Department of Transportation: Status of Achieving Key Outcomes	 
and Addressing Major Management Challenges (22-JUN-01,		 
GAO-01-834).							 
								 
The Government Performance and Results Act of 1993 requires	 
agencies to produce performance reports by fiscal year (FY). GAO 
reviewed the Department of Transportation's (DOT) FY 2000 and FY 
2002 performance reports to assess its progress in achieving	 
selected key outcomes that are important mission areas for the	 
agency. This report (1) assesses the progress DOT has made in	 
accomplishing these outcomes and the strategies the agency has in
place to achieve them and (2) compares DOT's FY 2000 performance 
report and FY 2002 performance plan with the agency's prior year 
performance report and plan for these outcomes. GAO found that	 
(1) DOT's consolidated performance report makes it clear that DOT
achieved only limited progress in FY 2000 toward achieving the	 
selected outcomes and that the agency directly indicated that its
current strategies are not likely to result in achievement of the
goals and (2) DOT provided a clear, well-organized discussion of 
performance goals, measures, and data in both FY 2000 and FY 2002
performance plans.						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-01-834 					        
    ACCNO:   A01231						        
  TITLE:     Department of Transportation: Status of Achieving Key    
             Outcomes and Addressing Major Management Challenges              
     DATE:   06/22/2001 
  SUBJECT:   Strategic planning 				 
	     Reporting requirements				 
	     Program evaluation 				 
	     Performance measures				 
	     Transportation safety				 
	     DOT Marine Information System for Safety		 
	     and Law Enforcement				 
								 
	     DOT Recreational Boating Safety Program		 
	     DOT Safe Communities Program			 
	     FAA Air Traffic Control System			 
	     FRA Safety Assurance and Compliance		 
	     Program						 
								 
	     National Highway System				 
	     Government Performance and Results Act		 
	     GRPA						 

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GAO-01-834
     
Report to the Ranking Minority Member Committee on Governmental Affairs U.
S. Senate

United States General Accounting Office

GAO

June 2001 DEPARTMENT OF TRANSPORTATION

Status of Achieving Key Outcomes and Addressing Major Management Challenges

GAO- 01- 834

Page 1 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

June 22, 2001 The Honorable Fred Thompson Ranking Minority Member Committee
on Governmental Affairs United States Senate

Dear Senator Thompson: As you requested, we reviewed the Department of
Transportation?s (DOT) fiscal year 2000 performance report and fiscal year
2002 performance plan required by the Government Performance and Results Act
of 1993 (GPRA) to assess DOT?s progress in achieving selected key outcomes
that you identified as important mission areas for the agency. 1 These are
the same outcomes we addressed in our June 2000 review of DOT?s fiscal year
1999 performance report and fiscal year 2001 performance plan to provide a
baseline by which to measure the agency?s performance from year to year. 2
These selected key outcomes are:

 fewer transportation- related accidents, deaths, injuries, and property
losses;  reduced flight delays through air traffic control modernization; 
less highway congestion and improved highway pavement condition; and 
reduced availability and/ or use of illegal drugs.

As agreed, using the selected key outcomes for DOT as a framework, we (1)
assessed the progress DOT has made in accomplishing these outcomes and the
strategies the agency has in place to achieve them and (2) compared DOT?s
fiscal year 2000 performance report and fiscal year 2002 performance plan
with the agency?s prior year performance report and plan for these outcomes.
Additionally, we agreed to analyze how DOT addressed its major management
challenges, including the governmentwide high- risk areas of strategic human
capital management and information security that we and DOT?s Inspector
General (IG) identified. Appendix I provides detailed information on how DOT

1 This report is one of a series of reports on the 24 Chief Financial
Officers (CFO) Act agencies? fiscal year 2000 performance reports and fiscal
year 2002 performance plans. 2 Observations on the Department of
Transportation?s Fiscal Year 1999 Performance Report and Fiscal Year 2001
Performance Plan (GAO/ RCED- 00- 201R, June 30, 2000).

United States General Accounting Office Washington, DC 20548

Page 2 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

addressed these challenges. (App. II contains DOT?s comments on a draft of
our report.)

Although the structure, coverage, and completeness of DOT?s consolidated
performance report and plan continue to be commendable, the report makes it
clear that DOT achieved only limited progress in 2000 toward achieving the
four selected outcomes and that the agency achieved fewer goals than it did
last year. Although DOT?s strategies appear reasonably related to achieving
its goals, in several cases the agency directly indicates that its current
strategies are not likely to result in achievement of the goals.

 Planned outcome: fewer transportation- related accidents, deaths,
injuries, and property losses. The agency reported limited success in
improving transportation safety during 2000. Although it met each of its
marine and hazardous material transport safety goals, it did not achieve any
of its highway safety goals, including its goals to reduce the rates of
highway fatalities and injuries. DOT reported mixed success in achieving its
aviation, rail, and transit safety goals. In several areas, DOT indicated
that performance improved. For example, DOT reported that 71 percent of
front seat occupants of motor vehicles used their seatbelts in 2000,
representing the highest usage rate in the nation?s history. This rate,
however, was below DOT?s goal to increase seat belt usage to 85 percent in
2000. For the most part, DOT?s goals are reasonable indicators of progress
toward improving transportation safety. However, DOT does not have
performance goals to reduce pipeline fatalities and injuries even though
pipeline fatalities are increasing and the agency?s strategies to improve
pipeline safety are geared, in part, toward reducing fatalities. DOT reports
strategies for meeting each goal in fiscal year 2002, and, for the most
part, the strategies appear reasonable. However, for some goals, the agency
reports that the strategies are likely to be insufficient to meet the goals.
For example, to reduce the number of collision hazards on airport runways
(called runway incursions), the Federal Aviation Administration (FAA) has
initiatives that include improving communications among controllers, pilots,
and ground crews. Nonetheless, the report indicated that FAA was unsure of
meeting this and other aviation safety goals in 2001.

 Planned outcome: reduced flight delays through air traffic control
modernization. DOT reported that it failed to meet its goal for reducing
aviation delays, which increased in 2000 for the third straight year, and it
does not expect to meet its goal in 2001 due to expected increases in air
Results in Brief

Page 3 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

travel. For 2000, DOT reported that approximately 70 percent of flight
delays were due to bad weather. DOT?s strategies for reducing delays may
help reduce some delays, but many of the strategies will not make a
difference in the next few years. For example, the report indicates that
FAA?s best means for reducing aviation delays, such as its plans to ensure
all- weather access to runways and build more runways, will happen only in
the long term. In the near term, the agency is continuing to modernize its
air traffic control systems. Since 1995, we have designated the air traffic
control modernization program as a high- risk information technology
initiative due to cost, schedule, and performance problems.

 Planned outcome: less highway congestion and improved highway pavement
condition. DOT reported mixed progress during 2000 in achieving its goals in
this area. The agency estimated that it met its goal to improve pavement
condition but did not meet its goal to reduce the rate of highway delays. In
addition, DOT exceeded its goal for installing intelligent transportation
systems in additional metropolitan areas. These systems use information and
communication technology to extend the capacity of existing highways and
could help lessen congestion. DOT?s strategies for improving highway
pavement condition and reducing congestion appear reasonable. These
strategies include continuing to fund pavement maintenance efforts and to
deploy additional intelligent transportation systems.

