Department of State: Human Capital Strategy Does Not Recognize
Foreign Assistance Responsibilities (28-SEP-07, GAO-07-1153).
The Secretary of State has made foreign assistance a pillar of
the department's Transformational Diplomacy Initiative and has
sought better policy coordination, planning, and oversight by
establishing a Director of Foreign Assistance (F Bureau). Even
though the U.S. Agency for International Development has been the
principal agency for development and humanitarian aid, the
Department of State (State) has had a significant role delivering
this type of assistance. Thus, it is essential that State have
the right staff, with the right skills, in the right places to
carry out its foreign assistance management responsibilities and
ensure that U.S. funds are well spent. As requested, this report
(1) describes the size and scope of development and humanitarian
foreign assistance programs managed by State, (2) describes
State's approaches to managing and monitoring such programs, and
(3) evaluates State's processes for determining its human capital
requirements for managing these programs.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-07-1153
ACCNO: A76889
TITLE: Department of State: Human Capital Strategy Does Not
Recognize Foreign Assistance Responsibilities
DATE: 09/28/2007
SUBJECT: Economic development
Employees
Federal employees
Federal grants
Foreign aid programs
Foreign economic assistance
Human capital
Human capital management
Human capital planning
Human capital policies
Policy evaluation
Program evaluation
Program management
Strategic planning
Program implementation
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GAO-07-1153
* [1]Results in Brief
* [2]Background
* [3]State's Amount of International Development and Humanitarian
* [4]Funding Available for State's International Development and
* [5]Many State Bureaus Manage Certain Types of Development and H
* [6]State Uses a Variety of Approaches to Manage and Monitor Dev
* [7]Most Programs are Centrally Managed
* [8]Grants Officers and Grants Officer Representatives Have Form
* [9]State Uses Headquarters and Overseas Staff to Monitor Assist
* [10]State Does Not Use Strategic Workforce Planning to Support I
* [11]State Has Not Determined Foreign Assistance Skills Requireme
* [12]State Has Not Collected Critical Information on Current Staf
* [13]State Does Not Have Consistent Training Requirements for Sta
* [14]State Officials Concerned About Department's Ability to Effe
* [15]State Has Not Yet Integrated Workforce Planning into Foreign
* [16]Conclusions
* [17]Recommendations
* [18]Agency Comments and Our Evaluation
* [19]GAO Contact
* [20]Staff Acknowledgments
* [21]GAO's Mission
* [22]Obtaining Copies of GAO Reports and Testimony
* [23]Order by Mail or Phone
* [24]To Report Fraud, Waste, and Abuse in Federal Programs
* [25]Congressional Relations
* [26]Public Affairs
Report to the Honorable
Richard G. Lugar, Ranking Minority Member, Committee on Foreign Relations,
U.S. Senate
United States Government Accountability Office
GAO
September 2007
DEPARTMENT OF STATE
Human Capital Strategy Does Not Recognize Foreign Assistance
Responsibilities
GAO-07-1153
Contents
Letter 1
Results in Brief 2
Background 5
State's Amount of International Development and Humanitarian Assistance
Has Increased Significantly in Recent Years 8
State Uses a Variety of Approaches to Manage and Monitor Development and
Humanitarian Assistance Programs 12
State Does Not Use Strategic Workforce Planning to Support Its Foreign
Assistance Efforts 20
Conclusions 28
Recommendations 29
Agency Comments and Our Evaluation 29
Appendix I Scope and Methodology 31
Appendix II Amounts Available from Each Part of the International Affairs
(function 150) Budget, Fiscal Years 2000 through 2006 35
Appendix III State's Available Funding from Development and Humanitarian
Assistance Fiscal Accounts for Fiscal Years 2000 through 2006 36
Appendix IV Comments from the Department of State 37
Appendix V GAO Contact and Staff Acknowledgments 41
Tables
Table 1: Development and Humanitarian Assistance Funding Available to
State for Fiscal Years 2000 and 2006, by Assistance Areas 10
Table 2: Obligation of Funds during Fiscal Year 2006 14
Table 3: Primary Monitoring Responsibilities 19
Figures
Figure 1: Five Types of International Affairs (function 150) Budget
Funding Available for Fiscal Year 2006 6
Figure 2: State Funding Available for International Development and
Humanitarian Assistance, Fiscal Years 2000 through 2006 9
Abbreviations
DRL Bureau of Democracy, Human Rights, and Labor
F Bureau Office of the Director of Foreign Assistance
FSI Foreign Service Institute
G/TIP Office to Monitor and Combat Trafficking in Persons
INCLE International Narcotics Control and Law Enforcement
INL Bureau of International Narcotics and Law Enforcement Affairs
MEPI Middle East Partnership Initiative
OMB Office of Management and Budget
OPM Office of Personnel Management
PRM Bureau of Population, Refugees, and Migration
USAID U.S. Agency for International Development
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United States Government Accountability Office
Washington, DC 20548
September 28, 2007
The Honorable Richard G. Lugar
Ranking Minority
Member Committee on Foreign Relations
United States Senate
The Honorable Richard G. Lugar
Ranking Minority Member
Committee on Foreign Relations
United States Senate
Dear Senator Lugar:
The Secretary of State has designated foreign assistance as a pillar of
the Transformational Diplomacy Initiative, which aims to integrate U.S.
foreign assistance activities into overall diplomatic efforts.
Accordingly, in January 2006, the Secretary established the Office of the
Director of U.S. Foreign Assistance (F Bureau) to serve as an umbrella
leadership structure for aligning foreign assistance policy, planning, and
oversight. According to the Director of the F Bureau, foreign assistance
is a mainstream commitment of the U.S. government, because--in addition to
its traditional objectives--it has been elevated to a national priority as
a core part of U.S. national security strategy. The Secretary of State has
designated foreign assistance as a pillar of the Transformational
Diplomacy Initiative, which aims to integrate U.S. foreign assistance
activities into overall diplomatic efforts. Accordingly, in January 2006,
the Secretary established the Office of the Director of U.S. Foreign
Assistance (F Bureau) to serve as an umbrella leadership structure for
aligning foreign assistance policy, planning, and oversight. According to
the Director of the F Bureau, foreign assistance is a mainstream
commitment of the U.S. government, because--in addition to its traditional
objectives--it has been elevated to a national priority as a core part of
U.S. national security strategy.
The U.S. Agency for International Development (USAID) has been and remains
the principal U.S. agency for delivering development and humanitarian
assistance, such as democracy and refugee programs, which fall under the
U.S. government's broad foreign assistance efforts. Nonetheless, the
Department of State (State) has a significant role in providing this type
of assistance. State received about $23 billion from fiscal years 2000
through 2006 for delivering such assistance, and annually it has been
responsible for managing between 7 and 11 percent of total U.S. government
developmental and humanitarian assistance over this time period. Due to
this higher profile for foreign assistance in State, it is essential that
State have the right staff, with the right skills, in the right places to
implement its foreign assistance management responsibilities and ensure
that U.S. funds are well spent. The U.S. Agency for International
Development (USAID) has been and remains the principal U.S. agency for
delivering development and humanitarian assistance, such as democracy and
refugee programs, which fall under the U.S. government's broad foreign
assistance efforts. Nonetheless, the Department of State (State) has a
significant role in providing this type of assistance. State received
about $23 billion from fiscal years 2000 through 2006 for delivering such
assistance, and annually it has been responsible for managing between 7
and 11 percent of total U.S. government developmental and humanitarian
assistance over this time period. Due to this higher profile for foreign
assistance in State, it is essential that State have the right staff, with
the right skills, in the right places to implement its foreign assistance
management responsibilities and ensure that U.S. funds are well spent.
As you requested, this report (1) describes the size and scope of
development and humanitarian foreign assistance programs managed by State;
(2) describes State's approaches, including types of staff involved, to
managing and monitoring international development and humanitarian
assistance programs; and (3) evaluates State's processes for determining
its human capital requirements for managing foreign assistance programs.
As you requested, this report (1) describes the size and scope of
development and humanitarian foreign assistance programs managed by State;
(2) describes State's approaches, including types of staff involved, to
managing and monitoring international development and humanitarian
assistance programs; and (3) evaluates State's processes for determining
its human capital requirements for managing foreign assistance programs.
