Reports and Testimony: February 1997 (Other Written Prod., 02/01/97,
GAO/OPA-97-5).

GAO published its monthly list of reports and testimony issued in
February 1997.

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

 REPORTNUM:  OPA-97-5
     TITLE:  Reports and Testimony: February 1997
      DATE:  02/01/97
   SUBJECT:  Risk management
             Computer software
             Program abuses
             Housing programs
             Health care services
             International relations
             National defense operations
             Telecommunication
             Natural resources
             Transportation operations
IDENTIFIER:  Bibliographies
             High Risk Series 1997
             
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REPORTS AND TESTIMONY:  FEBRUARY
1997

GAO/OPA-97-5


Highlights

High-Risk Series

Many crucial government programs remain vulnerable to waste, fraud,
abuse, and mismanagement.  In a 14-volume set of reports, GAO
highlights 25 programs in six broad categories that are the focus of
its concern and discusses progress made since the high-risk program
began in 1990.  Page 2. 

Year 2000 Problem

Because most federal computers, like those in private industry, were
programmed to record years in a two-digit format, the arrival of the
year 2000 will create problems for older machines, a situation with
wide ramifications for citizens who rely on government benefits.  GAO
has issued a draft guide to help federal agences assess their
managerial and technical response to this problem.  Pages 3 and 15. 

Telemedicine

Communications technology used to deliver medical care and
information-- telemedicine--is a promising field, attracting interest
and funding from both the private sector and the government.  Nine
federal agencies have invested more than a half billion dollars in
telemedicine projects since 1994, but a governmentwide strategy is
needed to coordinate investment and maximize benefits.  Page 9. 

GAO/OPA-97-5



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

  BLM - x
  CHAMPUS - x
  DOD - x
  DOE - x
  EPA - x
  FAA - x
  FEHBP - x
  FHWA - x
  GPRA - x
  GSA - x
  HCFA - x
  HMO - x
  HUD - x
  IRS - x
  SBA - x
  SSA - x
  USDA - x
  VA - x

REPORTS AND TESTIMONY:  FEBRUARY
1997
=========================================================== Appendix 0


   SPECIAL PUBLICATIONS
--------------------------------------------------------- Appendix 0:1

High-Risk Series
Feb.  1997 (14 reports). 

In 1990, GAO began a special effort to identify federal programs at
high risk for waste, fraud, abuse, and mismanagement.  GAO issued a
series of reports in December 1992 on the fundamental causes of the
problems in the high-risk areas; it followed up on the status of
these areas in February 1995.  This, GAO's third series of high-risk
reports, revisits these troubled government programs and designates
five additional areas as high-risk (defense infrastructure,
information security, the year 2000 problem, supplemental security
income, and the 2000 decennial census), bringing to 25 the number of
high-risk programs on GAO's list.  The high-risk series includes an
overview, a quick reference guide, and 12 individual reports.  The
high-risk series may be ordered as a full set, a two-volume package
including the overview and the quick reference guide, or as 12
separate reports describing in detail these vulnerable government
programs.  On the order form at the back of this publication, please
check the box marked GAO/HR-97-20SET for the entire high-risk series
or the box marked GAO/HR-97-21SET for the package consisting of the
overview and the quick reference guide.  Single reports may be
ordered by checking the boxes that correspond to the report numbers
listed below. 

An Overview
GAO/HR-97-1, Feb.  1997 (104 pages). 

Quick Reference Guide
GAO/HR-97-2, Feb.  1997 (148 pages). 

Defense Financial Management
GAO/HR-97-3, Feb.  1997 (50 pages). 

Defense Contract Management
GAO/HR-97-4, Feb.  1997 (28 pages). 

Defense Inventory Management
GAO/HR-97-5, Feb.  1997 (32 pages). 

Defense Weapon Systems Acquisition
GAO/HR-97-6, Feb.  1997 (41 pages). 

Defense Infrastructure
GAO/HR-97-7, Feb.  1997 (33 pages). 

IRS Management
GAO/HR-97-8, Feb.  1997 (44 pages). 

Information Management and Technology
GAO/HR-97-9, Feb.  1997 (69 pages). 

Medicare
GAO/HR-97-10, Feb.  1997 (54 pages). 

Student Financial Aid
GAO/HR-97-11, Feb.  1997 (58 pages). 

Department of Housing and Urban Development
GAO/HR-97-12, Feb.  1997 (72 pages). 

Department of Energy Contract Management
GAO/HR-97-13, Feb.  1997 (34 pages). 

Superfund Program Management
GAO/HR-97-14, Feb.  1997 (42 pages). 

GAO summarized the high-risk series in testimony before Congress;
see: 

High-Risk Areas:  Update on Progress and Remaining Challenges, by
Gene L.  Dodaro, Assistant Comptroller General for Accounting and
Information Management, before the Subcommittee on Government
Management, Information and Technology, House Committee on Government
Reform and Oversight.  GAO/T-HR-97-22, Feb.  13 (17 pages). 

Year 2000 Computing Crisis:
An Assessment Guide

GAO/AIMD-10.1.14, Feb.  1997 (32 pages). 

Instead of a time of celebration, New Year's Day in the year 2000
could be a day of dread for computer system managers worldwide.  As
the new century approaches, there is widespread concern about what
will happen at 12:01 on January 1, 2000.  The problem is rooted in
the way that dates are recorded and computed in many computer
systems.  In a two-digit format, the year 2000 is indistinguishable
from 1900, 2001 from 1901, and so on.  Every federal program is at
risk of widespread system failures.  For example, the Internal
Revenue Service's tax systems could be unable to process returns;
payments to disabled veterans could be severely delayed; and federal
systems used to track student education loans could produce erroneous
information on loan status.  Because converting systems to a
four-digit year will be a massive undertaking for large systems,
agencies must start now to address this problem.  This guide provides
a framework and a checklist for assessing the readiness of federal
agencies to achieve year 2000 compliance.  It provides information on
the scope of the challenge and offers a structured approach for
reviewing the adequacy of agency planning and management of the year
2000 problem. 


   AGRICULTURE AND FOOD
--------------------------------------------------------- Appendix 0:2

Commodity Programs:
Impact of Support Provisions on Selected Commodity Prices

GAO/RCED-97-45, Feb.  21 (52 pages). 

Reform in U.S.  agricultural policy began with passage of the 1985
farm act, which sought to make federal farm programs more market
oriented and to reduce the amount of support that the government
guarantees farmers for their commodities.  The 1990 and 1996 farm
acts continued to build on these efforts.  However, Congress retained
several income- and price-support provisions as a safety net for
producers.  In particular, nonrecourse loans with marketing loan
provisions continue to be available for a number of commodities,
including cotton, rice, wheat, feedgrains, and oilseeds.  This report
answers the following questions:  (1) Do marketing loan provisions
prevent loan rates from acting as price floors and do they allow U.S. 
prices to fall to levels that are closer to world prices?  (2) How
would lower loan rates affect the relationship between U.S.  and
world prices?  (3) How would a lower loan rate affect step two
payments for cotton exports and what impact have recent changes in
the timing of payments had on the program's effectiveness?  (4) What
steps could be taken to make the peanut and sugar programs more
market oriented? 


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

Farm Loans:  Information on the Status of USDA's Portfolio, by Robert
A.  Robinson, Director of Food and Agriculture Issues, before the
Subcommittee on Forestry, Resource Conservation, and Research, House
Committee on Agriculture.  GAO/T-RCED-97-78, Feb.  21 (six pages). 

This testimony discusses the farm loan programs administered by the
Agriculture Department's Farm Service Agency.  GAO (1) summarizes its
January 1997 report (GAO/RCED-97-35), which updated earlier reports
on the financial condition of the Service's farm loan portfolio, and
(2) discusses changes to the farm loan programs that were mandated by
the Federal Agriculture Improvement and Reform Act.  Overall, GAO
notes that a significant percentage of the Service's direct farm loan
portfolio continues to be at risk because it is held by delinquent
borrowers. 