 Planned outcome: reduced availability and/ or use of illegal drugs. DOT
reported that for 2000 it did not achieve its goal to increase the seizure
rate for cocaine that is shipped into the country via the high seas.
Although the agency seized a record 60.2 metric tons of cocaine in 2000,
this was not sufficient for the agency to reach its goal- to seize 13
percent of the estimated amount of cocaine being smuggled into the country
through maritime routes. Furthermore, the percentage of cocaine seized by
the agency fell from 12.2 percent in 1999 to 10.6 percent in 2000 because of
increases in the estimated amount of cocaine smuggled. For 2002, the agency
will continue to develop new tactics and vary its operations to thwart
maritime smuggling, but it indicated that it will be challenged to meet its
2001 goal. The Coast Guard?s efforts are part of a multiagency strategy to
reduce the supply of illegal drugs entering the United States.

As was true last year, DOT?s combined performance plan and report are well
designed and well presented. The performance report provides a clear and
comprehensive discussion of performance information. For example, DOT?s
safety goals and measures continue to be meaningful, outcomeoriented,
objective, measurable, and quantifiable. For each measure, the

Page 4 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

report provides a definition of the measure, data limitations and their
implications for assessing performance, procedures to verify and validate
data, and the source for the data. The performance plan provides details of
what the agency will do to try to meet its goals in the future. However, in
some cases, there appears to be a mismatch between DOT?s annual strategies
and goals. For example, DOT does not expect the strategies and resources it
is applying to several key goals to be sufficient to meet its goals in 2001.
The report and plan also addressed all of the management challenges we have
identified by including goals, measures, and/ or strategies to deal with
them. This report makes recommendations to DOT for improving the match
between the agency?s strategies and its goals.

We provided copies of a draft of this report to the Department of
Transportation for its review and comment. In a letter, the agency indicated
that it agrees with our recommendations. Specifically, the Department stated
that annual performance targets should be realistic, strategies will be
reviewed to better align them with performance goals, and pipeline injuries
and fatalities should be included in DOT?s future performance plans. DOT?s
written comments are included as appendix II.

GPRA is intended to shift the focus of government decisionmaking,
management, and accountability from activities and processes to the results
and outcomes achieved by federal programs. New and valuable information on
the plans, goals, and strategies of federal agencies has been provided since
federal agencies began implementing GPRA. Under GPRA, annual performance
plans are to clearly inform the Congress and the public of (1) the annual
performance goals for agencies? major programs and activities, (2) the
measures that will be used to gauge performance, (3) the strategies and
resources required to achieve the performance goals, and (4) the procedures
that will be used to verify and validate performance information. These
annual plans, issued soon after transmittal of the president?s budget,
provide a direct linkage between an agency?s longer term goals and mission
and day- to- day activities. 3 Annual performance reports are to
subsequently report on the degree to which performance goals were met. The
issuance of the agencies? performance reports, due by March 31, represents a
new and potentially more substantive phase in the implementation of GPRA-
the opportunity to assess federal agencies? actual performance for the prior
fiscal year and to

3 The fiscal year 2002 performance plan is the fourth of these annual plans
under GPRA. Background

Page 5 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

consider what steps are needed to improve performance and reduce costs in
the future. 4

DOT?s mission is to ensure a safe transportation system that furthers our
vital national interests and enhances the quality of life of the American
people. The agency has identified five strategic goals for achieving that
mission: (1) eliminating transportation- related deaths and injuries; (2)
shaping an accessible, reliable transportation system; (3) supporting
economic growth; (4) protecting the environment; and (5) ensuring the
security of the transportation infrastructure and the country. DOT?s
combined performance plan and report is organized around these strategic
goals. Table 1 illustrates how the report?s four key outcomes and their
supporting performance measures correspond to DOT?s strategic goals.

4 The fiscal year 2000 performance report is the second of these annual
reports under GPRA.

Page 6 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Table 1: DOT?s Strategic Goals, Selected Key Outcomes, and Performance
Measures DOT strategic goal Selected key outcomes and performance measures
for 2000

Eliminate transportation- related deaths and injuries Outcome: Fewer
transportation- related accidents, deaths, injuries, and property losses

Performance measures:

 Highway: reduce the rates of fatalities and injuries, reduce fatalities
and injuries involving large trucks, reduce the percentage of alcohol-
related fatalities, and increase the percentage of front seat occupants
using seat belts.

 Aviation: reduce the rate of fatal commercial accidents and reduce the
rates of runway incursions, operational errors, and operational deviations.

 Marine: reduce the number of recreational boating fatalities, reduce the
rate of passenger vessel fatalities, and increase the number of mariners
reported in imminent danger who are rescued.

 Hazardous material transport: reduce the number of natural gas pipeline
failures and the number of serious hazardous material incidents.

 Rail/ transit: reduce the rates of rail fatalities and crashes, reduce the
rates of transit fatalities and injuries, and reduce the rate of highway-
rail grade- crossing accidents. Shape an accessible, reliable transportation
system Outcome: Reduced flight delays through air traffic control
modernization

Performance measures:

 Reduce the rate of aviation delays.

 Increase the percentage of flight segments safely flown off air traffic
control- preferred routes.

Outcome: Less highway congestion and improved highway pavement condition
Performance measures:

 Increase the percentage of miles of the National Highway System that meet
pavement performance standards.

 Reduce the rate of delay on federal- aid highways.

 Increase the number of metropolitan areas that deploy Intelligent
Transportation System infrastructure. Ensuring the security of the
transportation infrastructure and the country Outcome: Reduced availability
and/ or use of illegal drugs

Performance measure:

 Increase the seizure rate of cocaine in maritime routes. Note: This report
does not focus on any key outcomes for DOT?s strategic goals to support
economic growth or protect the environment.

Source: DOT.

Page 7 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

This section discusses our analysis of DOT?s performance in achieving
selected key outcomes and the strategies the agency has in place,
particularly strategic human capital management 5 and information
technology, for accomplishing these outcomes. Although DOT did not include
specific human capital or information technology strategies for the four
outcomes we reviewed, the Department did address these strategies in other
parts of its performance report. In discussing the outcomes, we have also
provided information drawn from our prior work on the extent to which the
agency provided assurance that the performance information it is reporting
is credible.

For fiscal year 2000, DOT?s progress in achieving fewer
transportationrelated accidents, deaths, injuries, and property losses was
limited. The Department reported the least success in highway safety- it did
not meet any of its goals in this area. For example, DOT failed to meet its
goals for reducing highway- related fatalities and injuries, despite meeting
both goals in 1999. DOT?s best performance was in marine and hazardous
material transport safety- it met all of its goals in these areas. DOT?s
progress in and strategies for achieving its fiscal year 2000 goals are
discussed below for the areas of highway, aviation, marine, pipeline, rail,
and transit safety.

