Reports and Testimony: December 1996 (Other Written Prod., 12/01/96,
GAO/OPA-97-3).

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

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

 REPORTNUM:  OPA-97-3
     TITLE:  Reports and Testimony: December 1996
      DATE:  12/01/96
   SUBJECT:  Federal debt
             Airline industry
             Community health services
             Financial management
             Environmental monitoring
             Income maintenance programs
             International relations
             Defense operations
             Tax administration
IDENTIFIER:  Bibliographies
             Medicaid Program
             Medicare Program
             
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REPORTS AND TESTIMONY:  DECEMBER
1996

GAO/OPA-97-3


Highlights

The Federal Debt and Fiscal Trends

In a special publication, GAO addresses frequently asked questions
about trends in the growth of the federal debt, the federal deficit,
and the payment of interest to service the debt.  Meanwhile, a
separate GAO staff study analyzes fiscal trends for the 25 years
ending in 1995 using historical tables and other information.  Page
2. 

Airline Ticket Tax

A 10-percent tax on airline tickets now provides most of the funding
for the Federal Aviation Administration, but the tax may not fairly
allocate costs among all users of the air traffic system.  User fees
might better allocate costs if they properly account for the wide
range of costs incurred by FAA in managing the airport and airway
system.  Page 15. 

Rural Health Clinics

Funds for rural health clinics established to provide health services
to Medicare and Medicaid beneficiaries in sparsely populated areas
are increasingly being spent on well-staffed, financially sound
clinics in suburban locales where extensive medical facilities are
already available.  Page 7. 

GAO/OPA-97-3



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

  CPA - x
  DOD - x
  DOE - x
  EPA - x
  FAA - x
  FYDP - x
  IRS - x
  SSA - x
  USAID - x
  USDA - x
  VA - x
ERRATUM

The summary of GAO's report on private health insurance
(GAO/HEHS-97-8) found on page seven of the November "Monthly List"
contains an error.  The number of Americans purchasing private health
insurance for themselves and their families in 1994 was reported as
10.5 billion.  The correct number is 10.5 million. 


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


   BUDGET AND SPENDING
--------------------------------------------------------- Appendix 0:1

Federal Fiscal Trends:
Fiscal Years 1971-1995

GAO/AIMD-97-3, Nov.  1996 (56 pages). 

In recent years, GAO has examined various cross-cutting patterns in
the federal government's budget structures, processes, and reporting
mechanisms.  This staff study focuses on the fiscal components of the
budget--the trends in revenues and outlays as well as the underlying
factors contributing to these trends.  This staff study is primarily
derived from data published by the Office of Management and Budget as
part of the President's fiscal year 1997 budget submission.  Trend
data are presented in graphs accompanied by brief descriptions.  The
data are presented (1) in constant dollars, using 1995 as the base
year; (2) as a percent of gross domestic product; and (3) as a share
of totals.  Analyses of the data cover fiscal years 1971 through
1995. 

Federal Debt:
Answers to Frequently Asked Questions

GAO/AIMD-97-12, Nov.  27 (46 pages). 

Articles, reports, and books on the federal debt and its effects tend
to be complex and technical.  As a result, the public frequently
misunderstands these issues.  For example, people often forget that
even if Congress and the President agree to balance the annual budget
within the next several years, the federal debt will continue to grow
until balance is actually achieved.  Although declining deficits and,
ultimately, balanced budgets could reduce the debt as a share of the
economy, the debt will not decline unless there is a budget surplus. 
This document responds to frequently asked questions about the
federal debt, deficits, and interest rates.  GAO organizes these
questions into three sections:  (1) trends in the federal debt,
deficits, and interest; (2) sales and ownership of federal debt; and
(3) effects of the federal debt.  For readers who are interested in
more detailed information on these topics, GAO includes a short
bibliography. 


   ENERGY
--------------------------------------------------------- Appendix 0:2

Department of Energy:
Opportunity to Improve Management of Major System Acquisitions

GAO/RCED-97-17, Nov.  26 (68 pages). 

