Climate Change: Greater Clarity and Consistency Are Needed in	 
Reporting Federal Climate Change Funding (21-SEP-06,		 
GAO-06-1122T).							 
                                                                 
The Congress has required annual reports on federal climate	 
change spending. The Office of Management and Budget (OMB)	 
reports funding for: technology (to reduce greenhouse gas	 
emissions), science (to better understand the climate), 	 
international assistance (to help developing countries), and tax 
expenditures (to encourage emissions reduction). The Climate	 
Change Science Program (CCSP), which coordinates many agencies'  
activities, also reports on science funding. This testimony is	 
based on GAO's August 2005 report Climate Change: Federal Reports
on Climate Change Should Be Clearer and More Complete		 
(GAO-05-461). GAO examined federal climate change funding for	 
1993 through 2004, including (1) how total funding and funding by
category changed and whether funding data are comparable over	 
time and (2) how funding by individual agencies changed and	 
whether funding data are comparable over time.			 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-1122T					        
    ACCNO:   A61347						        
  TITLE:     Climate Change: Greater Clarity and Consistency Are      
Needed in Reporting Federal Climate Change Funding		 
     DATE:   09/21/2006 
  SUBJECT:   Climate statistics 				 
	     Comparative analysis				 
	     Data collection					 
	     Environmental monitoring				 
	     Federal funds					 
	     Financial analysis 				 
	     Funds management					 
	     Regulatory agencies				 
	     Reporting requirements				 
	     Research programs					 
	     Tax expenditures					 
	     Climate Change Science Program			 
	     U.S. Global Change Research Program		 

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GAO-06-1122T

     

     * Background
     * Reported Federal Climate Change Funding Increased for Three
          * Technology
          * Science
          * International Assistance
          * Tax Expenditures
     * Reported Funding for Most Agencies Increased, but Unexplaine
     * OMB Reports Presented Information on Budget Authority Rather
     * Conclusions
     * Contact and Staff Acknowledgments
     * GAO's Mission
     * Obtaining Copies of GAO Reports and Testimony
          * Order by Mail or Phone
     * To Report Fraud, Waste, and Abuse in Federal Programs
     * Congressional Relations
     * Public Affairs

Testimony

Before the Committee on Government Reform House of Representatives

United States Government Accountability Office

GAO

For Release on Delivery Expected at 10:00 a.m. EDT

Thursday, September 21, 2006

CLIMATE CHANGE

Greater Clarity and Consistency Are Needed in Reporting Federal Climate
Change Funding

Statement of John B. Stephenson, Director Natural Resources and
Environment

GAO-06-1122T

Mr. Chairman and Members of the Committee:

Increases in the earth's average temperature that have already occurred
over the last 100 years, combined with additional future increases
projected by a consensus of scientists, have the potential to dramatically
change life on earth. For example, changes in the frequency and intensity
of rainfall, both possible effects of climate change, could affect
agriculture and forest health in certain locations. Effects on planetary
biodiversity are projected to be even more pronounced. For more than a
decade, the federal government has funded programs to study the earth's
climate and to reduce emissions of carbon dioxide and other greenhouse
gases linked to climate change. According to the Office of Management and
Budget (OMB), 9 of the 15 cabinet-level executive departments, along with
5 other federal agencies, received funding for climate change activities
in 2004.

In annual reports and testimony before the Congress, OMB reported climate
change funding for 1993 through 2004 using the following four categories:

           o  Technology, which includes the research, development, and
           deployment of technologies and processes to reduce greenhouse gas
           emissions or increase energy efficiency. Funding for this category
           focuses on programs for energy conservation, renewable energy, and
           related efforts.
           o  Science, which includes research and monitoring to better
           understand climate change, such as measuring changes in forest
           cover.
           o  International assistance, which helps developing countries to
           address climate change by, for example, providing funds for energy
           efficiency programs.
           o  Tax expenditures related to climate change, which are federal
           income tax provisions that grant preferential tax treatment to
           encourage emission reductions by, for example, providing tax
           incentives to promote the use of renewable energy.1

           Over the same time period, the administration also reported
           annually on funding specifically for climate change science, one
           of the four categories used in OMB reports. The Climate Change
           Science Program (CCSP)-a multiagency coordinating group-is
           currently responsible for preparing the climate change science
           reports, which duplicate to some extent OMB's science funding
           reports.

           My remarks today are based on our August 2005 report on federal
           climate change funding from 1993 through 20042 and will focus on
           (1) how total funding and funding by category changed and the
           extent to which data on such funding are comparable over time and
           (2) how funding by agency changed and the extent to which data on
           such funding are comparable over time. We also examined whether
           OMB reports on climate change funding provided the data required
           by the Congress. It is important to note that in April 2006, OMB
           issued its fiscal year 2007 report to the Congress on federal
           climate change expenditures and has implemented several of GAO's
           August 2005 recommendations in that report. Likewise, in November
           2005, CCSP issued its fiscal year 2006 report to the Congress and
           has also implemented a GAO recommendation in that report. My
           testimony today addresses only climate change spending and
           reporting through fiscal year 2004.

           To determine how federal climate change funding by category and
           agency changed, we analyzed data from annual OMB and CCSP reports,
           as well as congressional testimony. To determine the extent to
           which the data on climate change funding were comparable, we
           analyzed and compared the contents of the reports and interviewed
           responsible officials. To determine whether OMB and CCSP reports
           provided the data the Congress required, we reviewed the reporting
           requirements, the legislative history of these requirements, and
           the data OMB and CCSP presented in their reports. The term
           "funding" in this testimony reflects discretionary budget
           authority, or the authority provided in law to incur financial
           obligations that will result in outlays, as reported by OMB and
           CCSP in their reports.3 Unless otherwise stated, we report funding
           in nominal terms (not adjusted for inflation), and all years refer
           to fiscal years.4 This testimony is based on work that was
           conducted between July 2004 and August 2005 in accordance with
           generally accepted government auditing standards.