Regarding highway safety, DOT had expected to achieve at least three of the
six key goals, but it did not meet any of them (see table 2). For example,
DOT did not meet its goal of less than 4,934 large truck- related fatalities
in 2000. On the basis of estimated data, DOT reported that 5,307 fatalities
involving large trucks occurred in 2000, which was a slight improvement from
1999 when 5,362 large truck- related fatalities occurred. DOT provided
explanations for not achieving its highway safety goals. For example, DOT
attributes the increase in highway fatalities to a continued increase in
motorcycle fatalities and deaths of young drivers. For three of the unmet
goals, performance improved compared to 1999. For example, DOT has made
progress in seatbelt use; the 71- percent rate of front seat occupants using
seat belts achieved in 2000 represents the highest in our nation?s history.
This rate, however, was below DOT?s goal to increase seat belt usage to 85
percent. DOT?s highway safety data for 2000 are all preliminary estimates.
The report notes that timeliness of performance

5 Key elements of modern human capital management include strategic human
capital planning and organizational alignment; leadership continuity and
succession planning; acquiring and developing staffs whose size, skills, and
deployment meet agency needs; and creating results- oriented organizational
cultures. Assessment of DOT?s

Progress and Strategies in Achieving Selected Key Outcomes

Transportation- Related Accidents, Deaths, Injuries, and Property Losses

Page 8 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

information is a significant limitation of data from outside the agency-
highway safety data comes from police reports and state data- and
preliminary estimates are based on extrapolations of partial- year data. DOT
reports that its data on highway fatalities and injuries have been in use
for many years and are generally accepted as accurate. However, we have
reported that DOT lacks high- quality, up- to- date information on the
causes of large truck crashes; and, as a result, DOT has begun to improve
its data on the causes of these crashes. 6

Table 2: DOT?s Reported Progress in Meeting its Highway Safety Performance
Goals

Highway safety performance goals 1999 goal 2000 goal 2001 goal

Reduce the rate of highway- related fatalities Reduce the rate of highway-
related injuries Reduce the percentage of alcohol- related highway
fatalities

Reduce the number of fatalities involving large trucks

Reduce the number of injuries involving large trucks

Increase the percentage of front seat occupants using seat belts

Legend: = met or expects to meet goal

= did not meet goal or does not expect to meet goal

= will be challenged to meet goal Source: DOT.

For the most part, DOT?s strategies to improve highway safety appear
reasonable; however, they may be insufficient to meet many of the agency?s
2001 goals in this area (see table 3). Some strategies, such as improving
and expanding oversight and enforcement activities and improving safety data
collection concerning motor carriers, address concerns that have been raised
by GAO and DOT?s IG (see app. I). The strategies also include a large- scale
safety awareness program targeted at teenage drivers and the Safe
Communities program, which provides grants to develop and implement
community- based transportation safety programs. DOT?s evaluation of the
Safe Communities program showed success in some communities, such as Dallas,
TX, where the use of child safety seats more than doubled following the
implementation of a child

6 Truck Safety: Motor Carriers Office Hampered by Limited Information on
Causes of Crashes and Other Data Problems (GAO/ RCED- 99- 182, June 29,
1999).

Page 9 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

safety seat loaner program. The agency is also proposing an increase in the
resources available to counter the increase in fatality and injury rates by
more than $30 million in fiscal year 2002. DOT does not indicate any
activities to specifically address motorcycle fatalities, which had
increased 8 percent from 1999 to 2000.

In the area of aviation safety, DOT reported that it met its fiscal 2000
goal for reducing the rate of fatal commercial aviation accidents but did
not achieve its other two goals- to reduce the rate of runway incursions 7
that create dangerous situations that can lead to serious accidents and
reduce the rates of air traffic operational errors 8 and deviations. 9 (See
fig. 1.) For the three unmet goals, performance worsened compared to 1999,
and DOT is skeptical that it will be able to reach the goals in 2001. DOT
attributed these trends to improved reporting and tracking as well as
greater flight volume in congested and restricted airspace.

7 A runway incursion occurs when an aircraft, vehicle, person, or object on
the ground creates a collision hazard or results in a loss of separation
with an aircraft taking off, intending to take off, landing, or intending to
land.

8 An operational error occurs when the rules and procedures that define
separation standards between aircraft are not applied or followed
appropriately by a controller and a separation between aircraft is less than
required.

9 An operational deviation occurs when an aircraft enters airspace without
prior coordination.

Page 10 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Figure 1: Actual Runway Incursions and DOT?s Goals

Source: DOT.

DOT?s performance report indicated that there is no significant and/ or
systematic error in the counts of accidents, runway incursions, operation
errors, or operational deviations. In addition, the Department reported that
it regularly checks or validates these data sets. On the basis of a joint
government/ industry working group determination and a GAO recommendation,
10 DOT has switched to the use of departures rather than flight hours for
determining the rate of air carrier fatalities. To improve aviation safety,
FAA is implementing several initiatives designed to address shortcomings in
training; technology; communications; and airport signs, marking, and
lighting. FAA will also investigate the use of

10 See Aviation Safety: Safer Skies Initiative Has Taken Initial Steps to
Reduce Accident Rates by 2007 (GAO/ RCED- 00- 111, June 28, 2000).

Page 11 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

new safety technologies. In addition, to reduce runway incursions, the
agency is undertaking initiatives to improve communications among
controllers, pilots, and ground crews. The aviation strategies appear
reasonable. Nonetheless, DOT reported that it was unsure of meeting any of
these aviation safety goals in 2001.

In the marine sector, DOT reported that it met all three of its safety
goals- to reduce the number of recreational boating fatalities, reduce the
rate of passenger vessel fatalities, and increase the number of mariners
reported in imminent danger who are rescued. Next year, DOT will simplify
the passenger fatality measure because the current measure has been
difficult to understand. DOT indicated that it expects to meet all three
goals in 2001.

The report acknowledges that the data on recreational boating fatalities are
probably underreported by at least 6 percent due to the need for
interpretation of what constitutes a recreational boating fatality at the
state level. In addition, in 2001, DOT will switch data sources for
passenger vessel fatalities. The report indicates that the new data source-
the Marine Information System for Safety and Law Enforcement- will be a
significant improvement, but the improved data quality may cause serious
difficulties in making comparisons to prior data. The agency?s strategies
for achieving its marine safety goals in 2002 appear reasonable. The
strategies include increasing staffing and training at rescue stations and
command centers and promoting the wearing of lifejackets by recreational
boaters. In 2000, DOT?s evaluation of its Recreational Boating Safety
Program concluded that wearing personal flotation devices could save the
lives of about 500 boaters each year. In addition, the agency intends to
work with the U. S. Navy and Air Force, which also have search and rescue
responsibilities, primarily for their own vessels and aircraft. The Air
Force is the lead agency for land- based search and rescue, and the Coast
Guard is the lead for maritime search and rescue.