To determine the size and scope of State's development and humanitarian
assistance, we first reviewed U.S. budget documents and used State
allotment reports to capture the fiscal accounts that were available to
State for obligation between fiscal years 2000 and 2006. For the purposes
of this review, we defined foreign assistance management as obligating
funds, selecting grantees, making assistance awards, and monitoring the
implementation of development and humanitarian assistance programs. To
identify State's approaches to managing programs, we reviewed program
information and interviewed agency officials. To assess foreign assistance
human capital requirements, we reviewed staffing, workload, and workforce
planning data, and interviewed agency officials. We focused on the portion
of the International Affairs budget defined by the Office of Management
and Budget (OMB) as development and humanitarian assistance, which
includes funding for Migration and Refugee Assistance, International
Narcotic Control and Law Enforcement (INCLE), and other fiscal accounts.^1
We met with five functional bureaus/offices that manage development and
humanitarian assistance programs and all six regional bureaus. We also met
with officials of F Bureau, Bureau of Administration, Office of the
Procurement Executive; Bureau of Human Resources; Bureau of Resource
Management; the Foreign Service Institute (FSI); State's Office of the
Inspector General; and USAID. We determined that the budget and
obligations data we used were sufficiently reliable for the purposes of
this report, based on our review of the reasonableness and consistency of
methodology and discussions with knowledgeable officials. We conducted our
review between August 2006 and August 2007 in accordance with generally
accepted government auditing standards. A detailed description of our
scope and methodology is included in appendix I of this report.
Results in Brief
State had about $4.7 billion available in fiscal year 2006 for its
development and humanitarian assistance activities, which was nearly
double the amount it was responsible for managing in fiscal year 2000.
These amounts consisted mostly of annual appropriations and unused
portions from previous years. This increased funding, and related
management responsibilities, supported activities in such areas as
economic, social, and political assistance; and it included programs aimed
at alleviating poverty, alleviating the suffering of refugees, as well as
international drug interdiction efforts. Most of the increase in available
funding was from fiscal accounts that are annually appropriated to State,
such as (1) the migration and refugee assistance account and (2) the INCLE
and Andean Counterdrug Initiative accounts. About a quarter of the overall
increase was from other fiscal accounts, such as the economic support fund
account and the assistance for Eastern Europe and the Baltic States
account. Many State bureaus manage development and humanitarian assistance
funding, primarily through the use of grants and cooperative agreements.
^1Our scope of work represents a subset of the foreign assistance programs
that State is responsible for and does not include military,
antiterrorism, cultural and educational exchange programs, and some
assistance programs receiving less than $20 million.
State uses a variety of approaches to manage its foreign assistance
responsibilities. The bureaus and offices principally responsible for this
assistance obligated about 80 percent of their funds and awarded the
majority of their grants and cooperative agreements from headquarters. A
variety of staff are involved in managing State's foreign assistance
activities. Some employees, such as grants officers, are formally assigned
managerial and monitoring roles and responsibilities, while others are
not. The location of staff that monitor the implementation of the programs
varies. Seven of the bureaus have no assigned overseas staff and rely
mainly on headquarters staff to monitor the implementation of some of
their grants. Three of the State bureaus we visited have overseas staff
specifically assigned to monitor the implementation of their programs
overseas. For example, the Bureau of Population, Refugees, and Migration
(PRM) has 22 refugee coordinators assigned to overseas posts to oversee
the bureau's refugee activities.
State's strategic workforce planning does not reflect its foreign
assistance activities. A key principle of strategic workforce planning is
to define the critical skills and competencies that will be needed to
achieve current and future programmatic goals. However, State has not
identified the skills and competencies needed by its staff to manage and
monitor foreign assistance activities and has not collected critical
information on current staff with foreign assistance management
responsibilities. For example, most of the bureaus we visited could only
provide estimates of the number of staff working on their foreign
assistance programs. Moreover, we found that State has inconsistent
training and skills requirements for staff involved in foreign assistance
oversight. We found, for example, grants officers--who are responsible for
the legal aspects of entering into, amending, and terminating awards--must
meet educational and training requirements, while grants officer
representatives in some State Bureaus--who are delegated some of these
monitoring responsibilities--do not have to meet such requirements.
Further, a recent survey conducted by State suggests that Foreign Service
officers overseas recognize that there is a gap in their foreign
assistance management skills. Grant officers and other officials whom we
spoke with have concerns about the department's ability to effectively
carry out its grant management responsibilities. Finally, State has not
used strategic workforce planning to align the efforts of the F Bureau to
reform the foreign assistance budget with staffing and skill requirements.
This report recommends that the Secretary of State (1) take steps to
define the skills and competencies the department's employees need to
manage foreign assistance responsibilities, including developing
information on the number and type of staff who are currently managing
foreign assistance programs, their roles and responsibilities, workload,
experience, and training; and (2) develop a strategy to address any gaps
it identifies.
In commenting on a draft of this report, the Department of State generally
concurred with the report's findings, conclusions, and recommendations and
described steps it plans to take to address the recommendations. For
example, the Bureau of Human Resources will define critical skills and
competencies needed by all State employees managing foreign assistance.
Nevertheless, State expressed concern that our draft did not adequately
reflect the department's oversight of its foreign assistance programs and
described PRM's monitoring and evaluation procedures as an example. We
have included additional details on PRM's monitoring efforts throughout
the report as appropriate.
Background
Development and humanitarian assistance is one of five parts of the
International Affairs (function 150) budget that support U.S. government
foreign assistance efforts. Development and humanitarian assistance
includes State and USAID assistance activities, the Millennium Challenge
Corporation, the Peace Corps, Treasury contributions, and, from fiscal
year 2003 through 2006, spending for the relief and reconstruction of
Iraq. In fiscal year 2006, development and humanitarian assistance made up
$44 billion,^2 or just over one-half of the total $84 billion of
International Affairs (function 150) budget funds available to support
foreign assistance (see fig. 1).^3
^2Amount includes about $6 billion of economic support funding.
^3From fiscal year 2000 through 2006 development and humanitarian
assistance, including economic support funding, increased from $26 billion
to $44 billion.
Figure 1: Five Types of International Affairs (function 150) Budget
Funding Available for Fiscal Year 2006
Note: Includes funding available for obligation in fiscal year 2006
regardless of when funds were appropriated.
The four other types of funding in the International Affairs (function
150) budget that support foreign assistance activities include the
following:
o International security assistance, to finance and train foreign
militaries, promote nonproliferation activities, and support
international peacekeeping operations;
o The conduct of foreign affairs, which fund the salaries,
information technology, housing, and security for State staff,
including those with responsibilities to administer and monitor
foreign assistance activities;
o Foreign information and exchange activities, which include
fiscal accounts supporting education, cultural exchange
activities, and U.S. broadcasts overseas; and
o International financial programs, which primarily support the
International Monetary Fund and the Export-Import Bank of the
United States.
(See app. II for a break down of budget amounts available from each part
of the International Affairs (function 150) budget in recent years.)
Of the total $44 billion of development and humanitarian assistance
available in fiscal year 2006, State received about $5 billion, or 11
percent.^4 Other agencies received more of these funds, including USAID,
which received about $15 billion, or 34 percent, and the Department of
Treasury, which received about $13 billion, or about 30 percent.
In January 2006, the Secretary of State established F Bureau to serve as
an umbrella leadership structure for coordinating all foreign assistance
policy, planning, and oversight. The purpose of this reorganization was to
o ensure that foreign assistance is used as effectively as
possible to meet broad foreign policy objectives,
o more fully align the foreign assistance activities carried out
by the Department of State and USAID, and
o demonstrate responsible stewardship of taxpayer dollars.
In announcing these changes, the Secretary noted that "the current
structure of America's foreign assistance risks incoherent policies and
ineffective programs and perhaps even wasted resources."
The director of U.S. Foreign Assistance serves concurrently as the USAID
Administrator, and has authority over all State and USAID foreign
assistance funding and programs.^5 According to State, the F Bureau
provides coordination and guidance to all foreign assistance delivered
through other agencies and entities of the U.S. government.
^4In fiscal year 2006 State's development and humanitarian assistance,
including economic support funding, was 22 percent of State's total
funding through the International Affairs budget.
^5USAID's status as an independent organization with an administrator
reporting directly to the Secretary of State remains unchanged.
Specifically, the director was given authority over program planning,
implementation, and oversight of the various bureaus and offices within
State and USAID, to
o develop a coordinated U.S. government foreign assistance
strategy, including developing 5-year country specific assistance
strategies and annual country-specific assistance operational
plans;
o create and direct consolidated policy, planning, budget and
implementation mechanisms and staff functions required to provide
umbrella leadership to foreign assistance;
o provide guidance to foreign assistance delivered through other
agencies and government entities, including the Millennium
Challenge Corporation and the Office of the Global AIDS
Coordinator; and
o direct the required transformation of the government's approach
to foreign assistance in order to achieve the President's
Transformational Development Goals.
State's Amount of International Development and Humanitarian Assistance Has
Increased Significantly in Recent Years
State's funding available for international development and humanitarian
assistance, such as democracy promotion, drug interdiction, and refugee
assistance, nearly doubled between fiscal years 2000 and 2006. State uses
certain fiscal budget accounts to fund its development and humanitarian
assistance programs, with accounts related to refugees and international
narcotics control providing the most funding.
