Reports and Testimony: February 1996 (Other Written Prod., 03/01/96,
GAO/OPA-96-5).

GAO published its monthly digest of reports and testimonies issued in
February 1996.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  OPA-96-5
     TITLE:  Reports and Testimony: February 1996
      DATE:  03/01/96
   SUBJECT:  Food relief programs
             Budget administration
             Environmental monitoring
             Health insurance cost control
             Transportation operations
             Law enforcement
             Currency and coinage
             National defense operations
             International relations
             Veterans
IDENTIFIER:  Superdollar
             Mexico
             North American Free Trade Agreement
             Food Stamp Program
             Bibliographies
             Minnesota Family Investment Program
             Aid to Families With Dependent Children Program
             AFDC
             Minnesota Family General Assistance Program
             NAFTA
             Commonwealth of Independent States
             EPA National Environmental Performance Partnership System
             Grand Junction (CO)
             Federal Family Education Loan Program
             OMB 2000
             SSA Plan for Achieving Self-Support Program
             FHA Hospital Mortgage Insurance Program
             Medicare Hospital Insurance Trust Fund
             Supplemental Security Income Program
             NIST Advanced Technology Program
             Medicare Program
             NWS Advanced Weather Interactive Processing System
             Cambodia
             European Union
             Exchange Stabilization Fund
             
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REPORTS AND TESTIMONY:  FEBRUARY
1996

GAO/OPA-96-5


Highlights

Counterfeit Currency

Counterfeit currency--including "superdollar" bills allegedly
originating in the Middle East--is a threat to be taken seriously. 
However, counterfeit-detection data used by the Treasury and the
Secret Service are misleading and may result in the underreporting of
high-quality counterfeit notes.  Page 17. 

Mexico's Financial Crisis

GAO describes the origin of Mexico's 1994 financial crisis; assesses
the awareness of the problem at the time by U.S.  and international
financial experts; describes the U.S.  and international response to
the crisis, including an assessment of the terms of the U.S. 
assistance package; and examines Mexico's efforts to recover from the
crisis.  Page 15. 

Commercial Trucking

Although Mexico and the United States have made some progress in
developing compatible trucking regulations--as called for by the
North American Free Trade Agreement--compatibility for some
regulations may never be achieved.  Meanwhile, many trucks from
Mexico operating in U.S.  commercial zones are in poor condition and
do not meet U.S.  safety standards.  Page 25. 

GAO/OPA-96-5



Abbreviations
=============================================================== ABBREV

  ATF - x
  CBO - x
  DOD - x
  DOE - x
  EIA - x
  EPA - x
  FBI - x
  FDA - x
  FHA - x
  HCFA - x
  HMO - x
  HUD - x
  IMF - x
  IRS - x
  NAFTA - x
  NCIC - x
  NWS - x
  OIG - x
  OMB - x
  OPM - x
  PART - x
  PASS - x
  PBM - x
  ROTC - x
  SSA - x
  SSI - x
  UN - x
  USDA - x
  VA - x

REPORTS AND TESTIMONY:  FEBRUARY
1996
=========================================================== Appendix 0


   AGRICULTURE AND FOOD
--------------------------------------------------------- Appendix 0:1

Food Stamp Program:
Achieving Cost Neutrality in Minnesota's Family
Investment Program

GAO/RCED-96-54, Feb.  12 (14 pages). 

In 1994, Minnesota began a five-year federally authorized welfare
reform project known as the Minnesota Family Investment Program. 
Aimed at simplifying the welfare system, the project consolidates the
food assistance and the cash benefits provided by three programs--Aid
to Families With Dependent Children, the Food Stamp Program, and
Minnesota's Family General Assistance Program--into a single monthly
payment.  The Food Stamp Act of 1977 requires that the federal
government spend no more for this project's food assistance component
in any fiscal year than it would have spent for the Food Stamp
Program.  That is, the project must be cost neutral.  To ensure cost
neutrality, the act requires the Agriculture Department and the state
of Minnesota to agree upon methodologies for estimating what the
costs of the Food Stamp Program for both benefits and administration
would have been had there been no project.  This report (1) describes
the methodologies that Minnesota agreed to use for estimating Food
Stamp Program costs that would have been incurred if the project had
not been implemented; (2) determines if Minnesota implemented these
methodologies; (3) assesses the reasonableness of these
methodologies, as implemented, for estimating the cost of the Food
Stamp Program for fiscal year 1994; and (4) compares the payments
that would have been paid to Minnesota using the agreed-upon
methodologies with the actual payments in fiscal year 1994. 


   BUDGET AND SPENDING
--------------------------------------------------------- Appendix 0:2

Budget Issues:
Compliance Report Required by the Budget Enforcement Act
of 1990

GAO/AIMD-96-41, Feb.  16 (26 pages). 

As required by the Budget Enforcement Act of 1990, this compliance
report covers budget sequestration reports issued by the Office of
Management and Budget (OMB) and the Congressional Budget Office
(CBO).  In GAO's opinion, the OMB and CBO reports substantially
complied with the act.  GAO does raise some implementation issues
that are not, in GAO's judgment, compliance issues.  They relate to
(1) a change in OMB's methodology for calculating inflation for
discretionary spending limits, (2) OMB's reestimate of enacted
emergency legislation, and (3) differences in OMB and CBO spending
estimates of appropriation acts and direct spending legislation. 


      TESTIMONY
------------------------------------------------------- Appendix 0:2.1

Fiscal Year 1997 Budget Estimates for the U.S.  General Accounting
Office, by Charles A.  Bowsher, Comptroller General of the United
States, before the Subcommittee on Legislative, House Committee on
Appropriations.  GAO/T-OCG-96-1, Feb.  29 (17 pages). 

During the past year, GAO again demonstrated its worth to Congress
and the taxpayer.  Agency officials testified nearly 250 times before
congressional committees on issues ranging from budget savings, to
waste, fraud, and abuse, to reengineering the federal government. 
During fiscal year 1995, GAO recommendations produced more than $15
billion in measurable financial benefits, as well as many
improvements to government operations.  GAO's current staff of 3,700
employees--down from 5,325 in 1992--is the agency's lowest staffing
level since before World War II.  GAO is meeting the challenge of
doing a good job even better--and doing it faster, at less cost, and
with fewer people.  The agency is constantly seeking to improve
productivity, take advantage of modern technology, and improve
employee skills and expertise.  Concerns have been raised, however,
about GAO's lack of enough technical expertise to successfully
conduct a consolidated audit of the executive branch--an important
requirement of the Chief Financial Officers' Act. 


   ENVIRONMENTAL PROTECTION
--------------------------------------------------------- Appendix 0:3

Environmental Management:
An Integrated Approach Could Reduce Pollution and Increase Regulatory
Efficiency

GAO/RCED-96-41, Jan.  31 (18 pages). 

