Environmental Protection Agency: Difficulties in Comparing Annual Budgets
for Science and Technology (Testimony, 03/18/99, GAO/T-RCED-99-120).
Pursuant to a congressional request, GAO discussed the Environmental
Protection Agency's (EPA) budget justification for its Science and
Technology account, and changes among the justifications for fiscal
years (FY) 1998, 1999, and 2000, focusing on: (1) difficulties
experienced in comparing EPA's Science and Technology budget
justification for FY 1999 with those of previous years; and (2) actions
that EPA planned and implemented in order to improve the clarity and
comparability of the FY 2000 justification, and items that need further
clarification.
GAO noted that: (1) EPA's budget justification for FY 1999 could not be
readily compared to amounts requested or enacted for FY 1998 and prior
years because the justification did not show how the budget would be
distributed among program offices or program components--information
needed to link to the prior years' justifications; (2) the Office of
Management and Budget does not require EPA to provide information to
compare the justifications when the format changes; (3) to facilitate
such comparisons, agency officials provided supplemental information to
congressional committees; (4) because EPA did not maintain financial
records by both program components and strategic goals and objectives
for all enacted Science and Technology funds for FY 1998, it could not
readily provide information for all amounts; (5) at GAO's request, EPA
estimated the 1998 enacted amounts so that the 1998 budget could be
compared with the FY 1999 request; (6) EPA implemented several changes
to its FY 2000 justification to solve problems experienced in comparing
the 1998 and 1999 budget justifications; (7) to improve the clarity of
its budget justification for FY 2000, EPA included tables that detail,
for each objective, how requested amounts are allocated among key
programs; (8) backup information is also available that shows the
program offices that will be administering the requested funds; (9) the
agency also implemented a new accounting system that records budget data
by goals and objectives, which enhances reporting financial data by
goals and objectives; (10) while the budget justification followed the
basic format reflecting the agency's strategic goals and objectives, EPA
made changes to the objectives without explanations or documentation to
link the changes to the FY 1999 budget justification; (11) for example,
funds were allocated from one objective to other objectives without
identifying the objectives or amounts, funds that included money
transferred from another account were shown as Science and Technology
funds, and changes were made to the number or wording of objectives
without explanations; and (12) as a result, the FY 2000 budget
justification cannot be completely compared with the FY 1999
justification without supplemental information.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: T-RCED-99-120
TITLE: Environmental Protection Agency: Difficulties in Comparing
Annual Budgets for Science and Technology
DATE: 03/18/99
SUBJECT: Comparative analysis
Strategic planning
Budget administration
Mission budgeting
Appropriated funds
Reporting requirements
Financial records
Future budget projections
IDENTIFIER: EPA Planning, Budgeting, Analysis, and Accountability System
******************************************************************
** This file contains an ASCII representation of the text of a **
** GAO report. Delineations within the text indicating chapter **
** titles, headings, and bullets are preserved. Major **
** divisions and subdivisions of the text, such as Chapters, **
** Sections, and Appendixes, are identified by double and **
** single lines. The numbers on the right end of these lines **
** indicate the position of each of the subsections in the **
** document outline. These numbers do NOT correspond with the **
** page numbers of the printed product. **
** **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced. Tables are included, but **
** may not resemble those in the printed version. **
** **
** Please see the PDF (Portable Document Format) file, when **
** available, for a complete electronic file of the printed **
** document's contents. **
** **
** A printed copy of this report may be obtained from the GAO **
** Document Distribution Center. For further details, please **
** send an e-mail message to: **
** **
** **
** **
** with the message 'info' in the body. **
******************************************************************
Cover
================================================================ COVER
Before the Subcommittee on Energy and Environment, Committee on
Science, House of Representatives
For Release
on Delivery
Expected at
11:30 a.m. EST
Thursday
March 18, 1999
ENVIRONMENTAL PROTECTION AGENCY -
DIFFICULTIES IN COMPARING ANNUAL
BUDGETS FOR SCIENCE AND TECHNOLOGY
Statement of David G. Wood, Associate Director,
Environmental Protection Issues,
Resources, Community, and Economic
Development Division
GAO/T-RCED-99-120
GAO/RCED-99-120T
(160478)
Abbreviations
=============================================================== ABBREV
EPA -
============================================================ Chapter 0
Mr. Chairman and Members of the Subcommittee:
I am here to discuss the Environmental Protection Agency's (EPA)
budget justification for the Science and Technology account and
certain changes that we observed among the justifications for fiscal
years 1998, 1999, and 2000. For fiscal year 2000, EPA seeks $642
million for the Science and Technology account, an amount
representing 9 percent of the agency's total budget request of $7.2
billion.
