[Survey Report on Employee Housing Rental Income, National Park Service (99-I-919)]
[From the U.S. Government Printing Office, www.gpo.gov]
Title: Survey Report on Employee Housing Rental Income, National
Park Service (99-I-919)
Report No: 99-I-919
Title: Survey Report on Employee Housing Rental Income, National Park
Service
Date: September 1999
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C-IN-NPS-001-99
SURVEY REPORT
Memorandum
To: Assistant Secretary for Fish and Wildlife and Parks
From: Robert J. Williams
Assistant Inspector General for Audits
Subject: Survey Report on Employee Housing Rental Income, National Park Service
(99-I-919)
INTRODUCTION
This report presents the results of our survey of rental income for housing provided to
National Park Service employees. The objective of the survey was to determine whether (1)
the Park Service complied with the criteria contained in Office of Management and Budget
Circular No. A-45, "Rental and Construction of Government Quarters," concerning rental
rates charged for Government quarters; (2) housing was provided only to properly
authorized and eligible individuals; and (3) the Park Service established adequate controls
over the use of rental income.
BACKGROUND
According to the Acting Director of the Park Service, the Park Service provides housing for
"those persons who are essential to the management and operation of the park," including
Park Service employees, concessioners' employees, park volunteers, "essential cooperators,"
and employees of other Federal agencies. In fiscal year 1999, the Park Service managed
4,516 single-family and multiple-unit housing quarters (excluding trailers, trailer pads, and
tents). In its fiscal year 2000 budget justification, the Park Service reported that it expected
to receive rental income of about $15 million in fiscal year 1999 and $15.3 million in fiscal
year 2000. The Park Service collected rental income of about $14.8 million and spent
housing account funds of about $14.2 million in fiscal year 1998. The Park Service does not
maintain information on the amount of rental income paid by concessioner employees who
occupy park housing because this income is collected and retained by the concessioners.
Park Service compensation for concessioner employees' use of park housing was discussed
in our audit report "Concession Contracting Procedures, National Park Service" (No. 99-I-
626), dated June 1999. In this report, we stated that neither the Park Service's concession
management nor its housing program provided for concessioners or their employees to make
rental payments to the Government for concessioner use of park housing.
Federal law (5 U.S.C. 5911) requires agencies to establish rental rates or charges for
Government quarters that are based on their "reasonable value . . . to the employee . . . in the
circumstances under which the quarters and facilities are provided, occupied or made
available." Office of Management and Budget Circular No. A-45, "Rental and Construction
of Government Quarters," states that rental rates should be based on "the rule of equivalence;
namely, that charges for rental and related facilities should be set at levels equal to those
prevailing for comparable private housing located in the same area, when practicable."
Circular A-45 also states that the rates should not reflect subsidies to the employees or serve
as an inducement in the recruitment or retention of employees and that the rates should be
fair and consistent. The Interior Appropriations Acts for fiscal year 1985 (Public Law 98-
473) and fiscal year 1989 (Public Law 100-446) provide for rents and charges for housing
to be collected by payroll deductions and for rental fees to be deposited into a special fund
in each agency and for the monies "to remain available, until expended, for the maintenance
and operation of the quarters of that agency."
The Park Service uses the Department of the Interior's computerized Quarters Management
Information System to calculate rental rates. The System, which is operated by the
Department's National Business Center, has a rental rate calculation program and a
computerized housing inventory. The Park Service is responsible for providing accurate
housing inventory data to the Center on the location, type, age, size, and condition of each
housing unit. The Center uses this information to update its housing data and rental rate
calculations.
In November 1997, the Park Service revised its housing policy and criteria to comply with
the Omnibus Parks and Public Lands Management Act of 1996 (Public Law 104-333), which
required the Park Service to eliminate unnecessary housing, to assess the physical condition
of its housing, to determine whether existing housing was needed and justified, and to assess
its housing criteria. The revised policy created two categories of housing: Category I
(required housing), which covers "employees in positions whose physical presence is
required within a specific geographic area to provide timely response to emergencies outside
normal working hours," and Category II, which covers housing provided for employees at
remote locations, for the parks' temporary work force, and for the use of historic structures.
All housing that is neither Category I nor Category II is considered to be excess to the
housing program. According to the Park Service's Acting Director, in addition to revising
housing policy, "parks were directed to prepare an excess housing plan that could indicate
continued use, or other uses such as leasing, stabilization, removal, etc."
