INS did not always initiate reprogrammings when necessary. Without a regular comparison of estimates to collections, INS did not have assurance that estimates of revenue were reasonable, or that reprogrammings were initiated when required. Management did not have the most accurate information available to make decisions.
Reprogramming actions are mandated by Section 8 of the DOJ Appropriation Authorization Act, 1980, P.L. 96-132. Additionally, Section 605 of the 1994 DOJ Appropriations Act, P.L. 103-121 states:
"None of the funds . . . derived by the collection of fees available to the agencies funded by this Act shall be available for obligation or expenditure for activities, programs, or projects through a reprogramming of funds in excess of $500,000 or 10 per centum, whichever is less, that:
1. augments existing programs, projects, or activities;
2. reduces by 10 per centum funding for any existing program, project, or activity, or numbers of personnel by 10 per centum as approved by Congress; or
3. results from any general savings from a reduction in personnel which would result in a change in existing programs, activities, or projects as approved by Congress, unless the Appropriations Committees of both Houses of Congress are notified fifteen days in advance of such reprogramming of funds.
For any reprogramming of funds in excess of $1,000,000 and not covered by the preceding provision, the Appropriations Committees shall be notified within fifteen days after such reprogramming occurs."
Instructions for the budget and reprogrammings were distributed in an October 5, 1994 memorandum from the Assistant Attorney General for Administration to the Heads of Department Components. It "requires submission of reprogramming notifications based on changes contained in the initial operating plans that exceed the reprogramming thresholds based on a mid-year review of operations."
Reprogramming requests were developed by the Budget Division and sent from the INS Commissioner's office to JMD. The Assistant Attorney General for Administration is the approval authority and signs reprogramming memoranda to OMB. However, INS did not always initiate reprogrammings when required. We were unable to determine how often a reprogramming action was required since INS' financial information system was not always timely and reliable (see Appendix II for a more detailed explanation).
For example, at the time Congress approved the FY 1994 budget, receipts were estimated to be $345 million. But INS' first quarter review revealed a reduction in receipts of $81.5 million below the original estimate, to approximately $263.5 million in anticipated annual receipts. The JMD submitted a reprogramming memorandum through OMB, that reduced the spending level for the Examinations Fee by $69.6 million, to the Subcommittee on the Departments of Commerce, Justice, and State, the Judiciary and Related Agencies, Committee on Appropriations, on June 27, 1994 -- nearly 9 months into the fiscal year. The INS Budget Division actually sent a memorandum concerning the need for a reprogramming in April 1994. The request through INS channels, to the Department, to the OMB, and then to Congress took a total of 69 days. Actual collections of Examinations Fees amounted to only $268 million for the year, so INS overforecast by $77 million.
The effect of delaying a reprogramming action could be significant. If collections were less than anticipated, delays in requesting and performing a reprogramming could result in reducing the fund balance of a fee account to a level lower than 1 month's operating budget (the amount of funds required to operate for a month assuming no receipts are incoming). Lengthy delays could cause the depletion of the fund balance. If collections were greater than anticipated, it is probable that associated services and production would also exceed estimates. For example, if significantly more naturalization applications are received than expected, receipts would accumulate as the number of submitted applications increased, until processing requirements exceed the capability of available staff. Reprogramming delays would likely result in building backlogs of pending work. However, a reprogramming approval must be received before obligating additional resources, if the amount exceeds reprogramming thresholds.
Decisions on whether or not to proceed with reprogrammings were not always made in a timely manner. We determined that INS staff were not clear on who initiates reprogrammings and when they are necessary. There was no written definition for a "material" difference, as in "a material difference between estimated and actual revenue collections." There was no guidance on how to determine the minimum fund balance level for each fee account. However, we agree that it is prudent to avoid excessive reprogrammings due to the volatility of the fee accounts. Following an overly strict interpretation of the law could result in an unreasonable number of reprogramming actions, not really serving the public's interest as intended by Congress. However, our analysis of reprogrammings submitted in the last 2 years indicated that INS occasionally delayed beyond an obvious point of initiation.