From 1980 through 1996, the Department of Energy (DOE) conducted 80
projects that it designated as major system acquisitions.  DOE has
completed 15 of these projects--most of them behind schedule and over
budget.  Three of the completed projects have yet to be used for
their intended purpose.  Thirty-one other projects were terminated
before completion, after expenditures of more than $10 billion.  The
remaining 34 projects are ongoing.  Cost overruns and "schedule
slippages" continue to plague many of these ongoing projects.  GAO
believes that four key factors underlie these problems:  unclear or
changing missions, incremental funding of projects, a flawed system
of incentives for both DOE employees and contractors, and too few DOE
staff with the appropriate skills to oversee contractors' operations. 
In recent years, DOE has undertaken several initiatives that are
helping to improve the agency's overall management.  Although not all
of these efforts may improve the management of DOE's major system
acquisitions, GAO believes that their implementation offers an
excellent opportunity for DOE to address the
key factors. 

Energy Security:
Evaluating U.S.  Vulnerability to Oil Supply Disruptions and Options
for Mitigating Their Effects

GAO/RCED-97-6, Dec.  12 (120 pages). 

Since the early 1970s, the world oil market has experienced three
major supply disruptions that harmed the U.S.  economy.  All three
originated in the Persian Gulf.  Concerned that growing dependence on
low-priced imported oil, especially that from the Persian Gulf,
increases the economy's vulnerability to oil supply disruptions and
price shocks, the Clinton administration has adopted policies
designed to reduce that vulnerability and its associated economic
costs.  This report assesses (1) the economic benefits of importing
oil compared with the potential economic costs of vulnerability to
oil shocks, (2) the extent to which the U.S.  economy's vulnerability
to oil shocks will likely change over time given the programs and
policies contained in the administration's National Energy Policy
Plan and other relevant factors, and (3) options for reducing the
economy's vulnerability to oil shocks.  GAO's analysis of the
day-to-day economic benefits of U.S.  reliance on low-priced imported
oil shows that those benefits exceed the economic costs of occasional
oil supply disruptions.  Moreover, to the extent that imports might
replace higher-cost domestic oil, the benefits of such imports would
decline, but the cost of oil shocks would remain largely unchanged. 


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

Superfund:
Status of Selected Federal Natural Resource Damage Settlements

GAO/RCED-97-10, Nov.  20 (35 pages). 

Under federal law, parties responsible for the release of hazardous
substances are liable for damages to natural resources caused by the
release.  GAO reported in April 1996 on settlements for the five
largest federal natural resource damage cases.  (See GAO/RCED-96-71.)
This follow-up report finds that settlements have been reached at an
additional 62 sites as of July 1996, resulting in $33.8 million in
awards to federal trustees.  About 80 percent of the funds awarded
had been collected.  Of the collected funds, about 19 percent had
been allocated for performing damage assessments, planning, or
restoration.  One site had been restored, and seven were in various
stages of restoration.  The trustees' use of the remaining 81 percent
of the collected money was awaiting the completion of restoration
plans or other activities, such as cleanups or settlements with other
responsible parties at the same site. 


   FINANCIAL INSTITUTIONS
--------------------------------------------------------- Appendix 0:4

Bank Regulatory Structure:
Japan

GAO/GGD-97-5, Dec.  27 (61 pages). 

Proposals by various parties to consolidate U.S.  bank regulatory
agencies have raised questions about how other countries structure
and carry out their bank oversight responsibilities and central bank
activities.  This report, part of a series on such activities in
foreign countries, provides information on bank oversight in Japan. 
GAO describes how (1) Japanese bank regulation and supervision is
organized; (2) Japan's banking oversight structure works,
particularly with respect to licensing, regulating, and supervising
banks; (3) Japanese banks are monitored by their supervisors; and (4)
participants handle other financial
system responsibilities. 


   GOVERNMENT OPERATIONS
--------------------------------------------------------- Appendix 0:5

Federal Grants:
Design Improvements Could Help Federal Resources Go Further

GAO/AIMD-97-7, Dec.  18 (88 pages). 