           In summary, federal funding for climate change, as reported by
           OMB, increased from $2.35 billion in 1993 to $5.09 billion in 2004
           (116 percent), or from $3.28 billion to $5.09 billion (55 percent)
           after adjusting for inflation. OMB reports show that, during this
           period, funding increased for technology and science. CCSP, which
           reports only science funding, generally presented totals that were
           consistent with OMB's, but provided more detail. However, changes
           in reporting methods used by both OMB and CCSP limit the
           comparability of funding data over time, and therefore it was
           unclear whether total funding actually increased as much as
           reported. Furthermore, we were unable to compare changes in the
           fourth category-climate-related tax expenditures-because OMB
           reported estimates for proposed but not existing tax expenditures
           from 1993 to 2004. Specifically, for 1993 through 2004:

           o  Technology funding, as reported by OMB, increased from $845
           million to $2.87 billion (239 percent), or from $1.18 billion to
           $2.87 billion (183 percent) in inflation-adjusted dollars. The
           share of total climate change funding devoted to technology
           increased from 36 percent to 56 percent. However, we identified
           several ways that technology funding presented in OMB's more
           recent reports may not be comparable to previously reported
           technology funding. For example, OMB added accounts to the
           technology category that were not reported before or were
           presented in different categories, but it did not explain whether
           these accounts reflected the creation of new programs, or a
           decision to count existing programs for the first time. OMB also
           expanded the definitions of some accounts to include more
           activities without clarifying how the definitions were changed.
           Furthermore, OMB reports include a wide range of federal
           climate-related programs and activities, some of which-such as
           scientific research on global environmental change-are explicitly
           climate change programs, whereas others-such as technology
           initiatives promoting emissions reduction or encouraging energy
           conservation-are not solely for climate change purposes.

           o  Science funding increased from $1.31 billion to $1.98 billion
           (51 percent), according to both OMB and CCSP, or from $1.82
           billion to $1.98 billion (9 percent) in inflation-adjusted
           dollars. However, its share of total climate change funding
           decreased from 56 percent to 39 percent. OMB and CCSP generally
           presented consistent climate change science funding totals from
           1993 through 2004. CCSP reports also presented more detailed data,
           but these data were difficult to compare over the entire period
           because CCSP periodically introduced new categorization methods
           without explaining how the new methods related to the ones they
           replaced. Specifically, over the period CCSP used seven different
           methods to present detailed science funding data, making it
           impossible to develop consistent funding trends of the entire
           timeframe.

           o  International assistance funding reported by OMB increased from
           $201 million to $252 million (25 percent), but decreased from $280
           million to $252 million (10 percent) in inflation-adjusted
           dollars. Moreover, its share of total climate change funding
           decreased from 9 percent to 5 percent. International assistance
           funding reported by OMB was generally comparable over time,
           although several new accounts were added without explanation.

           o  Tax expenditures were not fully reported by OMB for any year,
           even though climate-related tax expenditures amounted to hundreds
           of millions of dollars in revenue forgone by the federal
           government in fiscal year 2004. Although not required to do so,
           OMB reported proposed climate-related tax expenditures. However,
           OMB did not report revenue loss estimates for existing climate
           change-related tax expenditures. Whereas OMB reported no funding
           for existing climate change-related tax expenditures in 2004, the
           federal budget for that year listed four tax expenditures related
           to climate change in that year, including estimated revenue losses
           of $330 million for incentives to develop certain renewable energy
           sources.

           OMB and CCSP officials told us that time constraints and other
           factors contributed to changes in report structure and content
           over time. For example, OMB officials said that the short timeline
           for completing the report required by the Congress (within 45 days
           of submitting the upcoming fiscal year's budget for the three most
           recent reports) limited OMB's ability to analyze data submitted by
           agencies. They also noted that they were not directed to use the
           same report format over time or explain differences in methodology
           from one report to another. Regarding tax expenditures, OMB
           officials said that they consistently included in the reports
           those proposed tax expenditures where a key purpose was
           specifically to reduce greenhouse gas emissions. They also stated
           that they had not included existing tax expenditures that may have
           greenhouse gas benefits but were enacted for other purposes, and
           that the Congress had not provided any guidance to suggest that
           additional tax expenditure data should be included in the annual
           reports. However, in response to a recommendation we made in our
           2005 report, OMB in its fiscal year 2007 report to the Congress
           included existing tax expenditures that could contribute to
           reducing greenhouse gases. Because of these and other limitations,
           determining actual changes in federal climate change funding is
           difficult.

           OMB reported that 12 of the 14 agencies receiving funding for
           climate change programs in 2004 received more funding in that year
           than they had in 1993, but it is unclear whether funding changed
           as much as OMB reported because unexplained changes in what was
           defined as climate change funding. Reported funding for the
           Department of Energy (DOE), the agency with the most reported
           climate-related funding in 2004, increased from $963 million to
           $2.52 billion (162 percent), or from $1.34 billion to $2.52
           billion (88 percent) after adjusting for inflation. DOE and the
           National Aeronautics and Space Administration (NASA) accounted for
           81 percent of the reported increase in funding from 1993 through
           2004. However, because agency funding totals are composed of
           individual accounts, the changes in the reports' contents
           discussed earlier, such as the unexplained addition of accounts to
           the technology category, limit the comparability of agencies'
           funding data over time, making it difficult to determine if these
           are real or definitional increases.

           We found that OMB reports presented information on budget
           authority, not-as required by the Congress-on expenditures. The
           Congress has required that information be provided on expenditures
           and obligations, the amounts actually spent or committed to be
           spent, while OMB reports generally have presented information on a
           different measure, budget authority, or the amount of funding
           provided by the Congress. OMB officials told us that they adopted
           their approach because the relevant congressional committees
           generally use budget authority. They told us that they reported on
           this basis because these committees have not objected to OMB's
           approach.

           We recommended that OMB and CCSP, from year-to-year, use the same
           format for presenting data, explain changes in report content or
           format when they are introduced, and provide and maintain a
           crosswalk comparing new and old report structures when changes in
           report format are introduced. We also recommended that OMB include
           data on existing climate-related tax expenditures in future
           reports. Finally, we recommended that OMB request that the
           Congress clarify whether future reports should be presented in
           terms of expenditures and obligations or in terms of budget
           authority, and if the Congress prefers the former, OMB should
           request the necessary time to prepare reports on that basis.

           We received oral comments from OMB on August 1, 2005, and written
           comments from CCSP in a letter dated July 28, 2005. OMB agreed
           with the recommendations relating to report content and format and
           said it was studying the other recommendations. CCSP agreed with
           all of our recommendations.

           After our report was issued in August 2005, OMB released its
           fiscal year 2007 report to Congress on climate change
           expenditures. Several of our recommendations were implemented in
           that report. For example, OMB included data on existing
           climate-related expenditures. OMB also labeled its tables for the
           major types of funding with respect to fiscal year and budgetary
           metric (actual budget authority, enacted budget authority,
           obligations, outlays, and proposed budget authority). CCSP has
           implemented our recommendation about explaining changes in report
           content or format.