Despite one of the deadliest pipeline accidents in recent years, DOT
projects that it met both of its goals for hazardous material transport
safety- reducing pipeline failures and serious hazardous material transport
incidents- because neither goal measures the increasing number of
fatalities. DOT statistics show that pipeline fatalities have been
increasing steadily over the past years (See fig. 2.). However, we recognize
that the overall number of fatalities from pipeline accidents remains low,
and that a single major accident can result in a significant increase in the
number of annual fatalities. Preliminary estimates also show that DOT will
meet its performance goal for reducing serious hazardous materials

Page 12 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

incidents in 2000. However, the fact that there were more incidents in 2000
than there were in 1999 will make it challenging for DOT to meet its 2001
goal.

Figure 2: Number of Fatalities Resulting from Pipeline Accidents

Source: GAO?s analysis of DOT?s data.

DOT acknowledged that the number of pipeline failures is likely
underreported, and federal, state, and industry teams have been formed to
improve the data. In addition, DOT reported that it is revising the
collection and processing of pipeline accident data to improve the
consistency and accuracy of the data on accident causes. To reduce the risk
of pipeline failures, DOT works to establish safety regulations and ensure
compliance. However, we have expressed concerns about certain agency
initiatives to improve pipeline safety. For example, DOT has changed its
approach to enforcing compliance with its regulations by reducing its use of
fines and, instead, working with pipeline operators to identify and correct
safety problems. We recommended that DOT determine whether this approach has
improved compliance with pipeline

Page 13 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

safety regulations. 11 A DOT official said that the Department is currently
evaluating the effectiveness of its approach of working with pipeline
operators to improve compliance.

DOT reported limited success in achieving its rail and transit safety
performance goals in 2000, when it met only two of five goals. (See table
3.) For 2001, the report indicated that the agency expects to meet only one
of these goals. The rate of highway- rail crossing accidents fell in 2000,
but DOT did not meet its goal. According to DOT, this goal was not met due,
in part, to a 15- percent increase in highway- rail crossing accidents on
private property, which the agency has limited authority or control over.
DOT is attempting to improve rail safety through its educational outreach
program and Safety Assurance and Compliance Program, in which the agency
works with major railroads to identify and solve systemic problems affecting
rail safety. To improve transit safety, the Federal Transit Authority
provides grants to states to improve public transit infrastructure and works
with states, local transit authorities, and the transit industry to develop
technology, provide training, and supply technical assistance that advances
safety.

Table 3: DOT?s Reported Progress in Meeting its Rail and Transit Safety
Performance Goals

Rail and transit safety goals 1999 goal 2000 goal 2001 goal

Reduce the rate of rail- related crashes Discontinued Reduce the rate of
rail- related fatalities

Reduce the rate of highway- rail gradecrossing accidents

Reduce the rate of transit- related fatalities

Reduce the rate of transit- related injuries Report does not indicate

expected progress

Legend: = met or expects to meet goal

= did not meet goal or does not expect to meet goal

= will be challenged to meet goal Source: DOT.

11 See Pipeline Safety: The Office of Pipeline Safety Is Changing How It
Oversees the Pipeline Industry (GAO/ RCED- 00- 128, May 15, 2000).

Page 14 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

The agency reported that it did not meet its goal of reducing the number of
flight delays as aviation delays and cancellations continued to increase in
2000 to the highest levels recorded, when nearly one in four flights were
delayed, cancelled, or diverted. DOT indicated that bad weather accounted
for about 70 percent of the delays. DOT had met its goal for reducing delays
in 1999 but indicated that it would not meet its 2000 goal if the country
experienced particularly bad weather in 2000. Similarly, DOT reported that
it does not expect to achieve this goal in 2001 due to expected increases in
air travel.

DOT provides a clear and comprehensive discussion of the performance data.
The performance report provides a definition of the measure, data
limitations and their implications for assessing performance, procedures to
verify and validate data, and the source database. For example, the report
indicates that the lack of a common definition of delay has led to confusion
and disagreement as to the extent of aviation delays. To address this
problem, DOT formed a task force that recommended four new categories for
the causes of flight delays: (1) circumstances within an airline?s control,
(2) extreme weather, (3) circumstances within the national aviation system,
and (4) late flight arrivals. DOT expects to test this new reporting format
with airlines before formally implementing it.

DOT?s strategies to reduce flight delays, such as improved weather tracking
and reporting mechanisms, appear reasonable but do not appear likely to
achieve the goal in the near term. For example, the report indicates that
FAA?s best means for reducing aviation delays, such as its plans for all-
weather access to runways and the construction of more runways, will happen
only in the long term. In the near term, to meet the growing demand for air
travel and decrease the number of flight delays, the agency is modernizing
its air traffic control (ATC) system by acquiring a network of radar,
automated information processing, navigation, and communications equipment.
However, over the years, the agency?s ATC modernization and other major
capacity- enhancing programs have not met expectations due to cost,
schedule, and performance problems. We designated the ATC modernization
program as a high- risk information technology initiative in 1995, and it
continues to be a high- risk area.

According to projections, DOT reported that it failed to achieve its 2000
goal to reduce highway congestion- measured by hours of delay per 1,000
vehicle- miles traveled on federal- aid highways- despite establishing a
positive trend in 1999. However, in 2001, the agency expects to meet three
new highway congestion goals- reducing congested travel time, peak Flight
Delays

Highway Congestion and Highway Pavement Condition

Page 15 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

period travel time, and traveler delay- that will replace the 2000 goal. DOT
did not indicate why the agency failed to meet the 2000 goal. In addition,
DOT estimated that it met its 2000 goal for improving highway pavement
condition. Consequently, it plans to continue a number of initiatives
designed to promote the construction of smoother pavements and extend
pavement performance, such as providing funding for pavement maintenance and
conducting pavement research. DOT also reported that it met its goal for
increasing the number of metropolitan areas that have intelligent
transportation systems, which use information and communication technology
to extend the capacity of existing highway infrastructure and could help
lessen congestion. The Department intends to fund intelligent transportation
systems in additional metropolitan areas in 2002 as part of its strategy to
reduce highway congestion. DOT?s report discussed the credibility of the
information for each goal and added a limitation that we identified in last
year?s report. We found that the 1999 performance report failed to explain
that states provided no information for the highway pavement condition of
about 7 percent of the miles on the National Highway System. This limitation
to the data is explained in the 2000 report. However, the 2000 report did
not address other problems with the pavement condition data that we
identified, such as the fact that states vary in their approaches to
measuring and reporting the statistic used to indicate pavement performance
and do not uniformly follow DOT?s guidance for making these measurements.

The Coast Guard is responsible, along with other federal agencies, for
reducing the amount of illegal drugs smuggled into the United States.
Although the agency seized a record 60.2 metric tons of cocaine in 2000,
this was not sufficient for the agency to reach its goal- to seize 13
percent of the cocaine being smuggled into the country through maritime
routes. Furthermore, the percentage of cocaine seized by the agency fell
from 12.2 percent in 1999 to 10.6 percent in 2000 because of increases in
the overall amount of cocaine smuggled. Consequently, the agency noted that
it will be challenged to meet its goal in 2001. The data quality for this
indicator is not as strong as it is for other indicators. The report notes
that the secretive nature of the illegal drug trade could cause estimates of
the amount of cocaine smuggled into this country to contain significant
errors. The Office of National Drug Control Policy attempts to refine and
improve this estimate each year, according to DOT.

