Facilities Location: Progress and Barriers in Selecting Rural	 
Areas and Using Telework (04-SEP-03, GAO-03-1110T).		 
                                                                 
The location of an organization's facilities has far reaching and
long-lasting impacts on its operational costs and ability to	 
attract and retain workers. The Rural Development Act of 1972 has
required federal agencies to give first priority to locating new 
offices and other facilities in rural areas. Rural areas	 
generally have lower real estate and labor costs, but agency	 
missions often require locations in urban areas. Telework, also  
called telecommunicating or flexiplace, is a tool that allows	 
employees to work at home or another work location other than a  
traditional office. Benefits of telework include reducing traffic
congestion, improving the recruitment and retention of workers,  
and reducing the need for office space. Telework could allow	 
federal workers who live in rural areas to work in or near their 
homes, at least some of the time. This testimony summarizes and  
updates work GAO has previously done on the progress in and	 
barriers to the federal government's efforts to locate its	 
operations and workers, when possible, in rural areas.		 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-03-1110T					        
    ACCNO:   A08318						        
  TITLE:     Facilities Location: Progress and Barriers in Selecting  
Rural Areas and Using Telework					 
     DATE:   09/04/2003 
  SUBJECT:   Federal agencies					 
	     Federal employees					 
	     Federal facilities 				 
	     Rural economic development 			 
	     Telecommunication					 
	     Telecommuting					 
	     Site selection					 

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GAO-03-1110T

Testimony Before the Committee on Small Business, House of Representatives

United States General Accounting Office

GAO For Release on Delivery Expected at 9: 30 a. m. EST Thursday,
September 4, 2003 FACILITIES LOCATION

Progress and Barriers in Selecting Rural Areas and Using Telework

Statement of Bernard L. Ungar Director, Physical Infrastructure Issues

GAO- 03- 1110T

Even though federal agencies have been required since 1972 to develop
policies and procedures to give priority to locating new offices and other
facilities in rural areas, this requirement has not been an important
factor in location decisions. In September 1990 we reported that there
were multiple laws and regulations to guide federal agencies in selecting
facility locations, but they did not always provide for consideration of
the best financial

interest of the government as a factor in the decision- making process. In
July 2001 we reported that many agencies had not issued policies and
procedures to give rural areas priority when considering the location of
new facilities. Only about 12 percent of federal workers were located in
nonmetropolitan statistical areas, a percentage that remained unchanged
from 1989 to 2000. Agencies said the need to be near clients, primarily in
urban areas, dictated the location of most operations in urban areas. In
spite of not having policies to give priority to rural areas, agencies
sometimes locate their operations in rural areas to serve clients in those
areas. Also, some functions, such as research and development, supply and
storage, automated data processing, and finance and accounting, can be
located in rural areas. Rural areas can offer lower real estate costs,
improved security, reduced parking and traffic congestion problems, and
better access to major transportation arteries. Potential barriers to
locating in rural areas include the lack of public transportation, lack of
available labor, location far from some other agency facilities, and
sometimes insufficient infrastructure for high- speed telecommunications.
In our July 2001 report, we made several recommendations to the General
Services Administration and Congress to

improve location decisionmaking. Congress and the General Services
Administration subsequently took action to stress the requirements of the
Rural Development Act.

Congress has promoted telework in several ways, including authorizing of
telework centers in the Washington, D. C., area, requiring agencies to
establish a policy under which employees may participate in telecommuting
to the maximum extent possible, and encouraging the development of
highspeed Internet access in rural areas. However, only about 5 percent of
the federal workforce is currently teleworking. In our July 2003 report,
we recommended that the General Services Administration and the Office of
Personnel Management improve their coordination and provide agencies with
more consistent guidance on telework and assist agencies in implementing
key practices we identified. The agencies generally agreed