Funding Available for State's International Development and Humanitarian
Assistance Doubled between 2000 and 2006
State's funding for international development and humanitarian assistance
nearly doubled from $2.4 billion in fiscal year 2000 to $4.7 billion in
fiscal year 2006. This increase in the funds available each year for
obligation meant more management responsibilities for State. This funding
consisted primarily of annual congressional appropriations and unused
portions from previous fiscal years, but it excluded money that State
allocated to other agencies to obligate. After decreasing slightly in
fiscal year 2001, the available funding increased steadily through fiscal
year 2006, with the sharpest increases coming after fiscal year 2003 (see
fig 2).
Figure 2: State Funding Available for International Development and
Humanitarian Assistance, Fiscal Years 2000 through 2006
Note: From 2003 to 2006 supplemental funding for Iraq reconstruction were
included.
These increased amounts varied by assistance areas (see table 1). About a
quarter of the overall increase in funding available to State was from (1)
fiscal accounts annually appropriated to the President, such as the
economic support fund account, and (2) the assistance for Eastern Europe
and the Baltic States account--which fund assistance in areas such as
economic support, democracy promotion, and efforts to combat human
trafficking. However, most of the increase was from migration and refugee
assistance, Global HIV/AIDS assistance, INCLE, and drug interdiction
accounts that are annually appropriated to State.^6
^6State also uses funding from the international narcotics control and law
enforcement account to fund its efforts to combat human trafficking.
Table 1: Development and Humanitarian Assistance Funding Available to
State for Fiscal Years 2000 and 2006, by Assistance Areas
Dollars (rounded) in millions
Assistance areas 2000 2006
Economic support, democracy promotion, human trafficking $58 $705
Migration and refugee assistance 819 947
Global HIV/AIDS Initiative N/A 251
Iraq Reconstruction N/A 282
Contributions to international organizations 309 308
International narcotics, law enforcement, and drug 1,207 2,153
interdiction
Other humanitarian assistance 3 9
Total $2,396 $4,655
Source: GAO analysis of the U.S. budget and State allotment reports.
The amounts appropriated by Congress to particular areas do not always
match the amounts available to State each year because appropriated funds
may be available for obligation for more than a year or transferred to
other agencies.^7 For example, according to State officials, State
allocates most of the funding that it is appropriated from the Global
HIV/AIDS Initiative account to other agencies, which then obligate the
funds. For instance, in fiscal year 2006, State allocated over 90 percent
of the nearly $2 billion Global HIV/AIDS Initiative appropriation to
USAID, the departments of Health and Human Services and Labor, and others.
State also received funding from the supplemental appropriation for Iraq
Reconstruction.^8 (See app. III for a breakdown of State's funding from
development and humanitarian assistance fiscal accounts for fiscal years
2000 through 2006).
^7From fiscal year 2000 through fiscal year 2006, development and
humanitarian assistance funds available to State for obligation from
current year appropriations rose from $2.1 billion to $3.4 billion.
^8Emergency Wartime Supplemental Appropriations Act, 2003, Pub. L. No.
108-11, 117 Stat. 559; Emergency Supplemental Appropriations Act for
Defense and for the Reconstruction of Iraq and Afghanistan, 2004, Pub. L.
No. 108-106, 117 Stat. 1209 (2003); Emergency Supplemental Appropriations
Act for Defense, the Global War on Terror, and Tsunami Relief, 2005, Pub.
L. No. 109-13, 119 Stat. 231; Emergency Supplemental Appropriations Act
for Defense, the Global War on Terror, and Hurricane Recovery, 2006, Pub.
L. No. 109-234, 120 Stat. 418.
Many State Bureaus Manage Certain Types of Development and Humanitarian
Assistance
Many State bureaus are responsible for managing at least some types of
development and humanitarian assistance funds. Fifteen State functional
bureaus and all six regional bureaus have received development and
humanitarian assistance funds to some degree since fiscal year 2000. The
primary users of this funding among the bureaus include the following:
o Bureau of Democracy, Human Rights, and Labor (DRL);
o The Office to Monitor and Combat Trafficking in Persons (G/TIP);
o Bureau of Population, Refugees, and Migration (PRM);
o The Office of the U.S. Global HIV/AIDS Coordinator;
o Bureau of International Narcotics and Law Enforcement Affairs
(INL)
o Bureau of European and Eurasian Affairs; and
o Bureau of Near Eastern Affairs.
These bureaus and offices that manage development and humanitarian
assistance rely on funding from particular assistance accounts. DRL and
G/TIP primarily receive funds from the economic support fund to manage
their respective programs.^9 In addition, G/TIP receives some funds from
the INCLE fiscal account. PRM manages money from the migration and refugee
assistance and emergency refugee migration assistance accounts, and the
Office of the Global AIDS Coordinator manages money from State's Global
HIV/AIDS initiative fiscal account. INL manages most of State's funding
from the INCLE account, and it manages all of State's funding from the
Andean counterdrug initiative account. The Bureau for European and
Eurasian Affairs manages assistance for Eastern Europe and Baltic States
and the assistance for the independent states of the former Soviet Union
accounts. Finally, the Bureau of Near Eastern Affairs uses funds from the
economic support fund to manage its Middle East Partnership Initiative
(MEPI) democracy promotion programs.
State does not always obligate all of its available funds each year.
State's authority to commit unobligated funds for spending can be carried
over to the following year or may expire, depending on how long Congress
makes the appropriated funding available. State obligates funds on
particular foreign assistance activities as it awards grants, enters into
contracts, and enters into cooperative agreements.^10
^9DRL also received an appropriation through the Democracy Fund in fiscal
year 2006.
State primarily uses grants and cooperative agreements to fund development
and humanitarian assistance activities. State defines a grant as
assistance used to support a public purpose, but for which no substantial
involvement by government is anticipated. A cooperative agreement is a
type of grant that State uses if it anticipates substantial government
involvement during the course of the agreement. There are exceptions to
State's reliance on grants and cooperative agreements for delivering
foreign assistance. PRM primarily uses voluntary contributions to deliver
foreign assistance through international organizations. According to PRM
officials, voluntary contributions do not have the same terms or
conditions required for grants or cooperative agreements, but PRM
contribution letters require international organizations to maintain
financial reports and accounting records, provide documentation for
payment requests, and submit published program and financial reports to
PRM in accordance with each international organizations' policies and
procedures. According to State, INL mainly delivers its assistance through
bilateral agreements with foreign governments.^11
State Uses a Variety of Approaches to Manage and Monitor Development and
Humanitarian Assistance Programs
State primarily manages its development assistance and humanitarian
programs centrally, obligating the majority of the funds and making the
assistance awards from State headquarters in Washington, D.C. Grants
officers and grants officer representatives have formal oversight
responsibilities, though other staff also carry out such functions
informally. A mix of headquarters and overseas staff monitor the
implementation of program activities, and only a few bureaus have staff
overseas specifically assigned to their programs.
^10See next section for a report on State's obligated, or committed
assistance funding.
^11INL, and to a lesser extent, PRM, also use contracts to deliver foreign
assistance, according to bureau officials.
Most Programs are Centrally Managed
State generally carries out its program planning, solicitation of
proposals, selection of grantees, and approval of the release of funds for
overseas programs from its headquarters in Washington, D.C. The major
bureaus and offices that are responsible for development and humanitarian
assistance made assistance awards and obligated the majority of their
funds--about 77 percent of the $2.6 billion^12 in total obligations in
2006--from their headquarters in Washington. Three bureaus and one
office--PRM, DRL, the Bureau of South and Central Asian Affairs and the
Office of the Global HIV/AIDS Coordinator--obligated all of their funds
from headquarters during fiscal year 2006. An exception was the Bureau of
East Asian and Pacific Affairs, for which overseas posts obligated 86
percent of the funds. Generally, funds were obligated for assistance
awards to U.S.-based nongovernmental organizations with ties to overseas
organizations. The bureaus and offices in our scope awarded over 7,000
grants and cooperative agreements totaling about $1.2 billion in fiscal
year 2006.^13 Table 2 shows funds obligated in Washington and overseas
during fiscal year 2006 for these bureaus and offices.
^12This amount includes operating expenses, voluntary contributions, and
contracts as well as grants and cooperative agreements.
^13We cannot attest to the reliability of this information due to problems
State has identified with the quality of its grants management database.
The department has identified a number of problems with the accuracy and
completeness of the data. State is undertaking corrective actions. State's
long-term solution is the joint assistance management system, which will
serve as the mandatory system of record for all assistance actions awarded
by State both domestically and overseas. However, implementation of this
system is estimated for fiscal year 2009 at the earliest.