Grants-in-aid are payments from the federal government to state and
local governments to help them finance various activities, such as
public assistance, highway construction, and education.  In addition,
lesser-known grant programs help to finance public libraries, efforts
to restore sport fish, programs to promote boating safety, and other
activities.  In fiscal year 1995, the federal government earmarked
$225 billion for more than 600 grant programs--about 15 percent of
all federal spending.  This report focuses on the extent to which the
grant system meets two goals frequently cited by public finance
experts:  (1) encouraging the states to use federal dollars to
supplement rather than replace their own spending on nationally
important activities and (2) targeting grant funding to states with
relatively greater programmatic needs and fewer fiscal resources. 

District of Columbia:
Status of the New Convention Center Project

GAO/AIMD-97-17, Dec.  20 (10 pages). 

Since GAO's last report on the new convention center in the District
of Columbia, the Washington Convention Center Authority has revised
its estimates for the predevelopment and construction costs.  These
estimates now total about $480 million, or $81 million less than the
$561 million that GAO last reported.  (See GAO/AIMD-96-44R, Feb. 
1996.) In addition, the authority has established a contingency
amount of about $70 million, which, if needed, would raise the
estimated cost of the project to $550 million--or only slightly less
than the earlier estimate.  However, the plans for the new convention
center are still in their early stages, and the cost estimates are
therefore preliminary.  As of November 1996, the District had
transferred $64.3 million to the Authority, which earned
approximately $1.7 million in interest on this amount.  The Authority
used $14 million of this $66 million to fund operating expenses of
the existing convention center, fund expenses relating to the
predevelopment costs of the new convention center, and repay amounts
borrowed from the District's Rainy Day Fund.  The Authority is
authorized to use revenue bonds backed by dedicated taxes to finance
the predevelopment costs of the new convention center, or it may use
those existing revenues to pay the predevelopment costs as they are
incurred. 

District of Columbia:
Status of the Sports Arena

GAO/AIMD-97-19, Dec.  31 (14 pages). 

As of October 1996, the estimated predevelopment costs for most cost
categories of the sports arena in the District of Columbia had
somewhat changed, but the overall estimated predevelopment costs had
increased by a net amount of $617,000, or about one percent, since
GAO's last report.  (See GAO/AIMD-96-43R, Feb.  1996.) The District
had $66.6 million available to fund the project's predevelopment
activities and establish a debt service reserve for the arena
project.  On the basis of estimates as of October 1996, GAO concludes
that the District has enough money to pay the predevelopment costs. 
The bond trustee has made the 1996 debt service payment of nearly $6
million on arena bonds, and the District's projections of arena tax
revenues of $9 million annually seem sufficient to redeem the bonds
by 2002 as scheduled.  Predevelopment activities for the arena are
nearing completion.  All land has been acquired; however, the final
cost of the parcel of land acquired through condemnation proceedings
will be determined by the outcome of legal proceedings.  The
buildings formerly on the site have been demolished, District
employees have been relocated, and construction of the Metrorail
connection is about 25 percent complete.  The arena's construction
began in February 1996 and the facility should open in late 1997. 

Courthouse Construction:
Improved 5-Year Plan Could Promote More Informed Decisionmaking

GAO/GGD-97-27, Dec.  31 (36 pages). 

The General Services Administration, together with the federal
judiciary, has embarked on a $10 billion courthouse construction
initiative to address the urgent housing needs of the federal
judiciary, which include more space and greater security.  One of the
major criticisms of this initiative has been the lack of a long-term
strategic plan that identifies and prioritizes the judiciary's most
urgently needed courthouse construction projects, helps Congress
compare the merits of project proposals and priorities, and provides
a rationale for allocating resources to the most urgently needed
projects.  In March 1996, the judiciary issued a courthouse
construction plan that identifies the projects it proposes be funded
through fiscal year 2001.  This report assesses whether the 5-year
plan (1) reflects the judiciary's most urgent courthouse construction
needs and (2) provides the information needed by decisionmakers on
the relative merit of the projects. 


   HEALTH
--------------------------------------------------------- Appendix 0:6

Rural Health Clinics:
Rising Program Expenditures Not Focused on Improving Care in Isolated
Areas

GAO/HEHS-97-24, Nov.  22 (35 pages). 