   BUDGET AND SPENDING
--------------------------------------------------------- Appendix 0:3


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

Fiscal Year 1998 Budget Estimates for the U.S.  General Accounting
Office, by James F.  Hinchman, Acting Comptroller General of the
United States, before the Subcommittee on Legislative, House
Committee on Appropriations.  GAO/T-OCG-97-1, Feb.  11 (nine pages). 

During the past year, GAO marked two important milestones.  Charles
A.  Bowsher retired as Comptroller General at the end of his 15-year
term, and the agency celebrated its 75th anniversary.  In fiscal year
1996, GAO issued more than 900 reports and testified about 200 times
before various congressional committees.  GAO's recommendations and
audit findings resulted in financial benefits to the taxpayer of more
than $17 billion as well as many improvements to government
operations.  As a result of a 25-percent budget reduction during
fiscal years 1996 and 1997, GAO's staffing is at its lowest level
since before World War II.  To maintain its strong tradition of
service to Congress and the nation, GAO is seeking an increase in its
appropriation for fiscal year 1998.  This increase will finance
mandatory increases in pay and benefits, the rising cost of goods and
services that the agency purchases, information technology upgrades,
and maintenance and repair of GAO's headquarters building. 


   BUSINESS, INDUSTRY, AND
   CONSUMERS
--------------------------------------------------------- Appendix 0:4

Small Business:
Update on Information on SBA's Small Business Investment Company
Programs

GAO/RCED-97-55, Feb.  21 (28 pages). 

The Small Business Investment Act of 1958 created a program to help
small businesses obtain financing to start or expand their
operations.  Under the program, small business investment companies
fund small businesses by purchasing their stock or issuing them
loans.  In 1972, Congress amended the act to establish specialized
small business investment companies to fund small businesses owned by
socially or economically disadvantaged persons.  This report updates
information presented in a May 1995 GAO report (GAO/RCED-95-146FS)
through fiscal year 1996.  GAO provides information on (1) the
programs' trends for fiscal years 1990 through 1996 in terms of the
number, size, funding, and private capitalization of the investment
companies; (2) the Small Business Administration's cumulative net
program losses through fiscal year 1996 from liquidating investment
companies, as well as specialized small business investment
companies' participation in the Three Percent Stock Repurchase
Program through December 1996; and (3) the investment companies'
investment activities during fiscal years 1990 through 1996. 


   CIVIL RIGHTS
--------------------------------------------------------- Appendix 0:5

Farm Programs:
Efforts to Achieve Equitable Treatment of Minority Farmers

GAO/RCED-97-41, Jan.  24 (16 pages). 

Minority farmers have for years voiced concerns that officials at the
U.S.  Department of Agriculture (USDA) do not treat them in the same
way as nonminority farmers in the conduct of the agency's programs,
particularly in decisions made in USDA's county offices and district
loan offices.  This report reviews the efforts of the USDA's Farm
Service Agency to conduct farm programs in an equitable manner.  GAO
(1) identifies the Farm Service Agency's efforts to treat minority
and nonminority farmers alike in delivering program services; (2)
examines the representation of minorities in county office staffing
and on county committees in the counties with the highest numbers of
minority farmers; and (3) examines data on the disposition of
minority and nonminority farmers' applications for participation in
the Agricultural Conservation Program and the direct loan program at
the national level and in five county and five district
loan offices. 


   EMPLOYMENT
--------------------------------------------------------- Appendix 0:6

National Service Programs:
Role of State Commissions in Implementing the
AmeriCorps Program

GAO/HEHS-97-49, Feb.  20 (25 pages). 

AmeriCorps--among the most significant national and community
programs since the Civilian Conservation Corps of the 1930s--allows
participants to earn education awards to help pay for postsecondary
education in exchange for performing community service.  In an era
marked by shrinking federal budgets, AmeriCorps has experienced
substantial budget increases relative to other domestic programs. 
Through fiscal year 1997, Congress has appropriated more than $800
million to support about 100,000 AmeriCorps participants.  Increasing
concerns over costs and internal controls at AmeriCorps has been
accompanied by considerable congressional oversight.  Among the
reforms contemplated during the 1996 appropriation process was to
scale back AmeriCorps' federal bureaucracy and transfer more program
management to state commissions.  This report provides information on
the following three issues:  the statutory role of state commissions;
state commission operations, including project-level outputs from
national service projects within their purview, such as participant
enrollment and expenditure data; and extending state commissions'
administrative and oversight role over AmeriCorps and correspondingly
decreasing the federal
government's role. 


   ENVIRONMENTAL PROTECTION
--------------------------------------------------------- Appendix 0:7


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

Superfund:  Times to Assess and Clean Up Hazardous Waste Sites Exceed
Program Goals, by Peter F.  Guerrero, Director of Environmental
Protection Issues, before the Subcommittee on National Economic
Growth, Natural Resources, and Regulatory Affairs, House Committee on
Government Reform and Oversight.  GAO/T-RCED-97-69, Feb.  13 (13
pages). 

For hazardous waste sites added in 1996 to the Environmental
Protection Agency's (EPA) register of the nation's most contaminated
locations, EPA took on average more than nine years to complete the
process--from site discovery to final listing on the National
Priorities List.  Although this represents some improvement over
1995, it is still longer than earlier listing times.  Cleanup times
have also lengthened.  From 1986 to 1989, cleanup projects were
finished, on average, 3.9 years after sites were placed on the
National Priorities List.  By 1996, however, cleanup completions were
averaging 10.6 years.  The increasingly lengthy cleanups are a
concern because of the amount of remaining listing and cleanup
activity still to be addressed in the Superfund Program.  EPA has
made progress at many sites, but construction work remains unfinished
at about 800 sites on the National Priorities List, and as many as
2,300 sites could still be added to Superfund in the future.  EPA
officials believe that recent initiatives will speed up both site
listings and cleanups. 


   FINANCIAL MANAGEMENT
--------------------------------------------------------- Appendix 0:8

Financial Management:
An Overview of Finance and Accounting Activities in DOD

GAO/NSIAD/AIMD-97-61, Feb.  19 (56 pages). 

Significant problems continue to plague financial operations at the
Defense Department (DOD).  This report discusses (1) DOD's rationale
for creating the Defense Finance and Accounting Service, (2) the
current size of DOD's finance and accounting infrastructure (e.g.,
locations, personnel, and systems) as compared with its size when the
Service was created, and (3) the various finance and accounting
activities performed by DOD personnel.  Included is a list of reports
GAO has issued over the years on DOD's financial management problems. 
A report in GAO's High-Risk Series entitled Defense Financial
Management (GAO/HR-97-3), found on page 2 of this publication,
summarizes DOD's problems in this area and assesses DOD's approach to
correcting them. 


   GOVERNMENT OPERATIONS
--------------------------------------------------------- Appendix 0:9

Cooperative Purchasing:
Effects Are Likely to Vary Among Governments and Businesses

GAO/GGD-97-33, Feb.  10 (114 pages). 

The National Performance Review reported in 1993 that consolidating
government purchasing would benefit the taxpayer through greater
volume discounts and simplified administration.  The following year,
Congress established a cooperative purchasing program to allow state
and local governments, as well as Indian tribes and Puerto Rico, to
purchase from federal supply schedules.  However, Congress suspended
the program in 1996 until its impact could be assessed.  This report
assesses the effects of the cooperative purchasing program on these
nonfederal governments and federal agencies and on industry,
including small businesses and dealers.  GAO also assesses the
preliminary implementation plan prepared by GSA.  GAO concludes that
although there is little risk to federal interests, the benefits for
nonfederal governments and the consequences for industry will likely
vary. 


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

Managing for Results:  Using GPRA to Assist Congressional and
Executive Branch Decisionmaking, by James F.  Hinchman, Acting
Comptroller General of the United States, before the House Committee
on Government Reform and Oversight.  GAO/T-GGD-97-43, Feb.  12 (21
pages). 