           Background
			  
			  In 1990, the Congress enacted the Global Change Research Act. 5
           This act, among other things, required the administration to (1)
           prepare and at least every 3 years revise and submit to the
           Congress a national global change research plan, including an
           estimate of federal funding for global change research activities
           to be conducted under the plan; (2) in each annual budget
           submission to the Congress, identify the items in each agency's
           budget that are elements of the United States Global Change
           Research Program (USGCRP), an interagency long-term climate change
           science research program; and (3) report annually on climate
           change "expenditures required" for the USGCRP.6 In 1992, the
           United States signed and ratified the United Nations Framework
           Convention on Climate Change, which was intended to stabilize the
           buildup of greenhouse gases in the earth's atmosphere, but did not
           impose binding limits on emissions.

           In response to the requirements of the 1990 act, the
           administration reported annually from 1990 through 2004 on funding
           for climate change science in reports titled Our Changing Planet.7
           From 1990 through 2001, the reports presented detailed science
           funding data for the USGCRP. Federal climate change science
           programs were reorganized in 2001 and 2002. In 2001, the Climate
           Change Research Initiative (CCRI) was created to coordinate
           short-term climate change research focused on reducing
           uncertainty, and in 2002, CCSP was created to coordinate and
           integrate USGCRP and CCRI activities. CCSP is a collaborative
           interagency program designed to improve the government wide
           management of climate science and research. Since 2002, CCSP has
           been responsible for meeting the reporting requirement and has
           published the Our Changing Planet reports. The most recent report
           in this series was published in November 2005.

           The Climate Change Technology Program (CCTP) is a multiagency
           technology research and development coordinating structure similar
           to CCSP. Its overall goal is to attain, on a global scale and in
           partnership with other entities, a technological capability that
           can provide abundant, clean, secure, and affordable energy and
           related services needed to encourage and sustain economic growth,
           while achieving substantial reductions in emissions of greenhouse
           gases and mitigating the risks of potential climate change.

           In March 1998, OMB, in response to a congressional requirement for
           a detailed account of climate change expenditures and obligations,
           issued a brief report summarizing federal agency programs related
           to global climate change. OMB produced another climate change
           expenditures report in March 1999 and, in response to a request at
           a 1999 hearing, OMB provided climate change funding data for 1993
           through 1998 for the hearing record. Each year since 1999, the
           Congress has included a provision in annual appropriations laws
           requiring OMB to report in detail all federal agency obligations
           and expenditures, domestic and international, for climate change
           programs and activities. As a result of these reporting
           requirements, OMB annually publishes the Federal Climate Change
           Expenditures Report to Congress, which presents federal climate
           change funding for the technology, science, and international
           assistance categories, and tax expenditures. The climate change
           activities and associated costs presented in OMB reports must be
           identified by line item as presented in the President's budget
           appendix. OMB has interpreted this to mean that the data in the
           reports must be shown by budget account. For the last 3 years for
           which we reviewed data, the Congress had required that the
           administration produce reports for climate change expenditures and
           obligations for the current fiscal year within 45 days after the
           submission of the President's budget request for the upcoming
           fiscal year. OMB's most recent report was released in April 2006.

           OMB reports include a wide range of federal climate-related
           programs and activities. Some activities, like scientific research
           on global environmental change by USGCRP, are explicitly climate
           change programs, whereas others, such as many technology
           initiatives, are not solely for climate change purposes. For
           example, OMB reports included some programs that were started
           after the United States ratified the Framework Convention in 1992
           and were specifically designed to encourage businesses and others
           to reduce their greenhouse gas emissions, for example, by
           installing more efficient lighting. OMB reports also included
           programs that were expanded or initiated in the wake of the 1973
           oil embargo to support such activities as energy conservation (to
           use energy more efficiently), renewable energy (to substitute for
           fossil fuels), and fossil energy (to make more efficient use of
           fossil fuels), all of which can help to reduce greenhouse gas
           emissions, but were not initially developed as climate change
           programs.

           Reported Federal Climate Change Funding Increased for Three of the
			  Four Funding Categories, but Data May Not Be Comparable Over Time
			  
			  Federal climate change funding, as reported by OMB, increased from
           $2.35 billion in 1993 to $5.09 billion in 2004 (116 percent), or
           from $3.28 billion to $5.09 billion (55 percent) after adjusting
           for inflation. Funding also increased for technology, science, and
           international assistance between 1993 and 2004, as shown in table
           1. However, changes in reporting methods have limited the
           comparability of funding data over time; therefore it is unclear
           whether funding increased as much as reported by OMB.8 OMB did not
           report estimates for existing climate-related tax expenditures
           during this period, although climate-related tax expenditures
           amounted to hundreds of millions of dollars in revenue forgone by
           the federal government in fiscal year 2004. OMB officials told us
           that changes in reporting methods were due to such reasons as the
           short amount of time available to prepare the report, the fact
           that the reporting requirement is not permanent law, but appears
           each year in their appropriations legislation, and changes in
           administration policy and priorities. As a result of our
           recommendations, however, OMB made changes in its report on
           climate change funding for fiscal year 2007, which was published
           in April 2006. For example, OMB more clearly labeled data
           throughout the report and added information on existing tax
           provisions that can contribute to reducing greenhouse gas
           emissions.

           Table 1: Reported Federal Climate Change Funding by Category,
           Selected Years
			  
			  Discretionary budget authority in millions of dollars
Category                    1993   1997   2001   2004 
Technology                  $845 $1,056 $1,675 $2,868 
Science                    1,306  1,656  1,728  1,976 
International assistance     201    164    218    252 
Tax expenditures               a      a      a      a 
Total                     $2,352 $2,876 $3,603 $5,090 

           Source: GAO analysis of OMB data.

           aOMB did not report revenue loss estimates for existing
           climate-related tax expenditures for this year.

           Technology
			  
			  From 1993 through 2004, technology funding increased as a share of
           total federal climate funding from 36 percent to 56 percent, as
           reported by OMB. Over this period, technology funding increased
           from $845 million to $2.87 billion (239 percent), or adjusted for
           inflation, from $1.18 billion to $2.87 billion (143 percent). For
           example, funding for energy conservation increased from $346
           million to $868 million, and funding for renewable energy
           increased from $249 million to $352 million. Table 2 presents
           funding data for selected years for the seven largest accounts,
           which accounted for 92 percent of technology funding in 2004.

