics team to continue and expand our focus on rapidly evolving 
science and technology issues. The team will focus on: (1) conducting 
technology assessments at the request of the Congress; (2) providing 
technical assistance to Congress on science and technology matters; (3) 
continuing to develop and use technical guides to assess major Federal 
acquisitions and technology programs in areas such as cost estimating, 
schedule planning and technology readiness; (4) supporting 
congressional oversight of Federal science programs; and (5) advancing 
GAO's ability to use data analytics in auditing.
    We also will continue to further enhance our capacity to assess 
efforts to protect our Nation from cyber threats. Specifically, we 
recently highlighted urgent actions needed to ensure the cybersecurity 
of our Nation. We also renamed our Information Technology team to 
Information Technology and Cybersecurity in order to better reflect the 
significant body of work the team does on protecting Federal 
information systems, critical infrastructure, and individual privacy 
from cyber threats. GAO will also support continued congressional 
oversight of DoD's efforts to balance current operational deployments 
with fulfilling the full spectrum of future military needs, as well as 
the Federal Government's challenges in effectively and efficiently 
managing healthcare programs.
    The chart below provides a summary by program for the fiscal year 
2020 request.

                                             TABLE 1: FISCAL YEAR 2018-2020 SUMMARY OF RESOURCES BY PROGRAM
                                                                 [Dollars in thousands]
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                                                                      Fiscal Year 2018     Fiscal Year 2019     Fiscal Year 2020     Net Change Fiscal
                                                                           Actual             Estimated             Request            Year 2019/2020
                              Program                              -------------------------------------------------------------------------------------
                                                                      FTE      Amount      FTE      Amount      FTE      Amount      FTE       Amount
--------------------------------------------------------------------------------------------------------------------------------------------------------
Human capital.....................................................   3,015     484,876    3,150     520,986    3,250     554,025      100         33,037
                                                                                                                                     3.2%           6.3%
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Engagement support................................................              14,194               13,300               14,050                     750
                                                                                                                                                    5.6%
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Infrastructure operations.........................................             103,837              100,361              116,883                  16,522
                                                                                                                                                   16.5%
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Center for Audit Excellence.......................................                 727                1,000                1,000                       0
                                                                                                                                                    0.0%
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Total budget authority............................................   3,015     603,634    3,150     635,649    3,250     685,958      100         50,309
                                                                                                                                     3.2%           7.9%
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Offsets \a\.......................................................             (34,566)             (45,899)             (38,321)                  7,578
                                                                                                                                                 (16.5)%
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Appropriation.....................................................            $569,068             $589,750             $647,637                 $57,887
                                                                                                                                                    9.8%
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Source: GAO. l GAO-19-451T.
\a\ Includes offsetting receipts and reimbursements from program and financial audits; rental income; training fees, collection of bid protest system
  user fees; supplemental funds for disaster audits; and for fiscal year 2019, carryover of fiscal year 2018 2-year funds.

        meeting the priority needs of committees across congress
    In fiscal year 2020, we will continue to support congressional 
oversight across the wide array of government programs and operations. 
We also will continue to increase our capabilities to review the 
opportunities and challenges associated with evolving science and 
technology issues; the risks and management needs to address complex 
and growing cyber security developments; increased investments in the 
Department of Defense; and rising healthcare costs.
            assessing evolving science and technology issues
    Rapid advances in technology and science play an increasingly 
important role in our society. These potentially affect areas such as 
economic competitiveness, improved medical care and information 
security. The rapid development and use of these new disruptive 
technologies test the government's and the Congress's ability to 
evaluate their potential and assess their program and policy 
implications.
    Our work has reflected the need to research and assess technology 
developments. In fiscal year 2018, we reported on the emergence and 
implications of Artificial Intelligence, the benefits, risks, and 
regulatory issues concerning Financial Technology (fintech), the need 
for revised cost estimation and scheduling policies by the National 
Science Foundation for large facilities, assessments of the National 
Aeronautics and Space Administration's (NASA) major projects, and 
critical infrastructure protection. We also used our technology 
readiness assessment best practices guide to evaluate major technical 
systems acquisitions such as those found at the Department of Defense 
(DoD), Department of Homeland Security (DHS), the Department of Energy 
(Energy), NASA and other agencies.\1\
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    \1\ We use these assessments in addition to two other best 
practices guides for capital acquisitions: life cycles cost estimating 
and project scheduling.
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    To enhance our ability to provide Congress with thorough and 
balanced analysis of technological and scientific developments that 
affect our society, environment, and economy, we established the 
Science, Technology Assessment, and Analytics team in January 2019. Our 
new team will expand our support to Congress by:

  --conducting technology assessments and providing technical services;
  --reviewing science and technology programs and initiatives to assist 
        in oversight of Federal investments in research, development, 
        and advanced manufacturing;
  --compiling and utilizing best practices in engineering sciences, 
        including cost, schedule, and technology readiness assessments; 
        and
  --establishing an audit innovation lab to explore, pilot, and deploy 
        new advanced analytic capabilities, conduct research in 
        information assurance, and explore emerging technologies that 
        will impact future audit practices.

    Technology Assessments. Our technology assessments explain the 
consequences that certain technology will have on the Federal 
Government--and on society as a whole.

  --Economic competiveness. Our work has covered a range of topics 
        including artificial intelligence, connectivity and the 
        Internet of Things, innovation in data analytics, and 3D 
        printing.
  --Energy and the environment. We have reported on topics like 
        improving municipal freshwater scarcity, reducing freshwater 
        use in hydraulic fracturing and thermoelectric power plant 
        cooling, and climate engineering.
  --Healthcare. We have evaluated enabling rapid diagnoses of 
        infectious diseases and the implications of nanomanufacturing 
        on human health. We are currently investigating the impact of 
        artificial intelligence on healthcare.
  --Homeland security. We have examined the use of explosive detection 
        technologies to protect passenger trains, and the use of 
        biometrics for border security.

    GAO has published a number of technology assessments on established 
and emerging technology. We continue to provide evidence-based analysis 
to assist policymakers with the privacy and security implications of 
technology, as well as the management of Federal investments in 
technology and science. We also develop best practice guides, such as 
our technology readiness assessment guide. Some of the key reports GAO 
has issued include:

           TABLE 2: TECHNOLOGY ASSESSMENTS AND SCIENCE FORUMS
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Technology Assessment: Artificial           Highlights of a Forum: 3D
 Intelligence: Emerging Opportunities,       Printing: Opportunities,
 Challenges, and Implications GAO-18-        Challenges, and Policy
 142SP, Mar 28, 2018                         Implications of Additive
                                             Manufacturing GAO-15-505SP,
                                             Jun 24, 2015
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Chemical Innovation: Technologies to Make   A Capsule Version of:
 Processes and Products More Sustainable     Nanomanufacturing--Emergenc
 GAO-18-307, Feb 8, 2018                     e and Implications for U.S.
                                             Competitiveness, the
                                             Environment, and Human
                                             Health GAO-14-406SP, May
                                             19, 2014
------------------------------------------------------------------------
Medical Devices: Capabilities and           Nanomanufacturing: Emergence
 challenges of technologies to enable        and Implications for U.S.
 rapid diagnoses of infectious diseases      Competitiveness, the
 GAO-17-347, Aug 14, 2017                    Environment, and Human
                                             Health GAO-14-181SP, Jan
                                             31, 2014
------------------------------------------------------------------------
Internet of Things: Status and              Technology Assessment:
 implications of an increasingly connected   Neutron Detectors:
 world GAO-17-75, Published: May 15, 2017    Alternatives to Using
                                             Helium-3 GAO-11-753:
                                             Published: Sep 29, 2011
------------------------------------------------------------------------
Highlights of a Forum: Data and Analytics   Technology Assessment:
 Innovation: Emerging Opportunities and      Climate Engineering:
 Challenges GAO-16-659SP, Sep 20, 2016       Technical Status, Future
                                             Directions, and Potential
                                             Responses GAO-11-71, Jul
                                             28, 2011
------------------------------------------------------------------------
Technology Assessment: Municipal            Technology Assessment:
 freshwater scarcity: Using technology to    Explosives Detection
 improve distribution system efficiency      Technologies to Protect
 and tap nontraditional water sources GAO-   Passenger Rail GAO-10-898,
 16-474, Apr 29, 2016                        Jul 28, 2010
------------------------------------------------------------------------
Municipal Freshwater Scarcity: Survey of    Technology Assessment:
 Technology Adoption by Municipal Water      Protecting Structures and
 Utilities (GAO-16-588SP, April 29, 2016),   Improving Communications
 an E-supplement to GAO-16-474 GAO-16-       during Wildland Fires GAO-
 588SP, Published: Apr 29, 2016              05-380, Apr 26, 2005
------------------------------------------------------------------------
Technology Assessment: Water in the Energy  Technology Assessment:
 Sector: Reducing Freshwater Use in          Cybersecurity for Critical
 Hydraulic Fracturing and Thermoelectric     Infrastructure Protection
 Power Plant Cooling GAO-15-545, Aug 7,      GAO-04-321, May 28, 2004
 2015
------------------------------------------------------------------------
Technology Assessment: Nuclear Reactors:    Technology Assessment: Using
 Status and Challenges in Development and    Biometrics for Border
 Deployment of New Commercial Concepts GAO-  Security GAO-03-174, Nov
 15-652, Jul 28, 2015                        15, 2002
------------------------------------------------------------------------
Source: GAO. l GAO-19-451T

Management of Federal Technology and Science Programs
    GAO also assess the management and coordination of Federal research 
and development efforts, including investments in scientific facilities 
(such as telescopes and research vessels) and emerging technologies 
(like synthetic biology and quantum computing).
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

    Ongoing and planned technology assessments in fiscal year 2019 
include freshwater technologies in agriculture, the implications of 
artificial intelligence on healthcare, 5G wireless communications 
systems, and epidemiological models for emerging infectious diseases. 
The requested resources will enable us to expand and accelerate our 
work including potential technology readiness assessments of complex 
technical acquisitions such as nuclear modernization programs, the 
Army's Next Generation Combat Vehicle program, DHS border protection 
technologies, and Uranium Processing Facility, among others. To bolster 
the new team, GAO has begun efforts to recruit additional staff with 
expertise in:

  --biological/life sciences for emerging infectious diseases, 
        epidemiology, synthetic biology, biosafety, and biosecurity 
        work;
  --computer/systems/electrical engineering for digital and 
        communications technologies (i.e., 5G wireless, Blockchain, 
        quantum cryptography, artificial intelligence/machine learning 
        systems);
  --applied math/statistics/computer science for advanced analytics/
        data science/data engineering;
  --nuclear physics for nuclear nonproliferation, waste management, 
        weapons systems analysis, radiation/nuclear detection systems, 
        quantum computing; and
  --physics/aerospace engineering for hypersonics, advanced weapons 
        systems, space systems, unmanned systems.

    Based on interest expressed by various committees of jurisdiction, 
potential future work could focus on digital ledger technologies such 
as Blockchain, opioid-addiction vaccine development, autonomous 
vehicles, and regenerative medicine, among many others. Also, as we do 
in all areas, we will make our expert staff available to Members and 
staff to share knowledge and insight on technical and scientific 
matters.
    Consistent with the 2019 Legislative Branch Appropriations Bill, 
Conference Report, we provided a detailed plan to this committee in 
March 2019. The report outlined our expanded capabilities on science 
and technology related issues, specific plans for additional staff and 
other resources, and the products and services the Team will provide to 
Congress. The document also describes the governance structures that 
will apply to the team's work, including technology assessments. To 
inform this plan, we conducted outreach to subject matter experts and 
stakeholders. These include Members of Congress, congressional 
committees, alumni of the former Office of Technology Assessment, major 
scientific associations, the National Academies, and leading science 
and technology policy experts in universities and nonprofit 
institutions.\2\
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    \2\ As of March 15, 2019, GAO met with more than 30 expert 
stakeholders. GAO plans to continue to meet with stakeholders 
throughout the remainder of fiscal year 2019.
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         addressing complex and growing cyber security threats
    Federal agencies and the Nation's critical infrastructures--such as 
energy, transportation systems, communications, and financial 
services--are dependent on cyber information systems and electronic 
data to carry out operations and to process, maintain, and report 
essential information. Our work in cybersecurity includes:

  --Critical infrastructure protection. We work on how to protect the 
        Nation's critical infrastructure--including financial markets, 
        telecommunications, the national airspace system, electricity 
        grid, and oil and gas pipeline sector.
  --Federal information systems. We evaluate the cybersecurity of key 
        Federal agencies, such as the Internal Revenue Service and the 
        Department of Homeland Security.
  --Privacy. We evaluate Federal efforts to ensure the privacy of 
        individuals in response to emerging technologies (such as the 
        Internet of Things and artificial intelligence), the collection 
        and use of personal information in the private sector through 
        social media, and privacy in government programs (e.g., Federal 
        student aid and Medicare).