Broad agreement exists that part of the solution to the government's
fiscal problems lies in better management of its programs and
activities.  At the same time, the American people are rightly
demanding that their government operate in a more efficient and
businesslike manner.  Faced with growing federal management problems,
Congress put in place several reforms designed to give managers
better information and improve decision making.  One of these
reforms--the Government Performance and Results Act (GPRA)--offers
the promise of shifting the focus of federal management from a
preoccupation with the number of tasks completed to actual results. 
This testimony by the Acting Comptroller General discusses how
Congress can use GPRA to cut costs and boost performance in the
federal government.  The Acting Comptroller General provides an
overview of the major management challenges facing federal agencies,
discusses how GPRA can be used to address those challenges and better
ensure that agencies become focused and results-driven, and makes
suggestions that Congress could consider in deciding how it can use
GPRA to enhance congressional oversight and decisionmaking. 


   HEALTH
-------------------------------------------------------- Appendix 0:10

Telemedicine:
Federal Strategy Is Needed to Guide Investments

GAO/NSIAD/HEHS-97-67, Feb.  14 (103 pages). 

Telemedicine refers to the use of communications technology to help
deliver medical care regardless of the distance that separates doctor
and patient.  Collectively, the public and private sectors have
funded hundreds of telemedicine projects that could improve, and
perhaps change significantly, how health care is provided in the
future.  The total amount of the investment, however, is unknown. 
GAO identified nine federal departments and independent agencies that
have invested upwards of $646 million in telemedicine projects during
fiscal years 1994 through 1996.  The Defense Department is the
largest federal investor with $262 million and considered a leader in
developing this technology.  Opportunities exist for federal agencies
to share lessons learned and exchange technology, but no
governmentwide strategy exists to ensure that the maximum benefits
are gained from the many federal telemedicine efforts.  Telemedicine
technology today is not only better than it was a decade ago, it is
becoming cheaper.  However, the expansion of telemedicine is hampered
by legal and regulatory, financial, technical, and cultural barriers
facing health care providers.  The questions facing telemedicine
today involve not so much whether it can be done but rather where
investments should be made and who should make them.  The solution
lies in the public and private sectors' ability to devise a way to
share information and overcome barriers.  The goal is to ensure the
creation of an affordable telecommunications infrastructure and that
the true merits and cost benefits of telemedicine are attained in the
most appropriate manner. 

Pharmacy Benefit Managers:
FEHBP Plans Satisfied With Savings and Services, but Retail
Pharmacies Have Concerns

GAO/HEHS-97-47, Feb.  21 (24 pages). 

The three Federal Employees Health Benefits Program (FEHBP) plans
that GAO studied contracted with pharmacy benefit managers to control
soaring pharmacy benefit payments.  The plans estimate that the
pharmacy benefit managers saved them more than $600 million in 1995
by obtaining manufacturer and pharmacy discounts and by managing drug
utilization.  The pharmacy benefit managers met most of the
performance standards specified in their 1995 contracts, and the
plans believe that these managers have provided plan enrollees with
high-quality pharmacy service.  Surveys of plan enrollees also
indicate a high degree of satisfaction.  However, the plans' decision
to use pharmacy benefit managers to control costs can shift business
away from retail pharmacies.  Moreover, pharmacy benefit managers and
plan officials, as well as industry experts, acknowledge that any
additional efforts to control FEHBP pharmacy benefit costs in the
future might require plans to adopt more restrictive cost-containment
procedures that could possibly limit enrollees' access to drugs and
pharmacy services and reduce enrollees' satisfaction with their
pharmacy benefits. 


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

Rural Health Clinics:  Rising Program Expenditures Not Focused on
Improving Care in Isolated Areas, by Bernice Steinhardt, Director of
Health Service Quality and Public Health Issues, before the
Subcommittee on Human Resources, House Committee on Government Reform
and Oversight.  GAO/T-HEHS-97-65, Feb.  13 (eight pages). 

This testimony summarizes GAO's recent report on the rural health
clinic program.  (See GAO/HEHS-97-24, Nov.  1996.) This program,
established two decades ago, allows higher Medicare and Medicaid
reimbursements to support health care professionals in underserved
areas that are too sparsely populated to sustain a physician's
practice.  GAO addresses two main questions:  Is the program serving
a Medicaid and Medicare population that would otherwise have
difficulty obtaining primary care?  Are adequate controls in place to
ensure that Medicare and Medicaid payments to rural health clinics
are reasonable and necessary?  In brief, the answer to both questions
is "no." GAO found that most clinics are in fairly well-populated
areas that already have extensive health care delivery systems in
place.  Controls over the amounts that these clinics receive from
Medicare and Medicaid are weak or nonexistent, resulting in
reimbursements that are in some cases more than five times higher
than those paid to other providers.  These financial benefits are
provided indefinitely, even after an area may no longer be rural or
underserved. 

Medicare HMOs:  HCFA Could Promptly Reduce Excess Payments by
Improving Accuracy of County Payment Rates, by William J.  Scanlon,
Director of Health Financing and Systems Issues, before the
Subcommittee on Health, House Committee on Ways and Means. 
GAO/T-HEHS-97-78, Feb.  25 (seven pages); and

Medicare HMOs:  HCFA Could Promptly Reduce Excess Payments by
Improving Accuracy of County Payment Rates, by Jonathan Ratner,
Associate Director for Health Financing and Systems Issues, before
the Subcommittee on Health and Environment, House Committee on
Commerce.  GAO/T-HEHS-97-82, Feb.  27 (seven pages). 

This testimony discusses the rates that Medicare pays health
maintenance organizations (HMO) in its risk contract program,
Medicare's principal managed care option.  Medicare's method for
paying risk contract HMOs was designed to save the program five
percent of the costs for beneficiaries who enroll in HMOs.  However,
GAO testified that HMO rate-setting problems have prevented Medicare
from realizing this saving.  The program's rate-setting methods have
resulted in excess payments to HMOs because HMO enrollees would have
cost Medicare less if they had stayed in the fee-for-service sector. 
A recent estimate placed the total excess payments to HMOs at $2
billion annually.  GAO's method of calculating the county rate would
reduce payments more for HMOs in counties with higher excess payments
and less for HMOs in counties with lower excess payments.  GAO's
method represents a targeted approach to reducing excess payments and
could lower Medicare expenditures by at least several hundred million
dollars each year. 


   HOUSING
-------------------------------------------------------- Appendix 0:11

HUD:
Field Directors' Views on Recent Management Initiatives

GAO/RCED-97-34, Feb.  12 (40 pages). 

In 1994, GAO designated the Department of Housing and Urban
Development (HUD) a high-risk area because of deficiencies that made
it vulnerable to waste, fraud, abuse, and mismanagement.  These
deficiencies were an ineffective organizational structure,
insufficient staff skills, inadequate information and financial
management systems, and weak internal controls.  Since then, HUD has
begun to (1) redesign its field structure, (2) increase its training
efforts, (3) improve and integrate its management information
systems, and (4) implement a new management approach that balances
risks with results.  In preparing its February 1997 high-risk series
(see page 3 of this publication), GAO conducted a telephone survey of
155 directors in four of HUD's major program areas--single-family
housing, multifamily housing, public housing, and community planning
and development--at the agency's 40 largest field offices.  This
report discusses the directors' views on the corrective measures HUD
has undertaken during the past two years. 

Housing and Urban Development:
Potential Implications of Legislation Proposing to Dismantle HUD

GAO/RCED-97-36, Feb.  21 (128 pages). 

The recent proposal to dismantle the Department of Housing and Urban
Development (HUD)--S.  1145--reduces federal funding and makes basic
changes to the federal role in housing and community development.  If
enacted, such a bill could have far-reaching effects on renters,
communities, and would-be home buyers.  Although the bill's voucher
system to allow tenants to choose their residences could expand
housing choices for renters in some areas, its phaseout of assistance
for specific projects could reduce the supply of affordable housing
in other areas.  The bill's creation of a block grant for community
development would give the states and localities more choice in
spending federal funds, but the total federal funding for community
development programs would be cut by about 40 percent.  Some
beneficiaries of federal programs, such as the homeless, might
receive less assistance in an open competition for funds at the local
level.  Also, small cities would see a significant reduction in
federal funding for their projects.  Other provisions in the bill
seek to reduce the government's risk in insuring loans and
guaranteeing mortgage-backed securities; however, these same
provisions would make purchasing a home more difficult, especially
for low-income and first-time buyers.  Both the states and federal
agencies that would take over HUD's functions generally believe that
they could assume additional responsibilities if they also received
additional resources.  HUD contends that transferring its functions
to other agencies would break up the network it has developed to
implement its programs, could harm the delivery of services to its
clients, and would eliminate the focus on housing and community
development that it has provided as a cabinet-level agency. 