           Table 2: Reported Technology Funding for Selected Accounts and
           Years
			  
			  Discretionary budget authority in millions of dollars
Agency               Account                     1993   1997   2001   2004 
Department of Energy Energy Conservation         $346   $414   $810   $868 
                        Energy Supply - Fossil                                
                        Energy Research and                            
                        Development (R&D)            250    201    292    455
                        Energy Supply -Renewable                              
                        Energy                       249    244    370    352
                        Science (Fusion,                                      
                        Sequestration, and                             
                        Hydrogen)a                     b      b     35    333
                        Energy Supply - Nuclear c      b      b     39    309 
National Aeronautics Exploration, Science, and                             
and Space            Aeronautics                                    
Administration                                      b      b      b    227
Environmental        Environmental Programs and                            
Protection Agency    Management                     b     70     96     89
Other                                               b    127     33    235 
Total                                            $845 $1,056 $1,675 $2,868 

           Source: GAO analysis of OMB data.

           aSequestration can be defined as the capture and isolation of
           gases that otherwise could contribute to global climate change.

           bOMB did not report a value in the technology category for this
           account for this year.

           cFor 2001 Energy Supply - Nuclear funding, we counted the Nuclear
           Energy Research Initiative and Energy Supply - Nuclear budget
           accounts as presented by OMB. OMB did not separately present these
           accounts for 2004, and included funding for the Nuclear Energy
           Research Initiative within the Energy Supply-Nuclear account.

           We identified three ways that the data on technology funding
           presented in three of OMB's recent reports may not be comparable
           to the data presented in previous reports. First, OMB added
           accounts that were not previously presented. For example, OMB
           reported that NASA had $152 million in funding for
           technology-related activities, which included research to reduce
           emissions associated with aircraft operations in 2003. OMB did not
           report this account in the technology category in 2002. In
           addition, OMB included and removed some accounts, without
           explanation, from reports in years other than 2003. For example,
           OMB reported combined funding of $195 million in 1999, and $200
           million in 2000, for bio-based products and bio-energy at the
           Departments of Energy and of Agriculture. No funding for these
           accounts was reported from 1993 through 1998 or from 2001 through
           2004. In each of these cases, OMB did not explain whether the new
           accounts reflected the creation of new programs, a decision to
           count an existing program for the first time, or a decision to
           re-classify funding from different categories as technology
           funding.

           According to OMB officials, these changes in report structure and
           content for technology funding, as well as similar changes in
           science and international assistance funding, were the result of
           time constraints and other factors. They told us that the short
           timeline required by the Congress for completing the report
           (within 45 days of submitting the upcoming year's budget) limited
           OMB's ability to analyze data submitted by agencies. They said
           that they must rely on funding estimates quickly developed by
           agencies in order to produce the report within the specified
           timeframe, and that the reports are often compilations of agency
           activities and programs, some of which may or may not have been
           presented separately in prior years. Moreover, these officials
           told us that the presentation of data has changed over time for a
           variety of reasons other than short time limits, including changes
           in administration priorities and policy, changes in congressional
           direction, changes to budget and account structures, and attempts
           to more accurately reflect the reporting requirement as specified
           in the annual appropriations language. The officials also stated
           that in each report they ensured consistency for the 3 years
           covered (prior year, current year, and budget year).

           Furthermore, OMB officials told us that the presentation of new
           accounts in the technology category, as well as the international
           assistance category, was due to the establishment of new programs
           and the inclusion of existing programs. They told us that the
           account-by-account display in the reports has been changed over
           time as the CCSP and the Climate Change Technology Program (CCTP),
           a multiagency technology research and development coordinating
           structure similar to the CCSP, have become better defined.

           Second, OMB reported that it expanded the definitions of some
           accounts to include more activities but did not specify how the
           definitions were changed. We found that over 50 percent of the
           increase in technology funding from 2002 to 2003 was due to
           increases in two existing DOE accounts: nuclear energy supply and
           science (fusion, sequestration, and hydrogen). OMB reported
           funding of $32 million in 2002 and $257 million in 2003, for the
           nuclear energy supply account9 and reported funding of $35 million
           in 2002, and $298 million in 2003, for the science (fusion,
           sequestration, and hydrogen) account. Although OMB stated in its
           May 2004 report that 2003 funding data included more activities
           within certain accounts, including the research and development of
           nuclear and fusion energy, the report was unclear about whether
           the funding increases for these two existing accounts were due to
           the addition of more programs to the accounts or increased funding
           for existing programs already counted in the accounts. Finally, if
           new programs were counted in these accounts, OMB did not specify
           what programs were added and why.

           OMB officials told us that the definitions of some accounts were
           changed to include more nuclear programs because, while the prior
           administration did not consider nuclear programs to be part of its
           activities relating to climate change, the current administration
           does consider them to be a key part of the CCTP.

           Third, OMB did not maintain the distinction that it had made in
           previous reports between funding for programs whose primary focus
           is climate change and programs where climate change is not the
           primary focus. As a result, certain accounts in the technology
           category were consolidated into larger accounts. From 1993 through
           2001, OMB presented funding data as directly or indirectly related
           to climate change. The former programs are those for which climate
           change is a primary purpose, such as renewable energy research and
           development. The latter are programs that have another primary
           purpose, but which also support climate change goals. For example,
           grants to help low-income people weatherize their dwellings are
           intended primarily to reduce heating costs, but may also help
           reduce the consumption of fossil fuels. OMB did not maintain the
           distinction between the two kinds of programs for 2002, 2003, and
           2004 funding data. For example, OMB presented energy conservation
           funding of $810 million in 2001, including $619 million in direct
           research and development funding, and $191 million in indirect
           funding for weatherization and state energy grants. In contrast,
           2002 funding data presented by OMB reflected energy conservation
           funding of $897 million, including $622 million in research and
           development, $230 million for weatherization, and $45 million for
           state energy grants, but did not distinguish between direct and
           indirect funding. OMB presented energy conservation funding of
           $880 million in 2003 and $868 million in 2004 as single accounts
           without any additional detail.

           OMB officials stated that they had adopted a different approach to
           reporting climate change funding to reflect the new program
           structures as the CCSP and CCTP were being established. They
           stated that the result was, in some cases, an aggregation of
           activities that may have previously been reported on separate
           accounts. According to the officials, the 2003 and 2004 data more
           accurately reflect the range of climate change-related programs as
           they are now organized. OMB included a crosswalk in its May 2004
           report that showed 2003 funding levels as they would have been
           presented using the methodology of previous reports. While the
           crosswalk identified funding for accounts that were presented in
           previous reports, it did not identify new funding reported by OMB
           or specify whether such funding was the result of counting new
           programs, a decision to start counting existing programs as
           climate change-related, or shifts between categories. OMB
           officials told us that the reporting methodology has changed since
           the initial reports and that it may be difficult to resolve the
           differences because of changes in budget and account structure.
           Finally, they noted that each report has been prepared in response
           to a one-time requirement and that there has been no requirement
           for a consistent reporting format from one year to the next or for
           explaining differences in methodology from one report to another.
           However, in its fiscal year 2007 report to the Congress, OMB
           responded to our recommendations by labeling the data more clearly
           and reporting changes were footnoted.