In addition, during our review, the Park Service was reviewing or planned to review housing
in three phases: conducting an overall needs assessment, conducting condition assessments,
and developing a business plan/feasibility analysis for housing use. The needs assessment
was completed by contractors in December 1998; however, the contractors and the individual
parks did not always agree on the parks' housing needs. Consequently, as of June 1999, the
Park Service had not finalized the needs assessment. According to a Park Service official,
the second phase of the review will be initiated after the issues relating to the first phase are
resolved.
SCOPE OF SURVEY
Our survey work was performed from March through May 1999 at the Intermountain
Regional Office in Lakewood, Colorado; Rocky Mountain National Park; and Sequoia and
Kings Canyon National Parks (two distinct parks that are administratively managed as one
park). We also contacted the Pacific West Regional Office, in San Francisco, California, and
the Bureau of Reclamation's Quarters Management Information System Office, in Denver,
Colorado. We selected the Intermountain and Pacific West Regions because they contain
3,042, or 67 percent, of the 4,516 units in the Park Service's housing inventory. In addition,
total employee housing revenues and expenditures for these two regions were $10.2 million
and $9.8 million, respectively, or 69 percent of the total Park Service revenues and
expenditures for housing in fiscal year 1998. For our survey, we selected Rocky Mountain
National Park (141 housing units) in the Intermountain Region and Sequoia and Kings
Canyon National Parks (172 housing units) in the Pacific West Region. These two parks
were selected for review because they have a large number of housing units (only
Yellowstone, Yosemite, and Grand Canyon National Parks have a significantly greater
number of housing units) and a variety of housing types.
We conducted the survey in accordance with the "Government Auditing Standards," issued
by the Comptroller General of the United States. Accordingly, we included such tests of
records and other auditing procedures that were considered necessary under the
circumstances. As part of our review, we evaluated the system of internal controls related
to the Park Service's compliance with housing eligibility requirements and the collection and
use of housing rental fees. We found internal control weaknesses in these areas, which Park
Service officials agreed to correct. Based on the relatively minor deficiencies found during
our review and the Park Service's plans to review its policy regarding housing eligibility, we
limited our audit to the survey sites selected.
In addition, we reviewed the Departmental Report on Accountability for fiscal year 1998,
which includes information required by the Federal Managers' Financial Integrity Act, and
the Assistant Secretary for Fish and Wildlife and Parks annual assurance statement on
management controls for fiscal year 1998 and determined that a material weakness was
reported in the annual assurance statement regarding housing needs assessments and the cost
of constructing new housing in the National Park Service. The annual assurance statement
stated that Park managers, as part of the corrective action plan, will be responsible for
determining the minimum number of mission-critical housing units at their park units.
PRIOR AUDIT COVERAGE
During the past 5 years, the Office of Inspector General has not issued any audit reports on
Park Service housing rentals. However, the General Accounting Office has issued three
reports on the subject as follows:
- "National Park Service Concerns About the Implementation of Its Employee
Housing Policy" (No. GAO/T-RCED-99-119), issued in March 1999, presented General
Accounting Office testimony before the Subcommittee on Interior and Related Agencies,
Committee on Appropriations, House of Representatives. The report discussed the Park
Service's progress in implementing its October 1997 commitments to issue a revised housing
policy and hire contractors to conduct a park-by-park needs assessment based on the revised
policy. The report stated that the contractors determined that there was a surplus of 522
housing units Servicewide (which included an overall surplus of 1,072 units and an overall
shortage of 550 units) but that Park managers who reviewed the contractors' work
determined that there was a shortage of 760 housing units Servicewide (which included an
overall surplus of 165 units and an overall shortage of 925 units). The report attributed the
differences to "many park managers' fundamental disagreement with the revised housing
policy" and stated that this disagreement "raises serious concerns about the credibility of
future Park Service housing initiatives and any funding requests that the agency might have
for providing employee housing."
- "National Park Service Employee Housing Issues" (No. GAO/T-RCED-98-35),
issued in October 1997, presented General Accounting Office testimony before the
Subcommittee on Interior and Related Agencies, Committee on Appropriations, House of
Representatives. The report stated that the Park Service was slow in responding to
previously identified housing issues; "had not clearly justified the need for all" employee
housing; had prepared no detailed support for the estimated repair backlog; and had given
park managers' broad discretion in implementing housing policy, which resulted in
"inconsistencies in how the program was managed across the agency and raises questions
about whether housing decisions are being made in the best interest of the agency." The
report also stated that as a result of the Omnibus Parks and Public Lands Management Act
of 1996, the Park Service "is beginning the process to assess the need for its housing units"
but that "continued Congressional attention is needed to ensure that the Park Service is held
accountable" for its housing policies and decisions.