Public Housing:
Status of the HOPE VI Demonstration Project

GAO/RCED-97-44, Feb.  25 (32 pages). 

In 1992, the National Commission on Severely Distressed Public
Housing reported that about six percent of the nation's public
housing could be considered severely distressed and that traditional
methods of revitalizing this housing had been ineffective.  In
response, Congress created the HOPE VI program to address the
following three conditions common to severely distressed areas:  (1)
physically deteriorated buildings, (2) residents living in despair
and needing high levels of social and support services, and (3)
economically and socially distressed surrounding communities.  Of the
$1.58 billion appropriated by Congress for the HOPE VI program for
fiscal years 1993-1995, the Department of Housing and Urban
Development (HUD) had awarded $1.54 billion for capital improvements
and community and support services as of September 30, 1996. 
Congress also earmarked $5 million for HUD to provide technical
support to housing authorities.  HUD has identified several
innovative approaches used by HOPE VI grantees to implement their
projects, including Cleveland's concept of centralizing social
services and Milwaukee's street layout to reduce density and enhance
neighborhood security.  HUD is conducting a phased 10-year evaluation
of the program; in August 1996, it completed a baseline study of 15
HOPE VI activities and plans 5-year and 10-year followup evaluations
of these activities. 


   INCOME SECURITY
-------------------------------------------------------- Appendix 0:12

Social Security Administration:
Significant Challenges Await New Commissioner

GAO/HEHS-97-53, Feb.  20 (32 pages). 

The Social Security Administration (SSA) is ahead of many federal
agencies in developing strategic plans; measuring its service to the
public; and producing complete, accurate, and timely financial
statements.  This gives SSA a sound foundation from which to manage
significant current and future challenges.  The aging of the baby
boomers, coupled with longer life expectancy and the declining ratio
of contributing workers to beneficiaries, will place unprecedented
strains on the social security program in the 21st century.  SSA,
however, has yet to do the research, analysis, and evaluation needed
to inform the public debate on the future financing of social
security--the most critical long-term issue confronting the agency. 
Also challenging SSA have been disability caseloads that have soared
by nearly 70 percent during the past decade.  At this critical
juncture, leadership is essential so that SSA can take the following
steps to ensure success in the years ahead:  inform the national
debate on social security financial issues; complete its redesign of
the disability claims process and promote return to work in its
disability programs; enhance efforts to ensure program integrity,
while quickly and effectively implementing many reforms; and make the
technology enhancements and workforce decisions needed to meet
increasing workloads with
fewer resources. 


   INFORMATION MANAGEMENT
-------------------------------------------------------- Appendix 0:13

Air Traffic Control:
Complete and Enforced Architecture Needed for FAA
Systems Modernization

GAO/AIMD-97-30, Feb.  3 (65 pages). 

The Federal Aviation Administration (FAA) lacks a complete systems
architecture, or overall blueprint, to guide its development of
interrelated systems comprising the air traffic control system.  The
lack of such an architecture allows incompatibilities to persist
among air traffic control systems, which in turn result in
higher-than-necessary development, integration, and maintenance
costs.  Because of the size, complexity, and importance of FAA's air
traffic control modernization effort, GAO reviewed it to determine
(1) whether FAA has a target architecture(s) and associated
subarchitectures to guide the development of its air traffic control
systems and (2) what, if any, architectural incompatibilities exist
among air traffic control systems. 


      TESTIMONY
------------------------------------------------------ Appendix 0:13.1

Year 2000 Computing Crisis:  Strong Leadership Today Needed to
Prevent Future Disruption of Government Services, by Joel C. 
Willemssen, Director of Information Resources Management Issues,
before the Subcommittee on Government Management, Information, and
Technology, House Committee on Government Reform and Oversight. 
GAO/T-AIMD-97-51, Feb.  24 (10 pages); and

Year 2000 Computing:  Risk of Serious Disruption to Essential
Government Functions Calls for Agency Action Now, by Joel C. 
Willemssen, Director of Information Resources Management Issues,
before the National Commission on Restructuring the Internal Revenue
Service.  GAO/T-AIMD-97-52, Feb.  27 (10 pages). 

The "Year 2000" problem is rooted in the way that dates are recorded
and computed in many computer systems.  Existing systems typically
use two digits to represent the year (e.g., 97 for 1997) to conserve
electronic data storage and reduce operating costs.  But with the
start of a new century comes a new problem--does 01 mean 1901 or
2001?  This ambiguity means that every government program that
provides benefits--from social security to subsidized housing to
student loans--is at risk of system failure.  Many of the federal
government's computer systems were developed 20 to 25 years ago, are
poorly documented, and use computer languages that are often old and
obsolete.  The systems consist of tens or hundreds of computer
programs, each with thousands or even millions of lines of code, each
of which must be examined for date format problems.  GAO has
developed a guide that agencies can use to assess their readiness to
achieve year 2000 compliance--defined as the ability of information
systems to accurately process date data from, into, and between the
twentieth and twenty-first centuries, including leap years.  The
framework laid out in the guide draws on best practices identified by
federal agencies and the information technology industry.  GAO has
also added the year 2000 problem to its list of high-risk programs. 
(See GAO/AIMD-10.1.14 and GAO/HR-97-9 on page 3 of this publication.)


   INTERNATIONAL AFFAIRS
-------------------------------------------------------- Appendix 0:14

Export Finance:
Federal Efforts to Support Working Capital Needs of
Small Businesses

GAO/NSIAD-97-20, Feb.  13 (53 pages). 

This report reviews current government programs that provide export
working capital for small- and medium-sized enterprises.  GAO (1)
describes federal and state approaches for providing export working
capital, (2) assesses federal efforts to harmonize the export working
capital programs of the U.S.  Export-Import Bank and the Small
Business Administration (SBA), (3) discusses issues associated with
the increasing number of cooperative agreements with lenders and
devolving greater responsibility for export working capital programs
to the states, and (4) examines the potential implications of
transferring SBA's export working capital program to Eximbank. 

Haiti:
U.S.  Response to Allegations of an Assassination Plot

GAO/NSIAD-97-87, Feb.  14 (six pages). 

In March 1995, a prominent attorney and critic of the Haitian
government--Mrs.  Mireille Durocher Bertin--was assassinated.  This
report discusses how the U.S.  government handled the allegations it
received about a plot to kill her.  GAO answers the following
questions:  Who decided that the government of Haiti was responsible
for warning Mrs.  Bertin of the assassination plot?  Were other
approaches to handling the assassination plot allegations considered? 
What information was available to U.S.  decisionmakers on the
involvement of Haitian officials in political violence?  Was Mrs. 
Bertin warned of the assassination plot?  Did the Haitian government
investigate the assassination plot allegations?  Are there any U.S. 
laws or regulations on notifiying targets of assassination plots? 
Since Mrs.  Bertin's death, has the United States warned any persons
in Haiti of threats against their lives? 

Weapons of Mass Destruction:
DOD Reporting on Cooperative Threat Reduction Assistance
Has Improved

GAO/NSIAD-97-84, Feb.  27 (six pages). 

The law requires the Defense Department (DOD) to report annually on
cooperative threat reduction assistance provided to the newly
independent states of the former Soviet Union.  GAO must assess DOD's
report within 30 days after it has been issued.  This report
discusses whether DOD's report (1) contains current and complete data
on cooperative threat reduction assistance deliveries, including
their location and condition; (2) presents the best available sources
of information to show what assistance was accounted for and how it
was used; (3) provides an overall determination of assistance use;
and (4) lists planned audits and examinations for the coming year. 
GAO also follows up on DOD's implementation of recommendations GAO
previously made to improve DOD's annual reports. 