DOT provided a general overview of its strategies for 2002 to reduce the
availability of illegal drugs, which included continuing to develop new
tactics and vary its operations to thwart maritime smuggling. DOT
Availability and/ or Use of

Illegal Drugs

Page 16 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

reported that the Coast Guard?s efforts are part of an overall strategy to
reduce the illegal drug supply entering the United Sates. The multiagency
effort is coordinated by the Office of National Drug Control Policy; the
Coast Guard?s role in the effort is to serve as the lead federal agency for
maritime drug interdiction.

For the selected key outcomes, this section describes major improvements or
remaining weaknesses in DOT?s (1) fiscal year 2000 performance report in
comparison with its fiscal year 1999 report, and (2) fiscal year 2002
performance plan in comparison with its fiscal year 2001 plan. It also
discusses the degree to which the agency?s fiscal year 2000 report and
fiscal year 2002 plan address concerns and recommendations by the Congress,
GAO, DOT?s Inspector General, and others.

As we found last year, DOT provides a clear and comprehensive discussion of
performance goals, measures, and data in this year?s report. Overall, it is
easy to ascertain DOT?s progress in meeting its goals because the
performance information is clearly articulated in the performance report,
which provides goal levels and the actual performance for all the measures
we reviewed. This represents an improvement over last year?s performance
report, for which we noted that DOT did not report actual performance for
two goals: highway delays and pavement condition. For 1999, the agency
reported that actual data were not available. For 2000, the agency estimated
the level of performance. As was true last year, DOT?s goals and measures
are meaningful, outcome oriented, objective, measurable, and quantifiable.
In addition, summary tables list the fiscal year 2000 goals, trend data, and
checkmarks to indicate goals that were met. For each performance measure,
the agency provides a definition of the measure, data limitations and their
implications for assessing performance, procedures for verifying and
validating data, and the source for the data.

The report also notes the agency?s attempts to improve the quality of its
goals. For example, in 2000, DOT deleted the maritime safety goal to reduce
the fatality rate among maritime workers and added the goal to Comparison of
DOT?s

Fiscal Year 2000 Performance Report and Fiscal Year 2002 Performance Plan
With the Prior Year Report and Plan for Selected Key Outcomes

Comparison of Performance Reports for Fiscal Years 1999 and 2000

Page 17 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

reduce the fatality rate on passenger vessels. The agency reported that it
made the change because it believed the new goal reflected a broader area of
safety performance. In 2001, the agency made additional improvements; it
simplified the passenger fatality measure to make it more understandable and
implemented a new information system to improve the quality of its passenger
fatality data. Regarding the highway pavement condition data, however, the
report does not address several weaknesses we raised concerning last year?s
report, such as the fact that states vary in their approaches to measuring
and reporting the statistic used to indicate pavement performance and do not
uniformly follow DOT?s guidance for making these measurements.

DOT changed several performance measures for this year?s report. For
example, it implemented a recommendation made by GAO and others to link its
fatal commercial aviation accident measure to the number of departures
instead of flight hours. However, the report did not always discuss its
reasons for discontinuing or changing its performance measures, which
sometimes occurred when performance was declining. For example, DOT
discontinued its aviation safety performance goal of reducing the rate of
deviations- aircraft entering airspace without prior coordination- but the
report did not indicate why. DOT did not make its 1999 goal, and pilot
deviations increased by 38 percent in 2000.

As was true in 1999, the 2000 performance report does not always explain why
DOT did not reach its performance goals or how its plans to mitigate the
external factors that affect outcomes. For example, DOT indicated that it
failed to meet its goals for reducing highway fatalities in part due to a
continuing increase in motorcycle fatalities. However, DOT?s plan does not
include any specific strategies for reducing motorcycle fatalities.

As it did last year, the 2000 performance report addressed the majority of
the management challenges identified by GAO, the Inspector General, and the
Office of Management and Budget (OMB) by including a discussion of each
management challenge in the section devoted to the relevant performance
indicator. The management challenges not directly or indirectly linked to
one of DOT?s goals were listed together after the goals. Although the report
discussed DOT?s progress toward resolving most of the management challenges,
it did not address aspects of the management challenge to enhance
competition in the freight rail industry and consumer protection in the
aviation and freight rail industries. DOT improved its discussion of the
management challenges by indicating whether GAO, the DOT Inspector General,
OMB, or some combination of these organizations identified each challenge.

Page 18 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

As it did last year, DOT identifies in a clear, well- organized manner the
strategies and initiatives it will pursue for each of the 2002 performance
goals. For the four outcomes that we reviewed, these strategies did not
include strategic human capital management and information technology.
However, the report discusses these types of strategies elsewhere. The
report also provides the fiscal years 2001 and 2002 funding that DOT will
direct toward each performance goal. This information is an improvement to
last year?s report because it enhances the reader?s ability to compare the
agency?s initiatives and the resources committed to those initiatives.

The plan outlines DOT?s expectation for meeting its 2001 goals, and in
several cases the plan indicates that the agency does not expect to meet its
goals. This is especially true for the numerous goals that it did not meet
in 2000. For example, in the short term, DOT may not be able to meet its
goal for reducing the rate of runway incursions. The rate of runway
incursions has increased over the last 6 years, with a very large upsurge in
2000, moving the rate of incursions even further from DOT?s goal. As a
result, for the second straight year, DOT?s performance plan indicated that
it is unlikely that the agency will meet its goal for the upcoming year.

The plan also notes DOT?s continuing efforts to correct data limitations.
For example, DOT found that its performance measure for highway congestion
(delay per 1,000 vehicle- miles traveled) did not reflect the actual
performance of the highway system in places where congestion regularly
happens (e. g., congested, urban areas), and the measure was difficult for
the public to understand. As a result, next year DOT will replace the one
highway congestion performance measure with three new measures that DOT
believes will reflect changing travel conditions more comprehensively by
focusing on the different aspects of inefficient road performance in areas
where congestion regularly occurs.

The plan did not include a future performance goal for reducing pipeline
accident injuries and fatalities even though one would appear relevant for
several reasons. First, fatalities due to pipeline accidents are increasing.
Second, the plan includes goals to reduce injuries and fatalities related to
all of the other transportation sectors; and, third, DOT?s future plans for
pipeline safety are geared, in part, toward reducing fatalities.

As it did last year, in its discussion at the end of the relevant
performance goal, DOT?s 2002 performance plan addressed the majority of the
management challenges identified by GAO, the Inspector General, and OMB. For
some of the management challenges, DOT breaks out its plans and goals by
fiscal year. For example, in response to its management Comparison of

Performance Plans for Fiscal Years 2001 and 2002

Page 19 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

challenge for computer security, DOT lays out a number of milestones for
improving computer security with specific dates leading up to May 2003, when
all DOT systems are expected to be adequately protected. However, the plan
acknowledged that DOT did not meet the first milestone on schedule.