with our recommendations and committed to implement them. In addition, the
Congressional Research Service reported in July 2003 that about 85 percent
of U. S. households have broadband access, although rural, minority, low-
income, inner city, tribal, and U. S. territory consumers are particularly
vulnerable to not receiving this service. Technological barriers, such as
the lack of access to high- speed Internet connections, could have a
detrimental effect on the ability of some federal workers in rural areas
to take advantage of telework. The location of an organization*s

facilities has far reaching and longlasting impacts on its operational
costs and ability to attract and retain workers. The Rural Development Act
of 1972 has

required federal agencies to give first priority to locating new offices
and other facilities in rural areas. Rural areas generally have lower real
estate and labor costs, but agency missions often require

locations in urban areas. Telework, also called telecommunicating or
flexiplace, is a tool that allows employees to work at home or another
work location other than a traditional office. Benefits of telework
include reducing traffic congestion, improving the recruitment and
retention of workers, and reducing the need for office space. Telework
could allow federal

workers who live in rural areas to work in or near their homes, at least
some of the time. This testimony summarizes and

updates work GAO has previously done on the progress in and barriers to
the federal government*s efforts to locate its operations and workers,
when possible, in rural areas.

www. gao. gov/ cgi- bin/ getrpt? GAO- 03- 1110T. To view the full product,
including the scope and methodology, click on the link above. For more
information, contact Bernard Ungar

at ungarb@ gao. gov. Highlights of GAO- 03- 1110T, a testimony

to Committee on Small Business, House of Representatives

September 4, 2003

FACILITIES LOCATION

Progress and Barriers in Selecting Rural Areas and Using Telework

Page 1 GAO- 03- 1110T Mr. Chairman and Members of the Committee: We are
pleased to be here to testify on federal agencies* efforts to consider

locating facilities in rural areas, as required by the Rural Development
Act of 1972 (RDA), and to use telework 1 as a way of allowing workers to
live in rural areas. My testimony is based on our September 1990 and July
2001 reports on facilities location 2 and subsequent actions by the
General

Services Administration (GSA) to address our recommendations; selected
agencies* responses to a requirement in a fiscal year 2002 appropriations
act directing Inspectors General to report on policies and procedures
their agencies have to give first priority to the location of facilities
in rural areas; and our July 2003 report on telework 3 and other GSA,
Office of Personnel Management (OPM), and Congressional Research Service
(CRS) reports on telework. My testimony focuses on the progress federal
agencies have made and barriers they face in locating federal buildings,
when possible, in rural areas and making telework available to federal
workers who live in rural areas.

Although RDA has required federal agencies to establish policies and
procedures giving first priority to the location of new offices and other
facilities in rural areas since 1972, RDA has not been an important factor
in federal location decisions. Many agencies have not issued policies and
procedures regarding RDA, and there is little evidence that agencies
consider RDA*s requirements when locating new federal facilities. Agency
officials said requirements to be near clients in urban areas to
accomplish their missions dictated the location of most operations in
urban areas. However, some agencies locate operations in rural areas to
serve rural populations, and functions such as research and development,
supply and storage, automated data processing, and finance and accounting
can often be located in rural areas. Benefits of rural areas can include
improved

1 Telework, also referred to as telecommunicating or flexiplace, is work
that is performed at an employee*s home or work location other than a
traditional office. 2 U. S. General Accounting Office, Facilities Location
Policy: GSA Should Propose a More Consistent and Businesslike Approach,
GAO/ GGD- 90- 109 (Washington, D. C.: Sept. 28, 1990); and U. S. General
Accounting Office, Facilities Location: Agencies Should Pay More Attention
to Costs and Rural Development Act, GAO- 01- 805 (Washington, D. C.: July
31, 2001). 3 U. S. General Accounting Office, Human Capital: Further
Guidance, Assistance, and Coordination Can Improve Federal Telework
Efforts, GAO- 03- 679 (Washington, D. C.: July 18, 2003). Summary

Page 2 GAO- 03- 1110T security, reduced parking and traffic congestion
problems, and better access to major transportation arteries. Potential
barriers to locating in rural areas include the lack of public
transportation, location far from

some other agency facilities, the lack of available labor, and
insufficient infrastructure for high- speed telecommunications. In 2000,
about 12 percent of federal workers were located in nonmetropolitan
statistical areas.