    We also will continue to further enhance our capacity to assess 
efforts to protect our Nation from cyber threats. Specifically, we 
recently updated our cybersecurity high-risk area based on our recent 
evaluations. We did so to highlight urgent actions that are needed by 
Federal agencies to ensure the cybersecurity of our Nation.\3\ We also 
renamed our Information Technology team. Its new name, Information 
Technology and Cybersecurity (ITC), better reflects the significant 
body of work the team does on protecting Federal information systems, 
critical infrastructure, and individual privacy and sensitive data from 
cyber threats. To reinforce GAO's cybersecurity audit capabilities, the 
ITC team is actively recruiting additional resources, including those 
participating in the CyberCorps Scholarship for Service program. The 
new recruits will augment our cadre of experts who can assess the 
criticality of cyber risks, both present and future, as well as 
evaluate the government's complex and multi-faceted attempts to address 
them.
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    \3\ High-Risk Series: Urgent Actions Are Needed to Address 
Cybersecurity Challenges Facing the Nation, GAO-18-622 (Washington, 
D.C: Sept. 6, 2018).
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cyber-based threats to the nation's systems and critical infrastructure
    The cyberattacks suffered by the Office of Personnel Management, 
Equifax, and other large organizations in recent years highlight the 
increasing importance of cybersecurity. Threats from state and non-
state actors are growing in sophistication, scope, and impact. These 
increasing threats could have a serious, or even potentially 
catastrophic, impact.
    Attackers target increasing volumes of sensitive and Internet-
accessible data by using ever-more powerful tools like automation, 
social media manipulation, vulnerability exploitation, and insider 
access to carry out attacks. These threats pose growing dangers for the 
entire Federal Government, the Nation's infrastructure and democratic 
processes, and the privacy and financial security of American citizens.
    As Congress turns to GAO for insightful analysis and advice to 
address these rapidly evolving threats, recruiting top-tier cyber 
talent to augment our current audit workforce is critical. Additional 
resources will allow us to quickly expand our audit capabilities 
related to key components of the cyber high-risk area, including 
evaluating efforts to protect Federal systems, critical infrastructure, 
and individual privacy from cyber threats. Over the next 2 years, our 
planned efforts include assessing the Federal Government's efforts to 
establish and implement a comprehensive national cyber strategy, to 
evaluate government-wide initiatives to implement continuous 
diagnostics and monitoring capabilities, and to establish effective 
risk management processes at Federal agencies. GAO is also evaluating 
key agency capabilities for responding to security incidents and data 
breaches, as well as assessing their security postures through detailed 
vulnerability assessments of agency network defenses.
    Our work on the protection of critical infrastructure will continue 
to focus on two areas: (1) the cybersecurity of specific sectors,\4\ 
including the electricity grid and the financial services and 
communications sectors, and (2) the effectiveness of the public-private 
partnership model as a framework for protecting the Nation's critical 
assets from cyber threats.
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    \4\ Critical infrastructure includes systems and assets so vital to 
the United States that incapacitating or destroying them would have a 
debilitating effect on national security. These critical 
infrastructures are grouped by the following 16 industries or 
``sectors'': chemical; commercial facilities; communications; critical 
manufacturing; dams; defense industrial base; emergency services; 
energy; financial services; food and agriculture; government 
facilities; healthcare and public health; information technology; 
nuclear reactors, materials, and waste; transportation systems; and 
water and wastewater systems.
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    As part of our work on critical assets, we are also starting work 
evaluating the cybersecurity implications of the move to 5G in the 
communications sector. Our work on the protection of individual privacy 
will also continue to focus on two areas: (1) Federal efforts to 
protect consumers from data breaches and their after effect; and (2) 
whether Federal agencies are applying data protection best practices 
when performing their own critical mission activities.
     overseeing increased investments in the department of defense
    The Department of Defense (DoD) faces significant challenges in 
responding to a complex and rapidly evolving national security 
environment that includes instability in key regions of the world, 
cyber threats, and terrorist activities. As DoD works to sustain and 
advance its military superiority and achieve efficiencies that can be 
reinvested to increase readiness, it continues to undergo one of the 
most significant organizational realignments since the Goldwater-
Nichols Act of 1986.
    As you know, in support of DoD's mission, Congress entrusted DoD 
with considerable resources, about $686 billion in discretionary funds 
enacted in fiscal year 2019, and Congress has directed GAO to review a 
broad range of DoD's activities to assist Congress in its oversight of 
this investment. Since 2006, GAO's work has resulted in 4,072 
recommendations to DoD designed to strengthen the department's programs 
and operations. These recommendations focus on critical challenges 
facing the department, including rebuilding readiness, managing space 
capabilities, strengthening cyber defenses, acquiring and sustaining 
major weapon systems, and addressing inefficiencies in the military 
health system, among others.
    GAO's work has led to the designation of seven DoD areas on our 
High Risk List, including financial management, weapon systems 
acquisitions, business systems modernization, and support 
infrastructure management, as well as the government-wide personnel 
security clearance process, for which DoD has significant 
responsibilities. Collectively, our work has resulted in over $70 
billion in financial benefits since fiscal year 2015. For example, we 
identified $36 billion in financial benefits from improvements to DoD's 
weapon systems acquisitions processes, an estimated $3.1 billion from 
improvements to DoD's method for setting standard fuel prices, and $849 
million through identifying unexpended and unobligated balances in 
DoD's Military Personnel accounts.
    GAO anticipates continuing to support congressional oversight of 
DoD by testifying during congressional hearings, providing quick-turn-
around technical assistance, and issuing special oversight publications 
across a broad range of areas.
    GAO will continue to interact extensively with committee staff on 
the Senate and House Armed Services Committees as they draft the annual 
National Defense Authorization Act, providing input on many legislative 
provisions based on GAO's work. For example, Congress approved a budget 
reduction of $1.3 billion for the Navy's frigate program, based on 
GAO's finding that more knowledge was needed before contracts were 
awarded.
    GAO will also support congressional appropriators by conducting 
budget justification reviews on a variety of topics and defense 
operations and maintenance, weapon system acquisitions, personnel, and 
defense healthcare. GAO's review of DoD's 2019 research, development, 
and procurement budget request identified almost $2 billion in 
potential rescissions and reductions. GAO also will continue to issue 
annual ``Quick Look'' reports assessing the cost, schedule, and 
performance of about 80 major defense acquisition programs, helping 
support the Congress in overseeing the department's estimated $1.5 
trillion in future spending on these systems.
    GAO also continues to assess DoD's efforts to strengthen its 
financial management practices and efforts to obtain a clean opinion on 
its financial statements. DoD has never received a clean opinion on its 
financial statements, which prevents GAO from expressing an opinion on 
the consolidated financial statements of the Federal Government. Long-
standing weaknesses in DoD's financial management adversely affect the 
economy, efficiency, and effectiveness of its operations. The same 
financial management problems that prevented DoD from being auditable 
in the past, adversely impact its operations and its ability to achieve 
broader business transformation goals.
    We anticipate a growing demand from the Congress for GAO's work 
regarding DoD. In the last year, for example, Congress signaled a 
continued emphasis on DoD's new Chief Management Officer as the driving 
force behind the department's business reform efforts. We have a number 
of ongoing audits assessing DoD's progress in this area, including 
reviewing DoD's efforts to implement cross-functional business reform 
teams and to achieve enterprise-wide efficiencies.
    GAO will also support continued congressional interest in DoD's 
efforts to balance current operational deployments with training and 
equipping forces capable of fulfilling the full spectrum of military 
operations. We will continue to assess DoD's efforts to sustain its 
major weapon systems and address challenges from aging depot 
maintenance facilities. We will also review the plans, organization, 
and capabilities of the department's cyber operations; the safety and 
effectiveness of the U.S. strategic nuclear force; and DoD's 
investments in hypersonic weapons and associated defensive systems. We 
also anticipate further congressional interest in DoD's long-range 
strike fighter and next generation air dominance acquisition efforts, 
as well as a broad array of space-based programs.
    Regarding DoD's efforts to control costs, we plan to continue 
assessing the costs, schedule, and technical capabilities of the 
Columbia class nuclear submarine program. We also plan to assess DoD's 
efforts to achieve efficiencies and reduce overlap and duplication, 
such as across its defense agencies and field activities. We will also 
continue to assess the department's approach and methodologies for 
improving the efficiency of the military health system and determining 
its medical workforce needs.
    We will support the Congress in assessing DoD's efforts in 
implementing other key legislative requirements, including acquisition 
reform legislation aimed at streamlining DoD's processes for buying 
weapon systems.
    With the resources requested, GAO will expand our work within and 
beyond these areas, helping ensure that we address the issues most 
important to the Congress and taxpayer during this critical period for 
DoD and our country's national defense.
                   managing rising health care costs
    Estimated at $1 trillion in fiscal year 2018, growth in Federal 
spending for major healthcare programs has exceeded the growth of GDP 
historically and is projected to grow faster than the economy. These 
healthcare programs include Medicare, Medicaid, and the Children's 
Health Insurance Program, along with Federal subsidies for health 
insurance purchased through the marketplaces established by the 
Affordable Care Act (ACA) and related spending. Federal spending also 
supports healthcare for American Indians, veterans, servicemembers and 
public health priorities, such as preventing and responding to 
infectious disease outbreaks and bio health threats. These Federal 
commitments to healthcare programs are a key driver of the nation's 
fiscal spending. Growth in Federal spending on healthcare is driven 
both by increasing healthcare spending per person and by increasing 
enrollment, in part stemming from the aging of the population.
    The Federal Government faces challenges in effectively and 
efficiently managing healthcare programs. Specifically, the demands to 
meet Americans' health needs are growing in volume and complexity while 
oversight is becoming more challenging. Understanding these 
complexities and offering fact-based recommendations to address them 
requires advanced policy and analytical expertise. Congress has 
frequently sought our healthcare policy expertise on a range of 
healthcare issues. In 2018, we issued 85 products that examined access 
to and quality of care, drug availability and pricing, program 
expenditures and integrity, the protection of public health, and 
healthcare markets, among other topics. We made 123 recommendations to 
improve the efficiency and effectiveness of Federal healthcare 
spending, and documented about $40 billion in savings in 2018 alone by 
agencies taking action on our recommendations.
    GAO has also focused on healthcare issues through its biennial High 
Risk Report. With our 2017 High Risk Update, we designated the Indian 
Health Service (IHS) as high-risk. This area joins four other high-risk 
areas related to healthcare: Medicare, Medicaid, the Food and Drug 
Administration, and Department of Veteran Affairs (VA) Health Care.
    In addition to these audit products, we annually respond to dozens 
of requests for informal assistance regarding Federal healthcare policy 
and programs. The demand for this type of assistance continued in 2018, 
as committees considered evolving and complex healthcare policy 
changes. These requests ranged from making our subject matter experts 
available to answer detailed questions about the interworking of 
programs to providing time-sensitive data analysis.
    Our healthcare policy experts also advise me on my statutory 
responsibilities for appointing members to six different health-related 
commissions.\5\ Carefully considering each appointment to these 
commissions requires a high-degree of professional judgment and subject 
matter expertise and demands a significant investment of time by our 
healthcare senior executives.
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    \5\ GAO has responsibility for appointing members to six healthcare 
commissions, including the Health Information Technology Advisory 
Committee; Medicaid and CHIP Payment and Access Commission; Medicare 
Payment Advisory Commission; Patient-Centered Outcomes Research 
Institute (PCORI) Governing Board; PCORI Methodology Committee; and the 
Physician-Focused Payment Model Technical Advisory Committee.
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    Additional resources for our healthcare work would not only allow 
us to respond more quickly to congressional requests, it would allow us 
to expand our work on the drivers of healthcare costs. For example, the 
continued growth of the Medicare and Medicaid programs drives Federal 
spending on healthcare and these programs are expected to place 
additional strain on the Federal budget in the coming years, as each 
program is projected to top $1 trillion in annual expenditures within 
the next decade.
    With decades of experience, our expertise positions us to examine 
the growth of Medicare spending relative to other components of the 
healthcare system (e.g., inpatient and post-acute care) and ask which 
is growing higher and faster. Our expertise also positions us to 
examine the incentives created by certain Medicare payment policies 
that drive excess and inappropriate utilization of services. 
Furthermore, our staff's Medicaid expertise positions us to explore 
issues like access, financing arrangements, delivery, and program 
integrity, all critical issues that are made more complex by the 
variation among state Medicaid programs.
    In addition to examining the sustainability of these large Federal 
healthcare programs, we would continue to examine how these healthcare 
programs and markets affect the daily lives of Americans and 
communities. For example, given:

  --The complexities of the prescription drug market, we would continue 
        to provide objective, unbiased examinations of trends in drug 
        costs and identify options to control these costs.
  --Congressional interest and the ongoing opioid epidemic, we would 
        expand our work examining the Federal Government's effort to 
        curb drug misuse.\6\
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    \6\ Congress directed GAO to conduct over a dozen studies in the 
2018 Substance Use-Disorder Prevention that Promotes Opioid Recovery 
and Treatment for Patients and Communities Act.
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  --Our high-risk designation of veterans' healthcare issues, we would 
        provide real-time assessments of significant VA initiatives in 
        these areas.
         gao information technology and building infrastructure
    The resources we received for fiscal year 2019, and request for 
fiscal year 2020, will allow GAO to make strategic investments in 
information technology (IT), and GAO's facilities infrastructure. 
Funding in these areas enables GAO to make sound capital investments in 
new technology and address important funding requirements in support of 
our building facilities that will increase efficiency, lower operating 
costs, and allow us to increase our rental revenue.

    Information Technology. GAO has a range of business applications, 
many of which rely on outdated technologies. A multi-year, multi-phase 
effort to improve our aging IT infrastructure is underway. This effort 
will allow us to further streamline business operations, increase staff 
efficiency and productivity, improve access to information, and 
facilitate a more agile and mobile workforce, all in a more secure 
environment. This modernization effort will include several components, 
some of which are discussed below.

    In fiscal year 2019 and fiscal year 2020, we will:

  --Continue our efforts to modernize content development, 
        distribution, and publishing our reports. This effort, New 
        Blue, will allow our reports to be formatted for and consumed 
        on any Internet-connected device. GAO will be publishing 
        reports from each mission team in preparation for full 
        deployment. Initial stakeholder feedback from congressional 
        staff on New Blue has been very positive, specifically, the 
        ability to access GAO products remotely for use during 
        congressional hearings.
  --Finish rolling out cloud-based technology to provide enhanced 
        Unified Communication Tools (UCT) and collaboration 
        capabilities within GAO for an increasingly mobile workforce. 
        UCT supports our mobile workforce/virtual presence goals to 
        reduce the need for travel among field offices and 
        headquarters, in addition to audit locations. This effort will 
        modernize our suite of telecommunications tools, which will 
        facilitate greater video conferencing, audio, data sharing, 
        reduce redundant implementation and maintenance costs, and 
        standardize the infrastructure that supports voice and data 
        usage. In addition, this effort will migrate telecommunications 
        infrastructure to a cloud hosted solution, which will reduce 
        expenditures and fully integrate with enhanced collaboration 
        tools.
  --Deploy a cloud-based Web Content Management solution for GAO's 
        external web site, www.gao.gov, which will better enable mobile 
        content and increase customer satisfaction.
  --Upgrade the virtual desktop infrastructure \7\ to be more 
        responsive to staff needs and better enable staff to conduct 
        analysis and develop content. This effort will include 
        upgrading the operating environment on our desktops to Windows 
        10 prior to Windows 7 being sunset in 2020.
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    \7\ Virtual desktop infrastructure (VDI) is virtualization 
technology that hosts a desktop operating system on a centralized 
server in a data center.
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  --Implement software enhancements to automate and improve how GAO 
        receives complaints regarding fraud, waste, and abuse through 
        GAO's Fraudnet portal.
  --Define the requirements to replace our decades old document and 
        records management system, which houses the supporting 
        documentation for our audit engagements and operational support 
        programs. We are looking to move to a cloud-based Enterprise 
        Content Management solution that provides enhanced 
        functionality, including security, knowledge management, 
        workflow automation, and business process management.

    This solution will improve existing document and records management 
capabilities, and will do so with less administrative burden on 
employees. In addition, the solution will radically improve our ability 
to share knowledge across the agency and automate many routine 
workflows for engagement management and execution as well as for 
internal operations. This will free staff to focus their energies on 
content development and client and customer service. We expect to 
acquire and begin implementation of the solution in fiscal year 2020.

  --Replace the agency's outdated Learning Management and Performance 
        Management systems with a cloud-based Talent Management 
        information system to track and manage training and development 
        activities of GAO staff.

    We also plan to expand our IT capacity to meet the demands of a 
larger GAO staff and support the new STAA Team and Audit Innovation 
Lab.

    Facilities and Security. While most of GAO's staff is located at 
its Headquarters in Washington, DC, GAO maintains a presence in 
strategic locations throughout the country. GAO is always working to 
ensure our headquarters and field office locations operate as 
efficiently as possible, and we continue to reduce our real property 
footprint as we identify opportunities.
    In fiscal year 2018, GAO consolidated space in its headquarters 
building to maximize efficiency, freeing up over 40,000 square feet for 
use by another Federal agency and increasing GAO's rental income. In a 
further effort to cut costs and reduce our real estate footprint, GAO 
is strategically moving its field offices into federally owned space as 
commercial leases expire. For example, GAO recently moved its San 
Francisco Office from a commercial lease in the financial district to a 
Federal building in Oakland.
    Over the next 2 years, GAO is also looking at options to relocate 
staff in Los Angeles and Chicago from commercial buildings. GAO is 
requesting additional funding related to these office moves to ensure 
we have funding needed for fixed costs related to moves and other 
expenses related to the office transitions. In addition, as reported in 
our fiscal year 2018 financial statements, GAO has over $29 million of 
deferred but necessary maintenance at its headquarters building. This 
includes heating and air conditioning infrastructure and major 
electrical equipment that are original to our 67-year old building and 
past their useful life. Additional funds will help enable this work and 
protect these valuable assets from quickening deterioration.