Each year, EPA provides to the congressional appropriations
committees a budget justification for requested appropriations for
the forthcoming fiscal year. This justification supplements the
President's budget submitted to the Congress by providing additional
details and shows funding levels for the previous fiscal year. This
committee and others use the justification in deliberating EPA's
budget, programs, and activities. EPA's budget justifications for
fiscal years 1999 and 2000 differed significantly from its
justifications for fiscal year 1998 and the prior year because they
were organized according to the agency's strategic goals and
objectives (e.g., Clean Air: Reduce Emissions of Air Toxics). These
goals and objectives were established in the strategic plan EPA
prepared to meet the requirements of the Government Performance and
Results Act. In contrast, the fiscal year 1998 budget justification
was organized according to EPA's program offices and components
(e.g., Office of Air and Radiation: Air Toxics).
My statement today discusses the findings from our recent report on
EPA's Science and Technology funds requested for fiscal year 1999 and
on our limited review of EPA's fiscal year 2000 budget
justification.\1 Specifically, I will discuss (1) difficulties
experienced in comparing EPA's Science and Technology budget
justification for fiscal year 1999 with those of previous years and
(2) actions that EPA planned and implemented in order to improve the
clarity and comparability of the fiscal year 2000 justification, and
items that need further clarification. In summary we found the
following:
-- EPA's budget justification for fiscal year 1999 could not be
readily compared to amounts requested or enacted for fiscal year
1998 and prior years because the justification did not show how
the budget would be distributed among program offices or program
components�information needed to link to the prior years'
justifications. The Office of Management and Budget does not
require EPA to provide information to compare the justifications
when the format changes. However, to facilitate such
comparisons, agency officials provided supplemental information
to congressional committees. This information included tables
that linked the amounts for specific program components used in
prior justifications to the agency's various strategic goals and
objectives. Because EPA did not maintain financial records by
both program components and strategic goals and objectives for
all enacted Science and Technology funds for fiscal year 1998,
it could not readily provide information for all amounts. At
our request, EPA estimated the 1998 enacted amounts so that the
1998 budget could be compared with the fiscal year 1999 request.
-- EPA implemented several changes to its fiscal year 2000
justification to solve problems experienced in comparing the
1998 and 1999 budget justifications. To improve the clarity of
its budget justification for fiscal year 2000, EPA included
tables that detail, for each objective, how requested amounts
are allocated among key programs. Backup information is also
available that shows the program offices that will be
administering the requested funds. The agency also implemented
a new accounting system that records budget data by goals and
objectives, which enhances reporting financial data by goals and
objectives. While the budget justification followed the basic
format reflecting the agency's strategic goals and objectives,
EPA made changes to the objectives without explanations or
documentation to link the changes to the fiscal year 1999 budget
justification. For example, funds were allocated from one
objective to other objectives without identifying the objectives
or amounts, funds that included money transferred from another
account were shown as Science and Technology funds, and changes
were made to the number or wording of objectives without
explanations. As a result, the fiscal year 2000 budget
justification cannot be completely compared with the fiscal year
1999 justification without supplemental information.
--------------------
\1 Environmental Protection: EPA's Science and Technology Funds
(GAO/RCED-99-12, Oct. 30, 1998).