In 2002, about 5 percent of the federal workforce was teleworking. In
2003, we assessed the federal government*s progress in implementing
telework programs and found that, while recently improved, OPM and GSA
have not always coordinated their efforts; as a result, agencies have not
always received consistent, unambiguous support and guidance related to
telework. We identified 25 key practices, including 5 relating to
technology (such as providing technical support for teleworkers), that
federal agencies should implement in developing telework programs. We
found that the agencies we reviewed had fully implemented 7 of the 25
practices but had generally implemented the 5 practices relating to
technology. CRS reported in July 2003 4 that about 85 percent of U. S.
households have access to high- speed Internet connections, but rural,
minority, lowincome, inner city, tribal, and U. S. territory consumers are
particularly vulnerable to not receiving this service. Technological
barriers, including the lack of access to high- speed Internet
connections, could have a detrimental effect on the ability of some
federal workers in rural areas to take advantage of telework.

In our July 2001 report on federal location policies, we suggested that
Congress consider requiring agencies to consider real estate, labor, and
other costs, and applicable local incentives when making location
decisions and to amend RDA to clarify the definition of *rural area.* We
made similar recommendations to GSA and also recommended that GSA require
agencies to provide a written statement that they complied with RDA and to
justify their decision if they did not select a rural area. Subsequent to
our report, Congress has required agency inspectors general to report on
what policies and procedures are in place at their agencies to comply with
RDA, and GSA has issued additional guidance and policies on RDA. In our
July 2003 report on telework efforts, we recommended that GSA and OPM
improve coordination of their efforts to

4 Congressional Research Service, The Library of Congress, Broadband
Internet Access: Background and Issues (Washington, D. C.: Updated July 1,
2003).

Page 3 GAO- 03- 1110T provide agencies with enhanced guidance on telework
and to assist agencies in implementing key practices we identified. GSA
and OPM generally agreed with our recommendations and committed to take
steps

towards their implementation. When considering areas in which to locate,
RDA directs the heads of all executive departments and agencies of the
government to establish and maintain departmental policies and procedures
giving first priority to the location of new offices and other facilities
in rural areas. Any move by an agency to new office space in another
location would be considered a new office or facility covered by RDA.

Two primary executive orders on federal facility location decisions are
Executive Order 12072, Federal Space Management, dated August 16, 1978;
and Executive Order 13006, Locating Federal Facilities on Historic
Properties, dated May 21, 1996. Executive Order 12072 specifies that when

the agency mission and program requirements call for federal facilities to
be located in urban areas, agencies must give first consideration to
locating in a central business area and adjacent areas of similar
character. Executive Order 13006 requires the federal government to
utilize and maintain, wherever operationally appropriate and economically
prudent, historic properties and districts, especially those located in
the central business area.

In 1990, we reviewed whether federal agencies give rural areas first
priority in location decisions as required by RDA and whether any changes
in federal location policies were warranted. We reported that RDA had not
been an important factor in federal facility location decisions. In fiscal
year 1989, about 12 percent of federal civilian workers were located in
nonmetropolitan statistical areas. Agency officials attributed mission

requirements, the need to be in areas where the populations they serve are
located, political considerations, and budget pressures as reasons why
urban areas received more facilities than rural areas. Those agencies that
did locate in rural areas said it was more because they served rural
populations than because they were following the requirements of RDA. We
also reported that a growing number of private sector corporations

were moving to suburban and rural settings to take advantage of incentives
offered by localities to attract jobs and the ability to separate
functions resulting from changes in telecommunications technology. We
concluded that there were multiple laws and regulations guiding federal
The Rural Development Act and

Other Federal Location Policies

Agencies Generally Locate in Urban Areas and Lack Policies and Procedures
for Considering RDA

Page 4 GAO- 03- 1110T agencies in selecting facility locations, but they
do not always provide for consideration of the best financial interest of
the government as a factor in the decision- making process. We recommended
that GSA develop a more

consistent and cost- conscious governmentwide location policy that would
require agencies, in meeting their needs, to maximize competition and
select sites that offer the best overall value considering such factors as
real estate and labor costs.