    Increased Classified Work. In recent years, GAO has received an 
increasing number of mandates and congressional requests for reviews 
that require GAO staff to have access to classified agency information, 
as well as reviews that require accessing information at higher 
classification levels. Further, GAO's Procurement Law division hears 
bid protests that involve classified information as part of its 
statutory responsibility for adjudicating bid protests of government 
contracts.
    Given this increased demand, GAO began making corresponding 
infrastructure investments in fiscal year 2017 and fiscal year 2018. 
For example, GAO has increased the size of its secure space available 
in its headquarters for processing classified information at both the 
Secret and Top Secret and Sensitive Compartmented Information levels.
    Additional funds in fiscal year 2020 will help enable GAO to make 
further cost- effective technological and infrastructure improvements 
to support the anticipated increase in work involving classified 
information, such as

  --upgrading and deploying additional secure video teleconference 
        equipment for field offices;
  --a new case management system to more efficiently track personnel 
        security clearances;
  --a new Classified Enterprise Content Management solution to enhance 
        processing of classified products; and
  --networked Top Secret and Sensitive Compartmented Information 
        computer processing capabilities.
             assisting the congress in shaping legislation
    GAO continues to be recognized for its non-partisan, objective, 
fact-based, and professional analyses across the full breadth and scope 
of the Federal Government's responsibilities and the extensive 
interests of Congress.
    Since our last budget request, Congress used GAO's work to make 
important legislative decisions. Examples linked directly to GAO's work 
include:

  --The Consolidated Appropriations Act of 2019. Based on GAO work, 
        Congress directs:

    --DoD to (1) mitigate the effects of flooding on roads and 
            infrastructure on domestic installations that are vital to 
            military operations; and (2) improve oversight of its 
            global real property portfolio;
    --VA to (1) modernize and improve its appeals process; (2) improve 
            the accuracy and fairness of Gulf War illness claims; (3) 
            retrofit facilities to eliminate barriers to care for women 
            veterans; (4) report on progress to improve oversight of 
            the controlled substance inspection program; and (5) 
            improve staffing, recruitment, and retention strategies for 
            physicians;
    --DOE to (1) better account for fraudulent spending or other 
            improper payments; (2) improve contract auditing and the 
            tracking of meaningful data for fraud, waste, and abuse in 
            its contracts; and (3) improve the Office of River 
            Protection's ability to carry out oversight of its 
            contractors' quality assurance programs.

  --The National Defense Authorization Act for Fiscal Year 2019. 
        Reflecting our past work, the Congress directs DoD to:

    --develop a plan to rebuild military readiness in 5 warfighting 
            domains, including ground, air, sea, space, and cyberspace, 
            as well as requiring GAO to annually review the 
            department's plan through 2022;
    --provide military servicemembers with training to enhance their 
            employability within 1 year prior to their separation, and 
            improve related performance reporting and monitoring;
    --require the Navy to provide detailed budget information for 
            multi-billion dollar aircraft carrier dismantlement and 
            disposal activities; and
    --require the Secretary of Defense to designate a component 
            responsible for coordinating efforts to acquire a 
            modernized Global Positioning System receiver, to maximize 
            the government's return on a multi-billion dollar 
            investment.

  --In addition, a House report accompanying the Act directs DoD to:

    --use policy and technological solutions to manage risk and secure 
            classified information and systems to counter insider 
            threats; and
    --urge the Secretary of the Air Force and Secretary of the Navy, in 
            concert with the F-35 Joint Program Office, to reduce F-35 
            sustainment costs.

  --The Good Accounting Obligation in Government Act (GAO-IG Act). 
        Signed into law on January 3, 2019, the act requires certain 
        Federal agencies:

    --to include a report in their annual budget justification that 
            identifies the implementation status of each public GAO 
            recommendation that has been outstanding for at least 1 
            year and that not been implemented.\8\
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    \8\ For GAO's own reporting in response to the GAO-IG Act, see page 
30.

  --The 2018 Omnibus Appropriations Act. Based on GAO's work, the 
---------------------------------------------------------------------------
        Congress directs:

    --the Veterans Health Administration (VHA) to research the 
            overmedication of veterans that led to deaths, suicides, 
            and mental health disorders;
    --DoD to align its (1) structure, (2) statutory parameters, and (3) 
            regulatory guidance across Federal prescription drug buying 
            programs to increase its buying power and reduce costs;
    --DHS to (1) develop performance metrics for all deployed border 
            security, (2) evaluate the individual and collective effect 
            of deployed technologies, and (3) assess progress;
    --DHS to regularly assess advanced protective technologies for 
            cybersecurity; and
    --Federal agencies, such as DoD, National Cybersecurity and 
            Communications Center, and Bureau of Indian Affairs, to 
            report on how they plan to implement GAO recommendations.

  --The National Defense Authorization Act for Fiscal Year 2018. 
        Reflecting our past work, the Congress directs DoD to:

    --improve its budget guidelines, cost savings, leadership of 
            business operations, military readiness goals and 
            implementation strategies, and reduce vulnerabilities in 
            military aircraft and risks to military installations from 
            climate change;
    --increase reporting on the Columbia class nuclear submarine to 
            keep the program on track;
    --change its space leadership structure;
    --reinstate annual reports on the time required to conduct 
            investigations, adjudicate cases, and grant security 
            clearances; and
    --establish new ways for agencies to modernize their legacy 
            information technology.

  --The Disaster Recovery Reform Act of 2018. In October 2018, based in 
        part on GAO's work, Congress passed the 2018 Disaster Recovery 
        Reform Act, which directs the Federal Emergency Management 
        Agency (FEMA) to:

    --develop a National Public Infrastructure Pre-Disaster Mitigation 
            fund to allow for a greater investment in building 
            resilience before a disaster occurs;
    --make Federal disaster assistance available to State and local 
            governments for building code administration and 
            enforcement;
    --reconsider the factors it uses to evaluate a jurisdiction's 
            request for a major Federal disaster declaration; and
    --update Congress on the development of a national preparedness 
            assessment and efforts to avoid duplication across 
            preparedness grants.

    Federal funding for disaster assistance since 2005 is approaching 
half a trillion dollars (about $430 billion), most recently for 
hurricanes and wildfires in 2017 and 2018. These costs are expected to 
increase as extreme weather events become more frequent and intense. 
Increasing reliance on Federal assistance is a key source of Federal 
fiscal exposure. Since adding limiting the Federal Government's 
exposure by better managing climate change risks to our High Risk List 
in 2013, we have made several recommendations to help improve 
resilience to potential disasters.
                     financial and program benefits
    Financial Benefits. In fiscal year 2018, financial benefits 
resulting from our work included (1) revising spending limits for 
Medicaid demonstration projects to assure that they are budget-neutral 
($36.8 billion); (2) helping the Centers for Medicare & Medicaid 
Services (CMS) achieve and measure the benefits of its fraud prevention 
system ($1.3 billion); (3) identifying unexpended and unobligated 
balances in selected DoD accounts and proposing changes in its fuel 
pricing methodology ($5.3 billion); and (4) identifying unexpended and 
unobligated balances in DoD's Military Personnel accounts ($849 
million).

    Other Benefits. Many other benefits resulting from our work led to 
program and operational improvements. In fiscal year 2018, we recorded 
1,294 of these other benefits. For example, our work on public safety 
and security:

  --positioned U.S. Customs and Border Protection to better protect 
        U.S. manufacturers from economic harm and U.S. consumers from 
        potential risks posed by counterfeit products sold online;
  --resulted in comprehensive ready-for-sea inspections of Navy ships 
        based in Japan and changes to sleep schedules after deadly 
        collisions in the Pacific highlighted training, maintenance, 
        and manning shortfalls that had contributed to insufficient 
        sleep time for sailors;
  --led the Transportation Security Administration (TSA) to begin 
        updating and improving the risk assessment and strategy it uses 
        to (1) secure airport perimeters, and (2) control access to 
        restricted areas to better assess security issues at airports 
        nationwide; and
  --prompted the Department of Justice (DOJ) and the Office of National 
        Drug Control Policy to begin developing results-oriented 
        measures, such as reductions in overdose deaths, to help them 
        assess progress made in combatting the Nation's opioid 
        epidemic.

    Similarly, our work related to vulnerable populations:

  --contributed to the Congress passing legislation to strengthen the 
        Nation's data on elder abuse by requiring annual data 
        collection and reporting to support national prevention policy; 
        and
  --led the Federal Communications Commission to begin measuring the 
        effectiveness of industry efforts to prevent wireless network 
        outages helping to ensure that Americans who rely solely on 
        them have access during emergencies.

    In addition, our work in the healthcare area:

  --prompted the Indian Health Service (HIS) to publish wait-time 
        standards for primary care and urgent care visits to help it 
        monitor patient access to care;
  --led CMS to establish regular checks for identifying duplicate 
        health coverage in both Medicaid and the health insurance 
        exchange marketplaces, thereby helping to minimize the risk of 
        the Federal Government paying twice for an individual's health 
        insurance coverage; and
  --prompted the Food and Drug Administration (FDA) and Drug 
        Enforcement Administration to formalize procedures for sharing 
        information that would allow FDA to better manage drug 
        shortages.

    Furthermore, our work in the area of agency operations:

  --led FEMA to (1) pilot a data sharing process with States to allow 
        it to identify potentially duplicative disaster assistance 
        payments, and (2) make plans to create a similar process to 
        manage future disasters;
  --prompted the Office of the Director of National Intelligence to 
        issue formal guidance and implementation guidelines to help 
        Federal agencies continually assess their employees' 
        eligibility to hold security clearances and to do so uniformly; 
        and
  --prompted the Congress to require Federal agencies to inform active 
        duty military servicemembers of their eligibility to receive 
        student loans at a 6 percent interest rate to better ensure 
        timely access to these loans and prevent overpayments.
        evaluating federal disaster response and recovery issues
    The Supplemental Appropriations for Disaster Relief Requirements 
Act of 2017 provided GAO with $14 million to conduct unanticipated 
disaster oversight and audit work associated with the catastrophic 
hurricanes and wildfires in 2017. GAO is evaluating a variety of topics 
including disaster contracting, response challenges, progress in 
multiple Federal recovery programs, fraud prevention and internal 
controls, and is identifying recommendations to improve Federal actions 
in all these areas.
    So far, GAO has completed 11 disaster-related reports and has 25 
additional ongoing audit engagements. Specifically, we have reported on 
the initial Federal efforts to respond to Hurricanes Harvey, Irma, and 
Maria, as well as the California wildfires. We have also reported on 
disaster-related Federal spending and identified a number of long-term 
recovery challenges in disaster-impacted areas, such as Puerto Rico and 
the U.S. Virgin Islands. Further, we identified challenges related to 
FEMA's disaster workforce and recommended actions to address weaknesses 
in Federal disaster contracting practices.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

    In regard to ongoing work, we are evaluating disaster recovery 
programs for individuals and those with disabilities, efforts to 
strengthen disaster resilience and better prepare for future disasters, 
and efforts to restore the power grid in Puerto Rico, among other 
issues. Given the number of ongoing engagements and our reporting 
schedule, we anticipate that GAO will use all of the $14 million in 
disaster funds by the end of fiscal year 2020. A complete list of the 
reports issued and audits currently underway is included as Enclosure 
II.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                      building bodies of knowledge
    Through the products we issued in fiscal year 2018, we continued to 
build on bodies of work related to our three broad strategic goals to 
(1) address current and emerging challenges to the well-being and 
financial security of the American people; (2) help the Congress 
respond to changing security threats and the challenges of global 
interdependence; and (3) help transform the Federal Government to 
address national challenges. Examples include:

  --Protection of children. We reported on the need to (1) improve 
        Federal support to help states recruit and retain foster care 
        families to meet demand; (2) develop guidance for states to 
        help them better apply protections for substance-affected 
        infants; (3) consider discipline disparities for Black 
        students, boys, and students with disabilities in K-12 public 
        schools; and (4) update guidance to better monitor lead in 
        school drinking water.

  --Support of Veterans. We reported on the need for VA to improve its 
        oversight and evaluation of the effectiveness of its suicide 
        prevention outreach activities. We found that VA's outreach 
        activities dropped off in 2017 and 2018, and the office 
        responsible for these activities lacked consistent leadership. 
        We also found that VA did not have clear goals for evaluating 
        the effectiveness of its outreach activities.

  We also reported on the need for (1) DoD to improve its monitoring of 
and reporting on its transitioning veterans program; (2) VA to further 
assess its performance and progress toward meeting its opioid safety 
goals for veterans; and (3) VHA to collect better data and evaluate its 
strategies for improving physician staffing, recruitment, and 
retention.

  --Advancement of healthcare. We reported on the need to (1) better 
        secure the electronic health information of Medicare 
        beneficiaries; (2) improve Federal oversight of the health and 
        welfare of beneficiaries receiving Medicaid assisted living 
        services; and (3) improve assessments of individuals' needs for 
        home and community based services.

  --Oversight of military readiness. We continued to monitor DoD's 
        efforts to rebuild military readiness and reported on the need 
        to (1) better plan for sustaining various military aircraft, 
        including the new F-35; (2) reassess the utilization and 
        organization of the Air Force F-22 Raptor fleet; (3) improve 
        maintenance of the Navy's submarine fleet and the Army's 
        Patriot missile defense system; and (4) clarify policies and 
        gather reliable data to manage the impact of time away from 
        home on service members and their families.

  --Assessment of technology and science. We reported on (1) Artificial 
        Intelligence applications in four areas--cybersecurity, 
        automated vehicles, criminal justice, and financial services; 
        (2) sustainable chemical innovation, new approaches that 
        improve the chemistry behind medicines, personal care products, 
        and other everyday items to reduce environmental impacts; (3) 
        technologies to mitigate electromagnetic risks to the U.S. 
        electric grid; and (4) quantum computing, synthetic biology, 
        and other potentially transformational research and 
        considerations for U.S. competitiveness.

  --Designation of High Risk areas. In our latest March 2019 update, 
        the ratings for seven areas improved, two to the point of 
        coming off the list--Department of Defense Supply Chain 
        Management and Mitigating Gaps in Weather Satellite Data. The 
        rankings for more than half of the over 30 areas on the list 
        remained largely unchanged with three regressing. We also added 
        VA Acquisition Management to the list after identifying seven 
        VA contracting challenges. VA has one of the most significant 
        acquisition functions in the Federal government, in costs and 
        numbers of contracts. Another issue--the Government-wide 
        Personnel Security Clearance Process--was added to the list in 
        January 2018 due to growing concerns about security clearance 
        backlogs and other problems.

  In fiscal year 2018, our high-risk work in 35 areas resulted in 166 
reports, 49 testimonies, $46.8 billion in financial benefits, and 526 
other benefits. Financial benefits to the Federal Government due to 
progress in addressing high-risk areas over the past 13 years (fiscal 
year 2006 through fiscal year 2018) totaled nearly $350 billion or an 
average of about $27 billion per year. The updated list is included as 
Enclosure I.

  --Identification of Fragmentation, Overlap, and Duplication. Our 
        eighth annual report identified 68 new actions across 23 new 
        program areas that could reduce fragmentation, overlap, and 
        duplication, or provide other cost savings and revenue 
        enhancement opportunities across the Federal Government. 
        Congress and executive branch agencies addressed 724 of the 
        actions identified from 2011 to 2017, leading to about $178 
        billion in financial benefits; $125 billion had accrued through 
        2017, with $53 billion more expected. An updated Fragmentation, 
        Overlap, and Duplication report will be issued May 2019.
                  focusing on congressional priorities
    Serving Our Clients. In fiscal year 2018, we issued 633 reports and 
made 1,650 new recommendations. Our senior executives were asked to 
testify 98 times before 48 separate committees or subcommittees on 
topics including key risks for the 2020 Census, improper payments under 
Medicaid, national defense preparedness, border security, and the 
Nation's cybersecurity challenges. The table that follows lists 
examples of topics GAO addressed in testimony in fiscal year 2018, 
grouped by our three external strategic goals.