The nation's environmental programs have traditionally sought to
control the amount of pollution released to a specific medium--air,
water, or land.  Although these programs have produced environmental
benefits, concerns have been raised that the medium-specific approach
encourages "end-of-the-pipe" pollution controls to treat, store, or
dispose of waste, rather than encouraging pollution prevention. 
Massachusetts, New York, and New Jersey have experimented with
multimedia, or integrated, approaches to environmental management as
alternatives to the traditional medium-specific approach.  Although
the three states have not fully assessed the effectiveness of
integrating environmental management, this approach shows potential
for reducing pollution and increasing regulatory efficiency. 
Industry representatives also report positive results from this
approach.  Nonetheless, drawbacks exist.  For example, performing
integrated inspections and promoting pollution prevention require
inspectors to have more expertise.  Each of the three states has
found it difficult to fund its multimedia activities through EPA's
grants for medium-specific programs.  Although EPA has worked with
these states to resolve the funding problems, the extensive
negotiations that were required could discourage other states from
adopting multimedia initiations.  A new grant program proposed by EPA
holds the potential for resolving such funding and reporting issues. 

Water Pollution:
Differences Among the States in Issuing Permits Limiting the
Discharge of Pollutants

GAO/RCED-96-42, Jan.  23 (34 pages). 

The Environmental Protection Agency (EPA) has issued national
guidance and regulations to help the states establish standards to
protect water quality and issue permits to facilities to limit the
discharge of pollutants.  Although the Clean Water Act requires all
states to adopt water quality standards, EPA authorizes qualified
states to issue permits.  Currently, 40 states have obtained such
authority; in the remaining 10 states, EPA regional offices issue the
permits.  In issuing the permits, the states and EPA may impose
limits on the discharges of specific pollutants, require the
facilities to monitor the levels of pollutants they discharge, or
determine that no controls are warranted.  This report (1) determines
whether differences exist in whether and how the states and EPA
control pollutants in the discharge permits they issue, (2)
identifies the causes of any differences, and (3) provides
information on EPA's oversight of the states' water quality standards
and policies. 


      TESTIMONY
------------------------------------------------------- Appendix 0:3.1

Environmental Protection:  Status of EPA's Initiatives to Create a
New Partnership With States, by Peter F.  Guerrero, Director of
Environmental Protection Issues, before the Subcommittee on VA, HUD,
and Independent Agencies, Senate Committee on Appropriations. 
GAO/T-RCED-96-87, Feb.  29 (15 pages). 

As long as environmental laws are medium specific and prescriptive
and Environmental Protection Agency (EPA) personnel are held
accountable for meeting the laws' requirements, it will be difficult
for the agency to fundamentally change its relationship with states
to reduce day-to-day control over program activities.  This situation
was evident in the funding and reporting problems that arose from the
recent efforts of Massachusetts, New York, and New Jersey to
integrate their environmental management activities.  However, within
the flexibility granted by existing environmental statutes,
initiatives such as EPA's National Environmental Performance
Partnership System and its proposed performance partnership grants
have the potential to alleviate problems for those states interested
in obtaining greater flexibility in carrying out their environmental
responsibilities. 


   ENERGY
--------------------------------------------------------- Appendix 0:4


      TESTIMONY
------------------------------------------------------- Appendix 0:4.1

Uranium Mill Tailings:  Status and Future Costs of Cleanup, by
Bernice Steinhardt, Associate Director for Energy, Resources, and
Science Issues, before the Subcommittee on Energy and Power, House
Committee on Commerce.  GAO/T-RCED-96-85, Feb.  28 (11 pages). 

Energy Department (DOE) efforts to clean up contamination arising
from decades of processing uranium ore as part of the nation's
nuclear weapons and energy programs have grown in both size and cost
since the project began in 1979.  If the surface cleanup is completed
in 1998, it will have cost $2.3 billion and will have taken nearly
eight years longer and cost $621 million more than DOE expected. 
This 37-percent growth in costs has arisen from the discovery that
more properties were contaminated than anticipated, the need to clean
up more contamination than expected at some sites, and unexpected
changes in the cleanup strategies in response to state and local
concerns.  Several issues could affect the government's future
cleanup costs.  One issue is what the final costs for cleaning up
groundwater will be.  Another issue is the extent and the cost of
DOE's role in the future disposal of tailings in the Grand Junction,
Colorado, area.  Finally, the one-time charge assessed to owners and
operators for the long-term custody of sites that were still active
when the Uranium Mill Tailings Act was passed has not been updated
and does not reflect DOE's current estimates of surveillance and
maintenance costs at these sites. 

Nuclear Nonproliferation:  Concerns With the U.S.  International
Nuclear Materials Tracking System, by Victor S.  Rezendes, Director
of Energy, Resources, and Science Issues, before the Senate Committee
on Governmental Affairs.  GAO/T-RCED/AIMD-96-91, Feb.  28 (19 pages). 

A proposed agreement between the United States and the European
Atomic Energy Community would impose controls on the export of some
nuclear materials, nuclear reactors, and their major components
between the United States and 15 western European nations.  Keeping
track of the growing volume of nuclear material is especially
important because of the breakup of the Soviet Union and increases in
both domestic and international terrorism.  GAO testified that the
Energy Department's (DOE) nuclear-materials- tracking system, which
serves as the primary source of information for the United States to
track U.S.  nuclear materials transported to foreign countries, has
significant limitations.  Moreover, recent information suggests that
DOE's replacement tracking system faces a high probability of failure
because it has not been completely developed and tested. 


   FINANCIAL INSTITUTIONS
--------------------------------------------------------- Appendix 0:5

Foreign Banks:
Assessing Their Role in the U.S.  Banking System

GAO/GGD-96-26, Feb.  7 (57 pages). 

During the past 20 years, the share of U.S.  banking assets held by
foreign banks has increased significantly.  This report examines the
role of foreign banks in the United States and reviews U.S.  laws and
regulations governing their operations.  Specifically, GAO evaluates
whether these laws and regulations give foreign banks operating in
the United States a significant competitive advantage over U.S. 
banks.  GAO also identifies areas in which U.S.  laws and regulations
have been adapted to meet the circumstances of foreign banks and
examines the competitive impact of these adaptations on U.S.  banks. 


   FINANCIAL MANAGEMENT
--------------------------------------------------------- Appendix 0:6

Financial Audit:
Federal Family Education Loan Program's Financial Statements for
Fiscal Years 1994 and 1993

GAO/AIMD-96-22, Feb.  26 (74 pages). 

GAO reviewed the financial audit prepared by the Education
Department's Office of Inspector General (OIG) on the Federal Family
Education Loan Program's financial statements for fiscal years 1994
and 1993.  The OIG was unable to express an opinion on the financial
statements as a whole because student loan data on which the
Education Department had based its costs to be incurred on
outstanding guaranteed loans were unreliable.  In addition, the OIG
continued to report material weaknesses in internal controls related
to the program's liabilities for loan guarantees and related program
costs, effectively monitoring payments to guaranty agencies and
lenders, and ensuring accurate financial reporting.  Although
internal control weaknesses persisted during fiscal year 1994, the
Education Department has been trying to correct these shortcomings. 
GAO reviewed the OIG's work and concurs in its findings. 


      TESTIMONY
------------------------------------------------------- Appendix 0:6.1

Financial Audit:  Expenditures by Independent Counsels, by David L. 
Clark, Director of Audit Oversight and Liaison, before the
Subcommittee on Crime, House Committee on the Judiciary. 
GAO/T-AIMD-96-48, Feb.  29
(seven pages). 

This testimony focuses on GAO's financial audits of independent
counsel expenditures.  GAO discusses (1) independent counsels'
financial reporting and auditing requirements, (2) expenditures for
independent counsel operations for the 10-year period ended March
1995, and (3) independent counsels' compliance with financial laws
and regulations. 