Contrary to its original purpose, the rural health clinic program is
generally not focused on serving Medicare and Medicaid populations
that have difficulty obtaining primary care in isolated rural areas. 
Rather, the additional Medicare and Medicaid payments--estimated at
nearly $300 million for 1996--provided to the rural health clinics
increasingly benefit well-staffed, financially viable clinics in
suburban locales that already have extensive health care delivery
systems.  Most rural health clinics are conversions of physicians'
existing practices that generally do not need or use the benefits
under the program to enlarge the size of the practice or take other
actions to expand the care provided to underserved populations. 
Nevertheless, rural health clinic providers receive extraordinarily
high reimbursement for each visit by a Medicare or Medicaid
patient--as much as $214 for each visit at one clinic GAO surveyed
compared with the average reimbursement of $37 received by providers
on the Medicare fee schedule.  Contributing to this problem are the
program's broad eligibility criteria and the requirement that the
Health Care Financing Administration reimburse all rural health
clinics at cost, even if they are already financially viable.  One
hospital-owned clinic claimed overhead costs that were 120 percent of
the direct costs of running the clinic, and an independent clinic
claimed $270,000 in compensation for each of its four staff
physicians. 

Foreign Physicians:
Exchange Visitor Program Becoming Major Route to Practicing in U.S. 
Underserved Areas

GAO/HEHS-97-26, Dec.  30 (63 pages). 

Placing enough doctors in underserved areas is a long-standing
problem in the United States.  A growing number of locations are
turning to non-U.S.  citizens who have just finished their medical
education in the United States.  Waivers that allow foreign graduates
of U.S.  medical schools to remain in the United States if they agree
to practice in areas with shortages of medical personnel have grown
dramatically--from 70 in 1990 to more than 1,300 in 1995.  However,
the program is rudderless, with no single agency responsible for
managing and coordinating waiver requests.  Monitoring efforts to
ensure that physicians fulfill the terms of their agreements remain
spotty.  In addition, physicians who end up practicing in underserved
areas may not actually target those segments of the population that
are underserved. 


   INCOME SECURITY
--------------------------------------------------------- Appendix 0:7

SSA Benefit Statements:
Well Received by the Public but Difficult to Comprehend

GAO/HEHS-97-19, Dec.  5 (23 pages). 

The Social Security Administration (SSA) in 1995 began sending
statements--called Personal Earnings and Benefit Estimate
Statements--automatically to workers who had reached age 60.  By
fiscal year 2000, these statements will reach an estimated 123
million people annually--almost every U.S.  worker aged 25 and older. 
These six-page statements provide workers with information on their
yearly earnings on record at SSA, information on their eligibility
for social security retirement and other benefits, and estimates of
these benefits.  Experts agree that SSA's approach is generally
reasonable, and feedback suggests that the public generally finds the
statements to be helpful in retirement planning.  However, GAO
believes that the statements could benefit from extensive revisions. 
Specifically, the statements need a better layout and design and
simpler explanations.  SSA will need to start now to complete these
changes by its 1999 redesign target date because the agency will
require time to collect data and test alternatives. 

Child Support Enforcement:
Early Results on Comparability of Privatized and Public Offices

GAO/HEHS-97-4, Dec.  16 (36 pages). 

Growing caseloads and resource limitations have led some states to
privatize their child support enforcement offices.  Fifteen states
have turned to privatization as a way to boost performance and handle
caseloads that, in some instances, are approaching 1,000 per worker. 
For some offices, privatization has also been a response to state
restrictions on hiring additional public employees.  In a series of
comparisons, GAO found that fully privatized enforcement offices
performed as well or better than public child support programs in
locating noncustodial parents and collecting payments.  However,
these results are limited to the cases GAO reviewed and do not
reflect the performance of public or private offices overall within
the states selected.  Moreover, because the full-service
privatization of child support enforcement is relatively new, the
extent to which it offers comparable performance and
cost-effectiveness remains open for evaluation over the long term. 