           TABLE 3: SELECTED GAO FISCAL YEAR 2018 TESTIMONIES

_______________________________________________________________________
Goal 1: Address Current and Emerging Challenges to the Well-Being and 
        Financial Security of the American People
_______________________________________________________________________

-- Observations on DOJ's Grantees' Capacity to Process DNA Evidence
-- Observations on the Supplement Nutrition Assistance Program
-- Improving DoD's Oversight of its Program for Transitioning Veterans
-- Observations on the Strategic Petroleum Reserve's Emergency 
Stockpile
-- Addressing DOE Management Challenges
-- Implementing Positive Train Control
-- Addressing Native American Youth in the Justice System
-- Reducing Risk of Harm to Medicare Beneficiaries from Prescription 
Opioids
-- Improving the Transfer and Monitoring of Unaccompanied Children
-- Improving Federal Management of Indian Programs
-- Improving Oversight of VA Health Care Providers

_______________________________________________________________________
Goal 2: Respond to Changing Security Threats and the Challenges of 
        Global Interdependence
_______________________________________________________________________

-- Addressing Longstanding Management Challenges for Immigration Courts
-- Improving Management of the Coast Guard's Acquisition Portfolio
-- Securing the Southwest Border--Progress and Challenges
-- Improving Navy and Marine Corps Plans to Train for Amphibious 
Operations
-- Enhancing Information Sharing with Private Sector on the 
Counterfeits Market
-- Improving Oversight of the Antiterrorism Assistance Program
-- Using TSA Data to monitor Airport Operations Including Passenger 
Wait Times
-- Preliminary Observations on Reported Injuries to U.S. Personnel in 
Cuba
-- Monitoring Inter-American Assistance Agreements and U.S. 
Contributions
-- Improving Management of DHS' Chemical Facility Security Program
-- Improving VA's Medical and Surgical Supply Contracts to Reduce Cost

_______________________________________________________________________
Goal 3: Help Transform the Federal Government to Address National 
        Challenges
_______________________________________________________________________

-- Addressing Physical Security Challenges at NIST and Commerce
-- Implementing High-Risk Recommendations for IT Acquisitions, 
Operations, and Cybersecurity
-- Mitigating Key Risks for 2020 Census
-- Improving Federal Regulatory Guidance Practices
-- Addressing DHS' Urgent Cybersecurity Workforce Needs
-- Addressing Cost Growth and Schedule Delays in NASA's Major Projects
-- Improving Management of Medicare's Fraud Risks
-- Addressing Management Challenges Presented by
-- Budget Uncertainty
-- Preparing for VA's Transition to a New Electronic Health Record 
System
-- Improving Government Efficiency and Effectiveness to Reduce Federal 
Costs
-- Observations on USPTO's Covered Business Method Patent Review 
Program
-- Addressing Delays in NASA's Commercial Crew Program
-- Observations on Challenges and Opportunities for Grants Management
_______________________________________________________________________
Source: GAO | GAO-19-451T

    Outreach Efforts. I continued my regular meetings with the Chairs 
and Ranking Members of congressional committees to obtain their views 
on GAO's work, including their priorities, and to discuss opportunities 
and challenges facing our Nation.
    I also sent letters to the heads of most Federal departments to 
acknowledge the actions taken to date to implement our prior 
recommendations and to draw their attention to priority recommendations 
still requiring their attention. These letters were also sent to the 
congressional committees of jurisdiction to inform their oversight.
    We continue to collaborate with the Congress to revise or repeal 
mandated reporting requirements to align our work with current 
congressional priorities and maximize our staff resources.
                         internal improvements
    Supporting Our People. The hard work and dedication of our diverse 
and professional multidisciplinary staff positioned GAO to achieve 97 
percent on-time delivery of our products in fiscal year 2018. We 
exceeded the targets for our seven people measures, new hire rate, 
retention rates with and without retirements, staff development, staff 
utilization, effective leadership by supervisors, and organizational 
climate. GAO also continued its distinction as a best place to work--
the Partnership for Public Service ranked GAO fourth among mid-size 
Federal agencies and first for supporting diversity.

    Managing Our Internal Operations. In fiscal year 2018, we continued 
efforts to maximize our strategic goal to maximize our value by 
enabling quality, timely service to the Congress and being a leading 
practices Federal agency. We made progress addressing our three 
internal management challenges: managing a quality workforce; improving 
the efficiency of our engagements; and ensuring the confidentiality, 
integrity, and availability of GAO's information technology services. 
We are on track to achieve 3,150 FTE in our fiscal year 2019 hiring 
plan and expect to have over 3,250 staff on board at year-end.
    In fiscal year 2018 GAO deployed the Electronic Protest Docketing 
System (EPDS), made key security investments, and refreshed technology 
platforms needed to support our bid protest work.\9\
---------------------------------------------------------------------------
    \9\ The Consolidated Appropriations Act, 2014, included a provision 
for GAO to develop an electronic bid protest filing system. The statute 
also authorized the collection and use of fees to offset the costs of 
that system. GAO successfully piloted and launched its new system, 
EPDS, in 2018.
---------------------------------------------------------------------------
    As previously mentioned, in fiscal year 2019, we will complete the 
pilot of New Blue, a system that will allow analysts to more 
efficiently create and manage report content; streamline the publishing 
processes; and enable access on mobile devices. New Blue is planned to 
be rolled out across GAO following the conclusion of the pilot. If you 
are interested in reviewing a GAO product in the new format, please see 
GAO-18-312.
    To enhance information technology services, we continued to 
strengthen monitoring and detection of malicious activity to counter 
escalating cybersecurity threats.
    In keeping with our effort to continuously improve our operations, 
GAO migrated to the Legislative Branch Financial Management System 
(LBFMS) Momentum Financial operated by the Library of Congress. The 
system serves as our integrated Financial Management System and is 
hosted in a FedRAMP compliant and secure facility. LBFMS improved 
internal controls over invoicing processing, reduced data entry errors, 
and increased efficiency and timeliness of payments.
    GAO also received an unmodified or ``clean'' opinion from 
independent auditors on our financial statements for fiscal year 2018 
and our internal control over financial reporting. Independent auditors 
found no reportable noncompliance with provisions of applicable laws, 
regulations, contracts, and grant agreements tested. We demonstrated 
that all detailed performance and financial information is complete and 
reliable and meets high standards for accuracy and transparency.
         good accounting obligation in government act reporting
    With regard to the recommendations from GAO's Office of the 
Inspector General (OIG), GAO has implemented all of the recommendations 
issued by the OIG prior to January 2018. Additionally, GAO has 
determined that it will implement the three open OIG recommendations 
that have been issued within the past 12 months and expects that 
implementation will be completed within calendar year 2019.
                               legal work
    In fiscal year 2018, we addressed about 2,600 bid protest cases and 
issued more than 600 decisions on the merits. In addition, we published 
15 appropriations law products, including five products to carry out 
GAO's responsibilities under the Impoundment Control Act regarding the 
President's special message of May 2018.
                           strategic planning
    GAO issued its latest Strategic Plan for Serving the Congress and 
the Nation in February 2018, covering fiscal years 2018 to 2023. As the 
Nation confronts a series of both new and long-standing challenges, 
this plan describes our goals and strategies to support the Congress to 
identify cost savings and other financial opportunities; to make 
government more accountable, efficient and effective; and ultimately to 
improve the safety, security, and well-being of the American people. 
GAO's Strategic Plan provides a comprehensive roadmap for how the 
agency will support the most important priorities of Congress and the 
American people.
    This plan reflects the full scope of the Federal Government's 
operations, as well as emerging and future trends that may affect 
government and society. As part of our strategic planning process, we 
emphasize foresight, continuous environmental scanning, and trend 
analysis as essential to helping inform our decisionmaking and long-
term planning.
    The plan is comprised of three sections: strategic goals and 
objectives; key efforts; and trends that provide overall context 
supporting our long- range planning. The current strategic plan 
framework (Enclosure III) summarizes these global trends affecting 
government and society, as well as the strategic goals and objectives 
that guide our work.

    There are eight trend areas in GAO's 2018--2023 plan including:

    1.  Domestic and Global Security: Global conditions affecting U.S. 
and international security;
    2.  Fiscal Outlook and the Debt: The Federal Government's long-term 
unsustainable fiscal path;
    3.  Economics and Trade: Global response to challenges posed by 
divergent economic growth;
    4.  Jobs and Education: Technological advances and their impact on 
preparing the workforce of the future;
    5.  Demographics and Society: Demographic changes and their 
implications for U.S. society and economy;
    6.  Science and Technology: Five emerging technologies and 
scientific advances that could potentially transform society (Genome 
Editing; Artificial Intelligence and Automation; Quantum Information 
Science; Brain/Augmented Reality; and Cryptocurrencies and Blockchain);
    7.  Government and Governance: Increasingly complex governance 
relationships and practices; and
    8.  Environment and Sustainability: Balancing competing natural 
resource and sustainability needs.
                      center for audit excellence
    The Congress authorized GAO to establish a Center for Audit 
Excellence (the Center) in 2014 to provide training and technical 
assistance to enhance the capacity of domestic and international 
accountability organizations. GAO contributes to a number of efforts 
that promote good governance and enhance the capacity of the 
accountability community. The Center uniquely offers a wide range of 
training and technical assistance services at locations throughout the 
United States and the world. The Center is authorized to charge fees 
for its services to facilitate recovery of its costs.
    Since its opening in October 2015, the Center has expanded its 
volume of business significantly and increased annual revenue from 
$41,000 in fees in fiscal year 2016 to $624,000 in fiscal year 2018. 
Further, the Center has provided training or technical assistance 
services to over two dozen Federal, State, local and international 
accountability organizations. Several of these organizations have 
returned to the Center repeatedly for training and technical assistance 
services to help build staff capacity in applying auditing concepts and 
tools.
    In fiscal year 2018, the Center provided training and technical 
assistance to 12 domestic audit organizations, including Federal 
inspectors general and State and local audit offices. Center services 
helped these organizations improve their staff members' understanding 
of Federal internal control standards, Government Auditing Standards, 
and performance audit methodologies. For example, the Center provided 
10 classes on internal control to one Federal audit organization. Based 
on formal and informal feedback, the vast majority of training 
participants found Center training to be greatly useful.
    The Center also provided technical assistance to three national 
audit institutions in Europe and Central America during fiscal year 
2018 to enhance their capacity to conduct and achieve results from 
performance audits. For example, the Center helped a national audit 
institution in Eastern Europe enhance its capacity to conduct 
information technology audits and helped another national audit 
institution assess and improve its process for documenting financial 
benefits resulting from audits. The Center also provided technical 
assistance on a project funded by the Millennium Challenge Corporation 
to help enhance the performance audit capacity of a national audit 
institution in Central America.
    In April 2016, the Center signed a Memorandum of Understanding 
(MOU) with the U.S. Agency for International Development (USAID) to 
collaborate in enhancing audit capacity and accountability in 
developing countries. In fiscal year 2018, under the MOU, the Center 
assessed the capacity building needs of an African country's audit 
institutions for USAID and identified areas for improvement. In 
November 2018, the Center signed an agreement with USAID/Philippines to 
provide training and technical assistance services to the Philippine 
Commission on Audit to strengthen their capacity to conduct performance 
audits. USAID expects the total estimated cost of the 3-year project to 
be $1.48 million and has obligated $500,000 for services to be provided 
by the Center in the first year.
    The Center continues to implement its business plan and look for 
additional ways to build on its accomplishments and strengthen the 
capacity of accountability partners to enhance the oversight of U.S. 
Federal funds used domestically and across the globe. For example, 
during fiscal year 2019, the Center plans to expand its international 
work further by leveraging its MOU with USAID and expanding 
partnerships with other organizations such as the World Bank.
                           concluding remarks
    We value the opportunity to provide Congress and the Nation with 
timely, insightful analysis on the challenges facing the country. I 
would like to thank the Committee again for its support of GAO and the 
fiscal year 2019 budget. Our fiscal year 2020 budget requests the 
resources to ensure that we can continue to address the highest 
priorities of the Congress.
    Our request will allow us to continue building our staffing level 
and provide our employees with the appropriate resources and support 
needed to serve the Congress effectively. This funding level will also 
allow us to continue efforts to promote operational efficiency and 
address long-deferred information technology investments and 
maintenance. We will also continue to explore opportunities to generate 
revenue to help offset our costs.
    I appreciate, as always, your careful consideration of GAO's budget 
and your continued support.

                 Enclosure I: GAO's 2019 High Risk List

------------------------------------------------------------------------
              High Risk Area                       Year Designated
------------------------------------------------------------------------
Strengthening the Foundation for
 Efficiency and Effectiveness
    Improving Federal Programs that Serve   2017
     Tribes and Their Members \a\.
    2020 Decennial Census \a\.............  2017
    U.S. Government's Environmental         2017
     Liability \a\.
    Improving the Management of IT          2015
     Acquisitions and Operations.
    Limiting the Federal Government's       2013
     Fiscal Exposure by Better Managing
     Climate Change Risks \a\.
    Management of Federal Oil and Gas       2011
     Resources.
    Modernizing the U.S. Financial          2009
     Regulatory System \a\.
    Restructuring the U.S. Postal Service   2009
     to Achieve Sustainable Financial
     Viability \a\.
    Resolving the Federal Role in Housing   2013
     Finance \a\.
    Funding the Nation's Surface            2007
     Transportation System \a\.
    Managing Federal Real Property........  2003
    Strategic Human Capital Management....  2001
 
Transforming DoD Program Management
    DoD Approach to Business                2005
     Transformation.
    DoD Support Infrastructure Management   1997
     \a\.
    DoD Business Systems Modernization....  1995
    DoD Financial Management..............  1995
    DoD Weapon Systems Acquisition........  1990
 
Ensuring Public Safety and Security
    Government-wide Personnel Security      2018
     Clearance Process (new) \a\.
    Protecting Public Health through        2009
     Enhanced Oversight of Medical
     Products.
    Transforming EPA's Processes for        2009
     Assessing and ControllingToxic
     Chemicals \a\.
    Ensuring the Effective Protection of    2007
     Technologies Critical to U.S.
     National Security Interests \a\.
    Improving Federal Oversight of Food     2007
     Safety \a\.
    Strengthening Department of Homeland    2003
     Security Management Functions.
    Ensuring the Cybersecurity of the       1997
     Nation \a\.
 
Managing Federal Contracting More
 Effectively
    VA Acquisition Management (new).......  2019
    DoD Contract Management...............  1992
    DOE's Contract Management for the       1990
     National Nuclear Security
     Administration and Office of
     Environmental Management \a\.
    NASA Acquisition Management \a\.......  1990
 
Assessing the Efficiency and Effectiveness
 of Tax Law Administration
    Enforcement of Tax Laws \a\...........  1990
 
Modernizing and Safeguarding Insurance and
 Benefit Programs
    Managing Risks and Improving VA Health  2015
     Care \a\.
    National Flood Insurance Program \a\..  2006
    Improving and Modernizing Federal       2003
     Disability Programs.
    Pension Benefit Guaranty Corporation    2003
     Insurance Programs \a\.
    Strengthening Medicaid Program          2003
     Integrity \a\.
    Medicare Program & Improper Payments    1990
     \a\.
------------------------------------------------------------------------
Source: GAO. | GAO-19-451T
\a\ Legislation is likely to be necessary in order effectively address
  this area.

    Enclosure II--Federal Disaster Response and Recovery Engagements

                         completed engagements
Disaster Assistance: Opportunities to Enhance Implementation of the 
Redesigned Public Assistance Grant Program. GAO-18-30, November 8, 
2017.

2017 Disaster Contracting: Observations on Federal Contracting for 
Response and Recovery Efforts. GAO-18-335, February 28, 2018.

Federal Disaster Assistance: Individual Assistance Requests Often 
Granted but FEMA Could Better Document Factors Considered. GAO-18-366, 
May 31, 2018.

2017 Hurricanes and Wildfires: Initial Observations on the Federal 
Response and Key Recovery Challenges. GAO-18-472, September 4, 2018.

Homeland Security Grant Program: Additional Actions Could Further 
Enhance FEMA's Risk-Based Grant Assessment Model. GAO-18-354, September 
6, 2018.

Continuity of Operations: Actions Needed to Strengthen FEMA's Oversight 
and Coordination of Executive Branch Readiness. GAO-19-18SU, November 
26, 2018.

2017 Disaster Contracting: Action Needed to Better Ensure More 
Effective Use and Management of Advance Contracts. GAO-19-93, December 
6, 2018.

U.S. VIRGIN ISLANDS RECOVERY: Status of FEMA Public Assistance Funding 
and Implementation. GAO-19-253, February 25, 2019.

PUERTO RICO HURRICANES: Status of FEMA Funding, Oversight, and Recovery 
Challenges. GAO-19-256, March 14, 2019.

Huracanes de Puerto Rico: Estado de Financiamiento de FEMA, Supervision 
y Desafios de Recuperacion. GAO-19-331, March 14, 2019.