United Nations:
U.S.  Participation in Five Affiliated International Organizations

GAO/NSIAD-97-2, Feb.  27 (84 pages). 

This report provides information on management, administrative, and
program reforms in five organizations at the United Nations:  the
World Health Organization, the Pan American Health Organization, the
International Labor Organization, the U.N Conference on Trade and
Development, and the U.N.  Population Fund.  Although it is
acknowledged that the organizations are not operating as effectively
and efficiently as they should be, the State Department believes that
continued membership in the five organizations is important to the
United States because their activities contribute to U.S.  security,
prosperity, safety, and health.  The policies and agendas of each of
the five coincide with U.S.  foreign policy objectives and provide
significant benefits, such as setting international standards for
living and working conditions; improving global health; and
collecting, analyzing, and dissemiating global information on trade,
health, population, and employment.  They also provide opportunities
for joint research among technical experts to combat deadly diseases,
such as AIDS and the Ebola virus.  The five organizations have begun
to address weaknesses in the management and adminstration of their
programs, such as the lack of budget transparency and the overlap of
programs and activities.  These weaknesses have been the subject of
frequent criticism by Congress, the State Department, and others. 


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

World Trade Organization:  Observations on the Ministerial Meeting in
Singapore, by JayEtta Z.  Hecker, Associate Director for
International Relations and Trade Issues, before the Subcommittee on
Trade, House Committee on Ways and Means.  GAO/T-NSIAD-97-92, Feb. 
26 (14 pages). 

This testimony presents GAO's observations on the results of the
World Trade Organization's ministerial meeting in Singapore that took
place in December 1996.  GAO discusses (1) trade liberalization, (2)
implementation of the Uruguay Round agreements, (3) areas of ongoing
World Trade Organization negotiation, and (4) emerging trade issues
that are being debated in the World Trade Organization and other
international forums. 


   JUSTICE AND LAW ENFORCEMENT
-------------------------------------------------------- Appendix 0:15

Defense of Marriage Act:
Federal Benefits, Rights, and Privileges Contingent on
Marital Status

GAO/OGC-97-16, Jan.  31 (58 pages). 

The Defense of Marriage Act, which became law in 1996, defines
"marriage" as a "legal union between one man and one woman as husband
and wife"; similarly, it defines "spouse" as "a person of the
opposite sex who is a husband or a wife." The legislation potentially
affects the interpretation of a wide variety of federal laws in which
marital status is a factor.  This report identifies federal laws in
which benefits, rights, and privileges are contingent on marital
status.  GAO divides its discussion into 13 categories:  social
security, housing, and food stamps; veterans' benefits; taxation;
federal civilian and military service benefits; employment benefits;
immigration, naturalization, and aliens; Indians; trade, commerce,
and intellectual property; financial disclosure and conflict of
interest; crimes and family violence; loans, guarantees, and payments
in agriculture; federal natural resources; and miscellaneous laws. 

Drug Control:
Long-Standing Problems Hinder U.S.  International Efforts

GAO/NSIAD-97-75, Feb.  27 (48 pages). 

The United States has spent billions of dollars on international drug
control and interdiction efforts but illegal drugs still flow into
this country.  A major factor is that international drug-trafficking
organizations have become sophisticated, multibillion-dollar
industries capable of changing tactics to elude new U.S.  drug
control efforts and corrupting the institutions of drug-producing and
transit countries.  U.S.  efforts have also been hampered by
competing foreign policy objectives, inconsistent funding for U.S. 
international drug control plans, and a lack of ways to measure the
success of counternarcotics efforts.  Although no panacea exists that
will curb illegal drug trafficking, a multiyear plan that sets out
funding needs linked to goals and objectives would provide a more
consistent approach to drug control efforts.  GAO also believes that
improved used of technology and intelligence and the development of a
centralized "lessons learned" system could bolster
counternarcotics efforts. 


   NATIONAL DEFENSE
-------------------------------------------------------- Appendix 0:16

Export Controls:
Change in Export Licensing Jurisdiction for Two Sensitive Dual-Use
Items

GAO/NSIAD-97-24, Jan.  14 (27 pages). 

Jurisdiction over the licensing of exports with military applications
is split between two agencies.  The State Department licenses
munitions, which have military uses, while the Commerce Department
licenses most dual-use items, which have both commercial and military
applications.  In March 1996, the executive branch announced that
licensing jurisdiction for two items--commercial jet engine hot
section technology and commercial communications satellites--would
shift from State to Commerce.  This report examines the implications
of this change in export licensing jurisdiction.  GAO (1) assesses
the military sensitivity of the two items, (2) discusses the
executive branch's rationale for the change in jurisdiction, (3)
compares the licensing systems that the two agencies use to control
exports, and (4) analyzes proposed changes in Commerce controls for
these two items. 

Chemical Weapons and Materiel:
Key Factors Affecting Disposal Costs and Schedule

GAO/NSIAD-97-18, Feb.  10 (72 pages). 

Destroying the stockpile of U.S.  chemical munitions will exceed the
Army's estimate of nearly $25 billion and will take longer than
planned because of public concerns over the safety of incineration,
compliance with environmental laws, and the introduction of
alternative disposal technologies.  The costs and schedule of the
disposal program are largely driven by whether states and local
communities agree with the proposed disposal method at the remaining
stockpile sites.  Reaching agreement has consistently taken longer
than the Army had anticipated.  Recognizing the difficulty of
satisfying public concerns about specific disposal locations,
suggestions have been made by Congress, the Defense Department (DOD),
and others to change the program's basic approach to destruction. 
However, these proposals entail trade-offs and would require changes
in existing legal requirements.  These suggestions have included
deferring plans for additional disposal facilities until an
acceptable alternative to incineration is developed, consolidating
disposal operations at a national or regional site, destroying
selected nonstockpile chemical warfare materiel in stockpile disposal
facilities, establishing a centralized disposal facility for
nonstockpile materiel, and changing existing laws to standardize
environmental requirements.  Notwithstanding these overarching
issues, DOD and the Army have taken steps to improve program
management. 

U.S.-Japan Fighter Aircraft:
Agreement on F-2 Production

GAO/NSIAD-97-76, Feb.  11 (28 pages). 

Under an agreement with Japan, U.S.  companies are to receive 40
percent of the production work to develop Japan's new F-2 fighter
aircraft, which is based on the American F-16.  However, the Air
Force's plans to monitor the production agreements cannot ensure that
U.S.  firms will receive their allotted share--currently worth an
estimated $4.1 billion.  This unclassified version of a classified
GAO report examines the status of the F-2 program as development
nears completion.  GAO discusses (1) the proportion of production
work that will be done in the United States and how the U.S. 
workshare will be calculated and monitored, (2) the status of
technology transfers from Japan to the United States and whether
these technologies are of interest to the U.S.  government and
industry, and (3) the program's potential contributions to Japan's
future aerospace plans. 

Contingency Operations:
Opportunities to Improve the Logistics Civil
Augmentation Program

GAO/NSIAD-97-63, Feb.  11 (37 pages). 

Despite escalating costs associated with the use of civilian
contractors to provide logistics and engineering services in support
of contingency operations in Bosnia and elsewhere, the Army lacks
basic financial systems to track how contractor funds are being spent
and contractor monitoring systems to evaluate contractor performance. 
The Army has traditionally employed civilian contractors to augment
military forces.  For example, civilian contractors were used
extensively in the Korean and Vietnam Wars.  In the case of Bosnia,
the Army's latest estimate for contractor support has risen to $461.5
million--about $111 million more than the Army's original estimate. 
This report makes several recommendations for improving the program
from a doctrine, cost control, and contract oversight standpoint. 
GAO also discusses the potential for unnecessary overhead costs and
duplication resulting from the Navy and the Air Force introducing
similar support contract programs. 