- "National Park Service: Reexamination of Employee Housing Program Is Needed"
(No. GAO/RCED-94-284), issued in August 1994, stated that a major issue facing the Park
Service's housing program was insufficient rental and appropriated funds to finance the
backlog of housing repair, rehabilitation, and replacement needs. The report recommended
that the Park Service (1) conduct a park-by-park review of housing needs to determine
whether the current housing inventory at each location is necessary and justified and (2)
develop a strategy for obtaining non-Federal funds by reviewing identified housing
alternatives and formulating a plan for implementing the most effective alternatives.
RESULTS OF SURVEY
The National Park Service generally charged and collected the proper rents for Government-
furnished quarters and used the rental income properly with the exceptions that are discussed
in the Other Matters section of this report. However, we found that the Park Service
provided Category II housing to permanent employees who were not eligible for such
housing under Park Service policy, which was under reconsideration as of August 1999.
Specifically, we identified 52 housing units that were assigned to permanent employees who
were not eligible under existing policy to occupy the housing. Chapter 3, Sections 3.4 and
3.5, of the Employee Housing Management Handbook, issued by the Park Service in
December 1997, permits permanent employees to occupy housing (other than historic
structures) under Category II criteria only when their duty station is "remote" and adequate
private housing is not available within a 60-minute one-way commute. The Park Service
provided housing to permanent employees who did not qualify for housing because two parks
(Rocky Mountain and Kings Canyon National Parks) relied on contractor needs assessment
studies that qualified employees for housing based on determinations of remoteness, which,
in our opinion, were incorrect. At another park (Sequoia National Park), ineligible
employees were provided housing, which was contrary to the Park Service's policy. As a
result, the Park Service may not have accurate information for the employee housing needs
assessment, which is required under provisions of Public Law 104-333.
At the three parks visited, there were 313 housing units available for occupancy. Of these
housing units, 49 were occupied by employees who qualified for housing under Category I
criteria, 260 were occupied by Park Service or concessioner employees under Category II
criteria, and 4 were considered excess based on the Park Service's needs assessment (see
Appendix 2).
Remoteness Determinations
One criterion for assigning Category II housing to employees is "remoteness," which is
defined by the Park Service as an adequate supply of private housing not being available
within a commuting "distance requiring travel time of not more than 60 minutes (one way)
from the employee's duty station by conventional private/public transportation." The Park
Service further required that the remoteness determination should be based on the
commuting time from the park to the available housing in "good weather at non-peak times."
In March and November 1997, the Park Service contracted for two housing needs
assessments, which were being finalized at the time of our survey. Based on the contractors'
determinations, Rocky Mountain and Kings Canyon National Parks assigned Category II
housing to permanent employees on the basis of remoteness because, according to the
contractors, local communities with adequate housing within a 60-minute drive did not exist.
Specifically, at Rocky Mountain National Park, the contractor's report stated that adequate
private housing did not exist within a 60-minute drive from the headquarters area of the park.
However, the contractor told us that its evaluations were made during a light snowfall and
that the driver encountered two separate rock slides en route--conditions that would decrease
the number of communities within a 60-minute commute. Consequently, in making its
determination, the contractor did not include housing in the communities of Loveland
(population 45,728), Longmont (population 60,226), and Boulder (population 92,446), all
of which were within a 50- to 51-minute commute to the Park (based on our commute to the
Park from these areas in good weather at non-peak times). A similar condition existed for
the Grant Grove housing area at Kings Canyon National Park, where the communities of
Reedley (population 20,050) and Sanger (population 18,650), California, were not included
in the contractor's determination of remoteness, even though we determined that the areas
were less than a 60-minute commute to the Park. As such, we identified 30 housing units
(20 at Rocky Mountain and 10 at Kings Canyon) that were occupied by permanent
employees who were not eligible for housing based on the remoteness consideration under
the Park Service's Category II requirements.
Policy Implementation
Regarding Sequoia National Park's Ash Mountain housing area, the contractor
determined, and Park officials agreed, that private housing was available within a 60-minute
drive. As such, Ash Mountain housing could be occupied only by employees eligible
under Category I criteria and seasonal employees or employees who occupied historic
structures under Category II criteria. The housing could not be used for permanent
employees under Category II criteria. However, Park officials allowed ineligible permanent
employees to reside in the housing and continued to assign ineligible permanent employees
to the housing when it became available because the officials were awaiting the completion
of all three phases of the Park Service's housing review. We determined that 22 housing
units at Ash Mountain were occupied by permanent employees who did not qualify for
housing under either the Category II historic structure or the remoteness criterion.