PRIOR DIFFICULTIES IN COMPARING
BUDGET JUSTIFICATIONS
---------------------------------------------------------- Chapter 0:1
In 1998, we reported that difficulties in comparing EPA's fiscal year
1999 and 1998 budget justifications arose because the 1999 budget
justification was organized according to the agency's strategic goals
and objectives, whereas the 1998 justification was organized
according to EPA's program offices and components. Funds for EPA's
Science and Technology account were requested throughout the fiscal
year 1999 budget justification for all 10 of the agency's strategic
goals and for 25 of its 45 strategic objectives. As shown in table
1, two strategic goals--Sound Science and Clean Air--accounted for 71
percent of the funds requested for Science and Technology.\2
Table 1
Science and Technology Funds Requested
for EPA's 10 Strategic Goals and 25
Objectives, Fiscal Year 1999
Number Fiscal Percenta
of year ge of
objectiv 1999 total
Strategic goal es request request
---------------------------------------- -------- -------- --------
Sound science, improved understanding of 5 $312,955 49.4%
environmental risks, and greater ,700
innovation to address environmental
problems
Clean air 4 137,154, 21.7%
200
Reduction of global and cross- 1 67,406,5 10.6%
environmental risks 00
Clean and safe water 3 55,335,7 8.7%
00
Expansion of American's right to know 1 18,648,3 2.9%
about their environment 00
Preventing pollution and reducing risks 3 14,383,6 2.3%
in communities, homes, workplaces, and 00
ecosystems
Better waste management, restoration of 3 14,139,3 2.2%
contaminated sites, and emergency 00
response
A credible deterrent to pollution and 2 8,760,70 1.4%
greater compliance with the law 0
Safe food 2 4,450,00 0.7%
0
Effectivement management 1 226,000 <0.1%
======================================================================
Total 25 $633,460 100.0%
,000
----------------------------------------------------------------------
Source: GAO's analysis of EPA's fiscal year 1999 Justification of
Appropriation Estimates for the Committees on Appropriations and data
provided by EPA.
In its fiscal year 1999 budget justification, EPA did not show how
the funds requested for each goal and objective would be allocated
among its program offices or components. To be able to compare EPA's
requested fiscal year 1999 funds for Science and Technology to the
previous fiscal year's enacted funds, EPA would have had to maintain
financial records in two different formats�by program components and
by strategic goals and objectives�and to develop crosswalks to link
information between the two. EPA maintained these two formats for
some of the Science and Technology funds but not for others.
Guidance from the Office of Management and Budget (OMB) does not
require agencies to develop or provide crosswalks in their
justifications when a budget format changes. However, OMB examiners
or congressional committee staff may request crosswalks during their
analyses of a budget request.
Two of EPA's program offices�Research and Development and Air and
Radiation�accounted for over 97 percent of the Science and Technology
funds that were requested for fiscal year 1999. The offices
maintained their financial records differently. The Office of
Research and Development maintained the enacted budget for fiscal
year 1998 by program components (the old format) and also by EPA's
strategic goals and objectives (the new format). With these two
formats of financial data, the Office of Research and Development
could readily crosswalk, or provide links, to help compare the 1998
enacted funds, organized by program components, to the fiscal year
1999 budget justification, organized according to EPA's strategic
goals and objectives.
In contrast, the Office of Air and Radiation maintained its financial
records for fiscal year 1998 under EPA's new strategic goals and
objectives format but did not also maintain this information under
the old format. Therefore, the Office of Air and Radiation could
only estimate how the fiscal year 1998 enacted funds would have been
allocated under the old format. For example, EPA estimated that the
Office of Air and Radiation's program component for radiation had an
enacted fiscal year 1998 budget of $4.6 million. While the
activities of this program component continued in fiscal year 1999,
they were subsumed in the presentation of the budget for EPA's
strategic goals and objectives. Therefore, because the radiation
program could not be readily identified in the fiscal year 1999
budget justification, congressional decisionmakers could not easily
compare funds for it with the amount that had been enacted for fiscal
year 1998. At our request, the Office of Air and Radiation estimated
its enacted budget for fiscal year 1998 by program components and
then developed a crosswalk to link those amounts with EPA's strategic
goals and objectives.
The remaining 3 percent of the requested funds for Science and
Technology is administered by the Office of Water; the Office of
Administration and Resources Management; the Office of Prevention,
Pesticides, and Toxic Substances; and the Office of Enforcement and
Compliance Assurance. Two of these offices--the Office of
Prevention, Pesticides, and Toxic Substances and the Office of
Enforcement and Compliance Assurance--did not format financial
information by program components. These offices estimated how the
1998 enacted funds would be classified under their various program
components.
--------------------
\2 Strategic goals and objectives for Sound Science and Clean Air
were also funded by other appropriations.