Weapons Acquisition:
Better Use of Limited DOD Acquisition Funding Would Reduce Costs

GAO/NSIAD-97-23, Feb.  13 (26 pages). 

The Defense Department (DOD) is wasting billions of dollars by buying
large numbers of weapons before they are fully tested--a practice
that results in substantial inventories of unsatisfactory weapons
requiring costly modifications and, in some cases, deployment of
substandard weapons to combat forces.  For example, the Air Force's
C-17 airlift aircraft, the Navy's T45A trainer aircraft, and the
Army's Family of Medium Tactical Vehicles encountered problems during
test and evaluation that required major changes after significant
quantities had been purchased during low-rate initial production.  If
DOD bought minimal quantities of untested weapons during low-rate
initial production, more funds would be available to buy other proven
weapons in full-rate production at more efficient rates and at lower
costs. 

C-17 Globemaster:
Support of Operation Joint Endeavor

GAO/NSIAD-97-50, Feb.  14 (12 pages). 

GAO found that the C-17 Globemaster aircraft accomplished everything
it was asked to do while it was deployed in Bosnia.  In particular,
the C-17 was used to satisfy the Army's need for a high-capacity,
short-distance air transport to move troops, equipment, and outsize
cargo.  However, the aircraft was not called upon to perform many
tasks that it has had difficulty doing, or did not do, during
testing.  These include several tasks that the Army considers
important, such as landing on short, wet runways of about 3,000 feet;
performing airdrops of both troops and equipment; or handling routine
medical evacuations.  At the end of fiscal year 1996, the Pentagon
had spent $20.5 billion to develop and purchase 28 C-17s; it plans to
buy a total of 120 C-17s at an estimated cost of $43 billion. 

Military Airlift:
Options Exist for Meeting Requirements While Acquiring
Fewer C-17s

GAO/NSIAD-97-38, Feb.  19 (62 pages). 

Congress, concerned about the C-17's history of cost, schedule, and
performance problems, required the Defense Department to acquire a
commercially available transport aircraft as a substitute for, or as
a complement to, a fleet of C-17s.  Despite possible cost savings
from a mixed fleet of C-17s and commercial transport aircraft, the
Defense Acquisition Board recommended in 1995 that the Air Force
acquire 120 C-17s and no commercial planes.  GAO believes that an
option not considered by the Board--purchasing only 100 C-17s--could
satisfy the military's airlift needs and save $7 billion.  The only
mission that would require more than 100 C-17s is an extended range
brigade airdrop to a small, austere airfield directly from the
continental United States.  A fleet consisting of 100 C-17s and
modified C-5s could support an extended range airdrop to such an
airfield until the Air Force begins replacing the C-5--now slated to
begin in 2007.  GAO cautions, however, that the aircraft's wake
turbulence problem has forced the Army to restrict paratroopers from
jumping from C-17s in close airdrop formations.  Until this safety
issue is resolved, the C-17 cannot be used to support the brigade
airdrop mission. 

DOD Aviator Positions:
Training Requirements and Incentive Pay Could Be Reduced

GAO/NSIAD-97-60, Feb.  19 (19 pages). 

To retain skilled aviators, the Air Force, the Navy, and the Marine
Corps in recent years paid more than $200 million in incentives and
bonuses to pilots and navigators holding jobs that do not require
them to fly.  Filling these positions with nonaviators could save
millions of dollars in pay and training costs for aviators now
assigned to nonflying jobs.  This report discuses (1) the number of
aviators who are assigned to nonflying positions in the armed forces,
(2) the amount of aviation career incentive pay and aviation
continuation pay paid to aviators in nonflying positions, (3) whether
the services implement such pay uniformly, and (4) whether the
nonflying positions affect the number of aviators that the services
plan to train to meet future requirements. 

Military Bases:
Cost to Maintain Inactive Ammunition Plants and Closed Bases Could Be
Reduced

GAO/NSIAD-97-56, Feb.  20 (28 pages). 

The yearly cost to maintain the Army's inactive ammunition plants,
which has totaled about $118 million since 1990, has decreased over
the years.  This decline is the result of various initiatives,
including downsizing, reduced maintenance requirements, more rigorous
contract negotiations with operating contractors, and the Armament
Retooling and Manufacturing Support Act of 1992.  That legislation
provides financial incentives to ammunition plant contractors to
reuse idle capacities by attracting commercial tenants to their
facilities.  The Army could further decrease its infrastructure costs
by disposing of unneeded property at inactive Army ammunition plants. 
In addition, DOD should establish (1) incentives for communities to
speed up the transfer of closed bases and (2) after the initial
maintenance period has elapsed, criteria for a phased drawdown of
maintenance until minimum levels are reached. 

Defense Health Program:
Future Costs Are Likely to Be Greater Than Estimated

GAO/NSIAD-97-83BR, Feb.  21 (42 pages). 

The Defense Department (DOD), which is counting on infrastructure
savings to pay for new weapon systems, may have underestimated its
health care budget by billions of dollars because of questionable
assumptions about the future costs of medical treatment and possible
savings from its new managed health care system.  In addition to
treating patients during wartime, DOD's medical system provides
health care for active duty military personnel, their families, and
retirees.  GAO found that DOD did not factor in any cost growth due
to advances in medical technology and the intensity of treatment.  In
addition, DOD claimed that its managed health care system would yield
substantial savings by reducing unnecessary treatments and
testing--even though DOD did not use a formal methodology or analysis
to arrive at such savings. 

Military Bases:
Mission Transfers Affecting Ellsworth Air Force Base

GAO/NSIAD-97-58, Feb.  24 (12 pages). 

This report examines the costs and benefits of several B-1B aircraft
mission transfers affecting the Ellsworth Air Force Base, located in
South Dakota.  GAO discusses the (1) extent to which the Air Force
analyzed the costs and benefits of the proposed jet engine
intermediate maintenance consolidation at Dyess Air Force Base in
Texas, (2) costs and benefits of transferring the Route Integration
Instrumentation System from Ellsworth to Nellis Air Force Base in
Nevada, and (3) reasons and costs to build facilities to house B-1B
aircraft at Robins Air Force Base in Georgia. 

National Missile Defense:
Risk and Funding Implications for the Space-Based Infrared
Low Component

GAO/NSIAD-97-16, Feb.  25 (31 pages). 

The Defense Department (DOD) made plans in 1995 to launch the space
and missile tracking system--the low satellite component of the
Space-Based Infrared System--in fiscal year 2006.  In February 1996,
Congress directed DOD to restructure the program and deploy the first
space and missile tracking system satellite in fiscal year 2002.  DOD
contends that accelerating deployment is not possible because
technical, funding, and management problems have delayed the
scheduled launch of two demonstration satellites, the results of
which are necessary before deciding to begin fabricating operational
space and missile tracking system satellites.  However, DOD is
planning to speed up deployment to fiscal year 2004 and has directed
the Air Force to prepare cost estimates and program plans to support
such deployment.  This report reviews the space and missile tracking
system to determine the effects of changing the deployment date from
fiscal year 2006 (the original schedule) to fiscal years 2002, 2003,
2004, or 2005. 

Combat Air Power:
Joint Assessment of Air Superiority Can Be Improved

GAO/NSIAD-97-77, Feb.  26 (56 pages). 

One of the main objectives of U.S.  combat air power is to achieve
air superiority, which allows operations in the air and on land and
sea without interference from an enemy's air forces, cruise missiles,
and theater ballistic missiles.  The Pentagon plans to spend more
than $43 billion through 2001 to acquire weapons systems to equip and
modernize forces for the air superiority missions.  This unclassified
version of a classified report (1) identifies the overlap among the
military services' planned capabilities and (2) determines whether
the joint warfighting assessment process relating to air superiority
was useful in making program and budget decisions about these
capabilities. 

Defense Logistics:
Much of the Inventory Exceeds Current Needs

GAO/NSIAD-97-71, Feb.  28 (32 pages). 