Table 2: Obligation of Funds during Fiscal Year 2006
Dollars (rounded) in millions
Program
expenses Percent
Program obligated Total obligated for
expenses by assistance program
obligated at overseas Operating account expenses at
Bureau/Office headquarters posts expenses obligations headquarters
International
Narcotics and
Law
Enforcement^a $659 $470 $53 $1,182 56%
Population,
Refugees, and
Migration 995 0 23 1,017 98%
Democracy,
Human Rights,
and Labor 160 0 1 161 99%
Trafficking in
Persons 20 2 0 22 89%
Global
HIV/AIDS
Coordinator 3 0 11 14 24%
Regional
bureaus
European and
Eurasian
Affairs 60 15 3 78 77%
Near Eastern
Affairs 52 4 0 56 93%
African
Affairs 28 0.7 0 28 98%
Western
Hemisphere
Affairs 4 0.4 0.2 4.6 87%
East Asian and
Pacific
Affairs 0.5 3 0 3.5 14%
South and
Central Asian
Affairs 0.2 0 0 0.2 100%
Total $1,981 $495 $91 $2,567 77%
Source: Department of State.
Note: Operating expenses were only counted if they came out of economic
support funds or a development and humanitarian assistance account.
aINL also receives funding from the assistance for Eastern Europe and
Baltic States and assistance for the independent states of the former
Soviet Union accounts that is not included in this table.
Assistance awards and funds obligated by overseas posts were small in
comparison with those obligated at headquarters. For example, in fiscal
year 2006 the overseas posts, under the jurisdiction of the Bureau of Near
Eastern Affairs, obligated about $4 million in MEPI funds, compared with
over $50 million obligated at headquarters. The bureau's regional office
in Tunis obligated and disbursed the bulk of the $4 million to be used for
small grants of no more than $100,000 (the grants were generally $25,000
or less). In addition, some bureaus allot small amounts of funds to
overseas posts for grants up to $20,000. For example, PRM administers the
Ambassador's Fund for Refugees, which generally supports small projects,
such as digging a well in a refugee camp. PRM allotted $578,000 to U.S.
embassies, primarily in Africa, for such activities in fiscal year 2006.
G/TIP administers a similar program, the Ambassador's Fund for
Anti-Trafficking in Persons Initiative, typically in Africa, for public
awareness campaigns. In 2006 G/TIP had 54 active grants totaling about
$4.9 million. Twenty-nine of the 54 grants were for small grants of
$20,000.
Grants Officers and Grants Officer Representatives Have Formal Oversight
Responsibilities
Grants officers are responsible for the legal aspects of entering into,
amending, and terminating awards. Such actions include the following:
o approving the initial determination by the program office of the
appropriate assistance instrument to be utilized;
o determining a potential recipient's responsibility and
management competence in carrying out a planned activity;
o preparing the award with the departmentwide standard award form;
o preparing and executing amendments to awards such as adjustments
to the scope, budget, and period of performance; and
o carrying out all other responsibilities, as required, to ensure
prudent award and administration of assistance for State within
the scope of all applicable State policies, OMB circulars, and
federal regulations.
State has 39 grants officers, including 10 that work directly for the
Office of Acquisitions Management of State's Bureau of Administration.
Five of the Administrative Bureau grants officers are responsible for
awarding grants for DRL, G/TIP, and all of the regional bureaus as well as
nine other bureaus. The Procurement Executive within the Bureau of
Administration provides overall leadership of the procurement and grants
functions for the Department of State and issues procurement and grants
policy, provides quality assurance and statistical reporting, and appoints
grants officers. Four of the seven primary bureaus delivering development
and humanitarian assistance have grants officers assigned to their
programs: PRM and the Bureau of Near Eastern Affairs each have five grants
officers, INL has two, and the Bureau of East Asian and Pacific Affairs
has one. The Administrative Bureau grants officers serve as a resource to
overseas posts as well as to program and regional bureaus that have their
own grants officers.
Some of the grants officers' duties are delegated to other staff. State
Policy Directive 16 authorizes grants officers to designate technically
qualified personnel as grants officer representatives to assist in grants
management. The directive is mandatory for domestic grant activities,
which according to State's Office of the Procurement Executive means
awards granted by a U.S-based grants officer, and is recommended for
overseas grant activities. Grants officer representatives are responsible
for ensuring that State exercises prudent management and oversight of the
award. The representatives receive an official designation letter when
they are appointed that describes their authorities and responsibilities.
Some of the grants officer representatives' authorities and
responsibilities include the following:
o coordinating and consulting with the grantee on all
programmatic, scientific, and/or technical matters that may arise
in the administration of the grant;
o evaluating project performance to ensure compliance with the
grant terms and conditions;
o assisting the grantee in problem identification and resolution;
o promptly notifying the grants officers in writing of any
noncompliance or deviation in performance or failure to make
progress;
o visiting the grantee's place of performance to evaluate progress
or problems, with prior approval from the grants officers;
o promptly submitting findings to the grants officers through a
trip report after visiting the grantee's location of performance;
o receiving and reviewing required grantee reports (progress,
financial, or other) on behalf of the government to ensure they
are timely and complete; and
o preparing a statement of satisfactory performance, or a
statement of any deviations, shortcomings, shortages, or
deficiencies upon completion of the grant.
The grants officer representative designation letter also describes the
limitations to the grants officer representative's authority. For example,
the grants officer representative does not have the authority to modify or
alter the grant or any of its terms and conditions.
However, not all staff responsible for monitoring the implementation of
foreign assistance activities receive formal appointments as grants
officer representatives. For example, PRM grant officials told us that PRM
does not designate its staff as grants officer representatives.^14 State's
Procurement Executive officials could not tell us the extent to which
staff from the six regional bureaus and the overseas posts were officially
designated as grants officer representatives. PRM officials said the
primary responsibility for monitoring PRM program activities rests with
its refugee coordinators,^15 and that these staff are aware of their
oversight responsibilities although they do not receive a formal
designation letter. Further, the officials said each PRM grant and
cooperative agreement formally designates grant monitoring
responsibilities. In addition, the PRM officials said that the bureau
sends the refugee coordinators instructions on monitoring and evaluating
the grants when it notifies them of grant awards.
State Uses Headquarters and Overseas Staff to Monitor Assistance Activities
A variety of headquarters and overseas staff--regardless of whether they
are officially assigned to a program or formally appointed as grants
officer representatives--are responsible for monitoring foreign assistance
activities. Monitoring is an important control to ensure that grantees
comply with applicable rules and regulations. Federal monitoring
requirements are detailed in the Code of Federal Regulations and OMB
circulars such as OMB Circular A110, which, in part, states that federal
agencies prescribe the frequency of performance reports, obtain financial
information from grantees, and make site visits as needed.^16 The grants
officer determines the monitoring activities that will be required to
ensure that a recipient is in adherence with department, bureau, and
program requirements. State includes its monitoring requirements in the
individual grant or cooperative agreement--which commits the department to
exercise federal stewardship responsibility, including, but not limited to
performing site visits; reviewing and responding to performance,
technical, or subject matter, and financial reporting and audits--to
ensure that the objectives, terms, and conditions of the award are
accomplished.
^14PRM plans to revise its procedures to implement the grants policy
directive requiring formal designation of a grants officer representative.
^15 State officials later told us that PRM program officers in Washington,
particularly those in regional assistance and refugee admissions offices,
have monitoring and evaluating responsibilities.
^16OMB, Circular A-110, Uniform Administrative Requirements for Grants and
Agreements with Institutions of Higher Education, Hospitals, and Other
Non-Profit Organizations.
The bureaus in our scope that obligated the greatest amount of development
and humanitarian assistance funds--PRM and INL--have overseas staff
specifically assigned to manage and monitor their programs. PRM has about
22 full-time Foreign Service officers serving as refugee coordinators at
18 overseas posts to oversee refugee programs. Many of the coordinators
have regional responsibility over a number of countries, and are assisted
by Foreign Service nationals. PRM processed 481 grant, cooperative
agreement, and contribution funding actions in fiscal year 2006. INL,
which primarily provides foreign assistance through bilateral agreements
with foreign governments, uses about 35 Foreign Service officers and 428
Foreign Service nationals overseas who are assigned to manage its programs
in about 47 locations overseas.
DRL and G/TIP rely mainly on headquarters staff to monitor their programs.
DRL--which obligated considerably more funds than the remaining
bureaus--uses its 36 headquarters policy analysts and program officers to
monitor program implementation, including the overseas activities of the
grantees. DRL staff monitor grant activities, as follows:
o maintaining contact with grantees, often through e-mail and
meetings in Washington, D.C.;
o reading grantee quarterly reports to assess how well grantees
are meeting their goals and objectives; and
o holding semiannual, internal review panels to determine whether
each grant requires follow-up.