DISASTER RECOVERY: Better Monitoring of Block Grant Funds Is Needed. 
GAO-19-232, March 25, 2019.
                          ongoing engagements
 1.  Federal post disaster contracts;
 2.  Disaster assistance for older Americans and individuals with 
disabilities;
 3.  Puerto Rico and U.S. Virgin Islands power grid restoration;
 4.  Review of U.S. Virgin Islands recovery planning and progress;
 5.  Puerto Rico disaster recovery planning and progress;
 6.  2017 wildfire response and recovery;
 7.  Federal internal control plans for disaster assistance funding;
 8.  Electricity grid restoration and resilience after the 2017 
hurricane season;
 9.  Mass care sheltering and feeding challenges during the 2017 
hurricanes;
10.  DOT highway and transit emergency relief funding;
11.  Drinking water and wastewater utility resilience;
12.  Review of disaster death count information in selected states and 
territories;
13.  Department of Health and Human Services Disaster Response Efforts;
14.  Disaster and climate change impacts on Superfund sites;
15.  FEMA Public Assistance program fraud risk management efforts;
16.  Fuel reduction efforts for wildland fires;
17.  Preparedness challenges and lessons learned from the 2017 
disasters;
18.  FEMA workforce management and challenges;
19.  Small Business Administration response to 2017 disasters;
20.  Development of the GAO disaster resilience framework;
21.  FEMA Individual Assistance programs and challenges;
22.  National Flood Insurance Program (NFIP) post-flood enforcement;
23.  Emergency alerting capabilities and progress;
24.  National Flood Insurance Program buyouts and property 
acquisitions; and
25.  Economic costs of large-scale natural disasters and impacts on 
community recovery.

             Enclosure III--GAO's Strategic Plan Framework
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

Source: GAO. | GAO-19-451T

    Senator Hyde-Smith. Thank you very much.
    Dr. Hall, we would love to hear your opening statement as 
well.
STATEMENT OF DR. KEITH HALL, DIRECTOR, CONGRESSIONAL 
            BUDGET OFFICE
    Dr. Hall. Chairman Hyde-Smith and Ranking Member Murphy and 
Members of the subcommittee, thank you for the opportunity to 
present the Congressional Budget Office's budget request. And 
thank you also for your longstanding support of CBO. That 
support has allowed us to provide budgetary and economic 
analysis that is timely, thoughtful, and nonpartisan as the 
Congress addresses issues of critical importance.
    The primary purpose of my testimony this morning is to 
request an appropriation of $53.6 million for 2020. That amount 
is an increase of $2.8 million, or 5.6 percent, from the amount 
provided in 2019. That increase is largely aimed at 
accomplishing two main goals.

             1. BOLSTERING RESPONSIVENESS AND TRANSPARENCY

    Last year, the Congress increased CBO's budget to put in 
place a multiyear plan to increase our capacity to make its 
work as transparent and responsive as possible. As a result, we 
are increasing staffing in high-demand areas, such as analyses 
of healthcare and immigration. In addition, we are continuing 
to hire analysts to expand our use of team approaches, in which 
work on large and complicated projects is shared.
    In 2020, we propose hiring additional staff who would 
increase our expertise and modeling capability in several 
areas. CBO's goal is to have more staff with overlapping skills 
within and across teams. In some cases, those skills will 
consist of expertise related to particular programs, such as 
transportation. In other cases, they will be more technical, 
such as the ability to design simulation models. Increasing the 
number of staff with overlapping skills will allow us to be 
more nimble when responding to requests for information.
    Building on the strong foundation we have established over 
many years, and with added resources, CBO will also undertake 
many different activities to make its analysis transparent. For 
example, during the next 2 years, we will:

  --Testify about our projections and analytical method and 
        will work to resolve issues raised by Congress;
  --Publish more overviews and documentation of some of our 
        major models and more detailed information, including 
        computer code, about key aspects of those models;
  --Release data in many forms, including an interactive 
        product to help users obtain information about our 
        estimates of the distribution of household income;
  --Use a new format for our cost estimates to highlight key 
        parameters as well as information needed by the 
        Congress for budget enforcement procedures;
  --Continue to evaluate previous estimates, when possible, in 
        order to improve future ones;
  --Publish several reports about uncertainty in our estimates;
  --Experiment with creating visual summaries of some of our 
        major reports, as we did in our most recent budget 
        outlook report; and
  --Interact daily with the Congress to explain our estimates 
        and obtain feedback and continue to regularly obtain 
        advice from outside experts.

                 2. CONTINUE OUR HIGH VOLUME OF OUTPUT

    In 2018, we published more than 900 formal cost estimates; 
we complete cost estimates for nearly all bills before a floor 
vote occurs. We also provided the Appropriations Committee with 
numerous summaries and account-level tabulations for 
appropriation bills; provided technical assistance to 
congressional staff as they developed thousands of legislative 
proposals and amendments; and published many reports about the 
budget, the economy, and related issues.
    Those reports included our assessment of the 10-year budget 
and economic outlook, a report on the longer term budget 
outlook, analysis of the President's budget, a 300-page report 
describing more than 100 options for reducing the Federal 
deficit, monthly budget reviews, and a variety of analytic 
reports that examined particular Federal spending programs, 
aspects of the tax code, and budgetary and economic challenges. 
Most of those reports are written at the request of the 
Chairman or Ranking Member of a committee or subcommittee or at 
the request of the leadership of either party in the House or 
Senate.
    But we know that Members would like us to do even more. So 
to achieve our two goals--to continue a high level of output 
and bolster responsiveness and transparency--CBO requests an 
increase of $2.8 million.
    About $1.5 million--a little more than half of the proposed 
increase would go toward funding for a full year 14 additional 
staff members we will be hiring during fiscal year 2019, as 
well as 6 additional hires in fiscal year 2020. That would 
boost our total FTEs from 255 planned for this year to 264 next 
year. The other $1.3 million would cover a small increase in 
our employees' average salary and benefits to provide merit 
based pay raises and keep pace with inflation.
    With your support, we look forward to continuing to provide 
timely and high-quality analysis to Congress. I'm very happy to 
take your questions.
    [The statement follows:]
                  Prepared Statement of Dr. Keith Hall
(See  in its original format the full report ``Testimony, CBO's 
    Appropriation Request for Fiscal Year 2020'' and statement of Keith 
    Hall, Director, in Appendix B at the end of the hearing.)

    Chairman Hyde-Smith, Ranking Member Murphy, and Members of the 
subcommittee, thank you for the opportunity to present the 
Congressional Budget Office's budget request. And thank you also for 
your long-standing support of CBO. That support has allowed CBO to 
provide budgetary and economic analysis that is timely, thoughtful, and 
nonpartisan as the Congress addresses issues of critical importance.
    CBO is asking for appropriations of $53.6 million for fiscal year 
2020. That amount represents an increase of $2.8 million, or 5.6 
percent, from the $50.7 million provided to CBO for 2019. Of the total 
amount, nearly 91 percent would be used for personnel costs.
             reasons for the requested increase in funding
    CBO requests an increase of $2.8 million for two priorities--to pay 
for current staffing and to bolster transparency and responsiveness. 
Last year, the Congress increased CBO's budget to put in place a 
multiyear plan to increase the agency's capacity to make its work as 
transparent and responsive as possible, and the increase requested now 
would allow the agency to continue to pursue that plan.
Paying for Current Staffing
    CBO requests an increase of $1.3 million to fund current staffing 
levels in 2020. That amount would be used for a small increase in 
employees' average salary and benefits to provide merit-based pay 
raises and keep pace with inflation.
Bolstering Transparency and Responsiveness
    The increase would include $1.2 million to fully fund 14 staff 
members hired throughout fiscal year 2019. (The addition in terms of 
full-time-equivalent positions, or FTEs, would be 7.6.) The increase 
would also include $0.3 million for 6 new hires in fiscal year 2020. 
(The addition in terms of FTEs would be 1.4.)
   cbo's budget request and its consequences for staffing and output
    In fiscal year 2020, CBO will continue its mission of providing 
objective, insightful, clearly presented, and timely budgetary and 
economic information to the Congress. To fulfill that mission, CBO 
requests $53.6 million in funding. The requested funds would be used 
for personnel costs (that is, salaries and benefits), information 
technology (IT), and other costs, such as training.
Funding Request for Personnel Costs and Consequences for Staffing
    CBO requests $48.7 million for salary and benefits. Those funds 
would support 264 FTEs. The requested amount represents an increase of 
$2.8 million, or 6.1 percent, from the amount provided for 2019. Of the 
total requested amount:

  --$36.5 million would cover salaries for personnel--an increase of 
        $2.3 million, or 6.7 percent, from the amount that will be 
        spent in fiscal year 2019. The increase would include $0.9 
        million in pay to fully fund the 14 staff members hired in 2019 
        and $0.2 million for the 6 new hires. The increase would also 
        cover performance-based salary increases for current staff and 
        an across-the-board increase of 1.9 percent for employees 
        earning less than $100,000. And it would provide funds for 3 
        FTEs for CBO's intern program.
  --$12.2 million would fund benefits for personnel--an increase of 
        $0.5 million, or 4.4 percent, from the amount projected to be 
        spent in 2019. The increase would cover a boost in the cost of 
        Federal benefits, fully fund benefits for the 14 staff members 
        hired in 2019, and pay for benefits for the 6 new staff 
        members.
Funding Request for Nonpersonnel Costs
    CBO requests $4.9 million for costs other than personnel. Those 
funds would cover current IT operations--such as software and hardware 
maintenance, software development, purchases of commercial data, 
communications, and equipment purchases--and would pay for travel, 
training, interagency agreements, facilities support, printing and 
editorial support, expert consultants, financial management auditing 
support, interactive graphic tools, and subscriptions to library 
services.
    The requested amount is roughly unchanged from the amount that will 
be spent in fiscal year 2019. That is the result of offsetting effects. 
The 2020 amount is pushed up in relation to the 2019 amount mainly 
because CBO plans to further develop tools to analyze and present data 
and would need to purchase additional resources to support a larger 
staff. But the 2020 amount is pushed down in relation to the 2019 
amount mainly because CBO anticipates achieving efficiencies in its IT 
operations and because costs in 2019 have been temporarily boosted by 
onetime agencywide training.
Consequences for Output
    The requested amount of funding would allow CBO to do the following 
for the Congress:

  --Provide roughly 700 formal cost estimates (and significantly more 
        than that number if legislative activity is as high as it was 
        in 2018, when CBO provided 947 estimates), most of which will 
        include not only estimates of Federal costs but also 
        assessments of the cost of mandates imposed on State, local, 
        and Tribal governments or the private sector;
  --Fulfill thousands of requests for background information and 
        technical assistance, the demand for which is very high as 
        committees seek a clear picture of the budgetary impact of 
        proposals and variants of proposals before they formally 
        consider legislation;
  --Produce about 150 scorekeeping tabulations, including account-level 
        detail for individual appropriation acts at all stages of the 
        legislative process, as well as summary tables showing the 
        status of discretionary appropriations (by appropriations 
        subcommittee) and running totals on a year-to-date basis; and
  --Publish about 70 analytic reports and papers--generally required by 
        law or prepared in response to requests from the Chairmen and 
        Ranking Members of key committees--about the outlook for the 
        budget and the economy, major issues affecting that outlook 
        under current law, the budgetary effects of policy proposals 
        that could change the outlook, and a broad range of related 
        budget and economic topics in such areas as defense policy, 
        infrastructure, Social Security, and housing.