   GOVERNMENT OPERATIONS
--------------------------------------------------------- Appendix 0:7


      TESTIMONY
------------------------------------------------------- Appendix 0:7.1

OMB 2000:  Changes Resulting From the Reorganization of the Office of
Management and Budget, by L.  Nye Stevens, Director of Federal
Management and Workforce Issues, before the Subcommittee on
Government Management, Information and Technology, House Committee on
Government Reform and Oversight.  GAO/T-GGD/AIMD-96-68, Feb.  7
(seven pages). 

This testimony discusses changes at the Office of Management and
Budget (OMB) resulting from a 1994 reorganization--commonly known as
OMB 2000.  The main goal of OMB 2000 was to integrate the agency's
budget analysis, management review, and policy development roles
under a new organizational structure.  In doing so, OMB sought to
improve its decisionmaking process and its oversight of executive
branch operations.  This testimony focuses on three issues:  (1)
changes in OMB's structure, responsibilities, and staffing, including
changes to the statutory offices; (2) changes in OMB's attention to
management issues in the budget process; and (3) the way OMB planned
to evaluate OMB 2000. 


   HEALTH
--------------------------------------------------------- Appendix 0:8

Health Insurance for Children:
State and Private Programs Create New Strategies to
Insure Children

GAO/HEHS-96-35, Jan.  18 (56 pages). 

In the mid-1980s, state and private groups began developing health
insurance programs to increase health care coverage for children.  By
1995, 14 states and upwards of 24 private-sector organizations
offered such programs.  The number of children enrolled in the six
programs GAO visited ranged from 5,000 to more than 10,000.  Unlike
state Medicaid programs, which operate as open-ended entitlements
funded partly by the federal government, these programs operated
within fixed and often limited budgets and were funded by various
sources, such as dedicated state taxes and private donations. 
Limited budgets forced five of the six programs to cap enrollment at
times and to place eligible children on waiting lists.  The programs
used several strategies to control costs.  Some limited the services
covered, while others resorted to patient cost-sharing through
premiums and copayments or enrolled children in managed care.  Most
of the programs operated, at least partially, through nonprofit or
private insurers, which allowed the programs to use existing provider
payment systems and physician networks and to offer near-market
reimbursement rates--features that appealed to insurers and
providers.  For patients, the programs guaranteed access to a
provider network, had simple enrollment procedures, and tried to
avoid the appearance of a welfare program.  Moreover, children in
these programs appeared to gain greater access
to health care. 

Medicare HMOs:
Rapid Enrollment Growth Concentrated in Selected States

GAO/HEHS-96-63, Jan.  18 (39 pages). 

Private-sector insurers cite extensive use of health maintenance
organizations (HMO) and other managed care approaches as a key factor
in slowing the growth of their insurance premiums.  As a result, part
of the current interest in controlling Medicare costs has centered on
ways to increase HMO use among Medicare beneficiaries.  This report
provides information on trends in the number of (1) Medicare
beneficiaries enrolling in HMOs and (2) HMOs enrolling beneficiaries. 
GAO analyzes this data for factors that might be influencing
decisions by HMOs to enroll Medicare beneficiaries and decisions by
beneficiaries to enroll in HMOs.  GAO found that about 2.8 million
Medicare beneficiaries--about seven percent of the total--were
enrolled in risk-contract HMOs as of August 1995.  This was double
the percentage enrolled in 1987.  The growth has been particularly
rapid during the past four years and has centered on certain states. 
California and Florida, for example, have more than half of all
enrollees. 

Fraud and Abuse:
Providers Target Medicare Patients in Nursing Facilities

GAO/HEHS-96-18, Jan.  24 (28 pages). 

Nursing home patients are an attractive target for fraudulent and
abusive health care providers that bill Medicare for undelivered or
unnecessary services.  A wide variety of providers, ranging from
durable medical equipment suppliers to laboratories to optometrists
and doctors, have been involved in fraudulent and abusive Medicare
billing schemes.  Several features make nursing home patients
attractive targets.  First, because a nursing facility houses many
Medicare beneficiaries under one roof, unscrupulous billers of
services can operate their schemes in volume.  Second, nursing homes
sometimes make patient records available to outsiders, contrary to
federal regulations.  Third, providers are permitted to bill Medicare
directly, without certification from the nursing home or the
attending physician that the items are necessary or have been
provided as claimed.  In addition, Medicare's automated systems do
not collect data to flag improbably high charges or levels of
services.  Finally, even when Medicare spots abusive billings and
seeks recovery of unwarranted payments, it often collects little
money from wrongdoers, which either go out of business or deplete
their resources so that they cannot repay
the funds. 

Medicare:
Millions Can Be Saved by Screening Claims for Overused Services

GAO/HEHS-96-49, Jan.  30 (30 pages). 

Medicare contractors routinely pay hundreds of millions of dollars in
Medicare claims without first determining if the services provided
are necessary.  GAO reviewed payments to doctors for six groups of
high-volume medical procedures--ranging from eye examinations to
chest x-rays--that accounted for nearly $3 billion in Medicare
payments in 1994.  GAO also surveyed 17 contractors to determine if
they had used medical necessity criteria in their claims processing
to screen for these six groups of procedures.  For each of the six
groups, more than half of the 17 contractors failed to use automated
screens to flag claims for unncessary, inappropriate, or overused
treatments.  These prepayment screens could have saved millions of
taxpayer dollars now wasted on questionable services.  Problems with
controlling payments for widely overused procedures continue because
the Health Care Financing Administration (HCFA) lacks a national
strategy to control these payments.  HCFA now relies on contractors
to focus on procedures where local use exceeds the national average. 
Although this approach helps reduce local overuse of some procedures,
it is not designed to control overuse of a procedure nationwide.  GAO
summarized this report in testimony before Congress; see: 

Medicare:  Millions Can Be Saved by Screening Claims for Overused
Services, by Sarah F.  Jaggar, Director of Health Financing and
Public Health Issues, before the Subcommittee on Human Resources and
Intergovernmental Relations, House Committee on Government Reform and
Oversight.  GAO/T-HEHS-96-86, Feb.  8 (16 pages). 

FHA Hospital Mortgage Insurance Program:
Health Care Trends and Portfolio Concentration Could Affect Program
Stability

GAO/HEHS-96-29, Feb.  27 (53 pages). 

The Federal Housing Administration's (FHA) Hospital Mortgage
Insurance Program insures loans to finance hospital renovation and
construction.  FHA mortgage insurance protects lenders against losses
they might incur if hospitals fail to make their mortgage payments. 
Although the hospital program had made a positive dollar contribution
to the General Insurance Fund as of fiscal year 1994, the
accumulation of more than $4 billion worth of insured projects and
the large loan amounts in New York threaten the program's stability. 
The continued buildup in New York may exacerbate this risk.  Further,
trends in health care and changes in state and federal health care
policies that reduce hospitals' revenues will affect hospitals
participating in the program.  Although FHA estimated its loan loss
reserve at nearly $460 million as of September 1994, this is not a
reliable measure of program losses because of methodology
limitations.  The implications of health care trends for program
hospitals were not factored into FHA's methodology for estimating
potential loan losses.  In addition, FHA's approach to determining
default and loss rate assumptions was unreliable.  FHA did not
consider the full loss exposure in estimating reserves for hospitals
that it had identified as having high default probabilities.  As a
result of these flaws, the loan loss reserve estimate could be
understated or overstated. 