We recommend that the INS Commissioner:
7. Clarify and document relevant terms and procedures used to initiate reprogrammings.
Immigration and Naturalization Service Comments
INS agrees. The reprogramming issue has been of concern for some time. The fee accounts are essentially business-type activities and the reprogramming process is primarily designed for appropriation-based activities. This, by its very nature, does not allow for swift and efficient responses to changes in immigration and naturalization service demands. INS is reviewing these issues, and is seeking to define the parameters as to when a reprogramming should be initiated. This may involve tasking the Headquarters working groups (established to monitor receipt projections) to (1) assess the impact on operational capacity, (2) identify and evaluate evidence of longer-term receipt trends, and (3) determine potential effects on fee account balances. At some pre-defined point of deviation from actual to projected workload/receipts, the group would evaluate these factors and make a recommendation on the feasibility of a reprogramming.
Status of Recommendation
Resolved, based on the agreement that INS will review these issues and define the parameters as to when a reprogramming should be initiated. To close this recommendation, please provide us with a copy of the results of this review, including any conclusions reached by the individual working groups.
The INS' annual budget submissions include estimated revenue collections for non-approved fees. For the last 3 years, INS has included revenue in its annual budget designated as "anticipated User Fee revenue: to be collected from sea passengers arriving from Mexico, Canada, and the adjacent Caribbean Islands." For FY 1996, this amounted to $20.1 million.
Sea passengers arriving in the United States from Mexico, Canada, and the adjacent Caribbean Islands are exempt from paying the $6 User Fee. For the past 3 years, in a separate Congressional proposal, INS has requested that these passengers be charged the $6 User Fee that the air passengers are charged. Each year, its request has been denied. INS continues to include estimated revenue collections from sea passengers arriving from these exempted areas, despite the fact that its request has been repeatedly denied. In FY 1994 and FY 1995, INS anticipated revenue of $18 million and $18.85 million respectively from these currently exempt sea passengers. This amounted to an estimated total of $56.95 million in unrealized earnings for the last 3 years.
The INS also included estimates for the proposed Border Services User Fee and fees for services performed at land border ports of entry, in its FY 1995 and FY 1996 budgets. These fees will cover processing service costs at selected land border ports of entry. In prior years, these services have been provided at no charge. For its FY 1995 budget, INS estimated fee receipts of $14.7 million. These estimates were included as part of the total Examinations Fee estimate. There were no such fees for services collected in FY 1995. The final rule for the fees for services performed at land border ports of entry was published late in FY 1995, and the INS began collecting these fees early in FY 1996.
In our judgment, the INS should include newly proposed fees in its budget submission, if the new fees are likely to be approved and generate income in the budget year under consideration. However, INS should be hesitant to include all other possible new collections, particularly those that have been disapproved for several years and seem unlikely to be approved. For proposed fees that are unlikely or difficult to predict, an explanatory discussion or footnote in the budget submission would be more appropriate. Including and presenting such uncertain programs in INS' budget as "anticipated revenue" could be somewhat misleading.
The Government Performance and Results Act (GPRA) requires agencies to submit a strategic plan to OMB and Congress not later than September 30, 1997. This plan is to be a resource allocation and decision making exercise focused on results. It requires agencies to prepare an annual performance plan in conjunction with its budget submission for FY 1999. Progress must be evaluated using performance measures and strategic objectives, comparing actual outcomes to the intended outcomes. The Chief Financial Officers (CFO) Act of 1990 also encouraged agencies to develop systematic performance measurements and results of operations.
In prior years, federal budget specialists focused on inputs rather than outputs, that is, how much money and how much staff should be invested into various programs. In a report titled "Implementation of the Government Performance and Results Act (GPRA)--CFO Council May 1995," one of the most critical goals cited was to ensure effective use of performance information in the budget process. Budget submissions must reflect an increased focus on performance information and how it was used in developing the budget, thus moving the discussion away from program inputs and more toward program outputs and outcomes.
Previously, budget justifications have been based on prior year resources, with an emphasis on gaining additional funding for equipment and enlarging staff. Program success has not been clearly presented and justifications did not demonstrate the value of the program being funded. Outcome-oriented measures could help assess the success of new programs in terms of program objectives, and better justify increased needs. The FY 1996 OMB passback guidance discussed problematic and effective performance measures in the DOJ:
"In general, the Department has begun to develop performance measures but has little information currently available for analysis. While the Community Relations Service has developed a large number of effective measures, the absence of Federal law enforcement, litigation, and immigration measures remains particularly problematic. OMB will continue to support the Department in its development of performance measures."
The INS management should require a regular review and comparison of actual receipts to estimated receipts for each fee account. Generating periodic assessments should lead to more accurate and timely reactions to unforeseen occurrences. In addition, standardizing information and methods enhances management's ability to compare actual results, learn from past forecasting experiences, and prioritize goals.