In 2001, we performed follow- up work on our 1990 report including
identifying what functions lend themselves to being located in rural
areas. We reported that since our 1990 study, federal agencies continued
to locate for the most part in higher cost, urban areas. The percentage of
federal employees located in nonmetropolitan statistical areas in 2000
remained virtually unchanged from 1989, at about 12 percent. Eight of the
13 cabinet agencies we surveyed had no formal RDA policy, and there was

little evidence that agencies considered RDA*s requirements when locating
new federal facilities. Further, GSA had not developed a cost- conscious,
governmentwide location policy as we recommended in 1990 and the
definition of rural used in RDA was unclear.

We reported in 2001 that agencies chose urban areas for most (72 percent)
of the 115 federal sites acquired from fiscal year 1998 through fiscal
year 2000. Agencies said they selected urban areas primarily because of
the need to be near agency clients and related government and private
sector facilities to accomplish their missions. The agencies that selected
rural areas said they did so because of lower real estate costs. Agencies
that relocated operations tended to relocate within the same areas where
they were originally located, which were mainly urban areas; newly
established locations were almost equally divided between urban and rural
areas. Private sector companies surveyed said they select urban areas over
rural areas largely because of the need to be near a skilled labor force.

Agencies said the benefits of locating in urban areas were efficiency in
agency performance as a result of the ability to share existing
facilities, close proximity to other agency facilities and employees, and
accessibility to public transportation. Agencies that chose rural sites
said that benefits included close proximity to agency support facilities,
improved building

and data security, and better access to major transportation arteries,
such as interstate highways. Barriers reported for urban sites included
the lack of building security and expansion space. For rural areas,
barriers

included the lack of public transportation, location far from other agency
facilities, and insufficient infrastructure for high- speed
telecommunications.

Page 5 GAO- 03- 1110T The functions that were located predominantly at
urban sites during 1998 through 2000 were loans/ grants/ benefits
administration processing,

inspection and auditing, and health and medical services. The functions
that were located predominantly in rural areas in that period were
research and development, supply and storage, automated data processing,
and finance and accounting. Some functions, such as law enforcement, were
placed in both urban and rural areas, although this particular function
was located more often at urban sites.

For our 2001 study, we contracted with a private sector consultant, John
D. Dorchester, Jr., of The Dorchester Group, L. L. C., to assist us in a
number of tasks. One task was to identify functions the private sector
might locate in rural areas. The consultant identified the following
functions: 5  Accounting

 Account representative  Appraisal/ market research  Clerical/
secretarial  Data processing  Distribution/ warehousing  Education/
training  Enforcement and quality control  Field service operations 
Human resources and social services

 Information technologies services  Legal support  Logistical support 
Manufacturing and assembly offices  Operations centers  Printing and
publishing  Records archiving  Repairs and servicing  Scientific
studies and research and development  Technical functions and support

 Telemarketing, order processing, and communications We also asked our
consultant to identify the benefits and challenges associated with rural
areas for selected functions. (See table 1.)

5 The Dorchester Group, LLC., Office Location Considerations of Large U.
S. Corporations: U. S. Government Potentials (Scottsdale, AZ: Mar. 31,
2001).