DRL staff may also make monitoring trips to the projects in order to
assess the grant. G/TIP, which receives a comparatively small amount of
funds, uses a similar process for monitoring its centrally managed
programs from headquarters. Although these bureaus use headquarters staff
for monitoring, they also request assistance from the overseas posts. For
example, DRL encourages the overseas posts to review proposals, attend
events that grantees hosts in their country, send feedback to DRL, visit
grantees regularly, and meet with DRL staff during their visits. G/'TIP
also encourages overseas staff to visit its centrally managed grants.
However, DRL officials stated that they cannot directly task overseas
staff to monitor their programs, because any help overseas staff provide
to DRL is beyond the overseas staffs' assigned duties.
Five of the six regional bureaus generally use their headquarters' desk
officers and varying levels of assistance from the overseas posts to
monitor their programs. The Bureau of Near Eastern Affairs--which
obligated a small amount of funds compared with PRM and INL--has full-time
coordinators for MEPI. All of these staff are locally engaged, and are
located at five overseas posts in Oman, Bahrain, Lebanon, Egypt, and
Morocco. In addition, overseas posts are responsible for monitoring the
implementation of the small grants they award. Table 3 shows the primary
location of staff primarily responsible for monitoring the implementation
of the foreign assistance activities of the bureaus and offices within the
scope of our review.
Table 3: Primary Monitoring Responsibilities
Overseas staff
assigned to Overseas staff not
Headquarters specific specifically assigned to
Bureau/Office staff program program
International X
Narcotics and Law
Enforcement
Population, X
Refugees, and
Migration
Democracy, Human X
Rights, and Labor
Trafficking in X
Persons
Regional bureaus
European and X X
Eurasian Affairs
Near Eastern Affairs X X X
African Affairs X X
Western Hemisphere X X
Affairs
East Asian and X X
Pacific Affairs
South and Central X
Asian Affairs
Source: Department of State.
Note: The Office of the Global Aids Coordinator is not included because
other U.S. agencies account for the use of Global HIV/AIDS funds.
State Does Not Use Strategic Workforce Planning to Support Its Foreign
Assistance Efforts
A key principle of strategic workforce planning is to define the critical
skills and competencies that will be needed to achieve current and future
programmatic goals.^17 However, State does not have an accurate picture of
the number and type of staff responsible for overseeing and monitoring
foreign assistance responsibilities. Without this critical information,
State cannot develop strategies, such as training, to address any gaps in
the number, skills, and competencies of its workforce--another key
strategic workforce planning principle. Internal control standards also
require that all personnel possess and maintain a level of competence that
allows them to accomplish their assigned duties.^18 We found that State
has inconsistent training and skills requirements for staff involved in
foreign assistance oversight. For example, grants officers--who are
responsible for the legal aspects of entering into, amending, and
terminating awards--must meet educational and training requirements, while
grants officer representatives in some State Bureaus--who are delegated
some of these monitoring responsibilities--do not have to meet such
requirements. In addition, grants officers responsible for awarding grants
for several of the bureaus within the scope or our work and other
officials whom we met with in State's Bureau of Administration expressed
concern about their ability to handle their grant monitoring
responsibilities because of workload, staffing, and training issues.
Finally, State has not used strategic workforce planning to align the
efforts of its recently established Office of the Director of Foreign
Assistance to reform the foreign assistance budget with staffing and skill
requirements.
State Has Not Determined Foreign Assistance Skills Requirements
We have developed a model of strategic human capital planning to help
agency leaders effectively use their personnel, or human capital, and
determine how well they integrate human capital considerations into daily
decisionmaking and planning for the program results they seek to achieve.
Our human capital model is consistent with similar efforts by OMB and the
Office of Personnel Management (OPM) to develop federal human capital
standards.^19 Under the principles of effective workforce planning an
agency should determine the critical skills and competencies that will be
needed to achieve current and future programmatic results. State needs
people with foreign assistance management skills and competencies to
achieve its development and humanitarian goals and objectives. Agencies
can take a range of approaches to identifying current and future skills
requirements, but they should be based on the collection of fact-based
information.^20 State has not taken such action for staff with foreign
assistance management responsibilities. For example, there is no specific
foreign assistance grant management skill set for Foreign Service
officers, according to a senior Human Resources official. Moreover, State
has never specifically examined foreign assistance workload indicators to
identify resulting workforce needs, according to its workforce planners.
Further, although the delivery of development and humanitarian assistance
is a critical component of three of State's seven strategic goals it is
not part of the official State mission as communicated by the current
workforce plan.
^17GAO, Human Capital: Key Principles for Effective Strategic Workforce
Planning, GAO-04-39, (Washington, D.C.: Dec. 11, 2003).
^18See GAO's Standards for Internal Control in the Federal Government,
[27]GAO/AIMD-00-21 .3.1 (Washington, D.C.: November 1999). The five
standards for internal control include: control environment, risk
assessment, control activities, information and communications, and
monitoring. One factor in the internal control environment is management's
commitment to competence. See also Internal Control Management and
Evaluation Tool, GAO-01-1008G (Washington, D.C.: August 2001).
State Has Not Collected Critical Information on Current Staff with Foreign
Assistance Management Responsibilities
The collection of information on critical skills and competencies needed
to perform an agency's mission is one step in determining current and
future human capital needs. Such information includes the number, type,
and skills of staff involved in the oversight and monitoring of foreign
assistance activities. However, State does not have complete and accurate
information on staff that manage and monitor foreign assistance programs.
We asked the bureaus and officers in our scope of work to provide
information on the number and type of staff in headquarters and overseas
posts that work on their development and humanitarian assistance programs
and the amount of time they spend on those programs. Only 3 of the 10
bureaus could provide detailed information on overseas staff devoted to
their programs. INL and PRM--the two program bureaus with overseas staff
assigned to their programs--were able to provide the number of
headquarters and overseas staff devoted to their programs, while the
Bureau of Near Eastern Affairs was also able to provide data on the
number, type of staff, and percentage of time devoted to MEPI programs in
15 countries. However, the other bureaus could provide only estimates of
overseas staff devoted to foreign assistance activities. A few bureaus,
such as South and Central Asian Affairs, Western Hemisphere Affairs, and
African Affairs, referred to the information they provided as best
guesses. East Asian and Pacific Affairs Bureau officials said they had to
query their overseas posts to obtain the staffing information they
provided.
^19In 2001, OMB announced the President's Management Agenda, designed to
address management weakness across the government. As part of this
initiative, in October 2002, OPM released a Human Capital Assessment and
Accountability Framework that built on its prior guidance for workforce
planning. It has also developed Human Capital Standards for Success, which
is consistent with the GAO model. OPM's Human Capital Assessment and
Accountability Framework and Human Capital Standards for Success can be
found at its Web site at www.opm.gov. OPM's Web site also provides a link
to the President's Management Agenda and the Strategic Management of Human
Capital Initiative, or this document can be accessed through OMB's Web
site at [28]www.whitehouse.gov/omb .
^20GAO, Human Capital: Key Principles for Effective Strategic Workforce
Planning, GAO-04-39 (Washington, D.C.: Dec. 11, 2003).
State officials attributed the difficulty in identifying current staff
devoted to foreign assistance activities to a variety of factors. For one,
State's primary role has traditionally been to implement U.S. foreign
policy. State bureaus and offices manage foreign assistance programs in
support of their foreign policy objectives, and some staff in policy
positions may also work on foreign assistance programs. Therefore, it is
difficult to separate the foreign assistance activities from State's
diplomatic functions, according to State resource managers. Moreover,
State's mission planning process only tracks staff time by strategic
objective and cannot identify staffing devoted to a specific program.
State workforce planners said they do not have a systematic way of
identifying personnel working on foreign assistance unless it is obvious
from their job title. In response to our request for information, the
workforce planners were able to identify about 300 foreign
assistance-related full-time positions in headquarters functional bureaus.
They said State's most recent domestic staffing model does not contain the
critical information necessary to identify foreign assistance-related
functions in the regional bureaus.
Furthermore, State does not have a systematic way of identifying all staff
officially designated as grants officer representatives, because State
does not maintain a comprehensive list of these designees. Grants officers
stated that the letters designating the grants officer representatives are
included in the grants file; however, State's current grants database
management system does not capture information on grants officer
representatives, according to Administrative Bureau procurement officials.
Thus there is no systematic workforce information on staff to whom foreign
assistance responsibilities are delegated. Moreover, it is not clear
whether staff with grants management responsibility who are not officially
appointed as grants officer representatives are bound by the same
responsibilities, authorities, and limitations described in the
designation letter.
State Does Not Have Consistent Training Requirements for Staff Managing Foreign
Assistance Activities
In accordance with internal control standards all personnel should possess
and maintain a level of competence that allows them to accomplish their
assigned duties, as well as understand the importance of developing and
implementing good internal control. This includes identifying appropriate
knowledge and skills as well as providing needed training.^21 However, as
State does not have complete data that would allow it to identify any gaps
in the numbers, skills, and competencies it needs to manage foreign
assistance programs and develop strategies--such as providing training--to
address those gaps, State cannot assure itself that all employees who
manage and monitor foreign assistance activities have the necessary
skills.