SSA Disability Redesign:
Focus Needed on Initiatives Most Crucial to Reducing Costs
and Time

GAO/HEHS-97-20, Dec.  20 (52 pages). 

The disability insurance and supplemental security income programs
grew rapidly between 1988 and 1995; the number of beneficiaries
increased by about 50 percent.  The Social Security Administration
(SSA), which downsized during that period, has struggled to keep up
with the unprecedented growth in applications for disability benefits
and appeals of disability decisions.  The processing of claims has
been delayed, creating hardship for disabled claimants, who often
must wait for more than a year for a final decision.  SSA is trying
to redesign its disability claims process to reduce administrative
costs and shorten the time a claimant awaits a decision.  This report
provides information on the redesign, specifically (1) SSA's vision
for and progress in redesigning the disability claims process, (2)
issues related to the scope and complexity of the redesign, and (3)
SSA's efforts to maintain stakeholders' support. 


   INTERNATIONAL AFFAIRS
--------------------------------------------------------- Appendix 0:8

Foreign Assistance:
Contributions to Child Survival Are Significant, but
Challenges Remain

GAO/NSIAD-97-9, Nov.  8 (55 pages). 

Funding provided by the U.S.  Agency for International Development
(USAID) has helped reduce child mortality in the developing world,
primarily through health initiatives centering on diarrheal
rehydration, immunization, and nutrition.  However, USAID defines
child survival activities so broadly that infrastructure projects
with only a slight connection to child survival, such as railroad
construction, are included in the $2.3 billion that USAID has spent
since 1985 on child survival.  In addition, some countries with
significant child mortality rates, such as those in sub-Saharan
Africa, have not received assistance for
child survival. 

Vietnamese Asylum Seekers:
A Review of Selected Cases in Four Southeast Asia Countries

GAO/NSIAD-97-51, Dec.  31 (44 pages). 

In response to congressional concerns about the implementation and
outcomes of the Comprehensive Plan of Action (CPA) for Vietnamese
asylum seekers in Southeast Asia, GAO reviewed selected cases from
Hong Kong, Indonesia, Malaysia, and the Philippines and evaluated how
the process for determining refugee status worked for these
individuals.  Specifically, GAO examined family unity and
victim-of-violence cases as well as general refugee (merit) cases. 
This report (1) reviews factual information about these cases from
the perspective of the international refugee criteria used under CPA
and (2) examines how the screening process was implemented. 


   NATIONAL DEFENSE
--------------------------------------------------------- Appendix 0:9

New Attack Submarine:
Program Status

GAO/NSIAD-97-25, Dec.  3 (20 pages). 

The Navy's goal of producing a new attack submarine at significantly
lower cost than that of the Seawolf is unlikely to be achieved.  The
Navy's cost estimate for the new submarine has already risen from
$1.5 billion to $1.8 billion, and further cost increases may well
occur because of various program risks.  Recent legislation directed
the Navy to accelerate construction of the first two submarines and
to use two shipyards instead of one to build the first four vessels. 
According to the Navy, this change has boosted the cost of building
30 new attack submarines by $3 billion.  The Defense Department
contends that a $3.8-billion increase in budget authority will be
needed to comply with the recent legislation.  GAO believes that
other cost increases are possible because of the following program
risks:  (1) Changes in the ship's design or the addition of new
technologies are anticipated.  (2) The new attack submarine's
command, control, communication, and combat system development and
integration program is highly complex and the schedule for its
completion is optimistic.  (3) Some prototype equipment is being
developed concurrently with the ship's construction.  (4) The cost of
transferring the submarine's design from the first to the second
shipbuilder is based on an optimistic estimate that is less than the
actual cost of the last major design transfer. 

Unified Command Plan:
Atlantic and Southern Command Participation in 1995 Review

GAO/NSIAD-97-41BR, Dec.  5 (25 pages). 