We concluded that housing was occupied by employees who were ineligible for the housing
under current Park Service policy because the contractors did not determine remoteness in
accordance with Park Service criteria. Specifically, the contractors did not include
communities that were within a 60-minute commute to Rocky Mountain and Kings Canyon
National Parks in their determination of the proximity of available housing. Also, Sequoia
National Park did not comply with Park Service policy on employee eligibility for park
housing. As a result, the needs assessment for the three parks appeared to be misstated by
52 units, or 16.8 percent (52 divided by 309).
During our review, the Park Service's Associate Director for Park Operations and Education
said that the Park Service intends to reconsider and possibly revise its November 1997
housing policy.
Recommendation
We recommend that the Director, National Park Service, review the Park Service's policy
regarding eligibility for employee housing under the Category II remoteness criterion. Upon
completion of the review, actions should be taken to ensure that all regions and parks comply
with the Park Service's housing policy (current or revised), and the needs assessments for
Rocky Mountain and Kings Canyon National Parks should be reviewed to determine
employee eligibility for housing based on the remoteness criterion.
National Park Service Response and Office of Inspector General Reply
In the September 15, 1999, response (Appendix 3) to the draft report from the Acting
Director, National Park Service, the Park Service did not respond to the report's
recommendation and said that it did not agree with our survey results. Based on the
response, we consider the recommendation unresolved (see Appendix 4).
Additional Comments on Report
In its response, the Park Service made general and specific comments on the report. The
general comments and the Office of Inspector General's responses to the comments are as
follows:
National Park Service Comment. The Park Service said that it was "concerned
. . . that the focus of the report [had] shifted from its stated objective to another objective:
the recent Housing Needs Assessment" and that the Inspector General should have met with
Park Service officials and "clearly" stated that it was expanding the audit objective to include
the housing study. The Park Service also said that the report contained "many allegations
which are not substantiated" regarding the Park Service's housing study and that we had not
requested information on the study "such as the scope of work and the specific criteria to be
used." The Park Service also stated that it disagreed with our conclusion that it provided
housing to ineligible employees. The Park Service, however, agreed with our finding on
housing rental income and stated that "any deficiencies noted were corrected or are to be
corrected effective October 1, 1999."
Office of Inspector General Reply. We did not conduct a comprehensive review
of the Park Service's contracted housing needs assessments/market analyses, and we did not
comment on the contractors' approach (scope or criteria) used to conduct the reviews.
Rather, we used the contractors' application of the Park Service's "remoteness" criterion in
determining whether housing was available outside the parks. We believe that using this
aspect of the housing needs assessment study was appropriate and relevant to the objective
of our audit, which included a determination as to whether "housing was provided only to
properly authorized and eligible individuals." Also, from personnel at the three parks visited,
we obtained copies of the contractors' housing studies for their parks, which we reviewed
and discussed with park and regional Park Service officials.
Also, we strongly disagree with the Park Service's statement that housing was not provided
to ineligible employees. At Sequoia National Park, Park officials said that housing was
provided to ineligible employees pending completion of the Park Service's needs assessment
studies and its development of related housing policy. Moreover, the General Accounting
Office in its March 1999 testimony (see "Prior Audit Coverage") said that "Park managers
did not assess their housing needs consistent with the Park Service's housing policy" and
later added that "there is some evidence to suggest that park managers have not accepted the
new housing policy or the need to minimize the agency's housing inventory."
In addition to its general comments, the Park Service made specific comments on the report,
and we revised the report to reflect the comments as appropriate. However, we did not revise
the report relating to the following comments:
- Referring to our discussion in Prior Audit Coverage of the General Accounting
Office's March 1999 testimony ("National Park Service Concerns About the Implementation
of Its Employee Housing Policy"), the Park Service said that it "did not change any contractor
numbers" when the Park Service and the contractors differed in their assessments of park
housing needs.
In the report, we did not state or imply that the Park Service made revisions to the
contractors' determinations of the parks' surplus or shortage of housing.
- The Park Service said that our statements "regarding contractor-determined
availability are not substantiated and leave the reader with the impression that the NPS
[National Park Service] market analysis was flawed. These statements need to be
substantiated and based on the very same criteria the [Park Service] contractor used, or they
should be deleted from the report."
We did not review or comment on the accuracy or propriety of the contractors' market
analysis. However, we discussed the contractors' assessments of remoteness with park and
regional officials and interviewed contractor employees who performed the assessments. For
one assessment, we found that a contract employee had not applied the Park Service's
remoteness criterion properly in determining whether housing was available within a 60-
minute, one-way commute to the park.