GAO has identified two governmentwide high- risk areas: strategic human
capital management 12 and information security. 13 We found that DOT?s
performance plan had a measure related to human capital but no corresponding
goal. In addition, the agency?s performance report explained DOT?s progress
in resolving certain human capital challenges. For example, the report
indicated that DOT made progress in implementing its human resources
management strategies in 2000 and has established worker satisfaction as a
new performance measure in 2002. With respect to information security, we
found that DOT?s performance plan did have goals and measures related to
information security, and the agency?s performance report explained its
progress in resolving a number of its information security challenges. For
example, the report focused on FAA?s air traffic control information systems
in response to a management challenge raised by GAO, the Inspector General,
and OMB.

In addition to the governmentwide challenges, GAO has identified six major
management challenges facing DOT. We found that DOT?s performance report
discussed the agency?s progress in resolving many of these challenges.
However, the report did not adequately discuss the agency?s progress in
enhancing competition in the freight rail industry and consumer protection
in both the freight rail and aviation industries. Table 4 illustrates how
the goals and measures address the eight management challenges that GAO
identified.

12 GAO designated strategic human capital management as a high- risk area in
2001 because serious challenges, such as skills imbalances, succession
planning challenges, outdated performance management systems, and
understaffing are risking agencies? ability to accomplish their missions in
an efficient, economic, and effective manner.

13 We designated information security as a high- risk area in 1997 because
growing evidence indicated that controls over computerized federal
operations were not effective and because the related risks were escalating,
in part due to increased reliance on the Internet. Although progress has
been made since then, recent audits show that federal operations and assets
continue to be highly vulnerable to computer- based attacks. DOT?s Efforts
to

Address its Major Management Challenges Identified by GAO

Page 20 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Table 4: The Way DOT Addressed the Management Challenges Identified by GAO
DOD?s goals and measures are Management challenge Directly related to

challenge Indirectly related to challenge

Governmentwide challenges: Information security X Strategic human capital
management X DOT challenges: Improve the safety and security of air,
highway, and pipeline transportation X Increase the accountability for
financial management activities X Improve the oversight of highway and
transit projects X Enhance major acquisitions and disposals X Strengthen the
financial condition of Amtrak X Enhance competition and consumer protection
in aviation and freight rail industries X

Source: GAO?s analysis of DOT information.

DOT has again produced a superior combined performance plan and report that
is clear, understandable, and well organized. It is easy for the reader to
quickly assess the agency?s progress in achieving key goals and understand
its plans for the future, including the budget resources that DOT plans to
direct toward achieving each goal. For readers seeking additional
information, the report also provides details on the agency?s data for each
performance measure, such as its definition, source, limitations, and DOT?s
efforts to verify and validate the data. These characteristics make DOT?s
report and plan a good model for other agencies to emulate.

However, the report shows that DOT is generally achieving fewer of its key
performance goals than last year. For example, in 2000, DOT failed to meet
any of its goals for highway safety, including its goals for reducing the
rate of highway fatalities and injuries that it had met in 1999. The plan is
candid about the agency?s likelihood of not achieving some future goals.
Some of this is understandable; DOT cannot mitigate all external factors,
such as bad weather or human error. However, in several cases, DOT?s annual
strategies and goals appear mismatched. Overall, DOT met fewer of its
performance goals than last year, and it already projects that it will fall
short on several future goals in important areas, such as aviation, highway,
and transit safety. For goals in which DOT is not making adequate progress,
the Department needs to either change its strategies or lower its
expectations. In the case of pipeline safety, the mismatch between goals and
strategies appears to be due to the lack of an appropriate measure.
Specifically, DOT does not have performance goals to reduce pipeline
Conclusions

Page 21 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

fatalities and injuries, even though pipeline fatalities are increasing and
the agency?s strategies to improve pipeline safety are geared toward
reducing fatalities. In the other areas- highway, aviation, transit, and
marine transportation- DOT has safety goals to reduce fatalities and
injuries.

We recommend that the Secretary of Transportation direct the operating
administrations and the Office of Budget and Program Performance to improve
the match between annual performance goals and strategies in the following
ways:

 Change strategies so that they help DOT achieve its performance goals or
lower performance goals to more achievable levels. In the latter case, the
Department should provide a justification for why the changes were
necessary, clearly note that the goals have been lowered, and identify any
long- term strategies that will bring performance into better alignment with
expectations.

 Establish performance goals for reducing the number of fatalities and
injuries caused by pipeline failures to match similar goals in the aviation,
highway, transit, and marine sectors.

As agreed, our evaluation was generally based on the requirements of GPRA;
the Reports Consolidation Act of 2000; guidance to agencies from OMB for
developing performance plans and reports (OMB Circular A- 11, Part 2);
previous reports and evaluations by us and others; our knowledge of DOT?s
operations and programs; our identification of best practices concerning
performance planning and reporting; and our observations on DOT?s other
GPRA- related efforts. We also discussed our review with DOT officials. The
agency outcomes that were used as the basis for our review were identified
by the Ranking Minority Member of the Senate Governmental Affairs Committee
as important mission areas for the agency and do not reflect the outcomes
for all of DOT?s programs or activities. The major management challenges
confronting DOT, including the governmentwide high- risk areas of strategic
human capital management and information security, were identified by GAO in
our January 2001 Performance and Accountability Series and High- Risk Update
and were identified by DOT?s Office of Inspector General in December 2000.
We did not independently verify the information contained in the performance
report and plan, although we did draw from other GAO work in assessing the
validity, reliability, and timeliness of DOT?s performance data. We
conducted our review from April 2001 through June 2001 in accordance with
generally accepted government auditing standards. Recommendations for

Executive Action Scope and Methodology

Page 22 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

We provided copies of a draft of this report to the Department of
Transportation for its review and comment. In a letter, the agency indicated
that it agrees with our recommendations. Specifically, the Department stated
that annual performance targets should be realistic, strategies will be
reviewed to better align them with performance goals, and pipeline injuries
and fatalities should be included in DOT?s future performance plans. DOT?s
written comments are included as appendix II.

As arranged with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days after
the date of this letter. At that time, we will send copies to appropriate
congressional committees; the Secretary of Transportation; and the Director,
Office of Management and Budget. Copies will also be made available to
others upon request.

If you or your staff have any questions, please call me at (202) 512- 2834.
Key contributors to this report were Teresa Spisak and Keith Cunningham.

Sincerely yours, JayEtta Z. Hecker Director, Physical Infrastructure Agency
Comments

Appendix I: Observations on the Department of Transportation?s Efforts to
Address Its Major Management Challenges

Page 23 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

The following table identifies the major management challenges confronting
the Department of Transportation (DOT), which include the governmentwide
high- risk areas of strategic human capital management and information
security. The first column lists the management challenges that we and/ or
DOT?s Inspector General (IG) have identified. The second column discusses
what progress, as discussed in DOT?s fiscal year 2000 performance report,
the agency made in resolving its challenges. The third column discusses the
extent to which DOT?s fiscal year 2002 performance plan includes performance
goals and measures to address the challenges that we and DOT?s IG
identified. We found that DOT?s performance report discussed the agency?s
progress in resolving all of its challenges. Of the agency?s nine major
management challenges, its performance plan (1) had goals and measures that
were directly related to 5 of the challenges and (2) had goals and measures
that were indirectly applicable to four of the challenges.