This briefing report reviews changes in the U.S.  Southern Command's
and the U.S.  Atlantic Command's geographic responsibilities
resulting from a 1995 review of the Unified Command Plan.  GAO
focuses on issues related to the realignment of responsibility for
the Caribbean Basin from the Atlantic to the Southern Command.  GAO
discusses the (1) Unified Command Plan review process and the
participation of the Atlantic and Southern Commands in the process,
(2) views of the Southern and Atlantic Command's on the Caribbean
realignment, and (3) rationale for the realignment recommended by the
Chairman of the Joint Chiefs of Staff. 

Future Years Defense Program:
Lower Inflation Outlook Was Most Significant Change From 1996 to 1997
Program

GAO/NSIAD-97-36, Dec.  12 (24 pages). 

By projecting significantly lower inflation rates, the Defense
Department (DOD) calculates that its future purchases of goods and
services will cost nearly $35 billion less than it projected a year
ago.  DOD plans to spend $19.5 billion of this newly found purchasing
power on forces modernization and other programs through fiscal year
2001.  However, the Congressional Budget Office estimates that the
future cost of DOD's purchases through 2001 willl decline by only
about $10.3 billion--far less than the DOD projection.  Resource
allocations in the 1997 Future Years Defense Program (FYDP) vary
considerably from those in the 1996 FYDP because of the lower
inflation projections, program transfers, and program changes.  The
projected savings from the latest round of base closures and
realignments dropped from $4 billion in the 1996 FYDP to $0.6 billion
in the 1997 FYDP because (1) the 1996 FYDP projected savings on the
basis of interim base closing plans that later changed and (2)
military construction costs related to the environmental cleanup of
closed bases are higher than anticipated.  A comparison of the 1996
and 1997 FYDPs also shows that DOD expects to reduce active duty
force levels. 

Logistics Planning:
Opportunities for Enhancing DOD's Logistics Strategic Plan

GAO/NSIAD-97-28, Dec.  18 (15 pages). 

The Pentagon recognizes that its logistics system, designed decades
ago to support the U.S.  military in a global war, is slow,
complicated, redundant, and costly.  With the end of the Cold War and
the advent of shrinking military budgets, the Defense Department's
(DOD) logistics system must now support a smaller, highly mobile,
high-tech force as efficiently as possible.  DOD in 1994 developed a
logistics strategic plan to promote a better, faster, more reliable,
highly mobile, and cheaper strategy for delivering logistics material
and services to users.  This report reviews DOD's logistics strategic
plan and identifies opportunities for increasing the likelihood of
implementing the plan's goals and objectives successfully. 

Defense Management:
Estimating Impact of Changes to Commissary Access Policy

GAO/NSIAD-97-45, Dec.  20 (20 pages). 

Commissaries are stores that sell groceries and household supplies to
members of the military, retirees, and their dependents.  The Defense
Commissary Agency manages all service commissaries worldwide and has
received an average of about $1 billion in federal support annually
during the past five years.  The Defense Department (DOD) has
proposed allowing reservists unlimited access to commissaries three
times in the recent past.  DOD officials view this policy change as a
low- or no-cost way to increase military service benefits.  This
report discusses the (1) evolution of the policy on military
reservists' access to the commissaries and proposals to change that
policy, (2) sources of the Defense Commissary Agency's funding, and
(3) information needed to analyze the impact on appropriated funds of
granting military reservists unlimited access to the
commissary system. 

Air Force Depot Maintenance:
Privatization-in-Place Plans Are Costly While Excess
Capacity Exists

GAO/NSIAD-97-13, Dec.  31 (28 pages). 

The report reviews the Defense Department's (DOD) decision to pursue
privatization-in-place at two major Air Force maintenance depots
slated for closure as part of the 1995 base realignment and closure
process.  Specifically, GAO reviews the Air Force's plans to
privatize-in-place depot maintenance workloads at the Sacramento and
San Antonio air logistics centers.  GAO discusses (1) the impact on
excess depot capacity and operating costs at the remaining defense
depots; (2) the cost-effectiveness of the planned privatization
initiatives, including the impact of delaying base closures until
2001; and (3) compliance with statutory requirements. 


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

Foreign Missile Threats:  Analytic Soundness of National Intelligence
Estimate 95-19, by Richard Davis, Director of National Security
Analysis Issues, before the Senate Select Committee on Intelligence. 
GAO/T-NSIAD-97-53, Dec.  4 (nine pages). 