We found that State has inconsistent training and skills requirements for
its staff involved in foreign assistance oversight. For example, grants
officers must meet a number of requirements under State Grant Policy
Directive 1 to obtain a Grants Officer Warrant to award federal
assistance. This directive establishes State's policy that grants officers
possess the minimum qualifications necessary to ensure that federal
assistance agreements issued by State are sound and in compliance with
laws and regulations. The directive requires domestic applicants to meet
specific education and training qualifications to obtain a grants
warrant--such as completion of a 56-hour course in grants management
training and 4-year course of study leading to a bachelor's degree. The
warrant limits the dollar amount of awards the officers can make. In
contrast, State does not have agencywide training requirements for grants
officer representatives who are often delegated some of the grants
officers' oversight responsibilities. For example, State Policy Directive
16 states that education and special training may be considered when
designating grants officer representatives, but it does not provide
specifics on what training and education to consider. Further, grants
officers do not have control over whether or not the grants officer
representatives are qualified, because the bureau for which the assistance
award is made generally appoints the grants officer representative when it
submits the award package to the grants officer for final processing. For
example, Near Eastern Affairs Bureau and INL grants officers stated that
program staff with subject area knowledge are designated as grants officer
representatives and that these staff do not have to meet any specific
training requirements.
^21GAO/AIMD-00.21.3.1.
Overseas staff with foreign assistance management responsibilities also do
not always have to meet foreign assistance management specific training or
experience requirements. For example, INL officials said that Foreign
Service officers applying for their bureau's overseas positions did not
have to meet any specialized management skill requirements. INL human
resources officials added that INL has difficulty matching staff with the
assignments because there is no guidance on skills requirements. Further,
some DRL and G/TIP officials stated that overseas staff generally lacked
the training to monitor their grants. Moreover, State's Inspector General
reported that Foreign Service officers overseas with MEPI responsibilities
lacked grants related training. The Inspector General further reported
that political and economic officers supporting small bilateral MEPI
grants and larger regional initiatives did not have grants training and
showed an uncertain grasp of their oversight responsibilities and of MEPI
expectations.^22 Lack of properly trained staff could negatively impact
State's ability to effectively deliver foreign assistance, and would be an
internal control weakness that puts grants at risk.
Several of the Administration Bureau and Near Eastern Affairs Bureau
grants officers we interviewed recommended that all grants officer
representatives receive training, such as the grants management courses
offered by FSI: "Introduction to Grants and Cooperative Agreements for
Federal Personnel" and "Monitoring Grants and Cooperative Agreements." The
former course is required for Public Diplomacy officers substantially
involved in pre and postaward assistance processes overseas. Any Federal
personnel responsible for overseeing administrative, financial, or program
performance of grant recipients would benefit from the latter class,
according to the FSI course catalog.
Although State does not have agencywide training requirements, some
individual bureaus do. For example, DRL has internal training requirements
for bureau staff who serve as grants officer representatives, requiring
them to complete the two FSI classes on grants management, according to
DRL officials. In addition, PRM officials stated that the bureau--which
does not designate grants officer representatives--requires its
headquarters and overseas staff to take the FSI's Population, Refugee and
Migration Officers Monitoring and Evaluation Workshop. FSI also offers a
week-long introductory orientation for staff who work on refugee issues
led by PRM officials.
^22OIG Report No. ISP-1-06-18, Review of Middle East Partnership
Coordination and Implementation, March 2006.
Moreover, an FSI survey in response to employee requests for grants
management training suggests that Foreign Service officers overseas
recognize that there is a gap in their foreign assistance management
skills. FSI officials stated that the Institute conducted a needs
assessment, including a survey, in response to anecdotal information about
the need for the training. The officials said that based on the survey
responses, FSI created a new training course--Managing Foreign Assistance
Awards Overseas. According to FSI, the new training was designed to meet
the changing needs of Foreign Service officers under the Diplomatic
Readiness and Transformational Diplomacy Initiatives. The 3-day elective
course is geared toward economic and political officers who need to learn
the fundamentals of assistance awards management and who will have project
management or oversight responsibilities. According to FSI, the course
targets officers who will design, develop, and oversee assistance programs
at post in support of mission performance plan goals, and is not geared
toward officers providing assistance on activities managed from
headquarters. FSI began offering the course in April 2007. The FSI
officials said they were not aware of any additional training needs or
proposed training related to foreign assistance management.
State Officials Concerned About Department's Ability to Effectively Manage
Grants
Grants officers and other officials whom we met with expressed concern
about their ability to handle their grant management responsibilities to
ensure that federal funds are being spent as intended. For example, we
interviewed all five Administrative Bureau grants officers responsible for
awarding grants for some of the bureaus and offices in our scope. We also
interviewed Bureau of Near Eastern Affairs and INL grants officers. The
Administrative Bureau grants officers who are responsible for much of
State's development and humanitarian assistance awards stated that they
did not have sufficient time to fully oversee the implementation of the
grants, including pre and postaward activities. Preaward activities
include determining the level of competition, soliciting the proposal, and
selecting the grantee. Postaward activities include the monitoring
required to ensure a recipient is in adherence with State, bureau, and
program requirements.
Various officials with whom we spoke expressed concerns about preaward
management activities. Two of the Administrative Bureau grants officers
told us they were concerned about whether program and regional bureau
staff were sufficiently knowledgeable to solicit proposals and
competitively select grantees. These grants officers stated they generally
are not involved in the process for soliciting proposals and selecting the
grantee because of their workload. Instead, the program bureau is
responsible for the review and selection of assistance recipients prior to
the award. The grants officers said that, as a result, they did not know
whether the solicitations complied with relevant laws and regulations. For
example, one of the grants officers did not believe a program bureau
selecting grantees had sufficiently advertised its grant solicitations to
reach the most potential grantees possible. Other State officials with
whom we met raised this same issue. Moreover, in June 2006, State's
Inspector General raised concerns about the lack of competition for some
foreign assistance awards, reporting that PRM had not consistently
followed State or U.S. government policies that require applications for
federal assistance to be solicited in a manner that provides for
competition.^23 In response, PRM established policies and procedures that
require that all awards are advertised and that relevant State regulations
to justify noncompetitive awards are complied with, according to PRM
officials.
The Administrative Bureau grants officers and other officials with whom we
spoke also discussed postaward activities. For example, three of the
grants officers told us they were concerned about the lack of time they
had to devote to the grants after funds are obligated. They said they
receive a number of program and financial reports from the grantees at the
same time and consequently do not have enough time to thoroughly review
them. They said that they rely on the grants officer representatives, who
are not subject to agencywide training requirements, to review the reports
and notify them of problems. The grants officers further stated that their
workload did not permit them to close out the grants and that they had to
rely on what the grantee reported.
Grants officers and other officials also discussed issues related to site
visits to monitor the grantees. For example, Administrative Bureau grants
officers expressed concerns over their lack of opportunity to make site
visits. They said that the program bureaus responsible for the grants
would have to set aside travel funds for them to travel, but that this is
rarely done. Most of the grants officers we interviewed said that they
have not traveled overseas for monitoring visits and that they rely on the
grants officer representatives to perform this duty. However, some of the
Administrative and Near Eastern Affairs Bureau grants officers said the
grants officer representatives do not consistently inform them of upcoming
site visit. Grants Policy Directive 16 requires the grants officer
representatives to obtain prior approval from the grants officer before
visiting the grantee's place of performance to evaluate progress or
performance. For example, one of the grants officer said the grants
officer representative does not consult with her on whether there are
financial issues to be addressed, and another stated that the grants
officer representatives focus more on programmatic rather than management
or financial issues. Both stated that they do not receive any reports
after site visits.
^23OIG Report No. ISP-I-05-40, Inspection of the Bureau of Population,
Refugees, and Migration, June 2006.