      TESTIMONY
------------------------------------------------------- Appendix 0:8.1

Pharmacy Benefit Managers:  Early Results on Ventures With Drug
Manufacturers, by John C.  Hansen, Assistant Director for Health
Financing and Public Health Issues, before the California State
Senate Committee on Insurance.  GAO/T-HEHS-96-85, Feb.  7 (nine
pages). 

Recently, some of the largest drug companies have merged or formed
alliances with some of the largest pharmacy benefit managers (PBM). 
PBMs manage the prescription drug part of health insurance plans
covering millions of Americans.  These ventures gained attention not
only because of their size but because of concerns that the PBMs
would automatically give preference to their manufacturer partners'
drugs over those made by competitors.  The results of GAO's analysis
of PBM formularies--a list of preferred prescription drugs by
therapeutic class, often with cost designations--indicate that
continued oversight of mergers and alliances between pharmaceutical
manufacturers and PBMs is warranted to ensure competition in the
marketplace.  For example, the changes in Medco's formulary that
appear to favor Merck drugs do not necessarily show that Medco
automatically gave preference to Merck drugs over those of
competitors.  However, the formulary changes support the Federal
Trade Commission's decision to continue monitoring the Merck/Medco
merger and other such ventures. 

FDA Review and Approval Times, by Mary R.  Hamilton, Director of
Program Evaluation in Human Service Areas, before the Senate
Committee on Labor and Human Resources.  GAO/T-PEMD-96-6, Feb.  21
(17 pages). 

New drug applications are moving more quickly through the Food and
Drug Administration's (FDA) review and approval process, and the
amount of time to obtain an application is about the same in this
country and in the United Kingdom.  GAO found that FDA review times
for medical device applications varied widely from one year to the
next.  For all types of applications, the median review time rose
dramatically in the early 1990s and then began to decrease.  Whether
the downturn will continue will become clear as data for additional
years become available.  Some aspects of new systems introduced by
the European Union in 1995 for drug and medical device review are
quite different from FDA's approach to medical product review, and
there is great optimism within the European community about their
prospects.  It is too soon to know, however, whether the European
Union's approach will result in more-efficient reviews while
guaranteeing product safety. 

Status of Medicare's Federal Hospital Insurance Trust Fund, by Sarah
F.  Jaggar, Director of Health Financing and Public Health Issues,
before the House Committee on Ways and Means.  GAO/T-HEHS-96-94, Feb. 
29
(seven pages). 

This testimony focuses on GAO's ongoing review of the status of
Medicare's Federal Hospital Insurance (part A) Trust Fund.  GAO
discusses (1) when the administration became aware that the trust
fund had an operating deficit--that is, cash outlays exceeded cash
receipts--of $36 million for fiscal year 1995 and how the information
was disseminated and (2) what the status is of current projections
regarding the trust fund. 


   INCOME SECURITY
--------------------------------------------------------- Appendix 0:9

Social Security:
Telephone Access Enhanced at Field Offices Under
Demonstration Project

GAO/HEHS-96-70, Feb.  23 (25 pages). 

The Social Security Administration (SSA) runs a nationwide toll-free
telephone number and is testing enhanced local office telephone
service at selected offices.  Beginning in February 1995, SSA began
installing new telephone equipment, called automated attendant and
voice mail, at 30 of its 800 nationwide field offices that list their
phone numbers in local telephone directories.  The equipment was
installed in different configurations.  Telephone access--calls
reaching an SSA employee with the caller spending less than two
minutes on hold--improved 23 percent under one of the configurations
being tested by SSA.  In addition, busy signals dropped by more than
55 percent.  Staffing, however, did not increase, and many callers
reaching SSA did spend some time on hold before reaching an SSA
representative.  SSA field office staff viewed the installation of
voice mail equipment at their desks as having a very positive effect
on office efficiency and public service.  SSA has not yet completed
its two internal evaluations of the demonstration project.  GAO
concludes that the technology tested in the demonstration projects
has the potential to further SSA's public service goals.  Public
reaction and the effect on operations, however, will need to be
considered as SSA weighs the costs and the benefits of this
technology. 

PASS Program:
SSA Work Incentive for Disabled Beneficiaries Poorly Managed

GAO/HEHS-96-51, Feb.  28 (63 pages). 

The Social Security Administration (SSA) is poorly managing a small
but growing program to encourage disability beneficiaries to seek
employment.  The "plan for achieving self-support" (PASS) program,
established in 1972, is currently small--only about 10,300 persons
participated in December 1994--but the number of participants has
swelled more than fivefold during the past five years as awareness of
the program has increased, and millions more disabled beneficiaries
have become eligible to participate.  The PASS program is vulnerable
to abuse because of vague guidelines, and its impact on employment is
unknown because SSA does not collect basic data on participants and
their employment.  In addition, SSA top management has not adequately
considered the potential problems posed by professional PASS
preparers, whose fees--as much as $800--are often included as PASS
expenses.  SSA is trying to address some of these internal control
weaknesses, but it cannot guarantee today that taxpayer dollars are
being well spent. 


      TESTIMONY
------------------------------------------------------- Appendix 0:9.1

Supplemental Security Income:  Noncitizens Have Been a Major Source
of Caseload Growth, by Jane L.  Ross, Director of Income Security
Issues, before the Subcommittee on Immigration, Senate Committee on
the Judiciary.  GAO/T-HEHS-96-88, Feb.  6.  (eight pages). 

Noncitizens are among the fastest growing groups receiving benefits
from the Supplemental Security Income Program (SSI), which provides
means-tested benefits to eligible blind, elderly, or disabled
persons.  Noncitizens represent nearly one-third of aged SSI
recipients and 5.5 percent of disabled recipients.  About two-thirds
of noncitizen SSI recipients live in three states--California, New
York, and Florida.  On the whole, noncitizens are more likely to
receive SSI than citizens, but this may be true primarily for
refugees and asylum seekers.  Adult children of aged immigrants and
others who say they are willing to financially support them sometimes
do not.  Eventually, many of these aged immigrants receive SSI. 
Also, some translators help noncitizens to fraudulently obtain SSI
disability benefits. 


   INFORMATION MANAGEMENT
-------------------------------------------------------- Appendix 0:10

Weather Forecasting:
NWS Has Not Demonstrated That New Processing System Will Improve
Mission Effectiveness

GAO/AIMD-96-29, Feb.  29 (21 pages). 

This report focuses on the National Weather Service's (NWS) Advanced
Weather Interactive Processing System, which is designed to help
local weather forecasters obtain meteorological data from
state-of-the-art weather observing systems and national weather
models, analyze trends, and disseminate forecasts and warnings to the
public.  This $525 million system is to be the centerpiece of NWS'
massive $4.5 billion modernization and restructuring program.  GAO
discusses whether NWS' process for developing the system has shown
that all proposed system capabilities will contribute to promised
modernization outcomes--better forecasts, fewer weather offices, and
reduced staffing.  GAO summarized this report in testimony before
Congress; see: 

Weather Forecasting:  New Processing System Faces Uncertainties and
Risks, by Jack L.  Brock, Jr., Director of Information Resources
Management Issues, before the Subcommittee on Energy and the
Environment, House Committee on Science.  GAO/T-AIMD-96-47, Feb.  29
(six pages). 