The principal finding of a recent national intelligence estimate that
no new foreign power will develop or acquire ballistic missiles that
could threaten North America during the next 15 years was worded with
100 percent certainty.  GAO found that because of intelligence gaps,
this level of certainty was overstated--one of a number of
shortcomings in the estimate.  This testimony is based on an August
1996 GAO report (GAO/NSIAD-96-225) that evaluates National
Intelligence Estimate 95-19, "Emerging Missile Threats to North
America During the Next 15 Years."


   NATURAL RESOURCES
-------------------------------------------------------- Appendix 0:10

U.S.  Forest Service:
Fees for Recreation Special-Use Permits Do Not Reflect Fair Market
Value

GAO/RCED-97-16, Dec.  20 (27 pages). 

Through special-use permits, the Forest Service authorizes various
recreational activities within the nation's forests, including
hunting, fishing, rafting, and lodging.  Since 1993, GAO has issued
several reports concluding that the Forest Service does not routinely
charge fees reflecting the fair market value for many of the larger,
commercial activities within the nation's forests, such as ski
concessions and mountain-top sites for radio and TV broadcasting. 
Similarly, the Forest Service's recreation special-use program is not
receiving fair market value or recovering its costs, largely because
of its relatively low priority and the lack of incentives to address
its critical needs.  The program would achieve a more businesslike
approach if the individual forest managers were allowed to keep
recovered revenue to offset the costs incurred for this program,
However, permitting the Forest Service to retain fees might raise
questions of oversight and accountability, as well as scoring and
compliance issues under the Budget Enforcement Act.  These matters
need to be weighed in considering fee retention proposals. 


   TAX POLICY AND ADMINISTRATION
-------------------------------------------------------- Appendix 0:11

IRS' 1996 Tax Filing Season:
Performance Goals Generally Met; Efforts to Modernize Had
Mixed Results

GAO/GGD-97-25, Dec.  18 (30 pages). 

As compared with the 1995 filing season, the Internal Revenue Service
(IRS) received 119 million fewer telephone calls for assistance and
answered about 4 million more calls during the 1996 filing season. 
That combination of reduced demand and increased service enabled IRS
to increase the percentage of calls answered from 8 to 20 percent and
to increase the percentage of callers who were eventually able to get
through to IRS from 41 to 50 percent.  Still, there is considerable
room for improvement.  In 1995, IRS delayed about 7 million refunds
to give itself time to verify social security numbers, especially for
filers claiming the earned income credit.  Although that verification
effort yielded some positive results, there were problems.  For
example, IRS identified many more missing or invalid social security
numbers than it was able to pursue and eventually sent out the
refunds without resolving the discrepancies.  For the 1996 filing
season, IRS revised its procedures and ended up delaying many fewer
refunds than it did in 1995, thereby avoiding the negative press it
received that year.  IRS' modernization efforts met with mixed
results in 1996.  Although a new document scanning and imaging system
performed better in 1996 than it did in 1995, the system still was
not meeting performance expectations and may end up costing much more
than originally anticipated.  Also, although the system that allows
taxpayers to file their returns by telephone worked very well and a
high percentage of its users were satisfied with it, only about 10 to
14 percent of those eligible to use the system in 1996 did so. 

Tax Expenditures:
Information on Employer-Provided Educational Assistance

GAO/GGD-97-28, Dec.  19 (38 pages). 

This report provides information on employer-provided educational
assistance, which covers expenses ranging from tuition to books,
between 1992 and 1994 under section 127 of the Internal Revenue Code. 
Under section 127, the amount of educational assistance that
employees receive from their employers is generally excludable from
employees' gross income.  GAO discusses (1) the characteristics of
employers providing educational assistance, such as the number of
providers and their size, and (2) employees eligible for and
receiving it, such as the number of recipients and their level of
study.  GAO also identifies other tax provisions related to
employer-provided educational assistance and discusses the
differences between them and section 127. 