           Science
			  
			  According to both OMB and CCSP, the share of total climate change
           funding devoted to science decreased from 56 percent in 1993 to 39
           percent in 2004, even though science funding increased from $1.31
           billion to $1.98 billion (51 percent), or from $1.82 billion to
           $1.98 billion (9 percent) after adjusting for inflation. For
           example, according to OMB, funding for NASA on activities such as
           the satellite measurement of atmospheric ozone concentrations
           increased from $888 million to $1.26 billion.10

           OMB reported new science funding for 2003 and 2004 to reflect the
           creation of CCRI. Funding for CCRI increased from $41 million in
           2003, the first year funding for CCRI was presented, to $173
           million in 2004, and included funding by most of the agencies
           presented in table 3. We present funding for CCRI as a separate
           program to illustrate the new organization's role in increasing
           reported climate change funding. Table 3 presents funding as
           reported by OMB for the eight largest agencies and programs in the
           science category, which accounted for 99 percent of the science
           total for 2004.

           Table 3: Reported Science Funding by Agency or Program for
           Selected Years
			  
			  Discretionary budget authority in millions of dollars
Agency or program        Account                 1993   1997   2001   2004 
NASAa                    Science, Aeronautics,                             
                            and Technology          $888 $1,218 $1,176 $1,256
National Science         Research and Related                              
Foundation               Activities               124    166    181    185
CCRI                     Various accounts for                              
                            eight agencies             b      b      b    173
DOE                      Science (Biological                               
                            and Environmental                          
                            Research)                118    109    116    102
Department of Commerce - Operations, Research,                             
National Oceanic and     and Facilities                             
Atmospheric                                                         
Administration                                     66     60     93     82
Department of            Agriculture Research                              
Agriculture              Service and four                           
                            other accounts            55     57     51     64
Department of Health and National Institutes                               
Human Services           of Health (NIH)            b      b     54     62
Department of Interior - Surveys and Research                              
U.S. Geological Survey                             22     26     27     28
Other                                              33     20     30     24 
Total                                          $1,306 $1,656 $1,728 $1,976 

           Source: GAO analysis of OMB data.

           Note: OMB generally presented climate science funding with one
           account per agency.

           aBeginning in 2004, NASA funding reflects full-cost accounting,
           meaning institutional activities such as personnel and facilities
           (which had been held in separate accounts) are included. NASA's
           climate change funding varies based on changes in its budget for
           space-observing platforms, the natural development cycle of its
           satellites, and revisions to mission profiles.

           bOMB did not report a value in the science category for this
           agency or program for this year.

           Science funding data from 1993 through 2004, as reported by OMB
           and CCSP, were generally comparable, although there were more
           discrepancies in earlier years than in later years.11 Science
           funding totals reported by CCSP from 1993 through 1997 were within
           3 percent of the OMB totals for all years except 1996 and 1997.
           Science funding totals reported by CCSP in 1996 and 1997 were $156
           million (9 percent) and $162 million (10 percent) higher than
           those reported by OMB. Over 90 percent of the difference for those
           years occurred because CCSP reported greater funding for NASA than
           OMB reported. CCSP stated in its fiscal year 1998 report that it
           increased its 1996 and 1997 budget figures to reflect the
           reclassification of certain programs and activities in some
           agencies that were not previously included in the science funding
           total.

           Total science funding reported by OMB and CCSP from 1998 through
           2004 was identical for 4 of the 7 years. The largest difference
           for the 3 years that were not identical was $8 million in 2001,
           which represented less than 1 percent of the science funding total
           reported by OMB for that year. The other differences in total
           science funding were $3 million in 2002, and $1 million in 1999,
           and each represented less than 1 percent of the OMB science total
           for those years.

           Science funding by agency, as presented by OMB and CCSP from 1993
           through 1997, differed in many cases, with the exception of
           funding for the National Science Foundation (NSF), which was
           nearly identical over that time period. For example, CCSP reported
           $143 million more funding for NASA in 1996 than OMB reported, and
           OMB reported $24.9 million more funding for DOE in 1994 than CCSP
           reported. The greatest dollar difference related to NASA's funding
           in 1997. Whereas OMB reported funding of $1.22 billion, CCSP
           reported funding of $1.37 billion-$151 million, or 12 percent more
           than the OMB amount. The greatest percentage difference related to
           the Department of the Interior's funding in 1993. Whereas OMB
           reported funding of $22 million, CCSP reported funding of $37.7
           million-$15.7 million, or 71 percent more than reported by OMB.
           Further, from 1993 through 1997, OMB did not report science
           funding by some agencies that were reported by CCSP. For example,
           CCSP reported that DOD's funding ranged from $5.7 million to $6.6
           million from 1993 through 1995, and that the Tennessee Valley
           Authority received funding of $1 million or less per year from
           1993 through 1997, but OMB did not report any such funding.

           OMB officials told us that data used for the 1993 to 1997 science
           funding comparison with CCSP were collected too long ago to be
           able to identify the differences. However, they stated that the
           data from early years were produced in a very short period for use
           in testimony or questions for the record. According to OMB, this
           quick turnaround did not allow time for a thorough consistency
           check with other data sources.

           From 1998 through 2004, OMB and CCSP data on funding by agency
           were nearly identical. Both OMB and CCSP reported science funding
           for nine agencies over the entire 7-year period, for a total of 63
           agency funding amounts. Of these, 52, or 83 percent, matched
           exactly. Of the 11 differences, there was one difference of $8
           million, one of $2 million, and nine of $1 million or less. The
           greatest difference from 1998 through 2004 was $8 million in
           funding for the Department of Commerce in 2001, which was 9
           percent of the Department of Commerce total, or less than 1
           percent of total science funding as reported by OMB for that year.

           The director of CCSP told us that changes to reports, such as the
           creation and deletion of different categorization methods, were
           made because CCSP is changing towards a goals-oriented budget, and
           that categorization methods changed as the program evolved. The
           director also said that future reports will explicitly present
           budget data as they were reported in prior reports to retain
           continuity, even if new methods are introduced. Another CCSP
           official told us that CCSP now works with OMB to ensure that
           consistent funding information is presented in Our Changing Planet
           reports and OMB reports, and that, beginning with the fiscal year
           2006 report (which was published in late 2005), CCSP would attempt
           to explain when and why changes are made to reporting methods. In
           its 2006 fiscal year report, CCSP did explain changes to its
           reporting.