      TESTIMONY
------------------------------------------------------ Appendix 0:10.1

Information Technology:  Best Practices Can Improve Performance and
Produce Results, by Christopher Hoenig, Director of Information
Resources Management Policies and Issues, before the Subcommittee on
Government Management, Information and Technology, House Committee on
Government Reform and Oversight.  GAO/T-AIMD-96-46, Feb.  26 (18
pages). 

This testimony discusses how best practices applied by leading
organizations can help improve information management technology in
the federal government.  GAO focuses on four key lessons learned from
its ongoing evaluation of strategic information management issues in
federal agencies.  First, better data are needed on the government's
information technology investments.  Although federal information
technology obligations now total at least $25 billion annually, what
the government is getting in return for these expenditures is
unclear.  Second, information technology is characterized by high
risk and high return.  Real opportunities exist to boost
organizational performance, but the risk of failure is ever present
and must be vigorously managed to ensure success.  Third, repeatable
success requires sound management processes that are applied with
relentless discipline.  Sustainable and effective management
practices are crucial to successful information technology projects. 
Fourth, the challenge is implementation.  Most leading organizations
have taken three to five years to fully integrate the practices into
improved management processes.  A consensus has emerged among federal
government officials on what the problems are and what can be done to
solve them.  Now agency heads must implement more-effective
information technology management processes and reinforce
accountability to produce tangible results. 


   INTERNATIONAL AFFAIRS
-------------------------------------------------------- Appendix 0:11

Mexico's Financial Crisis:
Origins, Awareness, Assistance, and Initial Efforts to Recover

GAO/GGD-96-56, Feb.  23 (167 pages). 

Mexico's devaluation of the peso in December 1994 precipitated a
crisis in Mexico's financial institutions and markets that continued
into 1995.  In response to the crisis, the United States assembled a
financial assistance package of nearly $50 billion in funds from the
United States, Canada, the International Monetary Fund (IMF), and the
Bank for International Settlements.  The multilateral assistance
package was intended to enable Mexico to avoid defaulting on its debt
obligations, and thereby overcome its short-term liquidity crisis,
and to prevent the crisis from spreading to other emerging markets. 
This report (1) examines the origins of Mexico's financial crisis;
(2) assesses the extent to which the U.S.  government and the IMF
were aware of Mexico's financial problems throughout 1994 and
provided advice to Mexico; (3) describes the U.S.  and the
international responses to the crisis, including an assessment of the
terms and the conditions of the agreements implementing the U.S. 
portion of the assistance; (4) analyzes the statutory authority for
the Secretary of the Treasury's use of the Exchange Stabilization
Fund to finance the assistance package; and (5) examines the initial
efforts of Mexico to recover from the crisis, including Mexico's
access to international
capital markets. 

United Nations:
U.S.  Participation in the Fourth World Conference on Women

GAO/NSIAD-96-79BR, Feb.  15 (65 pages). 

This briefing report focuses on the Fourth World Conference on Women,
sponsored by the United Nations (UN).  GAO discusses (1) the cost of
U.S.  participation in the conference and the parallel, independently
convened nongovernmental organizations' forum, (2) the UN process for
accrediting nongovernmental organizations, and (2) the handling of
conference travel visas by the Chinese.  A summary of GAO's
discussions with 28 U.S.  nongovernmental organizations about their
views on the accreditation process, the adequacy of accommodations,
and physical access to conference and forum facilities is included. 

Cambodia:
Limited Progress on Free Elections, Human Rights, and
Mine Clearing

GAO/NSIAD-96-15BR, Feb.  29 (44 pages). 

The signing of the Paris Peace Accords in 1991 ended years of
devastating civil war and started Cambodia on the road to building a
democratic civil society.  The United Nations Transitional Authority
in Cambodia, established to carry out the accords, supervised the
withdrawal of Vietnamese forces from Cambodia, repatriated more than
360,000 refugees, improved human rights conditions, and conducted
free and fair national elections in 1993.  The Authority concluded
its mission in late 1993 with the formation of a duly elected
government in Cambodia.  This briefing report provides information on
Cambodia's progress since 1993.  GAO discusses (1) Cambodia's
prospects for holding free and fair national elections by 1998; (2)
its progress in meeting international human and political rights
standards; and (3) its progress in clearing millions of land mines
left over from decades of war. 

Promoting Democracy:
Progress Reported on U.S.  Democratic Development Assistance
to Russia

GAO/NSIAD-96-40, Feb.  29 (83 pages). 

U.S.-funded democracy projects have demonstrated support for, and
contributed to, Russia's democracy movement.  Those assisted include
prodemocracy political activities and political parties, proreform
trade unions, court systems, legal academies, government officials,
and the media.  The democracy projects that GAO reviewed, however,
had mixed results in meeting their stated objectives.  Russian
reformers and others generally viewed U.S.  democracy assistance as
valuable, but in only three of the six areas GAO reviewed had
projects contributed significantly to political, legal, or social
changes.  Media projects generally succeeded in increasing the
quality and the self-sufficiency of nongovernment media
organizations, but the weak economy continues to threaten the
sustainability of an independent press.  U.S.  efforts to develop a
democratic trade union movement and improve Russia's electoral system
also contributed to systemic changes, although more needs to be done. 
Projects relating to political party development, rule of law, and
civil-military relations had limited impact.  Russian economic and
political conditions were the most important factors determining
project impact.  Implementation problems accounted for the limited
results derived from the rule-of-law project. 


   JUSTICE AND LAW ENFORCEMENT
-------------------------------------------------------- Appendix 0:12

Counterfeit U.S.  Currency Abroad:
Issues and U.S.  Deterrence Efforts

GAO/GGD-96-11, Feb.  26 (74 pages). 

U.S.  currency, reportedly the most widely held in the world, is
susceptible to counterfeiting.  The Federal Reserve estimates that of
the $380 billion of U.S.  currency in circulation, more than 60
percent may be held outside the United States.  The widespread use of
U.S.  currency abroad, together with the outdated security features
of the currency, make it particularly vulnerable to international
counterfeiters.  Widespread counterfeiting of U.S.  currency could
undermine confidence in the dollar and, if done on a large enough
scale, could harm the U.S.  economy.  This report discusses (1) the
nature of counterfeiting of U.S.  currency abroad, (2) the extent of
that counterfeiting and of concerns about this issue, and (3) the
status of U.S.  efforts to deter such counterfeiting.  GAO summarized
this report in testimony before Congress; see: 

Counterfeit U.S.  Currency Abroad:  Observations on Counterfeiting
and U.S.  Deterrence Efforts, by JayEtta Z.  Hecker, Associate
Director for International Relations and Trade Issues, before the
Subcommittee on General Oversight and Investigations, House Committee
on Banking and Financial Services.  GAO/T-GGD-96-82, Feb.  27 (21
pages). 

Money Laundering:
Rapid Growth of Casinos Makes Them Vulnerable

GAO/GGD-96-28, Jan.  4 (51 pages). 