   TRANSPORTATION
-------------------------------------------------------- Appendix 0:12

Airport and Airway Trust Fund:
Issues Raised by Proposal to Replace the Airline Ticket Tax

GAO/RCED-97-23, Dec.  9 (16 pages). 

As pressure mounts to rein in federal spending, user fees for
government services have become an increasingly attractive option. 
GAO believes that commercial users of the nation's airspace should
pay their fair share of the costs that they impose on the system, and
GAO has identified some areas, such as the certification of new
airlines, where additional fees could be justified.  Because the tax
on domestic airline tickets is based on the fares paid by travelers
and not on the Federal Aviation Administration's (FAA) actual costs,
it may not fairly allocate the system's costs among the users.  In
May 1996, a coalition of the seven largest U.S.  airlines proposed
replacing the ticket tax with user fees.  The coalition's proposal,
however, would substantially boost the fees paid by low-fare and
small airlines and would lower the fees paid by the seven coalition
airlines.  The upshot is that the proposal would dramatically
redistribute the cost burden among airlines and could have
substantial implications for domestic competition.  If Congress
decides to replace the ticket tax with a different fee system, such a
system would need to account for the wide range of costs that FAA
incurs in managing the airport and airway system, which vary greatly
by the amount, type, and timing of various airline operations.  In
addition, the views of all affected parties--not just a particular
group of airlines--would need to be considered.  Recognizing this,
Congress in October 1996 established a 21-member commission to study
how best to meet FAA's financing needs. 


   VETERANS AFFAIRS
-------------------------------------------------------- Appendix 0:13

VA Health Care:
Better Data Needed to Effectively Use Limited Nursing
Home Resources

GAO/HEHS-97-27, Dec.  20 (26 pages). 

The Department of Veterans Affairs (VA) reported spending $1.6
billion in fiscal year 1995 on nursing home care for nearly 80,000
veterans--about 14 percent of the estimated demand by veterans for
such care.  VA provides nursing home care in its own facilities,
contracts with community nursing homes, and pays state veterans'
homes part of the cost to care for veterans.  All veterans are
eligible for nursing home care essentially on a first-come,
first-served basis within VA's budget constraints.  As the number of
veterans aged 65 and older increases to 9.3 million by the year 2000,
the demand for nursing home care will likely rise.  The funds for VA
nursing home care, however, are expected to be limited.  This report
provides information on the (1) distribution of veterans in VA,
community, and state nursing homes; (2) costs to VA for these nursing
homes; (3) factors affecting VA's use of community and state
veterans' nursing homes; and (4) relative quality of the care
provided by VA, community, and state veterans' homes. 


   SPECIAL PUBLICATIONS
-------------------------------------------------------- Appendix 0:14

Aging Issues:
Related GAO Reports and Activities in Fiscal Year 1996

GAO/HEHS-97-41, Dec.  31 (56 pages). 

This publication provides a compilation of GAO's fiscal year 1996
products and ongoing work on older Americans.  Because the elderly
are one of the fastest-growing segments of American society today,
Congress faces a host of issues--from health care to social
security--in which the federal government will play an important
role.  The publication is divided into three sections, which contain
summaries of different types of GAO products on older Americans: 
reports and correspondence, testimony before Congress, and ongoing
work.  Overall, health, income security, and veterans issues were the
areas most frequently addressed by GAO's work on older Americans. 

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

GAO/HEHS-97-39W, Nov.  1996 (23 pages). 

This monthly bibliography lists GAO documents on health, education,
employment, social security, disability, welfare, and veterans
issues.  One section summarizes reports issued during October 1996. 
Another section lists the titles of all documents issued from July
through October 1996, organized chronologically by subject.  Order
forms are included, as is a list of issue area experts who can answer
questions about specific reports. 

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

GAO/HEHS-97-42W, Dec.  1996 (19 pages). 

This monthly bibliography lists GAO documents on health, education,
employment, social security, disability, welfare, and veterans
issues.  One section summarizes reports issued during November 1996. 
Another section lists the titles of all documents issued from August
through November 1996, organized chronologically by subject.  Order
forms are included, as is a list of issue area experts who can answer
questions about specific reports. 


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