Table 5: Major Management Challenges Major management challenge

Progress in resolving major management challenge as discussed in fiscal year
2000 performance report

Applicable goals and measures in the fiscal year 2002 performance plan GAO-
designated governmentwide high- risk

Strategic Human Capital Management: GAO identified shortcomings at multiple
agencies involving key elements of modern human capital management,
including strategic human capital planning and organizational alignment;
leadership continuity and succession planning; acquiring and developing
staffs whose size, skills, and deployment meet agency needs; and creating
results- oriented organizational cultures.

The specific concern with DOT that we identified in our January 2001 report
is the ?stovepiped? culture at FAA, which has been one of several underlying
causes of acquisition problems in the agency?s multibillion- dollar
modernization program. The program has experienced cost overruns, schedule
delays, and significant performance shortfalls.

DOT reported that during 2000, each operating administration and the Office
of the Secretary completed a workforce planning pilot and began to use
workforce analysis data to identify competencies needed to perform new or
desired functions.

The agency did not discuss human capital activities during 2000 that were
specific to FAA.

The plan includes a related performance measure: the percent of employees
satisfied with working for the Department. No target has been set for 2002.
In addition, the plan indicated that DOT has begun departmentwide strategic
workforce planning. According to DOT, operating administrations will
identify current and future human capital needs, the competencies required
to meet these needs, and plans for developing the current workforce and/ or
recruiting to fill the gaps. Time frames for completing these activities are
not identified in the plan. However, the plan indicates that further details
are provided in DOT?s Human Resource Strategic Action Plan. Information
Security: Our January 2001 high- risk update noted that the agencies? and
governmentwide efforts to strengthen information security have gained
momentum and expanded. Nevertheless, recent audits continue to show federal
computer systems are riddled with weaknesses that make them highly
vulnerable to

The U. S. transportation system increasingly relies on information and
telecommunication systems. DOT has a goal to protect the nation?s critical
transportation infrastructure, which includes information and

DOT?s plan includes a performance goal to increase the percentage of people
who receive threat information within 24 hours to 90 percent of those
persons who need to take actions, such as

Appendix I: Observations on the Department of Transportation?s Efforts to
Address Its Major Management Challenges

Appendix I: Observations on the Department of Transportation?s Efforts to
Address Its Major Management Challenges

Page 24 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Major management challenge Progress in resolving major

management challenge as discussed in fiscal year 2000 performance report

Applicable goals and measures in the fiscal year 2002 performance plan

computer- based attacks and place a broad range of critical operations and
assets at risk of fraud, misuse, and disruption. (The DOT IG also identified
information security as a management challenge.)

telecommunication systems. DOT did not meet its 2000 target of informing
those who need to receive threat information within 24 hours, but it noted
several initiatives that will help protect DOT?s critical physical assets
and information systems. DOT completed a master plan, in accordance with a
directive on Critical Infrastructure Protection, to protect the Department?s
critical assets and information systems. The Federal Aviation Administration
(FAA), Coast Guard, and Saint Lawrence Seaway Development Corporation, all
with critical facilities, began efforts to meet infrastructure physical and
logical improvement goals. DOT established a Chief Information Officer
Council that is working with the DOT Chief Information Officer to lead
intermodal efforts to ensure the continued security of DOT?s transportation
information systems and to make IT systems less vulnerable to attack and
other service disruptions, including those caused by natural disasters. In
addition, FAA established the Office of Information Systems Security to
provide information systems security direction, guidance, and policy.

In spite of DOT?s efforts during the fiscal year 2000 DOT Consolidated
Financial Statement audit, the IG found that improved security and controls
were needed in DOT data centers and computer networks, and major financial
application systems need to be accredited and certified. Consequently, the
IG reported information security as a material weakness during fiscal year
2000.

adjusting security procedures. DOT did not develop specific goals for
information security. Instead, it chose to incorporate its information
security work into broader goals addressing critical infrastructure
protection issues.

DOT will issue a comprehensive IT security program that will require a
certification of DOT IT systems in accordance with Office of Management and
Budget (OMB) Circular A- 130. To judge its progress, DOT established
specific goals for the systems:

 By April 30, 2001, the IT Security Program Plan will be issued (did not
accomplish this goal by the planned date).

 Within 120 days after issuance of the DOT IT Security Program Plan,
operating administrations will develop an overall strategy/ plan for
ensuring their IT assets are in compliance with this plan.

Appendix I: Observations on the Department of Transportation?s Efforts to
Address Its Major Management Challenges

Page 25 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Major management challenge Progress in resolving major

management challenge as discussed in fiscal year 2000 performance report

Applicable goals and measures in the fiscal year 2002 performance plan GAO-
and IG- designated major management challenges

Improve the safety and security of air, highway, and pipeline
transportation. Specifically, improve: 1. the implementation of certain
aviation safety

programs, 2. the screening of passengers at airports for

dangerous objects, 3. the security of air traffic control computer systems

and the facilities that house them, 4. its truck safety initiatives, and 5.
the evaluation of pipeline safety measures and the

involvement of states in the safety programs. Regarding fiscal year 1999,
the report

indicated the following: 1. FAA met its performance targets

for reducing the rate of fatal air carrier accidents and the number of
general aviation fatalities. However, it did not meet its targets for other
commercial aviation safety related performance measures.

2. FAA did not meet its performance target for increasing the detection rate
for explosives and weapons that may be brought aboard airplanes. As a
result, FAA, among others, will continue to implement the Airport Security
Improvement Act to improve the success of explosive detection equipment.

3. DOT did not have any direct or indirect performance measures for this
challenge, but DOT and FAA have taken a number of steps to improve computer
security. For instance, they are taking a number of steps to comply with
Presidential Decision Directive 63 that applied to computer security. The
agency is also in the process of authorizing and certifying computer
security systems, training FAA personnel, and improving intrusion detection.

4. DOT did not reach its performance targets for truck- related fatalities
and injuries. The Federal Motor Carrier Safety Administration within DOT
worked to improve truck safety by increasing compliance reviews,
strengthening enforcement, improving information systems, and initiating a
crash causation study.

5. DOT met its performance target for reducing the number of natural gas
transmission pipeline failures.

The report includes: 1. Performance goals to reduce

the rate of fatal aviation accidents for commercial air carriers and the
number of general aviation fatalities, the number of runway incursions, and
the rate of operational errors.

2. A performance goal to increase the detection rate for explosives and
weapons that may be brought aboard aircraft.

3. No performance goals directly linked to air traffic control security, but
it did indicate that it was unlikely that it would meet its goal of
completing its information technology security program plan and assess,
test, and certify all of its information technology systems in 2001. DOT
also plans to develop an information technology security program plan and
implementation strategy.