    The agency would also continue to bolster its transparency and 
responsiveness by increasing its staff's availability to meet surges in 
demand and by dedicating more staff to creating publications that 
explain and graphically illustrate CBO's work.
    Despite high productivity by a dedicated staff, CBO expects that 
the volume of estimates and other analyses will fall short of the 
number of requests from committees and congressional leadership and 
will fall considerably short of the number of requests from individual 
Members. The demands on the agency remain intense and strain its 
resources in many areas. For example, the workload associated with the 
analysis of appropriations continues to be heavy. Also, over the past 
year, CBO analyzed legislation related to financial reform, farm 
programs, nutrition programs, housing assistance for veterans, pension 
reform, disaster assistance, opioid abuse, and cybersecurity. CBO 
regularly consults with committees and leadership to ensure that its 
resources are focused on the work that is of highest priority to the 
Congress.
                              transparency
    CBO has always worked hard to make its analysis transparent, and 
the agency anticipates that almost all of its current employees will 
spend part of their time on such efforts. Moreover, CBO recently put in 
place a plan to strengthen those efforts. The Congress increased CBO's 
budget for 2019 in part to hire new staff to contribute to transparency 
and bolster responsiveness. To enhance transparency, CBO plans to hire 
10 staff members in 2019 and proposes to hire 6 more in 2020.
    During the next 2 years, CBO will undertake many different 
activities to make its analysis transparent.
Testifying and Publishing Answers to Questions
    In 2019 and 2020, CBO expects to testify about its baseline 
projections and other topics as requested by the Congress. That work 
will involve presenting oral remarks, answering questions at the 
hearings, and presenting written statements, as well as publishing 
answers to Members' subsequent questions for the record. CBO will 
continue to work to resolve issues raised as part of the oversight 
provided by the budget committees and the Congress generally. In 
addition, the agency expects that Members of Congress will ask other 
questions to which it will provide published responses.
Explaining Analytical Methods
    CBO plans to publish short reports providing general information to 
help Members of Congress, their staff, and others better understand its 
work. One such report will provide brief explanations of some important 
concepts related to the Congressional budget process. For example, that 
report will explain differences among authorizations, appropriations, 
rescissions, and reappropriations. Another will explain the differences 
between two types of estimates used for credit programs: estimates 
prepared using the methodology specified in the Federal Credit Reform 
Act, which applies to most Federal credit programs, and estimates 
prepared on a fair-value basis, which incorporates market risk. And 
another short report will explain key scorekeeping rules and how they 
have been used in providing estimates for recent legislation.
    CBO will publish a substantial amount of technical information 
about updates to its health insurance simulation model (HISIM). CBO 
also will provide technical information about several other methods 
used to analyze the effects of Federal policies. In addition to 
segments of computer code from HISIM, CBO plans to release some code 
from other models.
Releasing Data
    In 2019 and 2020, CBO will continue to publish extensive sets of 
data in conjunction with its major recurring reports, including 
detailed information on 10-year budget projections, historical budget 
outcomes, 10-year projections for trust funds, revenue projections by 
category, spending projections by budget account, tax parameters and 
effective marginal tax rates on labor and capital, and 10-year 
projections of economic variables, as well as data about the economy's 
maximum sustainable output.
    The agency will also provide details about baseline projections--
this year with more supporting spreadsheets--covering the following: 
the Pell grant program, student loan programs, Medicare, the military 
retirement program, the pension benefit guarantee program, the Social 
Security Disability Insurance program, the Social Security Old-Age and 
Survivors Insurance program, the trust funds for Social Security, child 
nutrition programs, child support enforcement and collections, foster 
care and adoption assistance programs, the Supplemental Nutrition 
Assistance Program, the Supplemental Security Income program, the 
Temporary Assistance for Needy Families program, the unemployment 
compensation program, the Department of Agriculture's mandatory farm 
programs, Federal programs that guarantee mortgages, programs funded by 
the Highway Trust Fund, benefits for veterans and military personnel 
stemming from the Post-9/11 GI Bill, and veterans' disability 
compensation and pension programs.
    Other data will provide details about long-term budget projections, 
projections underlying Social Security estimates, more than a thousand 
expired or expiring authorizations of appropriations, and dozens of 
Federal credit programs. When CBO analyzes the President's budget 
request, it will post a set of files providing estimates of the 
budgetary effects of specific proposals. Throughout the year, the 
agency will post the data underlying the figures in various reports.
Analyzing the Accuracy of CBO's Estimates
    In 2019 and 2020, CBO will release reports analyzing the accuracy 
of its past projections of outlays, revenues, deficits, and debt. As 
part of a continuing series of reports about the accuracy of its 
previous cost estimates, CBO will reexamine its original estimates of 
certain legislation. A report on the accuracy of CBO's economic 
forecasts will be released. And CBO will publish comparisons of 
previous projections of Federal subsidies for health insurance with 
actual amounts.
Comparing Current Estimates With Previous Ones
    In several of its recurring publications--reports about the budget 
and economic outlook, Federal subsidies for health insurance, and the 
long-term budget outlook--CBO will continue to explain the differences 
between the current year's projections and those from the previous 
year. In its cost estimates, CBO will continue to identify related 
legislative provisions for which it has provided estimates in the 
recent past and explain the extent to which the provisions and 
estimates at hand are similar or different.
Comparing CBO's Estimates With Those of Other Organizations
    The agency will continue to publish its regular comparisons of its 
budget projections and the administration's and of its economic 
projections and those of private forecasters and other government 
agencies. And the agency will include comparisons of estimates in 
various reports. In addition, when time does not allow for publication, 
analysts will sometimes be able to discuss such comparisons with 
congressional staff.
Estimating the Effects of Policy Alternatives
    In 2019 and 2020, CBO will release new interactive products to help 
users understand the effects of potential changes to Federal policies. 
And reports on other topics will also illustrate the potential effects 
of various policy proposals.
Characterizing Uncertainty Surrounding Estimates
    CBO will update its interactive workbook showing how changes in 
economic conditions might affect the Federal budget. Also, its reports 
about the 10-year outlook for the budget and the economy, the long-term 
outlook for the budget, and Federal subsidies for health insurance will 
contain substantial discussions of uncertainty.
Creating Data Visualizations
    In 2019 and 2020, CBO will provide information about its budget and 
economic projections in slide decks and create infographics about 
actual outlays and revenues. And the agency will continue to look for 
opportunities to include graphics to enhance the explanations in some 
cost estimates.
Conducting Outreach
    CBO will continue to communicate every day with congressional staff 
and others outside the agency to explain its findings and methods, 
respond to questions, and obtain feedback. The agency's Director will 
meet regularly with Members of Congress to do the same.
    As the agency updates its health insurance model, it will continue 
to discuss the development with representatives from the Congress, 
Federal agencies, States, insurers, employers, doctors, hospitals, and 
the general public. The agency will also obtain feedback from 
researchers such as those on the technical review panel that it 
established for HISIM.
    After each set of baseline projections is published, CBO's staff 
will meet with congressional staff to discuss the new projections and 
answer questions.
    CBO will continue to obtain input from its Panel of Economic 
Advisers and Panel of Health Advisers. It will continue to turn to 
other experts as well. For example, CBO will convene a recurring 
meeting of crop insurance and commodity analysts to review the past 
performance of the crop insurance program and commodity markets and to 
discuss projections of future spending in those areas. Many reports 
will benefit from written comments by outside experts on preliminary 
versions. For some recurring reports produced on compressed timetables, 
such as the one about CBO's long-term budget projections, the agency 
will solicit comments on previous publications and selected technical 
issues to incorporate improvements in future editions.
    CBO's staff will give presentations on Capitol Hill--some in 
collaboration with the Congressional Research Service--on its budget 
and economic projections and on other topics. Those presentations will 
allow CBO to explain its work and answer questions. The agency will 
also give presentations about its findings and about work in progress 
in a variety of venues to offer explanations and gather feedback. In 
addition, CBO will use podcasts and blog posts to summarize and 
highlight various issues.
                             responsiveness
    One of CBO's highest priorities is responding to the Congress with 
the information that it needs to legislate. That information takes a 
variety of forms, ranging from formal cost estimates to background 
information and technical assistance, and CBO tries to provide it when 
it is most useful. For example, CBO completes nearly all cost estimates 
before a floor vote on legislation.
    In addition, the agency works to provide technical assistance, 
reports, and other information to policymakers during earlier stages of 
the legislative process.
    The agency recently put in place a plan to strengthen its 
responsiveness. For 2019, the Congress increased CBO's budget in part 
to hire new staff to contribute to that effort. As a result, CBO is 
increasing staffing in high-demand areas, such as analyses of 
healthcare and immigration. In addition, the agency is continuing to 
hire analysts to expand its use of team approaches, in which work on 
large and complicated projects is shared.
    The budgetary increase that CBO is requesting now would allow it to 
continue such efforts while also enhancing transparency. In 2020, CBO 
proposes hiring additional staff who would increase the agency's 
expertise and modeling capability in several areas. CBO's goal is to 
have more staff with overlapping skills within and across teams. In 
some cases, those skills will consist of expertise related to 
particular programs, such as transportation. In other cases, they will 
be more technical, such as the ability to design simulation models. 
Increasing the number of staff with overlapping skills will allow the 
agency to be more nimble when responding to requests for information.
    This testimony summarizes information in CBO's budget request for 
fiscal year 2020, which was prepared by Mark Smith, with contributions 
from Leigh Angres, Wendy Edelberg, Joseph E. Evans Jr., Theresa Gullo, 
Deborah Kilroe, Jeffrey Kling, Cierra Liles, Benjamin Plotinsky, and 
Stephanie Ruiz.
    Mark Hadley reviewed the testimony, Benjamin Plotinsky edited it, 
and Jorge Salazar prepared it for publication. It is available on CBO's 
website at www.cbo.gov/publication/55088.

    Senator Hyde-Smith. Thank you.

       PLANS FOR GAO'S SCIENCE TECHNOLOGY ASSESSMENT AND ANALYSIS

    Mr. Dodaro, in March, you provided the subcommittee with 
your plan to expand the support you provide to Congress in the 
areas of science and technology by creating the new Science 
Technology Assessment and Analysis Division. Please tell us 
about the plan for this new division and how that plan is 
reflected in your budget request this year.
    Mr. Dodaro. Yes. First, the new team has four lines of 
effort. One is to do technology assessments for the Congress. 
For example, we've done ones in the past on artificial 
intelligence dealing with cybersecurity, transportation 
systems, autonomous vehicles, and in the financial regulatory 
areas. Some financial advisors are providing, through machine 
learning, advice to people to make investment decisions.
    We're doing one artificial intelligence review now on 
healthcare in terms of how we can help advise and provide 
assistance by analyzing patterns and provide advice to 
physicians and others. Also, in the new 5G area there's a big 
concern about the allocation of spectrum with 5G and the 
implication it's going to have for commercial uses, Federal 
domestic agencies, as well as defense.
    We will continue to expand our work doing these technology 
assessments for the Congress. In the past, based upon the 
agreement we've had with the Appropriations Committee, we do 
about two of these a year. We think we can do more with our 
budget request for next year, and Congress has asked for more 
of these technology assessments.
    Second, we are looking at programs that have science and 
technology implications in them. For example, the Congress is 
investing over several hundred billions of dollars for 
maintenance and modernization of our nuclear weapons systems. 
Congress has asked GAO to look at that. The estimate to resolve 
the hazardous waste that already exists for nuclear weapons is 
estimated to be almost a half a trillion dollars right now. 
We've looked at alternative ways of disposing of this waste 
through new technology applications. We'll be able to meet the 
demands of the Congress better and the priorities for all these 
implications of technology.
    Technology is pretty ubiquitous now in almost everything 
that the Federal Government does. We'll be able to expand our 
capabilities in that area and to look at cost estimates. For 
example, on the nuclear submarine work I just mentioned, we're 
able to identify the fact that the estimates are overly 
optimistic based upon the methodology and the fact that the 
people we have in these areas, that understand the technologies 
and the costs is important.
    We also do technology readiness assessments, that enable 
GAO to advise the Congress before it approves new technology to 
go into production, that the technologies aren't mature enough, 
and that Congress should wait before making the investments 
because if you don't, there will be costly modifications later 
on. So with the expansion of our team in this area, we can help 
Congress avoid spending billions of dollars that aren't going 
to produce the technology everybody thought it was going to 
produce.
    Third, we want to expand the technical assistance that we 
provide to the Congress on a short-term basis. This is if they 
have questions, such as ``What's this new technology about? 
What are the implications of it? What can be done in these 
areas? What questions should we be asking? What research and 
development should be done?'' We can expand our capabilities to 
provide that type of advice, not only to committees, we have to 
be in a position to give that advice to individual Members when 
they request it. So the additional resources we're requesting 
will help us expand that capability because all Members really 
need to understand these issues and the implications of them on 
policy decisions.
    Finally we're going to create, with the new resources, an 
innovation lab where we'll be able to test new audit 
methodologies. For example, on blockchain technology, if the 
government applies this widely, which a lot of people are 
suggesting that they do, how would you audit it? How would you 
make sure that it has the integrity everybody thinks it has?
    The other area is the information technology and 
cybersecurity area. We are inundated with requests to look at 
cybersecurity implications of virtually all Federal programs 
and activities, and protecting personally identifiable 
information, healthcare records, and it goes on and on. We will 
be in a better position to respond to congressional requests in 
order to respond to these cybersecurity concerns. As I 
mentioned in my opening statement, these issues will get more 
complicated, not less, with artificial intelligence.
    For example, we are moving to a new air traffic control 
system that will be based on satellite information, not the 
current radar-based closed system. Once you are open to that, 
autonomous vehicles and a wide range of other things, anything 
connected to the Internet is going to have, great benefits. 
Obviously, it's also going to have a down side too, in terms of 
being exploited. Last year we reported the Defense Department 
wasn't paying enough attention to cybersecurity concerns in the 
development of new weapons systems. So we've been asked to do 
more work in that area.
    Space is another area where the dominance in space will 
determine our success not only commercially, but also from a 
national defense standpoint. We have to make sure that our 
assets in space are protected as well. These are the areas that 
we'll be able to provide more advice to the Congress.
    Senator Hyde-Smith. Thank you. How do you intend for this 
division to be able to provide Congress with actionable 
information to guide technology-related policy decisions?
    Mr. Dodaro. Yes. We have been identifying the policy 
implications of this area. We've outreached to a wide number of 
people throughout the Congress, academia, others that are 
interested in this area. One comment is that we should provide 
more policy options for the Congress to consider in these 
areas. So we'll be providing more of that type of information 
when appropriate.
    In the cybersecurity area, in the last several years, we've 
made over 3,000 recommendations, 700 of them haven't been fully 
implemented yet, which is a part of my concern. In the 
cybersecurity area, we've made very specific recommendations, 
many of which aren't available publicly because they would 
expose vulnerabilities, but in the technology assessments, we 
need to add and we'll be developing more policy options for the 
Congress to consider in those areas.
    For example, we did a technology assessment on 
nanomanufacturing, nanotechnology. Here's an area Congress has 
invested $18 billion in the National Nano Initiative to provide 
more funding for research and development. What we found was 
while that was being successful, there was no Federal 
Government support for bringing those new technologies into the 
marketplace as soon as possible. So you had a big spike in 
research and development but a lot of these things weren't 
taken into commercial applications quickly and actually 
entering the economy and having as much benefit as possible. We 
advise that that's an area that Congress ought to look at.
    Other countries have more holistic policies to go from 
research and development all the way through supporting items 
to get to market. Now, we have a greater reliance on the 
private sector, but there is no reason we couldn't have more 
cooperation between the public sector and the private sector in 
bringing these technologies into fruition from research all the 
way to application. That's an area where we've made 
recommendations in the past.
    I'm particularly interested in artificial intelligence and 
the work we're doing on quantum computing as well. This is an 
area where we're in a race with our adversaries to be dominant 
going forward. Clearly we need to take some additional actions 
in those areas. I look forward to making recommendations to the 
Congress in that area as well, particularly in the defense 
realm and in some of the other areas.

                    UPDATE ON INCREASE TRANSPARENCY

    Senator Hyde-Smith. All right.
    Dr. Hall, in your time as Director of CBO, you've made 
transparency a top priority of the agency, which has also been 
a concern for this subcommittee. Will you please provide an 
update on current efforts to increase transparency in fiscal 
year 2019 and how you plan to continue that work in the coming 
fiscal year?
    Dr. Hall. Sure. Actually, we've already done quite--quite a 
lot. At the end of last year we produced a report that had sort 
of a long listing of some of the things that we've done and 
what we plan on doing. But we've done--we've done a--published 
more overviews and documentation of all our major models. We've 
provided some detailed documentation. We've provided some 
computer code on particular models where--where it made sense. 
We've released data, increased our release of data, in many 
forms. We've produced some interactive products. We have an 
interactive product on force structure, we have an interactive 
product on discretionary spending, and then something on the 
economic outlook where you're allowed to sort of vary some of 
the economic assumptions that we use for the budget, budget and 
economic outlook.
    We've changed the format of our cost estimates to try to 
make them--to highlight the key parameters that are used in the 
estimates and make it more useful for budgetary enforcement 
process. We've done continued evaluation of our estimates. 
We've published some reports about uncertainty. We're 
experimenting with visual summaries of some of the major 
reports, so we've actually gotten some really good feedback. We 
did that, for example, in the most recent budget outlook. And 
we continue to interact daily with Congress, so we get some 
feedback about how these--how these transparency efforts are 
working, how they're going over.
    And we've also done some--some talking. You know, we've 
done some--some presentations over at CRS about how we do 
healthcare estimates and how we do some of the other estimates, 
how we do economic estimates.
    So we've done quite a lot and we have quite a lot planned 
going forward.

                 ANY CHALLENGES INCREASING STAFF LEVELS

    Senator Hyde-Smith. Fantastic. Just one other follow-up to 
that, supporting the needs of Congress, including providing the 
enhanced transparency you are talking about, has required 
increases in human capital. Do you foresee any challenges with 
continuing to increase your staff levels?
    Dr. Hall. Well, that has gone--that has gone well. It's 
gone very well, I think. We've increased our hiring and we've 
managed to keep our hiring standards very high, so that part 
has worked out. We've added people in a lot of different areas.
    To be honest, one of the real challenges is we need a 
little bit of a larger footprint, so we're--we're crowding 
folks a little bit to bring--bring them on, but we're handling 
that. And, of course, we have lots of data and we need 
particular configurations to protect the data. But I'd say the 
challenges have not been great, and we're--we're rising to the 
challenges.

                      GAO'S DISASTER-RELATED WORK

    Senator Hyde-Smith. Okay. Moving on to your disaster work, 
Mr. Dodaro, GAO was provided $14 million in supplemental 
funding to conduct oversight work on disasters which occurred 
during calendar year 2017, which was a very busy year. How many 
projects have you completed related to this disaster work?
    Mr. Dodaro. We've issued 11 reports already. We have 25 
other audits underway. We expect in the next 2 months, this 
month and next month, to complete an additional six reports, 
and before the August recess, another eight reports. So by the 
end of August, we'll have issued 25 total reports on this 
subject and still have work underway because there's a long 
tail, as you know, to these recovery projects and activities, 
particularly, in this case, in Puerto Rico and Texas and the 
Virgin Islands and Florida as well.

                 VALUABLE GAO DISASTER-RELATED FINDINGS

    Senator Hyde-Smith. Yes. It does seem to go on and on and 
just compounded by other things as well.
    What has been the most valuable finding, and how can we 
improve the Federal response to disasters?
    Mr. Dodaro. Two main themes have come out of this. One is 
the importance of building resilience in at the beginning, and 
the level of preparedness at the State, territorial, or local 
level. In the 2017 situation where Florida was much more 
prepared than Puerto Rico, for example, and so they had built 
resilience in, they had changed their building codes, they had 
better secured their sources of electricity, and Puerto Rico 
really wasn't prepared in that area.
    So lesson number one is it's important to take adaptation 
measures and to build resilience into your building codes and 
then in to all other decisions, such as the height of the 
bridges, how you secure not only your electrical system but 
your communication systems, et cetera.
    Now, I was pleased to see, based in part on GAO's work last 
year, the Congress passed the Disaster Recovery Reform Act, 
which allows some of the money to be used for resilience 
building and through funding allows the State and local levels 
to bring up their codes to new international standards. The 
National Building Sciences group recommends for every dollar 
that you invest into resilience building, you will save $6.00 
later. The same thing with building codes: investments pay off 
later and you don't have as much damage to deal with.
    Lesson number two is that there is a need to improve the 
contracting process in this area. We have looked at the advance 
contracts that are supposed to be in place so FEMA could move 
quickly. We made a number of recommendations on how that could 
be strengthened, and also contracting right after the events.
    That last thing I would say is we made a recommendation to 
the Congress related to the Community Development Block Grant 
disaster component. That does not have a standard authorization 
for the Congress to have a permanent program there. And what's 
happened with Katrina, with Sandy, and now with these 2017 
hurricanes, it takes HUD time to design new programs using the 
Federal Register process. Programs with new rules and new 
regulations and everything. So they don't have anything ready 
to go. And if Congress is going to continue to use the 
Community Development Block Grant program, which is helpful 
because it covers things that aren't covered under other 
Federal programs and allows for building for housing and 
economic development, Congress should permanently authorize the 
program that would enable HUD to move out on contracts more 
quickly.
    So those are some of the recommendations we have so far. 
We'll have more in our upcoming reports.