The volume of cash wagered in a growing number of casinos around the
country, coupled with uneven enforcement of currency-transaction-
reporting requirements for casinos, makes these businesses vulnerable
to persons attempting to launder profits from illegal activities. 
This report discusses (1) the extent of legalized gambling in the
United States, especially that taking place in casinos; (2) the
currency-transaction-reporting requirements for casinos; (3) whether
the same reporting requirements apply to tribal casinos; and (4) the
level of enforcement efforts to ensure that casinos comply with
currency-transaction-reporting requirements.  This report also
provides information on new legislation and recent changes to
existing federal regulations that will affect currency transaction
reporting for casinos. 

Federal Fugitives:
More Timely Entry on National Wanted Person File Is Needed

GAO/GGD-96-64, Feb.  26 (27 pages). 

As a result of earlier work on interagency coordination in
apprehending federal fugitives, GAO noted that many entries in the
FBI's National Crime Information Center's (NCIC) wanted person file
had been made long after arrest warrants had been issued.  This was
contrary to the policies of the agencies that had made the entries
and the widespread view that the timely use of the file aids in the
apprehension of fugitives and reduces the risk to law enforcement
personnel and the public.  GAO did a follow-up review of the entries
made in the wanted person file and found that the FBI; the United
States Marshals Service; the Bureau of Alcohol, Tobacco, and Firearms
(ATF); and the Customs Service had entered many fugitives in the file
long after their arrests had been authorized.  In response to GAO's
finding, the FBI, ATF, and the Customs Service did their own reviews
and discovered similar entry time problems.  GAO concludes that NCIC
and its participating agencies need clear, written policies that call
for and define "immediate entry" and set forth any exceptions. 
Moreover, agencies should periodically monitor entry times and
reasons for delays and communicate problems and suggest actions to
their field offices.  Although GAO did not review entry times for all
law enforcement agencies in the Justice and Treasury Departments, GAO
believes that the same reasons for timely entry generally would apply
to these agencies. 


      TESTIMONY
------------------------------------------------------ Appendix 0:12.1

Money Laundering:  U.S.  Efforts to Combat Money Laundering Overseas,
by JayEtta Z.  Hecker, Associate Director for International Relations
and Trade Issues, before the House Committee on Banking and Financial
Services.  GAO/T-GGD-96-84, Feb.  28 (13 pages). 

Money laundering is a global problem requiring collective
international efforts to combat it.  This testimony describes U.S. 
efforts to deter this activity, including (1) regulation by the
United States and seven European nations of financial institutions
regarding money laundering; (2) U.S.  bank regulators' oversight of
money-laundering controls at overseas branches of U.S.  banks; (3)
U.S.  law enforcement agencies' efforts to coordinate their overseas
anti-money-laundering activities with those of host countries' law
enforcement agencies; and (4) U.S.  participation in international
anti-money-laundering arrangements. 


   NATIONAL DEFENSE
-------------------------------------------------------- Appendix 0:13

Military Aircraft Safety:
Significant Improvements Since 1975

GAO/NSIAD-96-69BR, Feb.  1 (28 pages). 

Despite a series of recent crashes, the safety record of military
aircraft has improved significantly during the past 20 years. 
Accidents dropped from 309 in 1975 to 76 last year, while fatalities
declined from 285 to 85 during the same period.  Human error was
reported as a contributing factor in 73 percent of these flight
mishaps.  This report discusses (1) historical trends in aircraft
accidents involving deaths or extensive aircraft damage, (2)
investigations performed to determine the causes, and (3) examples of
actions taken to reduce the number of aviation accidents. 

DOD Procurement:
Use and Administration of DOD's Voluntary Disclosure Program

GAO/NSIAD-96-21, Feb.  6 (31 pages). 

Forty-eight of the top 100 military contractors have disclosed
procurement fraud as part of a Defense Department (DOD) program
encouraging voluntary reporting of such incidents.  But the total
number of disclosures has been small and the dollar amounts recovered
have been modest--less than $100,000 in 63 percent of the cases. 
Moreover, under DOD's Voluntary Disclosure Program, cases took an
average of 2.8 years to close, with about 25 percent taking more than
four years.  Less-than-full cooperation from contractors and low
priority given by DOD and other investigative agencies to managing
cases expeditiously may be problems in some cases. 

Reserve Officers' Training Corps:
Questions Related to Organizational Restructuring

GAO/NSIAD-96-56, Feb.  6 (eight pages). 

Because of questions about readiness, housing, and costs, the Army
has not approved the proposal to close the Reserve Officers' Training
Corps (ROTC) regional headquarters at Fort Knox, Kentucky.  As a
result, the regional headquarters at Fort Knox remains open and the
summer camp run at Fort Knox is expected to remain in place through
fiscal year 1996 and possibly 1997.  Still unresolved are questions
about the (1) impact of the ROTC program on training and readiness of
combat units stationed at some bases that house and support ROTC
summer camp programs; (2) adequacy and condition of housing at bases
being considered for consolidation of the ROTC program, on both a
short- and long-term basis; and (3) costs to address the housing
program. 

Marine Corps:
Improving Amphibious Capability Would Require Larger Share of Budget
Than Previously Provided

GAO/NSIAD-96-47, Feb.  13 (53 pages). 

The Navy and the Marine Corps estimate that it will cost about $58
billion during the next 25 years to modernize the amphibious force,
which suffers from reduced vehicle lift capability and other
operational limitations.  This could be a major challenge for the
Navy, which risks a $16-billion gap between its projected
shipbuilding budget and the cost estimate to build all ships planned
between 2002 and 2005.  The Navy and the Marine Corps plan to spend a
much larger share of their procurement funds to buy upgraded
equipment for amphibious operations than has been the case for most
of the past 40 years.  The Navy and the Marine Corps will need to
earmark beyond 2001 a large share of available procurement dollars
for amphibious equipment to avoid delays in the modernization effort. 
Amphibious programs are competing with other major weapons programs,
such as the DDG-51 destroyer, the Army's Apache helicopter, and the
Air Force's F-22 fighter aircraft. 

Military Personnel Reassignments:
Services Are Exploring Opportunities to Reduce Relocation Costs

GAO/NSIAD-96-84, Feb.  16 (24 pages). 

In fiscal year 1995, the military spent nearly $3 billion to move
850,000 service members and their families.  GAO has found that few
opportunities exist to reduce the costs of permanent
change-of-station moves.  Overseas commitments and other laws also
require the military to move many service members each year.  Despite
these constraints, the military is trying to cut annual costs by
reducing the number of permanent change-of-station moves.  To further
reduce costs, the services are encouraging consecutive assignments in
some geographic areas and increasing tour lengths where possible. 
Finally, the Defense Department can further decrease its overseas
military requirements by hiring overseas contractors.  The number of
relocations, but not their costs, decreased in proportion to the
defense downsizing from fiscal year 1987 through fiscal year 1995. 
The main reasons that permanent change-of-station moves did not
decrease were inflation, changes in some entitlements, and an
increase in the number of service members with dependents.  According
to military officials, the frequency of permanent change-of-station
moves is only a minor contributor to readiness problems in military
units.  Other factors, especially the increase in deployments for
operations other than war, have a greater impact on readiness. 

Defense Industrial Security:
Weaknesses in U.S.  Security Arrangements With Foreign-Owned Defense
Contractors

GAO/NSIAD-96-64, Feb.  20 (72 pages). 