- Regarding the remoteness factor, the Park Service said that the contractor was
"directed to use a 60-minute commute shed from the employees' duty station, not the park,
under normal driving conditions" and that adverse weather conditions and heavy visitor
traffic were "considered normal" at both parks.
We do not consider adverse weather to be the normal condition at Rocky Mountain or Kings
Canyon National Park. Moreover, the contractor based his assessment of the commute to
one park on a trip in which he encountered light snowfall and two rock slides--conditions
that are not typical of a normal commute. Also, we based our commuting time on the
distance between Park headquarters and available housing outside the parks. We made the
commute under normal driving conditions and during a high-visitation period.
- The Park Service said that the criterion for remoteness was based on Office of
Management and Budget Circular A-11, which defines a reasonable commute as not more
than a 2-hour round-trip.
We revised the report to state that the remoteness criterion was based on a 60-minute, one-
way commute, which is the equivalent of a 2-hour round-trip commute.
Other Matters
During our review, we identified minor deficiencies in the areas of rental rates charged to
employees and the controls over collections and expenditures of rental income. Park
officials informed us that appropriate actions would be taken to correct these minor
deficiencies.
Rental Rates. The rental rates charged by the Park Service for Government housing
generally were established in accordance with Office of Management and Budget Circular
No. A-45, "Rental and Construction of Government Quarters." We tested the rental rate
calculations from the Quarters Management Information System (the Department of the
Interior's automated system used to record employee housing data) and found that the
calculations were accurate based on the inventory data in the System. However, when we
compared the data on housing conditions in the System (excellent, good, fair, or poor) with
the condition of housing units at Sequoia and Kings Canyon National Parks, we found minor
inconsistencies and inaccuracies in the data. For example, we found housing that needed
considerable maintenance recorded in "good" condition in the System. Conversely, we found
housing that was in very good condition with new paint and carpet and no identified
maintenance needs that was listed in "poor" condition in the System. These inconsistencies
occurred because the determinations of housing conditions were performed by different
employees who had different interpretations of what constituted excellent, good, fair, or poor
condition. In addition, the housing inventory was not always updated by Park officials to
recognize changes in the condition status resulting from renovations or repairs. We
identified two instances in which housing had been repaired/renovated but which were
recorded in the System as in "poor" condition. When rental rates are based on inaccurate
housing conditions, the monthly rent is higher or lower than necessary. The Park
Superintendent stated that a part-time housing assistant was being recruited and that the
inconsistency in housing condition determinations would be corrected.
Rental Income and Controls. We found that controls over the collection and
expenditure of rental income were generally adequate at the three parks visited. However,
at Rocky Mountain National Park, appropriate amounts of rent were not collected for housing
units occupied by volunteers. At Sequoia and Kings Canyon National Parks, the Park
Service did not implement adequate controls over the expenditure of rental income.
Chapter 8, Section 8.3.1, of the Park Service Employee Housing Management Handbook
requires benefiting activities to pay rent for quarters occupied by volunteers. However, at
Rocky Mountain, the Park did not charge the benefiting programs the full rental rate for
housing occupied by volunteers. As a result, for fiscal year 1998, the quarters account at
Rocky Mountain was not reimbursed $9,250. After we brought this matter to the attention
of Park management, the Park Superintendent issued a directive requiring benefiting
programs to pay, effective October 1, 1999, the full rental rate for housing used by
volunteers.
Also, at Sequoia and Kings Canyon National Parks, the Park Service did not implement
adequate controls over the expenditure of rental income. We found that maintenance salaries
of $248,154 charged to the housing accounts were not supported by adequate documentation.
In addition, of 21 transactions reviewed, totaling $15,858, we found only 5 transactions,
totaling $10,529, that were specifically identified as housing related. We also identified
seven transactions, totaling $3,201, that involved charges to the housing account for central
supply warehouse items. These expenses were charged to the housing account without
documentation to show that the expenses were justified or approved by a supervisor. Park
management said that the Park's controls "could be improved" and that corrective action
would be taken. (The monetary impact of the amounts cited is in Appendix 1.)
In accordance with the Departmental Manual (360 DM 5.3), we are requesting a written
response to this report by November 30, 1999. The response should provide the information
requested in Appendix 4.
Section 5(a) of the Inspector General Act (Public Law 95-452, as amended) requires the
Office of Inspector General to list this report in its semiannual report to the Congress.
We appreciate the assistance of Park Service personnel in the conduct of our survey.
APPENDIX 1
CLASSIFICATION OF MONETARY AMOUNTS
APPENDIX 2
SCHEDULE OF HOUSING UNITS BY TYPE AND PARK APPENDIX 3
APPENDIX 4
STATUS OF SURVEY REPORT RECOMMENDATION