Despite efforts to reduce its inventory of spare parts, clothing,
medical supplies, and other support items, the Defense Department
(DOD) still maintains more than $41 billion worth of items that are
obsolete or rarely used.  In some cases, the military maintains
enough excess inventory to supply U.S.  troops for more than 100
years.  DOD officials cite many reasons for having such a large
amount of unneeded inventory on hand.  The requirement changes
involved recurring or nonrecurring demands that decreased,
fluctuated, or did not materialize; parts or the systems on which the
parts were used were obsolete; and weapon system programs were
reduced.  Other reasons include purchases to cover the expected life
of weapon systems and adherence to minimum buy policies.  Records
indicate that the Army, the Navy, and the Air Force had a 20 years'
supply of unneeded inventory--valued at more than $28 million--on
hand and another $11 million worth of these same items on order. 
However, because the records for almost 40 percent of the reviewed
items were in error, these items, in fact, did not have additional
stock on order.  In cases in which inventory was on order, the
reasons included requirement changes, buys to cover the life of
weapon systems, and adherence to minimum
buy policies. 

Defense Budget:
Analysis of Operation and Maintenance Accounts for 1985-2001

GAO/NSIAD-97-73, Feb.  28 (78 pages). 

The Defense Department's (DOD) budget request for fiscal year 1997
includes $89.2 billion for operation and maintenance accounts--about
37 percent of the military's budget request for that year.  Because
these funds represent the largest share of DOD's budget, this report
(1) determines how annual funding relates to military and civilian
personnel levels through fiscal year 2001, (2) identifies overall
trends from fiscal years 1985 to 2001, and (3) identifies key
drivers--areas in which most money has been budgeted--through fiscal
year 2001.  GAO highlights significant information that Congress can
use to focus future budget deliberations.  Throughout the report, GAO
raises questions about reported trends in operation and maintenance. 
GAO also explains the reasons for major changes in funding because of
migrations of funds between operations and maintenance programs and
activities. 

Force Structure:
Army Support Forces Can Meet Two-Conflict Strategy With
Some Risks

GAO/NSIAD-97-66, Feb.  28 (81 pages). 

During the last two fiscal years, the Army has reduced its active
military forces from 540,000 to 495,000.  A key issue is whether the
Army's active end strength should be reduced to help pay for force
modernization.  Last year, Congress established an active Army
military personnel end strength floor of 495,000 out of concern that
further cuts could undermine the Army's ability to respond to two
nearly simultaneous regional conflicts, as well as to deploy to
operations other than war.  This report reviews (1) the extent to
which the Army's process for assessing its active and reserve support
forces resulted in sufficient force structure to meet the
requirements of the national military strategy; (2) whether the
Army's streamlining efforts have identified ways to reduce Army
personnel resources devoted to institutional functions; and (3) the
feasibility of reducing active Army end strength, a matter that
Congress will review when it debates future Army end strength
authorizations. 

Defense Health Care:
Dental Contractor Overcame Obstacles, but More Proactive Oversight
Needed

GAO/HEHS-97-58, Feb.  28 (49 pages). 

In 1985, Congress authorized the Defense Department (DOD) to
establish a dental benefits program for family members of active duty
service personnel who could no longer be accommodated on a
space-available basis at military dental clinics.  Through 2001, the
plan will be run nationwide for DOD under a contract with United
Concordia Companies, Inc.  of Camp Hill, Pennsylvania.  Concordia
experienced a difficult and lengthy takeover from the incumbent
contractor.  In addition, Congress has raised concerns about the
amounts that Concordia paid to dentists, the number of participating
dentists, and the timeliness of claims processing and the
restrictiveness of coverage.  This report discusses whether (1)
Concordia's fee allowances for participating and nonparticipating
dentists are appropriate, (2) Concordia has established an adequate
network of participating dentists, (3) Concordia's claims processing
and marketing efforts meet contract requirements, and (4) DOD is
ensuring that Concordia complies with contract requirements. 


      TESTIMONY
------------------------------------------------------ Appendix 0:16.1

Defense Health Care:  Limits to Older Retirees' Access to Care and
Proposals for Change, Stephen P.  Backhus, Director of Veterans'
Affairs and Military Health Care Issues, before the Subcommittee on
Military Personnel, House Committee on National Security. 
GAO/T-HEHS-97-84, Feb.  27 (seven pages). 

When space and resources are available in military medical
facilities, military retirees may receive care at little or no cost. 
When resources are unavailable, retirees under age 65 can seek
medical care from the private sector, and the Defense Department's
(DOD) Civilian Health and Medical Program of the Uniformed Services
(CHAMPUS) will cover the cost.  But retirees over age 65 lose the
CHAMPUS benefit, and the only DOD-funded care is the space-available
care at military facilities.  In the last 10 years, one-third of
military hospitals have been closed because of military downsizing,
reducing space available for older retirees, a group that has grown
75 percent during the last 10 years to 1.2 million.  In addition,
DOD's managed health care system gives older retirees the lowest
priority for access to space.  GAO examines the costs and benefits of
five proposed alternatives for addressing the issue of health care
for older retirees:  (1) Medicare subvention, (2) enrollment in the
Federal Employees Health Benefit Program, (3) CHAMPUS as a secondary
payer, (4) Medigap policies, and (5) a mail order pharmacy benefit. 


   NATURAL RESOURCES
-------------------------------------------------------- Appendix 0:17

Land Management Agencies:
Information on Selected Administrative Policies and Practices

GAO/RCED-97-40, Feb.  11 (26 pages). 

The federal government owns and manages about 650 million acres of
land in the United States--more than one quarter of the nation's
total land area.  Ninety-six percent of the federal land is managed
by four agencies:  the National Park Service, the Fish and Wildlife
Service, the Bureau of Land Management (BLM), and the Forest Service. 
In fiscal year 1995, the four agencies employed more than 75,000
full-time equivalent employees.  Combined, the agencies received new
budget authority in excess of $8 billion.  They provide some of their
employees with rental housing, authority to use the agencies'
vehicles, and allowances to buy uniforms.  The agencies also
encourage and pay for some employees to move to different geographic
locations during their careers.  This report compares the four
agencies' policies and practices relating to (1) the reasons for and
the costs of field-unit managers' geographic relocations; (2) the
authorization for and the quantity and condition of employees' rental
housing; (3) the requirements for providing employees' uniforms and
expenditures for them; and (4) the authorizations for employees'
home-to-work travel in agency vehicles.  GAO also compares the
processes by which BLM and the Forest Service issue grazing permits
and highlights the similarities and differences between the two
agencies'
grazing programs. 


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

Forest Service Decision-Making:  Greater Clarity Needed on Mission
Priorities, by Barry T.  Hill, Associate Director for Energy,
Resources, and Science Issues, before the Subcommittee on Forests and
Public Lands, Senate Committee on Energy and Natural Resources. 
GAO/T-RCED-97-81, Feb.  25 (12 pages). 

The Forest Service's decision-making process is costly and
time-consuming and often fails to achieve its objectives.  The agency
has spent more than 20 years and about $250 million developing
multiyear plans to manage livestock grazing, recreation, wildlife and
fish habitat, and other uses on national forests.  It also spend
about $250 million a year on environmental studies.  However,
according to an internal Forest Service report, inefficiencies within
this process cost as much as $100 million each year.  GAO notes three
underlying causes of inefficiency and ineffectiveness in the Forest
Service's decision-making process.  First, the agency has not given
enough attention to improving its decision-making process, including
strengthening its accountability for expenditures and performance. 
Second, issues that transcend the agency's administrative boundaries
and jurisdiction have not been adequately addressed.  Third, the
requirements of many planning and environmental laws, enacted during
the 1960s and 1970s, have not been harmonized. 

National Parks:  Park Service Needs Better Information to Preserve
and Protect Resources, by Barry T.  Hill, Associate Director for
Energy, Resources, and Science Issues, before the Subcommittee on
National Parks and Public Lands, House Committee on Resources. 
GAO/T-RCED-97-76, Feb.  27 (eight pages). 