           International Assistance
			  
			  From 1993 through 2004, international assistance funding decreased
           from 9 percent to 5 percent of total federal funding on climate
           change, as reported by OMB. Over the same time period,
           international assistance funding increased from $201 million to
           $252 million (an increase of 25 percent), but after adjusting for
           inflation, decreased from $280 million to $252 million (a decrease
           of 10 percent). For example, reported funding for the Department
           of the Treasury to help developing countries invest in energy
           efficiency, renewable energy, and the development of clean energy
           technologies, such as fuel cells, increased from zero in 1993 to
           $32 million in 2004. Table 4 presents funding as reported by OMB
           for the three largest accounts in the international assistance
           category.

           Table 4: Reported International Assistance Funding for Selected
           Accounts and Years
			  
			  Discretionary budget authority in millions of dollars
Agency                     Account                     1993 1997 2001 2004 
U.S. Agency for            Development Assistance                          
International Development                                             
(USAID)                                                $200 $147 $112 $125
                              Assistance for the                              
                              Independent States of the                  
                              Former Soviet Union            b    b   31   47
Department of the Treasury Global Environment                              
                              Facilitya                      b   14   41   32
Other                                                     1    3   34   48 
Total                                                  $201 $164 $218 $252 


           Source: GAO analysis of OMB data.

           aOMB did not include the Department of the Treasury's funding for
           the Global Environment Facility (GEF) in the international
           assistance category from 1994 through 2001. OMB presented GEF
           funding in the international assistance category from 2002 through
           2004. To maintain consistency, we included GEF funding in the
           international assistance category from 1994 through 2004 for the
           purposes of this testimony.

           bOMB did not report a value in the international assistance
           category for this account for this year.

           International assistance funding reported by OMB was generally
           comparable over time, although some new accounts were added
           without explanation. In its reports, OMB did not provide an
           explanation of whether such new accounts reflected the creation of
           new programs or a decision to count existing programs as climate
           change-related for the first time. OMB officials told us that the
           presentation of new accounts in the international assistance
           category was due to the establishment of new programs and the
           inclusion of existing programs. They told us that the
           account-by-account display in the reports has been changed over
           time as climate change programs have become better defined.

           Tax Expenditures
			  
			  Although not required to provide information on tax expenditures
           related to climate change, OMB reported certain information
           related to climate-related tax expenditures for each year.
           Specifically, it listed proposed climate-related tax expenditures
           appearing in the President's budget, but it did not report revenue
           loss estimates for existing climate-related tax expenditures from
           1993 through 2004. Based on the Department of the Treasury's tax
           expenditure list published in the 2006 budget,12 we identified
           four existing tax expenditures that have purposes similar to
           programs reported by OMB in its climate change reports. In 2004,
           estimated revenue losses amounted to hundreds of millions of
           dollars for the following tax expenditures:13

           o  $330 million in revenue losses was estimated for new technology
           tax credits to reduce the cost of generating electricity from
           renewable resources. A credit of 10 percent was available for
           investment in solar and geothermal energy facilities. In addition,
           a credit of 1.5 cents was available per kilowatt hour of
           electricity produced from renewable resources such as biomass,
           poultry waste, and wind facilities.
           o  $100 million in revenue losses was estimated for excluded
           interest on energy facility bonds to reduce the cost of investing
           in certain hydroelectric and solid waste disposal facilities. The
           interest earned on state and local bonds used to finance the
           construction of certain hydroelectric generating facilities was
           tax exempt. Some solid waste disposal facilities that produced
           electricity also qualified for this exemption.
           o  $100 million in revenue losses was estimated for excluded
           income from conservation subsidies provided by public utilities to
           reduce the cost of purchasing energy-efficient technologies.
           Residential utility customers could exclude from their taxable
           income energy conservation subsidies provided by public utilities.
           Customers could exclude subsidies used for installing or modifying
           certain equipment that reduced energy consumption or improved the
           management of energy demand.

           o  $70 million in revenue losses was estimated for tax incentives
           for the purchase of clean fueled vehicles to reduce automobile
           emissions. A tax credit of 10 percent, not to exceed $4,000, was
           available to purchasers of electric vehicles. Purchasers of
           vehicles powered by compressed natural gas, hydrogen, alcohol, and
           other clean fuels could deduct up to $50,000 of the vehicle
           purchase costs from their taxable income, depending upon the
           weight and cost of the vehicle. Similarly, owners of refueling
           properties could deduct up to $100,000 for the purchase of
           re-fueling equipment for clean fueled vehicles.

           OMB officials said that they consistently reported proposed tax
           expenditures where a key purpose was specifically to reduce
           greenhouse gas emissions. They also stated that they did not
           include existing tax expenditures that may have greenhouse gas
           benefits but were enacted for other purposes, and that the
           Congress had provided no guidance to suggest additional tax
           expenditure data should be included in the annual reports.

           OMB's decision criteria for determining which tax expenditures to
           include differed in two key respects from its criteria for
           determining which accounts to include. First, OMB presented
           funding for existing as well as proposed accounts, but presented
           information only on proposed, but not existing, tax expenditures.
           Second, OMB presented funding for programs where a key purpose was
           specifically to reduce greenhouse gas emissions, as well as for
           programs that may have greenhouse gas benefits but were enacted
           for other purposes. However, OMB presented information only on
           proposed tax expenditures where a key purpose was specifically to
           reduce greenhouse gas emissions. In response to GAO's
           recommendation to report existing climate-related tax
           expenditures, OMB's fiscal year 2007 report to the Congress
           includes existing tax expenditures that contribute to reducing
           global warming.

           Reported Funding for Most Agencies Increased, but Unexplained
			  Changes in Report Content Limit the Comparability of Data Over Time
			  
			  OMB reported that 12 of the 14 agencies that received funding for
           climate change programs in 2004 received more funding in that year
           than they had in 1993. However, it is unclear whether funding
           changed as much as reported by OMB because unexplained
           modifications in the reports' contents limit the comparability of
           agencies' funding data. From 1993 through 2004, climate change
           funding for DOE increased more than any other agency, from $963
           million to $2.52 billion, for an increase of $1.56 billion (162
           percent). Adjusted for inflation, such funding increased from
           $1.34 billion to $2.52 billion, for an increase of $1.18 billion
           (88 percent). The second largest increase in agency funding was
           for NASA, which received a $660 million (74 percent) increase in
           funding over the same time period. NASA's funding increased $310
           million (25 percent) over this period after adjusting for
           inflation. The funding increases for these two agencies accounted
           for 81 percent of the reported total increase in federal climate
           change funding from 1993 through 2004. Conversely, USAID
           experienced the largest decrease in funding-from $200 million in
           1993 to $195 million in 2004 (3 percent), or, in
           inflation-adjusted terms, from $279 million to $195 million (30
           percent). Table 5 shows OMB's reports on climate change funding by
           agency for selected years.