EPA'S CHANGES IMPROVED THE
CLARITY OF THE BUDGET
JUSTIFICATION, BUT ADDITIONAL
INFORMATION IS NEEDED
---------------------------------------------------------- Chapter 0:2
For fiscal year 2000, EPA made several changes to improve the clarity
of its budget justification. According to EPA officials, they
planned to provide tables for each goal and objective to show the
amounts of funds requested for key programs, starting with the
agency's fiscal year 2000 budget justification.\3 The justification
for fiscal year 2000 does contain additional information, in the form
of tables for each objective, that details some of the requested
amounts by key programs. For example, under the objective Research
for Human Health Risk, part of the Sound Science goal, the $56
million requested for the objective is divided into two key programs:
Human Health Research and Endocrine Disruptor Research.
According to EPA officials, they did not plan to identify in the
fiscal year 2000 budget justification the program offices that would
be administering the requested funds. However, they intended to make
available backup information to show the program offices that would
be administering the requested funds. Such information is available
for the fiscal year 2000 budget request and was provided to this
Committee.
According to EPA officials and an EPA draft policy on budget
execution, the agency's Planning, Budgeting, Analysis, and
Accountability System would record budget data by goals, objectives,
subobjectives, program offices, and program components. EPA expected
that this system would be fully implemented on October 1, 1998.
According to EPA officials, the new Planning, Budgeting, Analysis,
and Accountability System was implemented on this date; accordingly,
EPA can provide information showing how the agency's requested funds
would be allocated according to any combination of goals, objectives,
subobjectives, program offices, and key programs.
EPA also planned to submit future budget justifications in the format
of its strategic goals and objectives, as it had done for fiscal year
1999. That way, the formats for fiscal year 2000 and beyond would
have been similar to those for the fiscal year 1999 justification,
facilitating comparisons in future years. According to EPA
officials, the strategic goals and objectives in EPA's fiscal year
2000 justification for Science and Technology would be the same as
those in its fiscal year 1999 justification. However, beginning in
fiscal year 1999, the agency has begun to reassess its strategic
goals and objectives, as required by the Government Performance and
Results Act. This assessment was meant to involve EPA's working with
state governments, tribal organizations, and congressional committees
to evaluate its goals and objectives to determine if any of them
should be modified. Upon completion of this assessment, if any of
EPA's goals or objectives change, the structure of the agency's
budget justification would change correspondingly. Changes to the
strategic goals and objectives in the budget justifications could
also require crosswalks and additional information to enable
consistent year-to-year comparisons.
EPA did maintain, as planned, the strategic goals and objectives
format for its fiscal year 2000 budget justification. However, for
the objectives that rely on Science and Technology funds, EPA made
several changes without explanations or documentation to link the
changes to the fiscal year 1999 budget justification. EPA (1)
acknowledged that funds from one objective were allocated to several
other objectives but did not identify the objectives or amounts, (2)
did not identify funds in Science and Technology amounts that were
transferred from Hazardous Substances Superfund, and (3) made other
changes to the number or wording of objectives that rely on Science
and Technology funds.
The specific changes to objectives involving funds for Science and
Technology are as follows:
--------------------
\3 On September 30, 1998, EPA issued guidance requiring the use of
the term "key programs" for future budget requests.
FUNDS ALLOCATED BUT NOT
IDENTIFIED
------------------------------------------------------ Chapter 0:2.0.1
-- In the fiscal year 1999 budget justification, under the
strategic goal Sound Science, Improved Understanding of
Environmental Risk, and Greater Innovation to Address
Environmental Problems, EPA requested $86.6 million for the
fifth objective: Enable Research on Innovative Approaches to
Current and Future Environmental Problems; and the 1998 fiscal
year enacted amount was listed as $85.0 million. In the fiscal
year 2000 budget justification, EPA marked this objective as
�Not in Use.� The justification stated that the fiscal year 1999
request included the amounts for operating expenses and working
capital for the Office of Research and Development under the
same objective in the Sound Science goal. In the fiscal year
2000 budget justification, EPA allocated the amounts requested
for this objective among the other goals and objectives to more
properly reflect costs of the agency's objectives. However, the
fiscal year 2000 justification did not identify the specific
objectives for either the $85.0 million enacted for fiscal year
1998 nor the $86.6 million requested for fiscal year 1999. The
allocation of funds was not specifically identified in the
justification because EPA does not prepare crosswalks unless
asked to by OMB or congressional committees. Therefore, a clear
comparison of 1999 and 2000 budget justifications cannot be
made.