The National Park Service is the caretaker of many of this country's
most precious natural and cultural resources, which range from
natural areas, such as Yellowstone and Yosemite National Parks; to
urban areas, such as Gateway National Recreation Area in Brooklyn,
New York; to national battlefields, historic sites, and monuments. 
The agency's mission is to provide for the public's enjoyment of
these resources while also preserving and protecting these treasures
so that they can be enjoyed by future generations.  This testimony
draws on three recent GAO reports (GAO/RCED-94-59, Jan.  1994,
GAO/RCED-95-238, Aug.  1995, and GAO/RCED-96-202, Aug.  1996) and
discusses the Park Service's knowledge of the condition of the
resources that it is entrusted to protect within the National
Park System. 


   SOCIAL SERVICES
-------------------------------------------------------- Appendix 0:18

Child Welfare:
States' Progress in Implementing Family Preservation and
Support Services

GAO/HEHS-97-34, Feb.  18 (40 pages). 

To help keep families together, Congress passed legislation in 1993
that provided states with $930 million over five years for family
preservation and support services.  These services typically target
families already in crisis whose children would otherwise be removed
from home.  Forty-four states said that they have launched new
programs.  For example, some states now offer programs in which
counselors are available 24 hours a day to work with families having
a history of child abuse.  Forty-seven states report improving or
expanding existing programs.  For example, adding a service like
childcare could enhance a family resources center that already
provides an array of services, such as parenting classes, afterschool
activities, and family counseling.  Early results from 10 states
suggest some success, such as preventing child removal and continued
maltreatment.  Although it is too soon to know the overall impact of
these programs, federal and state officials report that the extensive
community and interagency collaboration required by the law has
improved identification of service needs, setting of priorities, and
receipt of services by at-risk families otherwise overlooked. 


      TESTIMONY
------------------------------------------------------ Appendix 0:18.1

Foster Care:  State Efforts to Expedite Permanency Hearings and
Placement Decisions, by Mark V.  Nadel, Associate Director for Income
Security Issues, before the Subcommittee on Human Resources, House
Committee on Ways and Means.  GAO/T-HEHS-97-76, Feb.  27 (12 pages). 

The federal government's tab for foster care totaled nearly $3.1
billion in fiscal year 1995; it is estimated to rise to almost $4.8
billion in 2001.  Available data suggest that more than 40 percent of
foster children stay in care for two years or more.  Moreover, almost
30 percent of children were placed in at least three different
settings while in foster care.  This situation is not in the best
interests of children who, without benefit of permanent homes and
stable caregivers, may be more likely to develop psychological or
physical problems.  This testimony discusses (1) state efforts to
reduce the time frames within which hearings must be held to
determine permanent placements for foster children, (2) state
initiatives designed to speed permanent placements for foster
children and the effectiveness of these efforts, and (3) key factors
that facilitate changes in this part of the child welfare system. 


   TRANSPORTATION
-------------------------------------------------------- Appendix 0:19

Urban Transportation:
Challenges to Widespread Deployment of Intelligent Transportation
Systems

GAO/RCED-97-74, Feb.  27 (24 pages). 

The Department of Transportation has received $1.3 billion to promote
the use of computers and telecommunications technologies to improve
the safety and efficiency of surface transportation.  The wide array
of intelligent transportation system technologies includes automated
toll collection systems that eliminate the need for vehicles to stop
at toll booths, real-time information on traffic conditions and
transit schedules for travelers, and automated traffic management
systems that can adjust traffic signals to respond to real-time
traffic conditions.  This report discusses (1) how the Department has
changed the focus of the intelligent transportation systems program
since Congress passed the Intermodal Surface Transportation
Efficiency Act in 1991; (2) progress in deploying integrated
intelligent transportation systems and the key factors affecting
deployment, including the status of the national architecture and
technical standards; and (3) the ways in which the federal government
can facilitate the deployment of intelligent transportation systems. 

Transportation Infrastructure:
Managing the Costs of Large-Dollar Highway Projects

GAO/RCED-97-47, Feb.  28 (44 pages). 

Each year, the federal government gives the states nearly $20 billion
to help build and repair the nation's highways.  To meet the nation's
transportation needs, states are planning or building large-dollar
projects to both replace aging infrastructure and build new capacity. 
This report discusses (1) whether large-dollar highway
projects--defined as costing more than $100 million--experience cost
growth, (2) how the Federal Highway Administration (FHWA) approves
large-dollar highway projects and agrees to their costs, and (3) how
FHWA ensures that project costs are controlled and that federal funds
are used efficiently. 


      TESTIMONY
------------------------------------------------------ Appendix 0:19.1

FAA Financing:  Issues and Options in Deciding to Reinstate or
Replace the Airline Ticket Tax, by John H.  Anderson, Jr., Director
of Transportation Issues, before the Senate Committee on Finance. 
GAO/T-RCED-97-56, Feb.  4 (18 pages); and

Airport and Airway Trust Fund:  Issues Related to Determining How
Best to Finance FAA, by John H.  Anderson, Jr., Director of
Transportation Issues, before the Subcommittee on Aviation, House
Committee on Transportation and Infrastructure.  GAO/T-RCED-97-59,
Feb.  5 (18 pages). 

On December 31, 1996, the government's authority to collect the taxes
that finance the Airport and Airway Trust Fund, which has
historically provided about three-quarters of the Federal Aviation
Administration's (FAA) funding, lapsed.  A coalition of the nation's
largest airlines has proposed replacing the tax on domestic airline
tickets, which has been the Trust Fund's main source of revenue, with
fees on domestic operations.  The coalition airlines contend that
they pay for more than their fair share of the costs incurred by FAA
in running the airport and airway system and that competing low-fare
airlines underpay.  This testimony discusses (1) the status of the
Trust Fund, (2) issues raised by the coalition's proposal, (3)
potential effects of the coalition's proposal on domestic
competition, and (4) potential competitive impacts of alternative
options for financing FAA. 

Transportation Infrastructure:  States' Implementation of
Transportation Management Systems, by Phyllis F.  Scheinberg,
Associate Director for Transportation Issues, before the Subcommittee
on Transportation and Infrastructure, Senate Committee on Environment
and Public Works.  GAO/T-RCED-97-79, Feb.  26 (15 pages). 

The Intermodal Surface Transportation Efficiency Act of 1991 mandated
six transportation management systems for managing highway pavement,
bridges, highway safety, traffic congestion, public transportation
facilities and equipment, and intermodal transportation facilities. 
These management systems are tools that provide information to help
state and local officials select cost-effective policies, procedures,
and projects to protect and improve the nation's transportation
infrastructure.  Recent legislation made the six systems optional,
except for the congestion management system in some areas.  This
testimony, which draws on a January 1997 report (GAO/RCED-97-32),
discusses the status of the states' implementation of the systems,
how the states expect to use the systems, and the factors that have
facilitated or hindered their development
and implementation. 


   VETERANS AFFAIRS
-------------------------------------------------------- Appendix 0:20

VA Disability Compensation:
Comparison of VA Benefits With Those of Workers'
Compensation Programs

GAO/HEHS-97-5, Feb.  14 (30 pages). 

Federal and state workers' compensation programs provide economic
support for persons with work-related illnesses or injuries, while
the Department of Veterans Affairs' (VA) disability compensation
program provides economic support for some veterans with
service-connected conditions.  In fiscal year 1995, VA paid $11.5
billion to the 2.2 million veterans on its disability rolls.  State
workers' compensation programs annually paid workers' compensation
indemnity benefits ranging from $14.2 million for claims filed in
Rhode Island to $4.6 billion for claims filed in California.  Between
July 1995 and June 1996, the Labor Department paid $1.29 billion for
claims filed under the Federal Employees' Compensation Act, one of
three workers' compensation programs it administers.  This report
compares (1) the criteria used by the VA disability compensation
program and federal and state workers' compensation programs to
determine compensation and (2) the compensation that individuals with
selected work-related injuries and diseases would receive under VA's
disability program and what they would receive for the same
impairments under the Federal Employees' Compensation Act. 

*** End of document. ***