This unclassified version of a 1995 GAO report discusses security
arrangements--known as voting trusts, proxy arrangements, and special
security agreements--used to protect sensitive information when
foreign-owned defense contractors work on classified Defense
Department projects.  GAO concludes that the Pentagon needs to
strengthen controls to prevent the export of military secrets when
foreign-owned defense contractors work on such highly sensitive
weapons programs as the B-2 bomber and the F-22 fighter.  Agreements
at most of the 14 companies GAO reviewed permitted some risk of
foreign control, influence, and unauthorized access to classified
data and technology. 

Best Management Practices:
Reengineering the Air Force's Logistics System Can Yield Substantial
Savings

GAO/NSIAD-96-5, Feb.  21 (64 pages). 

Redesign of the Air Force's $33 billion reparable parts inventory
could benefit from adopting leading-edge practices used by the
commercial airline industry to reduce costs and improve services. 
However, success hinges on the Air Force's ability to overcome major
barriers, such as organizational resistance to change and poor
inventory data.  Some commercial manufacturers are providing aircraft
parts to their customers on a just-in-time basis, and suppliers are
assuming inventory management responsibilities for airlines and
manufacturers.  One airline has reengineered its entire logistics
system in an integrated fashion by examining all aspects of its
logistics operations to pinpoint and remove inefficient processes and
functions.  The Air Force is beginning to test private-sector
management practices, such as removing unnecessary inventory layers,
repairing parts as they break, and rapidly transporting parts between
the end user and the repair facility.  GAO also recommends
establishing a top-level Defense Department position to champion
change, using third-party logistics services more often, building
closer partnerships with suppliers, encouraging suppliers to use
local distribution centers, centralizing repair functions, and
modifying repair facilities to accommodate these new practices. 

Defense Transportation:
Streamlining of the U.S.  Transportation Command Is Needed

GAO/NSIAD-96-60, Feb.  22 (57 pages). 

The military often pays as much as three times as much as commercial
carriers would charge to ship cargo because of a fragmented and
inefficient organizational structure and outdated management
practices at the U.S.  Transportation Command.  This situation has
led to confusing billing practices and expensive staff overhead.  For
example, a military customer might pay the U.S.  Transportation
Command $3,800 to ship a load of cargo from California to Korea,
while a commercial carrier would have charged only $1,250 for the
shipment.  Much of today's military cargo moves intermodally, by air,
land, and sea transport.  Under the U.S.  Transportation Command's
unwieldy organizational structure, customers receive bills from each
command for each mode of transportation, rather than a single bill
covering the entire shipment.  In addition to confusing customers,
separate billing systems increase personnel and costs.  Salaries and
wages alone for the command in fiscal year 1994 topped $1 billion. 

Embedded Computers:
B-1B Computers Must Be Upgraded to Support
Conventional Requirements

GAO/AIMD-96-28, Feb.  27 (seven pages). 

The Air Force plans to upgrade the computer and software systems
aboard the B-1B bomber, which the Pentagon envisions as the
"backbone" of its new bomber fleet.  The goal is to transform the
B-1B from a nuclear weapons carrier to a conventional weapons
carrier.  The 1970s vintage computer systems found on the B-1B are
operating at near capacity and, without upgrades, cannot support
additional weapons and capabilities, such as cluster bombs, a global
positioning system for better navigation and guidance, and
more-accurate and higher-range weapons.  This report discusses recent
decisions by the Air Force to upgrade the B-1B's embedded computer
systems, particularly in view of concerns GAO raised about the simple
memory upgrade. 

Navy Aviation:
AV-8B Harrier Remanufacture Strategy Is Not the Most Cost-Effective
Option

GAO/NSIAD-96-49, Feb.  27 (15 pages). 

The Navy could save millions per aircraft by buying new AV-8B Harrier
fighters equipped with night attack and radar capabilities instead of
disassembling and retrofitting older Harriers with the desired
technology.  The Navy estimates that each remanufactured AV-8B
aircraft could cost as much as $29.5 million.  Such aircraft are made
up largely of used and refurbished components.  GAO calculates that
the Marines can buy new radar model AV-8Bs for about $23.6 million
per aircraft.  Because the program is conducted under an annual
contract, the Navy can change its procurement strategy and begin
immediate negotiations to buy new radar models rather than continuing
to rebuild the aircraft.  The first aircraft rebuilt at the Naval
Aviation Depot in Cherry Point, North Carolina, took almost twice as
long to disassemble as planned.  Delays have also arisen from the
inability of McDonnell Douglas and depot vendors to provide
components promptly.  In addition, the radars to be used in the
Harriers are not going to be available as originally planned. 


   NATURAL RESOURCES
-------------------------------------------------------- Appendix 0:14


      TESTIMONY
------------------------------------------------------ Appendix 0:14.1

Federal Lands:  Information on Land Owned and Acquired, by Barry T. 
Hill, Associate Director for Energy, Resources, and Science Issues,
before the Subcommittee on Oversight and Investigations, Senate
Committee on Energy and Natural Resources.  GAO/T-RCED-96-73, Feb.  6
(nine pages). 

The U.S.  Forest Service, the Bureau of Land Management, the National
Park Service, and the U.S.  Fish and Wildlife Service manage about 95
percent of all federal lands.  This testimony discusses changes
during the past 30 years in the amount of acreage managed by these
four agencies.  In addition, GAO provides preliminary information on
the number of acres acquired by these agencies from nonfederal
parties during the past 30 years and the means, such as purchase and
exchange, by which these acres were acquired. 


   SCIENCE, SPACE, AND TECHNOLOGY
-------------------------------------------------------- Appendix 0:15

Measuring Performance:
The Advanced Technology Program and Private-Sector Funding

GAO/RCED-96-47, Jan.  11 (44 pages). 

The Advanced Technology Program, which is run by the National
Institute of Standards and Technology, seeks to provide support on a
cost-sharing basis for industrial research and development
projects--projects that have a significant potential for stimulating
economic growth and improving the competitiveness of U.S.  industry. 
Federal funding for the program has soared, from $68 million in
fiscal year 1993 to $341 million in fiscal year 1995.  Recent budget
proposals, however, have sought to eliminate funding for the program
in fiscal year 1996.  GAO's survey of program applicants found that
the program funds both projects that would have been funded in its
absence and projects that would not have been funded.  In addition,
the program achieves other goals, such as aiding the formation of
joint ventures and helping companies achieve research milestones
faster.  These results should be considered together when assessing
the
program's impact. 


   TAX POLICY AND ADMINISTRATION
-------------------------------------------------------- Appendix 0:16

Tax Administration:
Diesel Fuel Excise Tax Change

GAO/GGD-96-53, Jan.  16 (19 pages). 

The new diesel fuel excise tax appears to be having the desired
effect.  Preliminary data from the Internal Revenue Service (IRS)
show that diesel excise tax collections rose about $1.2 billion, or
22.5 percent, in 1994 as compared with figures for 1993.  This
increase does not include additional revenues due to the Omnibus
Reconciliation Act of 1993 increase of 4.3 cents per gallon in the
tax rate.  After adjusting for increased refund and credit amounts,
and for a portion of the increase that may be due to economic growth,
the Treasury Department estimates that increased compliance alone led
to an increase of up to $700 million.  IRS has responded to concerns
that stakeholders raised about the dyeing requirements.  Although the
new diesel taxation approach appears to be raising significant
additional revenue, those who wish to defraud the system continue to
have significant incentives to do so.  IRS has detected several scams
involving refunds of gasoline or diesel fuel excise taxes.  IRS does
not know how extensive this fraud may be.  Evasion problems may
persist because the incentives to evade are so great. 