                        FUTURE GAO DISASTER WORK

    Senator Hyde-Smith. So have you received requests for 
oversight work now on the 2018-2019-related disasters?
    Mr. Dodaro. I think we will. Just in defense alone, for 
example, the damage at Camp Lejeune from Hurricane Florence, 
and Hurricane Michael in Florida, and the Panhandle for Tyndall 
Air Force Base, each have damage estimates of over $3 billion 
for those areas alone.
    We have also received requests to deal with wildfires out 
West, and that's part of what we're doing right now, and, we've 
had historic flooding in the Midwest recently; I expect 
requests. There is hardly a disaster that happens that GAO is 
not immediately asked for assistance to find out what's going 
on, and we have built quite an expertise in this area. We 
appreciate the supplemental funds from the Congress. We've 
spent half of the $14 million so far. We expect to spend the 
rest of the money in fiscal year 2020. If we're going to do 
more work in these other disasters, having additional funding 
would be helpful.
    Senator Hyde-Smith. As I said, we're between votes and 
we've got 8 minutes left, but Senator Murphy is on his way 
back----
    Mr. Dodaro. Okay.
    Senator Hyde-Smith [continuing]. So maybe we can swap out 
and still make this work.

                    GAO INFORMATION TECHNOLOGY NEEDS

    One more question here. Part of your request includes 
investments in information technology and infrastructure, but 
of the $16.5 million increase, you request an additional $10 
million specifically for GAO's IT needs. Tell us about what 
this funding will provide and the need for these new 
investments.
    Mr. Dodaro. Yes. There are several that are really critical 
to our operations. First has to do with the unified 
communications technology. The phone system in the GAO building 
is still a PBX analog system. I've already made arrangements to 
have it retired to the Alexander Graham Bell Museum. We don't 
have Voice over Internet Protocol and a digital approach. That 
we're going to be able to do. We're going to go to Skype for 
Business so we can have clear communications with people, 
because we have people throughout the United States and people 
on field visits all the time. This will enable a very mobile 
workforce that we have to communicate better. So that's number 
one.
    Number two, it will help the Congress because we're moving 
to produce all our reports in an HTML digital format that can 
be read on any mobile device. We've already produced our first 
pilots under this program, that's been very favorably received 
by the Congress, because staff can have access at hearings in 
supporting Members on the floor to any GAO product through this 
method. We're rolling this out now based on a successful pilot.
    Third is our document management approach. We generate lots 
of analysis and information, and have to have it stored. Our 
document management system dates back to the 1990s. We need a 
new system that will enable us to store our documents and 
retrieve them effectively. This will increase our efficiency 
and effectiveness. Everybody wants things as fast as possible, 
and this will enable us to speed up our analysis and the 
production of our reports.
    Senator Hyde-Smith. What would be the effect if you were 
not to receive those funds for these initiatives this year?
    Mr. Dodaro. We'll have to use some Band-Aids and go to the 
first aid kit and limp along for a while, and it won't increase 
our productivity.

             EXPECTATION OF THE NEW HEALTH INSURANCE MODEL

    Senator Hyde-Smith. Okay. Dr. Hall, I understand CBO is 
currently working on updating its Health Insurance Simulation 
model, which the agency uses for cost estimates related to all 
healthcare legislation. What can we expect from the new model, 
and how are you ensuring transparency through this process?
    Dr. Hall. Well, we are just about to roll out the new 
model. We're going to use it in our spring baseline, which is 
early next month, so it--it's--it's in--it's in use at the 
moment. We had a process for preparing the model that was--that 
was rather thorough and very transparent. We--we had extensive 
peer review. We had broad external validation. We made a lot of 
presentations. It has been the most open and transparent 
development of a model I've ever seen, by far. And we've gotten 
very good reviews on doing it that way. And then ahead of the 
release of the baseline, which is, again, coming up next month, 
we've very shortly going to produce a slide deck that has the 
model specifications, the key equations and parameters, make 
those public. We're going to have additional documentation, 
particularly describing the sources and preparation of input 
data that's used in the simulation modeling. And then we're 
going to offer access to the computer code that the model uses 
to simulate certain decisions about insurance choices, in 
particular, that that's underlying the baseline work. So a lot 
of that is just on the verge of coming out, I would say.

             ECONOMIC OUTLOOK--DEBT AS A PERCENTAGE OF GDP

    Senator Murphy [presiding]. The gavel has been handed over 
here. So sorry--as I'm sure Senator Hyde-Smith mentioned, we're 
in the middle of a vote, so I appreciate you allowing us to do 
musical chairs here.
    Let me actually start with you, Dr. Hall, for my questions. 
I wanted to take advantage of the fact that I have you in front 
of our subcommittee because I haven't gotten the chance to talk 
to you about some of the recent economic outlooks that CBO has 
put forward, and I just wanted to take advantage of the 
opportunity to ask a few questions.
    I think the latest one that I saw was your January update, 
noted that deficits continue to rise, debt will achieve about 
93 percent of GDP in 2029. Can you talk a little bit about what 
is driving those historically high debt-to-GDP ratios, and 
these growing deficits, and how you analyze the recent tax 
reform bill as a component to debt and deficit numbers?
    Dr. Hall. All right. Well, one of the things that we see 
over the next several years is deficits of about 4 percent of 
GDP going forward, which is a high level. It's especially a 
high level when the economy is performing this well. One of the 
points I like to make is last year we had pretty good economic 
growth, 2.9 percent, the best since 2009, yet the deficit grew 
to almost 4 percent of GDP. So deficit is pretty significant 
now, and it's pretty significant during a time in the business 
cycle where--where one could have a--should have a--well, I 
don't want to use the word ``should''----
    Senator Murphy. Right.
    Dr. Hall [continuing]. But you could have a much lower 
deficit, because one of the things that can happen going 
forward is if we go through another cycle, deficits are going 
to grow and they're--but they're going to grow from a very high 
level. So we're almost at $1 trillion now, if we go through 
another cycle--I'll give you a for-example, during the Great 
Recession, the deficit was about $160 billion. In 4 years, it 
climbed to $1.2 trillion. Well, right now it's going to start 
at almost $1 trillion, and you go through another cycle, it's 
going to go up way beyond that. So that's a real concern. It's 
a concern over the time, again the timing of when things are 
good.
    But we see 4-percent deficits going straight through--
straight ahead. We do see the debt climbing, it's about 78 
percent of GDP now, we do see it getting to be 93 percent of 
GDP. Right now obviously spending outstrips revenues, and 
that's--that continues going forward.
    Part of why we think we're getting good growth right now is 
the effects of the tax bill, it did have a stimulus effect, but 
it's a stimulus effect, meaning that we'll have higher than 
trend growth this year probably, and we had it last year, but 
we think that's going to wear out, and growth is going to drop 
to much lower levels in 2020, and we're going to get slower 
growth, and that's going to mean--that's going to mean things 
for the budget going forward, the deficits are going to grow 
from there.
    Senator Murphy. And, you know, part of the dispute over the 
underlying deficit and debt impact of the tax bill was a 
disagreement over what that rate of growth would be----
    Dr. Hall. Mm-hmm.

    FUTURE RATE OF GROWTH (1.7 PERCENT) AND PROJECTED LABOR SHORTAGE

    Senator Murphy [continuing]. And it is interesting that 
you're pegging growth at around 1.7 percent leading up to 2023. 
And in that analysis, at least in the summary of your analysis, 
you recognize--I don't want to put a phrase in your mouth--but 
labor shortages, or a shrinking labor pool as contributory to 
that relatively new to rate of growth compared to what we have 
today. And I don't mean to bring politics into questioning you, 
but the President has gotten a lot of attention recently 
claiming that the country is full, and yet your analysis is 
that a lack of labor is going to contribute to our inability to 
eclipse 2-percent growth numbers.
    Can you just sort of play out for us a little bit why that 
is, explain why labor shortages, or lack of labor, leads to a 
lower growth rate?
    Dr. Hall. Sure. I'll start with history. When we were 
achieving 3-percent growth a few decades ago, we had the labor 
force growing 1.2, 1.4 percent a year. So we had baby boomers 
in their prime, and we had women's labor force participation 
climbing, and so closing the gap. Going forward, we see labor 
force growth only being about half a percentage point.
    So right away, if you go from 1.4-percent growth to 0.5-
percent growth, that's--that's a huge drag on the ability for 
the economy to grow. So our forecast over the long run, we see 
maybe productivity growth 1.3 percent, 1.4 percent, labor force 
growth of .4 percent. You literally add those together and you 
get that 1.7-, 1.8-percent growth, and that's where we see it, 
and it's a--it's a supply-side limitation, and it's primarily 
from a slower growing labor force than we've had in the past.
    Senator Murphy. And you're already in an environment where 
you have close to structurally low unemployment.
    Dr. Hall. Right. In fact, we think unemployment is below 
its structural level, so it's below a sustainable level, so we 
think it's going to go back up in the next year or two.
    Senator Murphy. So a lot of attention is to the number of 
people who are outside the labor force, who aren't counted in 
the reported percentage of individuals who are unemployed. If 
some of those individuals were to rejoin the labor force, that 
would, of course, change your dynamic about the effect of low 
labor supply. Is there any reason to believe that the 
individuals who have been permanently outside of the labor 
force will come back in as you have other sources of new labor, 
whether it be immigration or increases in women joining a labor 
force fail to meet our needs?
    Dr. Hall. Yes. Actually, I think we've already had pretty 
good recovery----
    Senator Murphy. Yes.
    Dr. Hall [continuing]. From the Great Recession. I think 
the number of people who have reentered the labor force has 
maybe been a little stronger than we thought already going 
forward. I don't know how much more one--one can expect from 
that.

      PROJECTED INCREASE IN REVENUE AS A PERCENTAGE OF GDP (2029)

    Senator Murphy. And then just lastly on the report, revenue 
as a percentage of GDP, around 16.5 percent today, slowly 
increases so that by 2029 you're back above 18 percent of GDP. 
Explain why that happened. Explain why you have a consistent 
increase in the percentage of revenue to GDP during that period 
of time.
    Dr. Hall. Well, there are two main reasons. One is under 
current law, the reduction in tax rates, individual tax rates, 
are going to go back up in 2025. So if those go back up, that 
will--that will raise that. And the other thing is real bracket 
creep. Typically GDP grows faster than inflation, and so more 
people move up into higher tax brackets. So those are the two 
things that we think under current law will raise the share of 
revenue as a share of GDP back above historical levels.
    Senator Murphy. And it's those individual tax reductions 
that are the temporary.
    Dr. Hall. Absolutely.
    Senator Murphy. Right. The corporate tax cuts do not 
expire.
    Dr. Hall. That's right. In fact, both of those things I 
mentioned are individual income tax increases.
    Senator Murphy. Right. Thank you very much, Mr. Hall. The 
last question for you--thank you for your answers to Senator 
Hyde-Smith's question about transparency. You're really to be 
applauded for how serious you've taken this issue. As we 
discussed, there's a limit to how much transparency can be 
provided, but you are delivering an extraordinary amount of 
additional window into your work, and these interactive models 
I think are really, really helpful to folks in our offices that 
are working on these complicated issues.

                        IT INFRASTRUCTURE NEEDS

    And to that last question, are there IT infrastructure 
needs, and I'm sorry if Senator Hyde-Smith asked this, that you 
need to increase this commitment to transparency? Is it really 
just a matter of sending staff on new missions and projects, or 
is there an IT component to this that you're going to need 
going forward?
    Dr. Hall. I think a lot of it is just sending--sending our 
staff on new missions to find things. And it's not just, you 
know, a few people, it's all our analysts are now taking more 
time to be more transparent, to document what they're doing 
better, to get good ideas on known interactives and that sort 
of thing.
    We do have some plans on our IT. We've moving to the--we're 
moving almost all our data center to the cloud, and we're 
moving to virtual desktops, but that's just part of, I think, 
being more efficient. We'll be fine with the transparency as 
long as we get some--continue to have some resources.
    Senator Murphy. And as long as you have the resources, you 
don't see the additional transparency commitment taking away 
from your workload and your responsiveness to requests.
    Dr. Hall. No. And that was--that was the one thing that we 
really insisted on, is our due diligence. The quality of our 
work can't suffer from this, which is part of why we made a 
real effort to shift resources around and ask for more 
resources.
    Senator Murphy. Great. Thank you very much, Dr. Hall.

                    MORE ON GAO'S DISASTER REPORTING

    Good to see you, Mr. Dodaro. I only have a few questions 
for you, but I wanted to focus them on the $14 million that you 
were given to conduct oversight of the nearly $122 billion 
provided in disaster relief for Puerto Rico and the U.S. Virgin 
Islands. Can you give us just a sense of the scope of this 
project, the size and duration of the audit plan? Is it 
happening now? If so, what do you have on the ground in terms 
of audit and analysis resources?
    Mr. Dodaro. We started shortly after the events occurred. 
We've already issued 11 reports on the initial response of our 
agencies, status of issues in Puerto Rico and the Virgin 
Islands, for example; how the advance use of contracting was 
used. We have 25 other audits underway. Of those, we expect to 
complete six of them in the next 2 months, by April and May. We 
also expect to complete eight others, additional ones, by the 
August recess. By the August recess, we will have issued 25 
reports.
    Now, the scope of this covers over a dozen Federal agencies 
that are providing support to the initial response and 
recovery. We issued a report, for example, recently on the 
Community Development Block Grant assistance. We'll look at the 
SBA response. We'll look at DOD's role in the whole process, 
Interior, Agriculture, in addition to the FEMA activities, and 
a number of other agencies are involved as well. So what will 
be the scope of our work, is really all the efforts, Federal 
efforts, underway to help in the initial response and then 
recovery.
    Usually it takes a long time for these things to spend out. 
Under CDBG, for example, the States and territories will have 
up to 6 years to spend that money. Hurricane Sandy efforts are 
just winding up in the last couple years as well.
    So we plan to stay with it through the time Congress needs 
oversight over the process.