We also met with about 20 DRL program and policy officers who serve as
grants officer representatives, and they generally indicated that grant
oversight would be improved by more frequent site visits to monitor
grantee activity.^24 The DRL grants officer representatives said they make
site visits as workload, travel funds, and conditions in the country
permit. A G/TIP grants officer representative expressed similar concerns,
stating that G/TIP does not have the time or the budget to visit every
grantee. State's Inspector General has found the lack of monitoring to be
an issue in the past, and reported in 2005 that G/TIP did not adequately
monitor its grantee activities. The report found that the grants officer
for G/TIP relied on a G/TIP grants officer representative who in turn
relied on overseas posts to monitor grantee activity. The Inspector
General found very few embassy evaluations verifying monitoring had been
occurring and recommended that G/TIP improve its recordkeeping.^25
State Has Not Yet Integrated Workforce Planning into Foreign Assistance Reform
Efforts
State is implementing foreign assistance budgetary reforms without
considering the potential impact of these reforms on its staffing and
skills requirements, which does not conform to strategic workforce
principles. One such principle is that an agency's management lead the
effort to align its human capital program with current and emerging
mission and programmatic goals.^26 The Secretary of State recently
established the F Bureau within State to serve as an umbrella leadership
structure for aligning and coordinating all foreign assistance, policy,
planning, and oversight. Since its establishment, the F Bureau has
developed a strategic framework for foreign assistance and established new
priority objectives. The budget reforms could result in some countries and
programs receiving more funding, while others receive less. Such changes
could shift where staff with foreign assistance responsibilities are
needed from one bureau to another or from headquarters to overseas
missions. For example, the fiscal year 2008 budget request includes INCLE
funds for many countries that had no such funding in previous years.
However, as of July 2007, State had not begun to align human capital
resources with the reforms, according to a senior F Bureau official. The
official said that the F Bureau would eventually address human capital
requirements, but he did not provide a time frame. Further, State's Human
Resources Bureau officials told us they had not attended meetings in which
foreign assistance budget decisions were made that could potentially
impact human capital requirements. Moreover, the Human Resources Bureau
had not taken any workforce planning actions related to F Bureau reform
efforts, and its future role had not been determined. Consequently, the
impact of the F Bureau reforms on foreign assistance staffing and skills
requirements is not clear to State officials.
^24State does not require a specific number of site visits.
^25OIG Report No. ISP-I-06-04, Inspection of the Office to Monitor and
Combat Trafficking in Persons, November 2005.
Conclusions
Strategic workforce planning focuses on developing long-term strategies
for acquiring, developing, and retaining an organization's total workforce
to meet the needs of the future. A key principle of strategic workforce
planning is to define the critical skills and competencies that will be
needed to achieve current and future programmatic goals. However, despite
its increasing role in development and humanitarian assistance, State has
limited data to determine whether department staff responsible for
managing and monitoring the programs have sufficient skills to ensure that
applicable U.S. laws and regulations are being complied with and U.S.
dollars are being spent as intended. Moreover, bureaus and offices that
manage development and humanitarian assistance programs could not readily
provide data on staffing devoted to foreign assistance activities,
particularly overseas staffing. In accordance with human capital
principles and internal control standards, agencies should have
individuals with specialized knowledge, skills, and abilities necessary to
perform complex and technical administrative responsibilities--such as
managing grants--effectively. However, we found that State does not have
departmentwide skills and training requirements for all staff who are
formally or informally delegated some of the oversight and monitoring
responsibilities of grants officers, who have formal responsibility for
overseeing grants.
^26GAO-04-39.
Recommendations
We recommend that the Secretary of State (1) take steps to define the
skills and competencies the department's employees need to manage foreign
assistance responsibilities, including developing information on the
number and type of staff who are currently managing foreign assistance
programs, their roles and responsibilities, workload, experience, and
training and (2) develop a strategy to address any gaps it identifies.
Agency Comments and Our Evaluation
The Department of State provided written comments on a draft of this
report. These comments and our response are reprinted in appendix IV.
State also provided technical comments, which we have incorporated into
this report as appropriate.
In commenting on a draft of this report, the Department of State generally
concurred with the report's findings, conclusions, and recommendations. To
address the recommendations State plans to (1) define critical skills and
competencies needed by all department employees managing foreign
assistance, (2) align workforce planning strategies with the management of
foreign assistance programs departmentwide, (3) review the overseas
staffing and domestic staffing models to determine if refinements are
required to the components that address foreign assistance programs, (4)
review the workforce plan to determine where enhancements to include
aspects of foreign assistance functions are warranted, and (5) consider
further training of personnel with grants management responsibilities.
Although State agreed with our recommendations, the letter expressed
concern that the draft report did not adequately reflect the department's
current oversight of its foreign assistance programs. State provided a
detailed description of how PRM monitors and evaluates its programs as an
example. We noted State's concerns in the results in brief section of this
report and have included additional details on PRM's monitoring efforts as
appropriate.
We are sending this report to other interested Members of Congress and to
the Secretary of State. We will also make copies available to others upon
request. In addition, the report will be available at
[29]http://www.gao.gov .
If you or your staff have any questions about this report, please contact
me at (202) 512-4128 or [30][email protected] . Contact points for our offices
of Congressional Relations and Public Affairs may be found on the last
page of this report. GAO staff who made major contributions to this report
are listed in appendix V.
Sincerely yours,
Jess T. Ford
Director, International Affairs and Trade
Appendix I: Scope and Methodology
To determine the size and scope of the Department of State's (State)
development and humanitarian assistance, we first reviewed U.S. budget
documents to identify funding supporting U.S. foreign assistance, as well
as State's part in supporting these overall efforts. We then reviewed the
portion of the U.S. budget that funded development and humanitarian
assistance and used State allotment reports to capture the fiscal accounts
that were available to State for obligation between fiscal years 2000 and
2006.
To identify overall funding supporting U.S. government foreign assistance
activities, we reviewed the U.S. budget general fund to identify
International Affairs (function 150) budget accounts. Function 150 budget
accounts are classified by the Office of Management and Budget (OMB)^1 as
those related to
o international development and humanitarian assistance (function
151),
o international security assistance (152),
o the conduct of foreign affairs (153),
o foreign information and exchange activities (154), and
o international financial programs (155).
We focused on the general fund because it contains the fiscal accounts
that are funded from regular congressional appropriations, as opposed to
accounts that are nonbudgetary or receive appropriations from other
general fund accounts, or trust funds that hold foreign government
payments, gifts, or contributions. To capture funds available for
obligation, including the congressional appropriation as well as funds
carried over from the previous year, we used the amounts shown on line
23.90 (total budgetary resources available for obligation) of the program
and financing table of the Department of State and Other International
Programs budget appendix for fiscal years 2002 through 2008.^2 We used the
budgets for these years because they have final (actual) amounts for
fiscal years 2000 through 2006. If line 23.90 was not applicable for a
certain account, such as when no unobligated funds were being carried
over, we used line 22.00 (new budget authority). For accounts that had not
received new funds, we used line 21.40 (unobligated balance brought
forward from the previous year).
^1OMB periodically consults with the congressional budget office and
relevant budget and appropriation committee staff members regarding these
classifications.
^2We also included function 150 budget lines from the budget appendixes of
the U.S. Departments of Agriculture and Defense, along with those for the
Executive Office of the President and Other Independent Agencies.
To identify the 150 budget accounts from which State received funding, we
used Treasury budget identification codes as well as assistance account
information obtained from State's office of the director of foreign
assistance. We also referred to Treasury Financial Management Service's
combined statement on appropriations and outlays to identify accounts from
which State received 150 funds and accounts State sent to other agencies,
such as the Global HIV/AIDS Initiative account. From the function 150
fiscal accounts we separated out development and humanitarian budget lines
(function 151) as well as the economic support fund. While the economic
support fund is not a function 151 account, we included it in our scope of
development and humanitarian assistance fiscal accounts because it was a
primary account that State used for funding this type of assistance.
To identify State's share of the 151 account, we used allotment reports
provided by State's resource management office that reported how much
development and humanitarian assistance State received annually, by fiscal
account. These allotment amounts included funds carried over from the
previous year, and so represented funds available to State for obligation.
We used transfer data from State's resource management office to identify
transfers of the economic support fund and other fiscal accounts to the
International Narcotics Control and Law Enforcement account (INCLE) and
the Andean Counterdrug Initiative. We determined State's allotment and
transfer information was sufficiently reliable for our purposes, through
(1) discussions with State resource management officials and (2)
cross-checks with the U.S. budget appendix, the Treasury Financial
Management Service's combined statement, and publicly available
information from the U.S. Agency for International Development (USAID).
To identify State's approaches to managing programs, we reviewed program
information, including obligations data, monitoring plans, trip report
templates, grant policy directives, and grants data. For the purposes of
this review, we defined foreign assistance management as obligating funds,
selecting grantees, making assistance awards, and monitoring the
implementation of development and humanitarian assistance programs. The
sources of the obligations data were excel spreadsheets used to track
transactions, including obligations and State's central financial
management system. We reviewed the data for reasonableness and consistency
of methodology and discussed the accuracy of the data with knowledgeable
officials at the bureaus and offices that provided the data. Based on our
analysis and discussions with the officials, we determined that these data
are sufficiently reliable for our purposes. We also obtained information
on the number of grants from State's grants management database, but, as
mentioned in this report, we determined this information was not reliable;
and therefore, we did not use these data as support of our findings.