Page 6 GAO- 03- 1110T Table 1: Benefits and Challenges Associated With
Rural Areas for Nine Functions Function Benefits Challenges

Accounting Lower wages and operating costs Data security and quality

control Data processing Reduced costs of office and

labor Needs skills more often found in metropolitan areas

Distribution and warehousing Savings on labor and real estate Needs good

transportation links Education and training Fewer distractions and

recreation opportunities None identified Enforcement/ quality control None
identified Needs good regional access Printing and publishing None
identified Needs good

transportation links Records archiving Lower costs for real estate

and wages Limited access to records Scientific studies/ research and
development Better security; in some

cases, access to universities Specialized employees may have to be
recruited

nationally Telemarketing, order processing, communications Operating cost
efficiencies Sufficient and sustainable

labor pool Source: The Dorchester Group, L. L. C., Office Location
Considerations of Large U. S. Corporations: U. S. Government Potentials
(Scottsdale, AZ: Mar. 31, 2001).

Our July 2001 report suggested that Congress consider enacting legislation
to (1) require agencies to consider real estate, labor, and other
operational costs and local incentives when making a location decision;
and (2) clarify the meaning of *rural area* in RDA. We also recommended
that GSA revise its guidance to agencies to require agencies making
location decisions to consider real estate, labor, and other costs and
local incentives. In addition, we recommended that GSA require agencies
subject to its authority to provide a written statement that they had
given first priority to locating in a rural area and to justify their
decision if they did not select a rural area. We also recommended that GSA
define rural area until

Congress amended RDA to define the term. Subsequent to our report, GSA
took action on our recommendations; actions which are described in greater
detail below.

Page 7 GAO- 03- 1110T The Fiscal Year 2002 Treasury and General Government
Appropriations Act, Public Law 107- 67, required the inspectors general
(IG) of

departments and agencies to submit to the appropriations committees a
report detailing what policies and procedures are in place requiring them
to give first priority to the location of new offices and other facilities
in

rural areas, as directed by RDA. These reports were due in May 2002. A
similar requirement was included in the Consolidated Appropriations
Resolution for Fiscal Year 2003, Public Law 108- 7. However, because the
IGs had until August 20, 2003, to report on this, we did not have the
opportunity to review those reports required by Public Law 108- 7 for this
testimony.

GSA*s May 2, 2002, response to the Public Law 107- 67 requirement
described the policies that GSA had in place to give first priority to the
location of new offices and other facilities in rural areas, as well as
what actions GSA had taken in response to our July 2001 recommendations.
GSA took the following actions:

 The Federal Management Regulation, section 102- 83.30, was revised to
require federal agencies to also consider real estate, labor, and other
operational costs and applicable incentives in addition to mission and
program requirements when locating space, effective December 13, 2002. 
The Public Buildings Service Customer Guide to Real Property was

revised to require agencies to provide GSA with a written statement
affirming that they have given first priority to locating in a rural area
as required by RDA when requesting space from GSA.

 The Federal Management Regulation, section 102- 83.55, effective
December 13, 2002, was revised to define *rural area* as a city, town, or
unincorporated area that has a population of 50,000 inhabitants or fewer,
other than an urban area immediately adjacent to a city, town, or
unincorporated area that has a population in excess of 50,000 inhabitants.
6  GSA published a recommendation in the Federal Register on January 21,

2003, that federal agencies with their own statutory authority to acquire
real property use the above definition of rural area and demonstrate 6 We
noted in our 2001 report that the definition of *rural area* in RDA was
unclear. In 2002, the RDA definition was repealed in its entirety, and
currently there is no statutory definition of rural area in RDA. In 1972,
RDA defined rural as any area in a city or town

with a population less than 10,000 inhabitants. Policies to Consider RDA
Have Been

Strengthened but Procedures are Still Lacking

Page 8 GAO- 03- 1110T compliance with RDA by including a written statement
in their files affirming that they have given first priority to the
location of new offices

and other federal facilities in rural areas. These actions responded to
all of our July 2001 recommendations with the exception of one. We had
recommended that GSA require agencies, when selecting a new facility
location, to provide a written statement that they

had given first priority to locating in a rural area. If a rural area was
not selected, agencies were to provide a justification for the decision.
GSA*s new guidance does not require agencies not selecting a rural area to
justify their decision.