4. A performance measure to reduce the number and rate of fatalities in
crashes involving large trucks.

5. A performance measure to reduce the number of failures of natural gas
transmission pipelines.

Appendix I: Observations on the Department of Transportation?s Efforts to
Address Its Major Management Challenges

Page 26 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Major management challenge Progress in resolving major

management challenge as discussed in fiscal year 2000 performance report

Applicable goals and measures in the fiscal year 2002 performance plan

However, the report acknowledged that fatalities due to pipeline accidents
remain a problem.

Acquisitions and disposals: Enhance major acquisitions and disposals

1. FAA?s air traffic control modernization program 2. the Coast Guard?s
Deepwater Project, and 3. surplus ship disposal

Regarding fiscal year 2000, the report indicated:

1. FAA did not meet its performance target for reducing aviation delay- an
indirect measure of its air traffic control modernization program. As a
result, FAA is taking a number of steps to address the challenges of keeping
its air traffic control modernization program on schedule and budget,
including setting baselines, applying new management techniques, and
improving problem analysis.

2. The Coast Guard did not meet its goal for increasing its seizure rate for
cocaine shipped via the sea- a performance indicator that the Deepwater
Project is designed in part to address.

3. None. The Maritime Administration will begin its program of disposing of
obsolete ships in the National Defense Reserve Fleet in 2001.

The report includes: 1. A performance measure to

reduce the rate of aviation delays that is indirectly applicable to air
traffic modernization. It also acknowledges that keeping air traffic control
modernization on schedule and on budget is a significant management
challenge, and it lists a number of tasks the agency will take to help
address the challenge.

2. No performance measures linked to the Coast Guard?s Deepwater Project,
but it did describe some of the actions it has taken to improve the program,
including updating the Deepwater Legacy Asset Baseline.

3. A performance goal of scrapping at least three vessels per year in fiscal
years 2001 and 2002.

Financial accountability. DOT?s lack of accountability for its financial
activities impairs its ability to manage programs and exposes the Department
to potential waste, fraud, mismanagement, and abuse. From fiscal years 1996
through 1998, the IG was unable to express an opinion on the reliability of
the DOT consolidated financial statement. For fiscal year 1999, the IG
expressed an unqualified opinion on DOT?s consolidated financial statement.
However, in the case of FAA, this required alternative procedures and
laborintensive methods with regard to property, plant, and equipment.
According to the DOT IG, these procedures and methods would not be
sustainable in the future. DOT also lacks a cost accounting system or
alternative means of accumulating the full costs of specific projects or
activities.

The FY 2000 Performance Report states that DOT?s 2000 Consolidated Financial
Statement received a

?qualified? opinion from the IG due to ongoing issues in FAA?s accounting
for property, plant, and equipment. The IG also issued a qualified opinion
on the separate FAA financial statement. The IG?s fiscal year 2000 audit
report on DOT ?s consolidated financial statement stated that FAA had to
calculate the property, plant, and equipment book value using electronic
spreadsheets outside the existing property systems, and the IG was unable to
substantiate the amounts. In addition, the IG reported that DOT continued to
lack systems to allocate costs by major

The plan states that the DOT Consolidated Financial Statement

?qualified? opinion issue will be resolved with the full implementation of
Delphi, the Department?s commercial off- theshelf core accounting system
replacement (No details of what remains to be done or projected completion
date are provided in the performance plan).

The plan also included goals for FAA to:

 convert to the Delphi accounting system in 2001,

 achieve unqualified audits in FY 2001 and FY 2002,

Appendix I: Observations on the Department of Transportation?s Efforts to
Address Its Major Management Challenges

Page 27 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Major management challenge Progress in resolving major

management challenge as discussed in fiscal year 2000 performance report

Applicable goals and measures in the fiscal year 2002 performance plan

program. As of September 30, 2000, FAA had implemented its cost accounting
system in the En Route, Oceanic and Flight Service Stations services portion
of its Air Traffic Services line of business. FAA still needs to implement
its cost accounting system in the Terminal/ Tower portion of Air Traffic
Services and in its other five lines of business. The FAA system will be in
addition to the cost accounting features being included in the new DOT
accounting system (Delphi) currently being implemented.

 implement cost accounting throughout the agency by FY 2002, and

 establish fees for the provision of ATC overflight services (no projected
implementation date is provided in the performance plan).

Strengthen the financial condition of Amtrak DOT did not meet its target for
Amtrak ridership of 23. 7 million passengers- an indirect measure of its
financial security- but ridership levels did increase for the fourth
straight year to 22.5 million. However, Amtrak also experienced increases in
labor costs, depreciation, and train operating expenses.

The plan includes a long- term performance measure of achieving financial
self- sufficiency in 2002 and an annual goal of increasing Amtrak?s
intercity ridership. Increased ridership is indirectly linked to Amtrak?s
financial condition because it increases its revenue.

GAO- designated major management challenges

Improve the oversight of highway and transit projects to provide maximum
transportation services for the federal dollars.

The report indicated that DOT has developed a comprehensive, standard
oversight approach to large projects that includes vigorously enforcing
financial reporting requirements, designating accountable oversight
managers, and taking special note of high- risk projects.

The plan includes the following goal to improve transit grant oversight:
reduce the deficiency findings per triennial and State management oversight
reviews by five percent per year. The plan did not include a goal for
improving the oversight of highway projects. Enhance competition and
consumer protection in aviation and freight rail industries to ensure
reasonable fares, rates, and service.

The report addressed the management challenge of competition in the aviation
sector by stating that DOT informally investigated major airline responses
to market entry by low- fare airlines and provided feedback to the Justice
Department.

The report will have a new performance target in 2002 for customer
satisfaction with the transportation system and the services provided by
DOT- an indirect measure of enhanced competition.

IG- designated major management challenge

Improve surface transportation security. DOT did not meet its goal for the
timely dissemination of information regarding transportation threats to
those who need to know- 90 percent of the people who need to act receive
infrastructure threat information within 24 hours. The agency achieved only
43- percent notification. However, DOT

DOT will continue to attempt to achieve its timely information dissemination
goal of 90- percent notification within 24 hours, and it plans to implement
its master plan for protecting critical physical assets.

Appendix I: Observations on the Department of Transportation?s Efforts to
Address Its Major Management Challenges

Page 28 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Major management challenge Progress in resolving major

management challenge as discussed in fiscal year 2000 performance report

Applicable goals and measures in the fiscal year 2002 performance plan

did complete a master plan to protect the agency?s critical physical assets
and information systems in accordance with a directive on critical
infrastructure protection, and FAA and the Coast Guard began making security
improvements. The Saint Lawrence Seaway Development Corporation completed
its security improvements.

Appendix II: Comments From the Department of Transportation

Page 29 GAO- 01- 834 DOT's Status in Achieving Key Outcomes

Appendix II: Comments From the Department of Transportation

Appendix II: Comments From the Department of Transportation

Page 30 GAO- 01- 834 DOT's Status in Achieving Key Outcomes (392008)

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