           Table 5: Reported Climate Change Funding by Agency, Selected Years
			  
			  Discretionary budget authority in millions of dollars
Agency                      1993   1997   2001   2004 
DOE                         $963   $968 $1,665 $2,519 
NASA                         888  1,218  1,176  1,548 
NSF                          124    222    181    226 
USAID                        200    147    157    195 
Department of Commerce        66    102     93    144 
EPA                           26     99    146    127 
Department of Agriculture     55     57     54    115 
Other                         30     63    131    216 
Total                     $2,352 $2,876 $3,603 $5,090 

           Source: GAO analysis of OMB data.

           Unexplained changes in the content of OMB reports make it
           difficult to determine whether funding changed as much as was
           reported by OMB. Because agency funding totals are composed of
           individual accounts, the changes in the reports' contents
           discussed earlier, such as the unexplained addition of accounts to
           the technology category, limit the comparability of agencies'
           funding data over time. For example, OMB reported Army, Navy, Air
           Force, and Defense-wide funding totaling $83 million in 2003, and
           $51 million in 2004, in accounts titled Research, Development,
           Test, and Evaluation, but did not report these accounts for prior
           years. OMB did not explain whether these accounts reflected the
           creation of new programs or a decision to count existing programs
           for the first time.

           OMB officials told us that agencies can be included in reports for
           the first time when new initiatives or programs are started, such
           as the CCTP. In some cases, those initiatives or programs are made
           up of entirely new funding but in other cases they may be
           additions on top of a small amount of base funding. These
           officials told us that agencies sometimes include data that were
           not previously reported when they requested funding for those
           initiatives, but they assured us that the data are reported
           consistently for the 3 years presented in each report.

           OMB Reports Presented Information on Budget Authority Rather Thanï¿½
			  as Required by the Congressï¿½on Expenditures and Obligations
			  
			  The federal budget process is complex, and there are numerous
           steps that culminate in the outlay of federal funds. Among the key
           steps in this process are the following, as defined by OMB:

           o  Budget authority means the authority provided in law to incur
           financial obligations that will result in outlays.
           o  Obligations are binding agreements that will result in outlays,
           immediately or in the future.
           o  Expenditures are payments to liquidate an obligation. The
           Congress, in the Congressional Budget and Impoundment Control Act
           of 1974, as amended, has defined outlays as being the expenditures
           and net lending of funds under budget authority.

           In simplified terms, budget authority precedes obligations, which
           precede outlays in the process of spending federal funds.

           As noted above, since 1999, the Congress has required the
           President to submit a report each year to the Senate and House
           Committees on Appropriations describing in detail all federal
           agency obligations and expenditures, domestic and international,
           for climate change programs and activities. In response, OMB had
           annually published the Federal Climate Change Expenditures Report
           to Congress which presented budget authority information in
           summary data tables instead of obligations and expenditures, as
           the title of the report and the table titles suggested. The only
           indication that the table presented budget authority information,
           rather than expenditures, was a parenthetical statement to that
           effect in a significantly smaller font.

           OMB officials told us that the term "expenditures" was used in the
           report title and text because that was the term used most often in
           the legislative language. They also said that the reports
           presented data in terms of budget authority because OMB hads
           always interpreted the bill and report language to request the
           budget authority levels for each activity in a particular year.
           They stated further that, from a technical budget standpoint,
           expenditures are usually synonymous with outlays, and that one way
           to think of budget authority is that it is the level of
           expenditures (over a period of 1 or more years) that is made
           available in a particular appropriations bill. OMB viewed this as
           an appropriate interpretation of the congressional requirements
           since the committees on appropriations work with budget authority
           and not outlays. Moreover, OMB told us that these committees had
           never objected to its interpretation of "obligations and
           expenditures" as budget authority and that OMB had always
           identified the data provided in the table as budget authority.

           In our August 2005 report, we expressed several concerns with
           OMB's approach. First, OMB's approach of reporting budget
           authority did not comply with the language of the annual legal
           requirements to report on climate change "obligations and
           expenditures." Second, in reviewing the legislative history of
           these reporting requirements, we found no support for OMB's
           interpretation that when the Congress called for "obligations and
           expenditures" information, it actually meant "budget authority"
           information. Third, OMB's interpretation was not consistent with
           its own Circular A-11, which defines budget authority as stated
           above, not actual obligations and expenditures. Nonetheless, we
           recognize that it is not possible for OMB to meet the most recent
           reporting requirements because it must provide a report on climate
           change obligations and expenditures for the current fiscal year
           within 45 days of submitting the President's budget for the
           following fiscal year (which must be submitted the first Monday of
           February). For example, the President submitted the fiscal year
           2006 budget on February 7, 2005, so OMB's report on fiscal year
           2005 climate change expenditures and obligations had to be
           submitted in March 2005-approximately halfway through the 2005
           fiscal year. However, complete expenditures data are available
           only after the end of each fiscal year. Thus, OMB could not meet
           both the timing requirement and report all actual expenditures and
           obligations in fiscal year 2005.

           CCSP has also reported budget authority data in its Our Changing
           Planet reports. As noted above, CCSP, or its predecessor
           organization, initially was required to report annually on certain
           climate change "amounts spent," "amounts expected to be spent,"
           and "amounts requested," but this reporting requirement was
           terminated in 2000. Currently, CCSP is responsible for reporting
           information relating to the federal budget and federal funding for
           climate change science, not climate change expenditure
           information. Since 2000, CCSP has fulfilled these reporting
           requirements by providing budget authority information in its Our
           Changing Planet reports.

           Conclusions
			  
			  In conclusion, we found that the lack of clarity in OMB's and
           CCSP's reports made it difficult to comprehensively understand the
           federal government's climate change expenditures. A better
           understanding of these expenditures is needed before it is
           possible to assess CCSP's and other federal agencies' progress
           towards their climate change goals. We therefore made seven
           recommendations to OMB and three to CCSP to clarify how they
           present climate change funding information. OMB agreed with most
           of our recommendations and has also implemented several of them.
           CCSP agreed with all of our recommendations and has implemented
           our recommendation about explaining changes in report content or
           format.

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

           Contact and Staff Acknowledgments
			  
			  For further information regarding this testimony, please contact
           me at (202) 512-3841. John Healey, Anne K. Johnson, and Vincent P.
           Price made key contributions to this testimony. Richard Johnson,
           Carol Kolarik, Carol Herrnstadt Shulman, and Anne Stevens also
           made important contributions.