We also reviewed the IG reports detailing the policies and procedures in
place regarding giving first priority to rural areas as required by Public
Law 107- 67 for the Departments of Energy, the Interior, Justice,
Transportation, and Veterans Affairs. According to GSA data, 7 these
agencies, along with the Department of Defense and the United States
Postal Service, have the largest amount of owned and leased building
square footage in the federal government. We excluded sites acquired by
the Defense Department because it has so much vacant space available at
its bases nationally that it has no choice but to give priority
consideration

to its existing vacant space when locating new or existing operations. We
excluded Postal Service sites because the Postal Service advised us it had
little or no discretion in deciding where to locate most of its facilities
in

that they needed to be in specific locations to serve customers or near
airports. In addition, the Postal Service is exempt from federal laws
relating to contracts and property and it has authority to acquire space
independently of GSA.

The IG reports for the five departments said that only two departments had
written policies regarding RDA, and only one of these two had issued
procedures. However, the departments said that in spite of not having

written policies or procedures, they had located many of their facilities
in rural areas. The Energy IG reported that Energy had no specific
policies or procedures, but it reported that a preponderance of the
department*s activities are located in remote parts of the United States.

7 U. S. General Services Administration, Federal Real Property Profile, as
of September 30, 2002 (Washington, D. C., 2002).

Page 9 GAO- 03- 1110T The Interior IG reported that Department of the
Interior and the U. S. Geological Survey, 1 of 35 bureaus and offices in
the Department of the

Interior, had policies regarding RDA. However, neither the department nor
any of the bureaus and offices had procedures to ensure compliance with
the policies. The IG reported that of the 270 locations established in the
last 5 years, 197 (73 percent) were located in rural areas. The IG said
that the decision to place facilities in rural areas was influenced by
Interior*s mission rather than by the requirements of RDA. The Justice IG
said Justice had no specific policy or procedures on RDA,

but department bureaus, offices, boards, and divisions were instructed to
implement all applicable federal regulations. The Justice IG cited the GSA
regulation requiring agencies to give first priority to the location of
new offices and other facilities in rural areas. The IG said it relies
upon GSA for most of its space needs, and GSA is responsible for
compliance with RDA. Further, the IG said the locations of its facilities
are ultimately determined by mission and operational requirements, which
predominantly require locations in major metropolitan areas. For example,
U. S. Attorneys Offices and the U. S. Marshals Service need to be located
near federal courthouses to accomplish their missions. The Bureau of
Prisons is located in rural areas to decrease land costs and increase
security. The Immigration and Naturalization Service 8 is stationed in
both urban and rural areas along the borders of the United States. The
Federal Bureau of Investigation and the Drug Enforcement Administration
are law enforcement agencies, and their missions and operational
requirements determine the location of facilities. The IG also pointed out
that the Federal Bureau of Investigation*s data center is located in a
rural part of West Virginia. The Department of Transportation policy on
RDA was the most complete

of the agencies we reviewed in that Transportation has procedures that
require a discussion of the considerations given to rural areas and
requires an explanation if a rural location is not selected. However, the
Transportation IG said the department does not provide any guidance on
decision criteria or factors to be considered, such as cost- benefit
analysis, access to public transportation, or effects of relocation on the
workforce. Of 33 site location decisions made from October 1997 through
February

8 The Justice Inspector General report is dated July 30, 2002. Since the
report was issued, part of the Immigration and Naturalization Service is
now in the Department of Homeland Security.

Page 10 GAO- 03- 1110T 2002, the Transportation IG found that 24 had no
documentation in the files to indicate compliance with RDA.

According to the Veterans Affairs IG, the department had no written policy
or procedures regarding RDA. The IG said priority is given to locating new
Veterans Health Administration medical care facilities in locations
convenient to veteran patients and to collocating Veterans Benefits
Administration regional offices on Veterans Affairs medical center
grounds.