OBJECTIVES DO NOT
IDENTIFY SUPERFUND AND
SCIENCE AND TECHNOLOGY
FUNDS
------------------------------------------------------ Chapter 0:2.0.2
-- Another aspect that made year-to-year comparisons difficult was
EPA's treatment of funds transferred to Science and Technology
from the agency's Superfund account. In the fiscal year 2000
justification, the Science and Technology amounts shown as
enacted for fiscal year 1999 include $40 million transferred
from the Hazardous Substances Superfund. In contrast, the
requested amounts for fiscal year 2000 do not include the
transfer from the Superfund. As a result, amounts enacted for
fiscal year 1999 cannot be accurately compared to the amounts
requested for fiscal year 2000. This discrepancy is
particularly evident in the objective Reduce or Control Risks to
Human Health, under the goal Better Waste Management,
Restoration of Contaminated Waste Sites, and Emergency Response.
The amounts for Science and Technology as shown in the budget
justification for the objective are shown in table 2.
Table 2
Science and Technology Funds Requested
for the Reduce or Control Risks to Human
Health Objective
Fiscal Fiscal year
year 2000 request
1999 vs. fiscal
reques Fiscal year Fiscal year year 1999
t 1999 enacted 2000 request enacted
------ ------------ ------------ ------------
$6,761 $49,809,400 $8,375,200 ($41,434,200
,200 )
------------------------------------------------
Source: EPA's fiscal year 2000 budget justification.
The $49.8 million shown as enacted for fiscal year 1999 includes a
significant amount of the $40 million transferred from the Superfund
account, according to an EPA official. However, because the specific
amount is not shown, an objective-by-objective comparison of the
Science and Technology budget authority for fiscal years 1999 and
2000 cannot be accurately made, and it appears that EPA is requesting
a significant decrease for this objective. An EPA official stated
that the $40 million was not separately identified because the
congressional guidance on transferring the funds did not specifically
state which objectives these funds were to support.
OTHER CHANGES TO
OBJECTIVES
------------------------------------------------------ Chapter 0:2.0.3
-- In the fiscal year 1999 budget justification, the strategic goal
Better Waste Management, Restoration of Contaminated Waste
Sites, and Emergency Response had three objectives: (1) Reduce
or Control Risks to Human Health, (2) Prevent Releases by Proper
Facility Management, and (3) Respond to All Known Emergencies.
In the fiscal year 1999 budget request, EPA indicated $6.3
million was enacted for Prevent Releases by Proper Facility
Management in fiscal year 1998 and requested $6.6 million for
fiscal year 1999. EPA indicated $1.6 million was enacted for
Respond to All Known Emergencies in fiscal year 1998 and
requested $1.6 for fiscal year 1999. The fiscal year 2000
budget justification omits these two�the second and third
objectives and does not indicate where the funds previously
directed to those objectives appear. Therefore, a clear
comparison of budget requests year to year cannot be made.
-- In the fiscal year 2000 budget justification, EPA added the
second objective�Prevent, Reduce and Respond to Releases,
Spills, Accidents, and Emergencies�to the strategic goal Better
Waste Management, Restoration of Contaminated Waste Sites, and
Emergency Response. EPA indicated that $8.8 million had been
enacted for this objective in fiscal year 1999 and requested
$9.4 million for this objective for fiscal year 2000. EPA did
not identify which objectives in the fiscal year 1999 budget
included the enacted $8.8 million and therefore a comparison to
the prior budget justification was difficult.
The other changes to the objectives were made as a result of the
program offices' reassessment of and modifications to subobjectives,
which in turn led to changes in the agency's objectives. While we do
not question EPA's revisions of its goals or objectives, the absence
of a crosswalk or explanation does not enable a clear comparison of
budget requests year to year.
-------------------------------------------------------- Chapter 0:2.1
Mr. Chairman, this concludes my prepared statement. I will be
pleased to respond to any questions that you or the Members of the
Subcommittee may have.
*** End of document. ***