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1The revenue losses resulting from provisions of federal tax laws may, in
effect, be viewed as expenditures channeled through the tax system. The
Congressional Budget and Impoundment Control Act of 1974, as amended,
requires that the budget include the level of tax expenditures under
existing law. Like the annual lists of tax expenditures prepared by the
Department of the Treasury, this testimony considers only tax expenditures
related to individual and corporate income taxes and does not address
excise taxes.

2U.S. Government Accountability Office, Climate Change: Federal Reports on
Climate Change Funding Should be Clearer and More Complete. GAO-05-461
(Washington, D.C.: Aug. 25, 2005).

3An OMB official stated that there is no mandatory budget authority for
climate change programs.

4When we adjusted for inflation, we used a fiscal year price index that we
calculated based on a calendar year price index published by the
Department of Commerce's Bureau of Economic Analysis. Unless otherwise
specified, figures represent actual funding (not estimates), with the
exception of 1993, 1994, and 2004, where we present estimated funding
reported by CCSP because actual data are not available. For the purposes
of this testimony, the term "agency" includes executive departments and
agencies, and we use the term "account" to describe the budget accounts,
line items, programs, and activities presented in OMB and CCSP reports.
Throughout this testimony, we characterize all climate change science
reports from 1993 through 2004 as CCSP reports, even though CCSP has been
in existence only since 2002, and reports prior to 2002 were published by
a predecessor organization. Totals and percentages may not add due to
rounding.

5Pub. L. No. 101-606, 104 Stat. 3096 (1990) (partially terminated pursuant
to the Federal Reports Elimination and Sunset Act of 1995, Pub. L. No.
104-66, S: 3003 (1995)).

6The annual reporting requirement for climate change expenditures was
terminated effective May 15, 2000. The reporting requirement had called
for "(A) the amounts spent during the fiscal year most recently ended; (B)
the amounts expected to be spent during the current fiscal year; and (C)
the amounts requested for the fiscal year for which the budget is being
submitted."

7To maintain consistency with OMB data, which are available from 1993 to
2004, we reviewed reported science funding from 1993 to 2004.

8Technology funding increased as a share of total funding over time, while
science and international assistance funding declined as shares of the
total because technology funding increased at a faster rate than the other
categories.

9We counted the Nuclear Energy Research Initiative (NERI) account as
Nuclear Energy Supply funding for 2002. The NERI line item is counted in
the aggregate Energy Supply - Nuclear budget account in OMB's 2004 and
2005 reports, and is no longer presented separately.

10The $1.26 billion includes NASA's reported funding for the United States
Global Change Research Program. NASA funding for CCRI is reported
separately.

11CCSP's most recent report (July 2004) presents estimated 2004 funding,
whereas OMB's most recent report (March 2005) presents actual 2004
funding. Whenever we compare 2004 science funding as reported by OMB and
CCSP, we are comparing estimated 2004 funding presented in OMB's May 2004
report and CCSP's July 2004 report.

12The Department of the Treasury reported 2004 tax expenditures in the
Budget of the U.S. Government, Fiscal Year 2006 edition, Analytical
Perspectives volume, chapter 19.

13The Department of the Treasury calculated each tax expenditure estimate
assuming other parts of the tax code remained unchanged. Because tax
provisions can be interdependent, we do not report the mathematical sum of
the revenue losses estimated for the four climate-related tax
expenditures, and instead present this general gauge of the magnitude of
revenue forgone for climate-related tax expenditures.

(360764)

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Highlights of GAO-06-1122T , testimony before the Committee on Government
Reform, House of Representatives

September 2006

CLIMATE CHANGE

Greater Clarity and Consistency Are Needed in Reporting Federal Climate
Change Funding

The Congress has required annual reports on federal climate change
spending. The Office of Management and Budget (OMB) reports funding for:
technology (to reduce greenhouse gas emissions), science (to better
understand the climate), international assistance (to help developing
countries), and tax expenditures (to encourage emissions reduction). The
Climate Change Science Program (CCSP), which coordinates many agencies'
activities, also reports on science funding.

This testimony is based on GAO's August 2005 report Climate Change:
Federal Reports on Climate Change Should Be Clearer and More Complete
(GAO-05-461). GAO examined federal climate change funding for 1993 through
2004, including (1) how total funding and funding by category changed and
whether funding data are comparable over time and (2) how funding by
individual agencies changed and whether funding data are comparable over
time.

What GAO Recommends

GAO recommended, among other things, that OMB include data on existing
climate-related tax expenditures. OMB agreed with most of GAO's
recommendations and has implemented several of them. CCSP agreed with all
of GAO's recommendations and has begun explaining changes in report format
or content when they are introduced.

According to OMB, from 1993 to 2004, federal funding for climate change
increased from $3.3 billion to $5.1 billion (55 percent) after adjusting
for inflation. During this period, reported inflation-adjusted funding
increased for technology and science, but decreased for international
assistance. However, it is unclear whether funding changed as much as
reported because changes in the format and content of OMB and CCSP reports
make it difficult to compare funding data over time. For example, over
time, OMB expanded the definitions of some accounts to include more
activities, but did not specify how it changed the definitions. OMB
officials stated that it is not required to follow a consistent reporting
format from year to year. Further, CCSP's science funding reports were
difficult to compare over time because CCSP introduced new methods for
categorizing funding without explaining how they related to previous
methods. The Director of CCSP said that its reports changed as the program
evolved. These and other limitations make it difficult to determine actual
changes in climate change funding.

Similarly, OMB reported that 12 of the 14 agencies that funded climate
change programs in 2004 increased such funding between 1993 and 2004, but
unexplained changes in the reports' contents limit the comparability of
data on funding by agency. For example, reported funding for the
Department of Energy (DOE), the agency with the most reported
climate-related funding in 2004, increased from $1.34 billion to $2.52
billion (88 percent) after adjusting for inflation. DOE and the National
Aeronautics and Space Administration accounted for 81 percent of the
reported increase in funding from 1993 through 2004. However, because
agency funding totals are composed of individual accounts, changes in the
reports' contents, such as the unexplained addition of accounts to the
technology category, make it difficult to compare agencies' funding data
over time and, therefore, to determine if this is a real or a definitional
increase. Furthermore, GAO found that OMB reported funding for certain
agencies in some years but not in others, without explanation. OMB told
GAO that it relied on agency budget offices to submit accurate data. These
data and reporting limitations make determining agencies' actual levels of
climate change funding difficult.

Reported Federal Climate Change Funding by Category, 1993-2004
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