Telework could be used to allow federal workers who live in rural areas to
work in or near their homes, at least on a part- time basis. For over a
decade, telework, also called telecommuting or flexiplace, has gained
popularity because it offers the potential to benefit employers, including
the federal government, by reducing traffic congestion and pollution,
improving the recruitment and retention of employees, increasing
productivity, and reducing the need for office space. Employees can
benefit from reduced commuting time; lower costs for transportation,
parking, food, and clothing; and a better balance of work and family
demands, which could improve morale and quality of life. Other benefits
might include removing barriers for those with disabilities who want to be
part of the work force and helping agencies maintain continuity of
operations in emergency operations.

Congress has enacted legislation that has promoted the use of telework in
several ways, including authorizing GSA telework centers, requiring each
agency to consider using alternate workplace arrangements when

considering whether to acquire space for use by employees, requiring each
agency to establish a policy under which eligible employees may
participate in telecommuting to the maximum extent possible, and
encouraging the deployment of high- speed Internet access in rural areas.
Congress has provided both GSA and OPM with lead roles and shared
responsibilities for advancing telework in the federal government.

Under the telework centers program, GSA supports 15 centers located in the
Washington, D. C., metropolitan area. These centers make alternative
office environments available to federal employees to perform their work
at a site closer to their homes. Federal Telework

Efforts are Improving but Limited

Page 11 GAO- 03- 1110T According to a recent OPM report, 9 federal
agencies reported in November 2002 that about 90,000 employees, or about 5
percent of the workforce,

were teleworking, compared with about 74,500, or 4.2 percent, reported in
2001. OPM reported that about 625,300 employees, or 35 percent of the
federal workforce, were eligible to telework in 2002, and 68. 5 percent of
the total eligible federal workforce had been offered the opportunity to
telework. In 2002, 14. 4 percent of eligible employees teleworked. OPM
reported that the rise in the number of teleworkers was due to a number

of factors, including intensified efforts by agencies to encourage
telework and a decline in management resistance to telework after training
and education efforts. OPM did not report on the number of federal workers
who resided in rural areas who were able to telework. We did not verify
the accuracy of the OPM data.

OPM reported a change in the ranking of major barriers to telework from an
April 2001 survey of agencies to the November 2002 survey. As shown in
table 2, security became the main barrier in 2002, replacing management
resistance, which had been the main barrier in 2001.

Table 2: Ranking of Major Barriers to Telework April 2001 Barriers
November 2002 Barriers

Management resistance Data security Funding Information technology issues
Employee resistance/ concerns Funding

Information technology issues Employee resistance/ concerns Data security
Management resistance Source: OPM. In July 2003 we reported on the federal
government*s progress in implementing telework programs. We found that
although OPM and GSA offer services and resources to encourage telework in
the government, they have not fully coordinated their efforts and have had
difficulty in resolving their conflicting views on telework- related
matters. As a result, agencies have not always received consistent,
inclusive, unambiguous support and guidance related to telework. We
recommended that OPM and GSA improve the coordination of their efforts to
provide federal agencies with enhanced support and guidance related to
telework and to assist

9 U. S. Office of Personnel Management, Report to the Congress: The Status
of Telework in the Federal Government (Washington, D. C.: Jan. 2003).

Page 12 GAO- 03- 1110T agencies in implementing 25 key practices we
identified. After we discussed the issues created by the lack of
coordination between GSA and

OPM, a GSA official indicated that GSA and OPM would commit to improved
coordination. The 25 key practices we identified by reviewing telework-
related literature and guidelines that federal agencies should implement
in developing telework programs are listed in table 3.

