GAO Issues Report on DHS' FY 2006 ACE Expenditure Plan

GAO states that as required by law, it has reviewed the Department of Homeland Security's (DHS') fiscal year (FY) 2006 expenditure plan for the Automated Commercial Environment (ACE) program.

According to GAO, its report (1) addresses whether the FY 2006 expenditure plan satisfies certain legislative conditions, (2) describes the status of DHS' efforts to implement prior GAO recommendations for improving ACE management, and (3) provides observations about the plan and DHS' management of the ACE program.

Observations about ACE Management

According to GAO, it has made observations about the development of ACE releases, as well as the performance of ACE releases that are deployed and operating.

Development of releases. GAO states that CBP has an established pattern of borrowing resources from future releases to address problems with the quality of earlier releases. CBP's planned schedule for developing additional releases includes a significant level of concurrence, because of CBP's interest in delivering ACE functionality sooner. Such concurrence between ACE release activities has led to cost overruns and schedule delays in the past. Thus, the revised ACE plans and actions are potentially reintroducing the same problems that produced past shortfalls.

ACE performance goals and measures. Another of GAO's observations about ACE management was a need to effectively set and use performance goals and measures. Goals have been established, but those goals are not always realistic. For example, ACE has decreased truck processing times at some ports, but ACE is not being used by as many CBP and trade personnel as was expected, and truck processing times at other ports have increased. Also, while setting a goal that 11 percent of all CBP employees should be able to use ACE during FY 2005, that target never reflected the fact that many CBP employees will never need to use the system.

In addition, according to GAO, while the program has created several program goals, expected business results, specific benefits and performance measures, many are not fully defined or adequately aligned with each other. Not every goal has defined benefits, for example, and not every benefit has a performance measure.

Compliance with Legislative Conditions

According to GAO, the FY 2006 ACE expenditure plan either satisfied or partially satisfied the legislative conditions imposed by Congress; however, more can be done to better address several aspects of these conditions. For example, one condition included addressing security and privacy issues; however, a privacy impact assessment for ACE has been in draft for several months and is not yet approved. GAO also states that DHS does not have a documented methodology for evaluating compliance with DHS' enterprise architecture as legislative conditions dictate. Another example is that although DHS satisfied the condition that it certify that an independent verification and validation (IV&V) agent is under contract, the scope of the IV&V contractor's activities is not consistent with the operative industry standard.

Status of GAO' s Open Recommendations

According to GAO, CBP has addressed some of GAO's recommendations, while progress has been slow on others. Among the recommendations that have been completed by CBP are confirmation of consistency between the program plan cost estimate with the independent cost estimate and a current program that delineates the respective roles and responsibilities of the government and prime contractor.

The GAO's recommendations in progress include having future ACE expenditure plans specifically address any proposals or plans for extending and using ACE infrastructure to support other homeland security applications, and ensuring currency, relevance, and completeness of all program commitments made to Congress in expenditure plans.

Prospects for ACE Success Remain Unclear

GAO concludes that although availability and responsiveness targets are largely being met and long-standing help desk limitation are being addressed, the prospects for a successful program nevertheless remain unclear.

In summary, GAO states that a number of ACE activities have been done and are being done well; these have contributed to the program's progress to date and will go a long way in determining the program's ultimate success. However, GAO states that it will be important for CBP to effectively address long-standing ACE management challenges along with emerging problems. Until it does so, ACE will remain a risky program.

GAO Contact - Randolph C. Hite (202) 512-3429

GAO Report (GAO-06-580, dated May 2006) available at http://searching.gao.gov/cs.html?charset=iso-8859-1&url=http%3A//www.gao.gov/new.items/d06580.pdf&qt=GAO-06-580&col=&n=1&la=en