To assess foreign assistance human capital requirements, we reviewed
staffing, workload, workforce planning documents, and data from State's
Workforce Plan. We also reviewed our reports on human capital management
and strategic workforce planning and consulted with GAO experts on these
issues. We also assessed the extent to which certain management functions
related to determining skills and training requirements met internal
control standards for the federal government. We interviewed agency
officials at the Bureau of Human Resources, Bureau of Resource Management,
the Foreign Service Institute, and the State's Office of the Inspector
General. We also discussed staffing and skills requirements with all of
the program and regional bureaus in our scope.
The bureaus and offices in our scope included the Bureaus of Democracy,
Human Rights, and Labor; International Narcotics and Law Enforcement
Affairs; Population, Refugees, and Migration; the Office of the U.S.
Global AIDS Coordinator, the Office to Monitor and Combat Trafficking in
Persons, and all of the regional bureaus: African Affairs; East Asian and
Pacific Affairs; European and Eurasian Affairs; Near Eastern Affairs;
South and Central Asian Affairs; and Western Hemisphere Affairs. We also
met with officials of the Office of the Director of Foreign Assistance;
Bureau of Administration, Office of the Procurement Executive; and USAID.
We interviewed a non-statistical sample of 11 grants officers that
included 5 officers from the bureau responsible for awarding grants for
all of the bureaus we examined. We also interviewed another
non-statistical sample of 21 program and policy officers that serve as
grant officer representatives. We selected these individuals to ensure
that we covered the range of actual grant officers as well as the program
and policy officers that serve as grant officers. We reviewed State's
fiscal year 2005 Performance and Accountability Report, publicly available
assistance account obligation information, and the foreign assistance
framework developed by the Office of the Director of Foreign Assistance to
identify State program bureaus with comparable assistance activities to
USAID. We excluded bureaus that managed military, antiterrorism, and
cultural and educational exchange programs. With the exception of the
regional bureaus, we also excluded some bureaus and offices managing
developmental and humanitarian assistance programs obligating less than
$20 million.
We conducted our review between August 2006 and August 2007 in accordance
with generally accepted government auditing standards
Appendix II: Amounts Available from Each Part of the International Affairs
(function 150) Budget, Fiscal Years 2000 through 2006
Dollars in
millions
Part 2000 2001 2002 2003 2004 2005 2006
151:
International
Development and
Humanitarian
Assistance $25,580 $25,580 $28,453 $35,361 $52,695 $48,690 $44,287
152:
International
Security
Assistance 5,633 4,568 5,289 7,077 5,321 6,128 5,696
153: Conduct of
Foreign Affairs 8,871 9,884 11,227 11,052 12,297 14,690 14,891
154: Foreign
Information and
Exchange
Activities 883 954 1,092 1,181 1,156 1,146 1,316
155:
International
Financial
Programs 26,616 31,848 29,976 31,396 28,559 24,635 18,039
Total $67,583 $72,834 $76,037 $86,067 $100,028 $95,289 $84,229
Source: GAO analysis of International Affairs (function 150) budget.
Note: Fiscal years 2003 through 2006 included supplemental funding for
relief and reconstruction in Iraq.
Appendix III: State's Available Funding from Development and Humanitarian
Assistance Fiscal Accounts for Fiscal Years 2000 through 2006
Dollars in millions
Fiscal accounts 2000 2001 2002 2003 2004 2005 2006 Total
Migration and $770 $721 $813 $841 $831 $904 $900 $5,781
refugee
assistance
International 382 354 476 470 589 1,285 1,599 5,155
Narcotics Control
and Law
Enforcement
Andean 825 95 449 700 637 620 554 3,880
Counterdrug
Initiative
Iraq N/A N/A N/A 39 1,205 684 282 2,210
reconstruction
supplemental
International 309 302 300 293 298 303 308 2,113
organizations
Economic support 28^a 76 296 198 302 371 382 1,654
fund
Assistance for 2^a 143 127 118 125 130 111 756
Eastern Europe
and the Baltic
States
Assistance for 27^a 98 87 126 99 123 118 679
the Independent
States of the
Former Soviet
Union
Emergency refugee 49 86 78 80 69 44 47 453
and migration
assistance
Global HIV/AIDS N/A N/A N/A N/A 14 77 251 342
Initiative
International N/A N/A N/A N/A 42 63 N/A 104
disaster and
famine assistance
Democracy fund N/A N/A N/A N/A N/A N/A 94 94
Tsunami fund N/A N/A N/A N/A N/A 10 9 19
Child survival N/A N/A 4^a 5^a 4^a 4^a N/A 16
and health
Development 3^a 3^a N/A 2 0 0 N/A 8
assistance
Total $2,396 $1,879 $2,628 $2,873 $4,215 $4,618 $4,655 $23,264
Source: GAO analysis of International Affairs (function 150) budget and
State allotment reports.
Note: Amounts capture funding from certain fiscal accounts, such as the
economic support fund account and the assistance for Eastern Europe and
the Baltic States account that State received but then transferred into
the international narcotics control and law enforcement account.
aAmounts that are primary allocations to State from USAID. While these
amounts remained on USAID's budget, State had authority to obligate the
funds.
Appendix IV: Comments from the Department of State
Appendix V: GAO Contact and Staff Acknowledgments
GAO Contact
Jess Ford (202) 512-4128
Staff Acknowledgments
In addition to the individual named above, Adam Cowles (Assistant
Director); Donald Morrison, and La Verne Tharpes made key contributions to
this report. The team benefited from the expert advice and assistance of
Martin de Alteriis, Joe Carney, William Doherty, Clarette Kim, Grace Lui,
Jeremy Sebest, and Mona Sehgal.
(320449)
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Highlights of GAO-07-1153, a report to the Honorable Richard G. Lugar,
Ranking Minority Member, Committee on Foreign Relations, U.S. Senate
September 2007
DEPARTMENT OF STATE
Human Capital Strategy Does Not Recognize Foreign Assistance
Responsibilities
The Secretary of State has made foreign assistance a pillar of the
department's Transformational Diplomacy Initiative and has sought better
policy coordination, planning, and oversight by establishing a Director of
Foreign Assistance (F Bureau). Even though the U.S. Agency for
International Development has been the principal agency for development
and humanitarian aid, State has had a significant role delivering this
type of assistance. Thus, it is essential that State have the right staff,
with the right skills, in the right places to carry out its foreign
assistance management responsibilities and ensure that U.S. funds are well
spent. As requested, this report (1) describes the size and scope of
development and humanitarian foreign assistance programs managed by State,
(2) describes State's approaches to managing and monitoring such programs,
and (3) evaluates State's processes for determining its human capital
requirements for managing these programs.
[37]What GAO Recommends
GAO recommends that State (1) define the skills and competencies it needs
to manage its foreign assistance responsibilities and develop critical
information on staff currently doing so, and (2) develop a strategy to
address any gaps it identifies. State agreed with our recommendations and
plans to take appropriate action.
In fiscal year 2006, State had about $4.7 billion available for
development and humanitarian assistance activities, nearly double the
amount it was responsible for managing in 2000. This funding supported,
for example, programs aimed at alleviating poverty and the suffering of
refugees, as well as funding international drug interdiction efforts.
State primarily uses grants and cooperative agreements to deliver this
type of assistance.
State manages its development and humanitarian assistance programs
centrally, obligating about 80 percent of the funds and making awards from
headquarters. State uses a variety of oversight approaches. Grants
officers and grants officer representatives have formal oversight
responsibilities, but other staff also carry out functions informally. A
mix of headquarters and overseas staff monitor program implementation.
State's strategic workforce planning does not reflect its foreign
assistance activities. A key principle of strategic workforce planning is
to define the critical skills and competencies that will be needed to
achieve current and future programmatic goals. State has not defined its
staff needs to manage and monitor its foreign assistance programs and has
not collected critical information on current staff with these
responsibilities. Moreover, GAO found inconsistent training and skills
requirements for staff involved in foreign assistance oversight. For
example, grants officers--who are responsible for the legal aspects of
entering into, amending, and terminating awards--must meet educational and
training requirements, while grants officer representatives--who are
delegated some monitoring responsibilities--do not. Further, a recent
State survey suggests that Foreign Service officers overseas recognize
that there is a gap in their foreign assistance management skills. Various
State officials have concerns about the department's ability to
effectively manage its development and humanitarian assistance. Finally,
State has not used strategic workforce planning to align F Bureau budget
reforms with staffing and skill requirements.
Funding Available to State for Development and Humanitarian Assistance
References
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28. http://www.whitehouse.gov/omb
29. http://www.gao.gov/
30. mailto:[email protected]
31. http://www.gao.gov/
32. http://www.gao.gov/
33. http://www.gao.gov/fraudnet/fraudnet.htm
34. mailto:[email protected]
35. mailto:[email protected]
36. mailto:[email protected]
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