Table 3: Key Telework Practices for Implementing Successful Federal
Telework Programs Program Telework practices

Program planning  Designate a telework coordinator

 Establish a cross- functional project team, including, for example,
information technology (IT), union representatives, and other stakeholders

 Establish measurable telework program goals  Develop an implementation
plan for the telework program

 Develop a business case for implementing a telework program

 Provide funding to meet the needs of the telework program  Establish a
pilot program Telework policy  Establish an agencywide telework policy

 Establish eligibility criteria to ensure that teleworkers are selected
on an equitable basis using such criteria as suitability of tasks and
employee performance

 Establish policies or requirements to facilitate communication among
teleworkers, managers, and coworkers

 Develop a telework agreement for use between teleworkers and their
managers

 Develop guidelines on workplace health and safety issues to ensure that
teleworkers have safe and adequate places to work off- site

Performance management  Ensure that the same performance standards,
derived from a modern, effective, credible, and validated performance
system, are used to evaluate both teleworkers and nonteleworkers

 Establish guidelines to minimize adverse impact on nonteleworkers before
employees begin working at alternate work sites Managerial support 
Obtain support from top management for a telework program  Address
managerial resistance to telework Training and publicizing  Train all
involved, including, at a minimum, managers and teleworkers

 Inform workforce about the telework program Technology  Conduct
assessment of teleworker and organization technology needs

 Develop guidelines about whether the organization or employee will
provide necessary technology, equipment, and supplies for telework 
Provide technical support for teleworkers

 Address access and security issues related to telework

 Establish standards for equipment in the telework environment

Page 13 GAO- 03- 1110T Program Telework practices

Program evaluation  Establish processes, procedures, and/ or a tracking
system to collect data to evaluate the telework program  Identify
problems and/ or issues with the telework program and make appropriate
adjustments Source: GAO analysis of telework- related literature and
guidelines. We found that the four agencies we reviewed for that report,
the

Departments of Education and Veterans Affairs, GSA, and OPM, had
implemented 7 of the 25 practices and had generally implemented the 5
practices relating to technology. Nevertheless, technological issues, such
as not being able to access to high- speed Internet connections, could
have a detrimental effect on the ability of some federal workers in rural
areas to take advantage of telework.

CRS reported this year on the ability of users to take advantage of
highspeed, or broadband, Internet access. CRS reported that although many,
but not all, offices and businesses now have Internet broadband access, a
remaining challenge is providing broadband over *the last mile* to
consumers in their homes. Congress has required the Federal Communications
Commission (FCC) to determine whether advanced

telecommunications capability is being deployed to all Americans in a
reasonable and timely fashion and, if not, to take immediate action to
accelerate deployment by removing barriers to infrastructure investment
and by promoting competition in the telecommunications market. 10 In
August 2000, FCC concluded that advanced telecommunications

capability was being deployed in a reasonable and timely fashion overall,
although rural, minority, low- income, inner city, tribal, and U. S.
territory consumers were particularly vulnerable to not receiving service
in a timely fashion. In February 2002, FCC concluded that the deployment
of advanced telecommunications capability to all Americans was reasonable
and timely and investment in infrastructure for most markets remained
strong, even though the pace of investment trends had slowed. According to
CRS, about 85 percent of households have access to broadband.

CRS also reported that the President*s Council of Advisors on Science and
Technology concluded in December 2002 that although government should not
intervene in the telecommunications marketplace, it should apply existing
policies and promote government broadband applications

10 47 U. S. C. 157 note.

Page 14 GAO- 03- 1110T and telework, among other actions. CRS also noted
that much broadband legislation introduced in the 107th Congress sought to
provide tax credits, grants, and/ or loans for broadband deployment,
primarily in rural and/ or

low income areas. It also noted that Public Law 107- 171, the Farm
Security and Rural Investment Act of 2002, authorized a loan and loan
guarantee program to entities for facilities and equipment providing
broadband

service in eligible rural communities. The purpose of this legislation is
to accelerate broadband deployment in rural areas.

Mr. Chairman, this concludes my prepared statement. I would be happy to
respond to any questions you or other Members of the Committee may have at
this time.

For further information on this testimony, please contact Bernard L. Ungar
on (202) 512- 2834 or at ungarb@ gao. gov. Key contributions to this
testimony were made by John Baldwin, Frederick Lyles, Susan MichalSmith,
and Bill Dowdal. Contacts and

Acknowledgments

(543071)

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