   TRANSPORTATION
-------------------------------------------------------- Appendix 0:17

Commercial Trucking:
Safety and Infrastructure Issues Under the North American Free Trade
Agreement

GAO/RCED-96-61, Feb.  29 (52 pages). 

According to the North American Free Trade Agreement (NAFTA), the
U.S.-Mexican border was to be opened in December 1995 for increased
commercial truck traffic within the border states in each country--
four in the United States (Arizona, California, New Mexico, and
Texas).  Before then, the 11,000 trucks crossing daily from Mexico
into the United States were limited to commercial zones along the
border.  GAO found that Mexico and the United States had made
progress in developing compatible trucking regulations. 
Compatibility is essential because existing differences in the two
nations' trucking regulations, operating practices, and enforcement
efforts could affect highway safety and harm the infrastructure. 
Compatibility in some trucking regulations, such as those on vehicle
size and weight, may never be reached; therefore, the host country's
regulations must be complied with, and enforcement is the key for
ensuring compliance.  The four U.S.  border states' readiness for
enforcement varies widely.  Texas faces the greatest enforcement
burden but has relatively limited resources-- enforcement personnel
and facilities--to cope with increasing truck traffic from Mexico. 
In addition to the northbound traffic entering the four U.S.  border
states, southbound and east-west traffic will add to their
enforcement burden. 

Denver Airport:
Operating Results and Financial Risks

GAO/AIMD-96-27, Feb.  9 (21 pages). 

After reviewing available financial data and analyzing the risks
associated with the financial condition of the new Denver
International Airport, GAO has found no evidence that the airport
will be unable to meet its financial obligations, including payments
to bondholders.  This report (1) analyzes the limited data available
on actual results after the airport opened for operations in February
1995 and (2) identifies risks that could affect the airport's future
financial condition.  GAO also reviews estimated cash flow and the
airport's cash reserves. 


      TESTIMONY
------------------------------------------------------ Appendix 0:17.1

Airport Privatization:  Issues Related to the Sale or Lease of U.S. 
Commercial Airports, by Gerald L.  Dillingham, Associate Director for
Transportation Issues, before the Subcommittee on Aviation, House
Committee on Transportation and Infrastructure.  GAO/T-RCED-96-82,
Feb.  29 (17 pages). 

Congress and the aviation industry have expressed much interest in
airport privatization.  Altering the current ownership and operation
of commercial airports could affect the nation's aviation system
considerably.  Airports are major employers in many communities and
directly affect millions of airline passengers every day.  This
testimony discusses (1) the current extent of private sector
participation at commercial airports in the United States and abroad;
(2) the incentives and the impediments to more-extensive forms of
privatization, such as selling an airport outright; and (3) the
implications arising from more-extensive privatization for major
stakeholders, such as passengers, airlines, and government. 


   VETERANS AFFAIRS
-------------------------------------------------------- Appendix 0:18

Veterans' Preference:
Data on Employment of Veterans

GAO/GGD-96-13, Feb.  1 (18 pages). 

Veterans were an increasing share of the new hires made by the Office
of Personnel Management (OPM) in recent years.  In fiscal year 1994,
for example, more than 18 percent of OPM's new hires had veterans'
preference, up from 6.6 percent in fiscal year 1990.  Increasing
numbers of veterans were also hired governmentwide.  Among all
agencies, the percentage of new hires with veterans' preference rose
from 12 percent in fiscal year 1990 to 14.8 percent in fiscal year
1994.  OPM policies encourage the employment and the career
enhancement of veterans.  OPM guidance explains how veterans may be
hired and outlines the responsibilities of OPM's veterans program
coordinator.  Prior GAO work found that veterans' preference
procedures were being properly applied in virtually all the hiring
GAO examined.  GAO believes that the current legal framework to
protect veterans' rights was not weakened by the Civil Service Reform
Act.  Prior GAO work at three Defense Department installations found
that women and minorities had been disproportionately affected during
a reduction-in-force, in part because they were ranked lower than
white males in one of three retention factors, including veterans'
preference. 

Veterans' Health Care:
Facilities' Resource Allocations Could Be More Equitable

GAO/HEHS-96-48, Feb.  7 (72 pages). 

The Department of Veterans Affairs (VA) confronts the challenge of
equitably allocating more than $16 billion in health care
appropriations across a nationwide network of hospitals, clinics, and
nursing homes.  The challenge is made greater by the changing
demographics of veterans.  Although nationally the veteran population
is declining, some veterans have relocated from the Northeast and the
Midwest to southern and southwestern states in the past decade,
offsetting veteran deaths in these states.  VA has tried for years to
implement an equitable resource allocation method--one that would
link resources to facility workloads and foster efficiency.  The need
for such a system has become more urgent in recent years because of
the demographic shift in veterans and the dramatic changes in health
care resulting from increasingly limited resources.  The resource
allocation system can help VA achieve this goal by forecasting
workload changes and providing comparative data on facilities' costs. 
Nonetheless, VA has not taken steps to overcome several barriers that
can prevent it from acting on the data the system produces.  If the
system is to live up to its potential, several changes must be made,
including linking resource allocation to VA's strategic plan,
conducting a formal review and evaluation of facility cost
variations, evaluating the basis for not allocating funds through
resource planning and management, and using resource planning and
management to overcome differences in veterans' access
to care. 

VA Health Care:
Exploring Options to Improve Veterans' Access to VA Facilities

GAO/HEHS-96-52, Feb.  6 (32 pages). 

Since its creation in 1930, the Department of Veterans Affairs' (VA)
health care system has become one of the nation's largest networks of
direct delivery health care providers, with 173 hospitals and 376
outpatient clinics nationwide.  But because public and private health
insurance programs have also grown, most veterans now have
alternatives to VA health care.  Many veterans indicate that they use
private providers because they live too far from VA hospitals or
outpatient clinics.  VA has recently encouraged its facilities to
improve veterans' access to VA health care.  This report discusses
(1) characteristics of recent users of VA medical facilities; (2) the
geographic accessibility of VA and private medical facilities that
provide standard benefits; and (3) options that VA facilities might
want to consider to improve the accessibility of VA health care, such
as locating new medical facilities closer to where veterans live and
contracting with private providers. 


   SPECIAL PUBLICATIONS
-------------------------------------------------------- Appendix 0:19

GAO Reports:
Health, Education, Employment, Social Security, Welfare, and Veterans
Issues

GAO/HEHS-96-89W, Feb.  1996 (45 pages). 

This booklet lists GAO documents on government programs related to
health, education, employment, social security, welfare, and veterans
issues, which are run primarily by the Departments of Health and
Human Services, Labor, Education, and Veterans Affairs.  One section
identifies reports and testimony issued during the past month and
summarizes key products.  Another section lists all documents
published during the past year, organized chronologically by subject. 
Order forms are included. 

*** End of document. ***