                 GAO DISASTER FINDINGS SPECIFIC TO HUD

    Senator Murphy. Congress provided HUD CDBG, you referenced 
that program, with just short of $20 billion in funding for 
Puerto Rico alone. Puerto Rico received the first infusion of 
that money, about $1.5 billion, just 3 months ago. That's over 
a year and a half after the storm, and HUD is sitting on the 
balance of that money, $18.5 billion, and, as far as I know, 
hasn't even posted anything in the Federal Register regarding 
the $8.3 billion in HUD disaster mitigation so that people can 
begin applying for those funds.
    I think you mentioned that you've already done some 
oversight here. Have you evaluated HUD's performance in 
administering this disaster funding?
    Mr. Dodaro. Yes, we have. A couple things we've suggested 
there. Number one, we think Congress ought to give permanent 
authorization to the HUD disaster assistance program. Right 
now, there is no process, so HUD has to tailor the rules, 
regulations, and programs to go through this process on each 
disaster, and it's taken longer. They also had to do this on 
Katrina. They had to do it on Superstorm Sandy. Now they're 
doing it with the 2017 disasters. We have a chart in our report 
that shows that it takes almost the better part of a year for 
HUD to go through the process that they have in place. So we 
recommend Congress, like in a lot of other Federal programs, to 
give permanent authority so that the regulations and rules are 
already in place, and so they can just start once Congress 
appropriates the money.
    Now, with regard to HUD itself, we found that they didn't 
have good processes and procedures for reviewing the 
applications from the States and territories. They could 
strengthen their process in that area, and develop better 
monitoring plans. They needed to think about the workforce that 
they need to carry out these activities in a timely and 
effective way. We made a number of recommendations to HUD as 
well.
    Now, with regard to Puerto Rico and spending the money, 
what we found was that in Texas and Florida, they had only 
spent about 1 percent of the money that was available for them. 
That was mostly for administrative purposes. Puerto Rico and 
the Virgin Islands hadn't spent anything yet because they 
didn't have the same kind of infrastructure ready that Texas 
and Florida had to spend the money.
    So none of the States or territories that received money 
under this program have spent any more than 1 percent of it as 
of January this year. So Puerto Rico is no different than the 
other States and territories.
    Senator Murphy. I mean, you're certainly right that we 
should have permanent authorization, but, you know, we're 
already in the permanent business of providing disaster 
assistance. HUD knows in any given year that it's going to be 
responding to disasters somewhere with or without our permanent 
reauthorization or authorization of that programming.
    So, I mean, that doesn't sound like an excuse that should 
be available to HUD given the fact that they know that they are 
going to be annually in the business of getting this money out. 
They could make reforms to expedite the funding notwithstanding 
Congress's failure or success in permanently authorizing those 
capabilities.
    Mr. Dodaro. Yes, well, I'll go back. I'll give you a more 
detailed answer for the record. But they can't spend money 
unless Congress appropriates the money to have a program. I 
mean, so they'd be having to use their authorities to create 
something that Congress hasn't authorized them in advance. So I 
think there's a legal issue limiting their ability to do what 
you're suggesting and have it in place and go through the 
process. But I'm not positive on that, and I will go back and 
talk to our legal and programmatic teams and get you a more 
detailed answer. But, you know, we--we've made that 
recommendation.
    We think Congress ought to give them the authority to 
establish that program. I'm not suggesting Congress give them 
funding in advance, I'm just saying that Congress ought to say 
we authorize there to be a permanent program for disaster 
recovery under the Community Development Block Grant program so 
HUD has the--then the legal authority to create a permanent set 
of rules and regulations that are in place.
    Senator Murphy. And, lastly, President Trump has reportedly 
been reluctant to deliver additional money to Puerto Rico, in 
part, because of his claims that the government has acted 
irresponsibly with respect to the money that they have already 
been given. Based on your work, do you have any reason to 
believe that Puerto Rico is spending Federal dollars it has 
received irresponsibly? Have you found any evidence of fraud or 
significant and unjustifiable waste in the dollars that have 
been spent thus far?
    Mr. Dodaro. Not yet. Actually, FEMA has in place manual 
procedures to approve every reimbursement that goes to HUD. So 
they have pretty strict controls in place right now. They're 
waiting for Puerto Rico to come up with an internal control 
plan that they'll produce that will give Puerto Rico more 
ability to operate on their own without FEMA having to approve 
manually every reimbursement of the money that they spent in 
that area.
    So, so far, it looks like there are stringent controls in 
place, but as Puerto Rico gets more authority to operate on 
their own, they--they've established a new office, they're in 
the process of developing their procedures, and so--but--and 
we'll--we're going to continue to monitor this, but so far it 
looks like FEMA has acted responsibly and have good controls in 
place over the money that's spent in Puerto Rico.
    Senator Murphy. And Puerto Rico has----
    Mr. Dodaro. Yes.
    Senator Murphy [continuing]. Acted responsibly.
    Mr. Dodaro. Well we haven't fully examined what Puerto Rico 
has done yet, but it--they have to get reimbursement from FEMA. 
So the real check is they have to provide documentation to 
FEMA, and so FEMA--to approve to get the money. So they really 
can't operate on their own very much without getting 
reimbursement without FEMA operating in that area.
    Senator Murphy. Right.
    Mr. Dodaro. So I think basically what we've seen is that 
the structure of a responsible approach is being put in place.
    Senator Murphy. Great. Thank you very much.
    Senator Lankford.

                 MORE COLLABORATION BETWEEN CBO AND GAO

    Senator Lankford. Thanks.
    Gentlemen, thanks again. I apologize, I'm running back and 
forth between votes and other hearings, and I'm not getting a 
chance to be able to get all of the dialogue today back and 
forth. I want to be able to go through a couple things.
    Both of you the last couple of years have asked for 
additional staffing, reasonably so, on some of the issues 
you've dealt with and some of the expansion of issues that are 
still to come on cyber, science and all those things. Help me 
understand this. How can the two teams work together more 
collaboratively when there's a surge moment?
    Dr. Hall, you had a moment where you were dealing with 
healthcare issues, and you needed a surge of staff. Gene Dodaro 
has a bunch of healthcare folks on his team as well. Now, 
they're not economists, they're not used to doing the same 
thing, but is there a way that we can plan together when we 
have two teams of folks giving us oversight and giving us 
analysis of different pieces of legislation that we can 
actually put a process in place to be able to have at moments 
some cooperation between the two groups, though they have 
uniquely different functions? Is there a way to do that that 
you could see?
    Dr. Hall. That's something we haven't thought about much, 
in part because, you know, people aren't terribly fungible. You 
have to have people who are--who are experts in an area.
    Senator Lankford. Right, but in surge moments.
    Dr. Hall. In surge moments, we already try to do more with 
that in terms of research assistance. We did--we threw a lot of 
people at it. Whether we could find expertise at GAO, you know, 
I don't know. We'd have to talk with them a little bit about 
that.
    Senator Lankford. Okay.
    Mr. Dodaro. Yes, Keith is right. We really haven't explored 
that issue. But what I would say for----
    Senator Lankford. Sure. You should ask for a GAO report on 
that.
    [Laughter.]
    Mr. Dodaro. But I'm happy to have a discussion with Keith 
and see if there are some possibilities there.
    Senator Lankford. Yes.
    Mr. Dodaro. But the point I would make, though, is that, 
and I'm not speaking for Keith, but just for GAO, we're already 
oversubscribed----
    Senator Lankford. Right.
    Mr. Dodaro [continuing]. So whatever we do we hit peak 
periods, too----
    Senator Lankford. Right.
    Mr. Dodaro [continuing]. We work with the committees to 
discuss trade offs, ``Okay, if we do this work for you, we're 
not going to do this other work for several months.'' So 
whatever we do might help in the immediate, but it's going to 
have consequences to other support for the Congress.

                TRANSPARENCY--INSIGHTS INTO CBO'S MODELS

    Senator Lankford. Well, we ask a lot, as a Congress, of 
both of you, and there reaches a moment that we're overasking. 
That's why you're going through committee Chairs and Ranking 
Members to be able to say, ``Okay, do you really need this?'' 
because we've got to be able to figure out how to prioritize 
things.
    It's entirely reasonable for both of you to be able to work 
through that process so people don't overask. But also at some 
point we've got to be able to find a moment to say, ``Is there 
more cooperation that we can do together?'' because, Dr. Hall, 
your peak periods are different than GAO's peak periods on a 
different issue, and there may be some cooperation that we 
haven't explored together. So I'll just leave that out as an 
idea. I don't anticipate including that as a report document, 
but I would like to be able to at least broach that and say 
let's consider that.
    Dr. Hall, you've done a lot of work, and we've had, in 
previous documents from Appropriations, some additional 
requests, and you have even worked with our team to be able to 
add more information about how models are done, how analytics 
are done. Your information that you've sent up to us for 
appropriations continues to include more viewing into the black 
box basically and how these things are done with statistics and 
background.
    Tell me how that's moving in a time period that we can see 
that because the modeling of this is extremely important. As 
you know, with any scientific model, having other folks run 
numbers in the same model is exceptionally helpful, and then to 
be able to ask, ``What are the variables in that model?'' to be 
able to look at it and say, ``Did you consider this?''
    Dr. Hall. Sure.
    Senator Lankford. Right now, we're not able to ask the 
reasonable question, ``Was this considered?'' And so for any of 
us to turn in any piece of legislation, we always wonder, 
``Where did that number come from?''
    Dr. Hall. Sure. Well, we're doing--we are already doing a 
lot of things. We've already done quite a lot. We've tried to 
increase transparency in many ways, and we're trying to make 
good business decisions on how we do it, and what drives the 
most is what's most helpful to Congress, what's something we 
can do? And that can be everything from better documentation to 
spelling out key variables, that sort of thing.
    There's a little bit of a focus--a bit of a focus on-- on 
modeling code, and we can try to do that some, but the only 
thing I would again caution on this--I've talked about this a 
bit--models are tools that analysts use.
    Senator Lankford. Right.
    Dr. Hall. Right? And so more than anything else, you need 
an analyst who does his or her work carefully, considers a lot 
of things, uses the model appropriately if there's a model 
involved. So there's a lot more besides just the model.
    We've done a lot of things, and we'd love to get some 
feedback on what's working, what you find helpful, what you 
don't find helpful. One of things I think we've done 
intentionally is we've cast a very broad net on ways to be 
transparent, and we're waiting to see what works.
    Senator Lankford. Right.
    Dr. Hall. And getting some feedback on that would be great 
because we still have a commitment to being more transparent.

            REPORT COMPARING PREVIOUS ESTIMATES ON PROGRAMS

    Senator Lankford. Yes. One of the things that you've 
included in your notes to us is your own requirement and 
deadline you're going to put together to be able to create a 
report to look at previous estimates on programs, on what you 
are expecting in deficit spending, whatever it may be, to look 
at, here's what we looked at in 2015, 2005, 2019, let's compare 
it to where we were same time, same period, to be able to help 
evaluate that.
    Dr. Hall. Right.
    Senator Lankford. That would be helpful to us, and because 
we're trying to be able to make decisions based on your 
estimates, and for you to be able to say, ``Here's our 
variabilities as well.'' As we go through this, economists are 
never going to get it 100 percent right except for the 
economist that wrote it after it was over. So to be able to--
anyone that's looking in the future to help us understand, ``We 
think our margin of error is historically somewhere through 
here,'' would help us tremendously.
    The challenge that we have--Chris and I would never do 
this, but there are other Members of the Senate that when they 
know they want a certain bill that's really in the jurisdiction 
of a different committee, but I'm not on that committee, so I'm 
going to write it in such a way that it lands in my committee, 
not in that one.
    Now, again, the two Senators present, clearly we would 
never do that, but the reason I bring that up is once your 
model comes out and once the details are out, there will be 
Members of the House and the Senate that will do gymnastics to 
be able to write whatever it is, not for best legislative texts 
or long term, but best possible score coming from CBO. We're 
going to have to figure this out because the models are 
exceptionally important so that we know what the variables are 
we're dealing with, but we've got to be able to figure out how 
to be able to manage this so we don't have legislative Jiu-
Jitsu to be able to write something that's not best text, but 
best for you, because at the end of the day it's going to be 
best for the American people, not best for CBO, but our 
scorekeeper is you. So if we don't get through you first, it 
never gets to the American people. Do you see what I mean?
    Dr. Hall. Sure. And let me say, we've actually--we've 
really done a lot. We've got a pretty significant report at the 
end of last year of the number of things that we've done, and 
we do--we do, do a lot of self-assessment. We've actually--
actually done that. We have--we do give you some idea how--what 
our error is. A year before I can tell you, a year ahead our 
typical revenue estimate is off by 1.5 to 2 percent.
    Senator Lankford. Right.
    Dr. Hall. And the outlays are something--something like the 
same. So we've got that process actually going where we're 
doing it annually. For every year, we're now going to look back 
to the prior year and produce a public report, and we did this 
year, as a matter of fact, of exactly how we did the prior 
year.
    And one of the things I think is particularly challenging, 
and I think part of what you have in mind, is on individual 
scores, individual pieces of legislation, and that's really 
challenging often because knowing the effect of the legislation 
can be really difficult because the data gets mixed in with 
other accounts, and it can be really hard to sort that out.
    Senator Lankford. Right.
    Dr. Hall. So what we're trying to do is we've done a couple 
of those now, is we're looking for instances to do those again 
where the data is available to give you an idea on the expected 
area and particular estimates, particularly pieces of 
legislation.
    And something else that probably should help is we're 
trying really hard to have a section on uncertainty in our 
estimates. We've redesigned our cost estimate format, and we 
set it up so it's more transparent, but there is now an 
uncertainty part of that. To try to give you the degree, we can 
tell you how uncertain our estimate is, we're going to try to 
tell you there.
    Senator Lankford. Yes.
    Dr. Hall. We're always hindered by the unknown unknowns, so 
sometimes it's qualitative rather than quantitative.
    Senator Lankford. Yes. Only God doesn't have unknowns, and 
so we all deal with that, and I get that. But that's helpful 
for us in our dialogue because at times, and both sides of the 
aisle do it, they look at what you put out and say that's 
exactly what it's going to be, and you and all of your team 
know it's not exactly what it's going to be, it's our best 
guess----
    Dr. Hall. Right.
    Senator Lankford [continuing]. As we go through this. And 
so to know some of the variables as we work through it would be 
exceptionally helpful. The more transparent you can build the 
process, the more it gets us good information to be able to 
work through the process as well.
    Dr. Hall. Good.
    Senator Lankford. I appreciate that very much. Give us the 
time period you're thinking of for some of these reports. You 
list in your information that you're going to release the 
estimates as you listed the analyzing accuracy of CBO estimates 
and some reports on that.
    Dr. Hall. Well, we've already produced some of those.
    Senator Lankford. Right.
    Dr. Hall. I'd be glad to follow up and point you to some of 
those and give you some idea of how we're going to repeat those 
over time.
    Senator Lankford. Okay. Spacewise, let me ask one question, 
Gene, on your own space. Do you have the appropriate space and 
the footprint in the building you're in as far as leased out 
space, space for your folks? Any changes that you need?
    Mr. Dodaro. We're in good shape in space in our building. 
Actually, we're leasing out the third floor, most of the sixth 
floor now, not only to the Army Corps of Engineers 
headquarters, but also to units from the Justice Department as 
well to increase our revenue. I mean, that's----
    Senator Lankford. Right. I knew that was coming.
    Mr. Dodaro. Yes.
    Senator Lankford. I just didn't know how that's working 
out.
    Mr. Dodaro. It's working out fine. What we did was we hired 
an architect to redesign and make better use of the space. It's 
a big building.
    Senator Lankford. You couldn't get the Army Corps to do 
that for you since they're moving in?
    Mr. Dodaro. Well, we thought there would be a conflict 
there.
    [Laughter.]
    Mr. Dodaro. That's working out very well. It's producing 
the revenue. We have enough space. We're allowing our people 
more telework options, and they don't need the same degree of 
space in headquarters.
    We've reduced our footprint in the field about 40 percent. 
There we have to lease from GSA, so we've avoided millions of 
dollars in rent increases in that area. I was just in Boston 
earlier this week in our field office there, and they've got 
nice space in the Tip O'Neill Federal Building. They're happy 
there because they have child care and everything available to 
them right in that facility.
    Senator Lankford. That's great. Okay. Thank you.
    Chris, thanks for letting me slip in.
    Senator Murphy. Thank you very much. Absolutely.
    This concludes the Legislative Branch Appropriations 
Subcommittee hearing on the 2020 funding levels for GAO and 
CBO. Thank you both for testifying. The hearing record is going 
to remain open for 7 days. Members can submit statements or 
questions for the record. They should be sent to the 
subcommittee by close of business on Wednesday, April 17.

                         CONCLUSION OF HEARINGS

    Senator Murphy. And this subcommittee stands adjourned.
    [Whereupon, at 4:33 p.m., Wednesday, April 10, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]

                               APPENDIX A

                    Government Accountability Office

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                               APPENDIX B

                      Congressional Budget Office

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