Department of Justice Conference Expenditures

Audit Report 07-42
September 2007
Office of the Inspector General


Executive Summary

The Department of Justice (DOJ) often hosts and participates in various conferences with other federal, state, and local law enforcement agencies and organizations.1 According to financial reports compiled by the DOJ Justice Management Division (JMD), DOJ components spent a total of $45.9 million on conferences, including costs for general support, programming, and travel during fiscal year (FY) 2006. Although this amount represented an increase of 34 percent compared to the $34.3 million DOJ components reported they spent on conferences during FY 2000, it is 21 percent less than the $58 million spent in FY 2004.

DOJ CONFERENCE EXPENDITURES
FROM FYs 2000 TO 2006

Fiscal Year/Amount ($ in millions): 2000-34.3; 2001-33.8; 2002-47.0; 2003-52.7; 2004-58.0; 2005-40.2; 2006-45.9.

Source: JMD reports on DOJ component conference expenditures

In the summer of 2005, the U.S. Senate Committee on Homeland Security and Governmental Affairs, Subcommittee on Federal Financial Management, Government Information, and International Security (Subcommittee), initiated an inquiry into conference spending by federal agencies. As a result of its examination, the Subcommittee expressed concern about the time, money, and human capital spent by federal agencies to sponsor conferences and the practice of sending federal employees to meetings held in resort locations.

Audit Approach and Objectives

Subsequent to the Subcommittee’s examination, the U.S. Senate Committee on Appropriations, Subcommittee on Commerce, Justice, Science, and Related Agencies requested that the DOJ Office of the Inspector General (OIG) perform an audit of the 10 most expensive DOJ conferences. The OIG agreed to conduct this review and examined the nine most expensive DOJ conferences held in the United States between October 2004 and September 2006 and the single most expensive international conference held during that same time period. For these conferences, our objectives were to review: (1) the justifications offered for the event; (2) the site-cost comparisons on where to hold the event; and (3) certain conference-related costs – including food and beverages, external event planning, and audio-visual – for compliance with applicable laws and regulations. Appendix I describes our scope and methodology related to the audit objectives.

As shown in the following table, of the top 10 conferences reviewed, 6 were sponsored by program offices within the Office of Justice Programs (OJP), 3 were sponsored by the Federal Bureau of Investigation (FBI), and 1 was funded by the Office of Community Oriented Policing Services (COPS).

FYs 2005 AND 2006 DOJ CONFERENCES SELECTED FROM JMD RECORDS

Formal Conference Name DOJ Sponsor Short Name Location Held Dates Held Reported Cost ($) *
Coordinating Council on Juvenile Justice and Delinquency Prevention’s National Conference: “Building On Success: Providing Today’s Youth With Opportunities for a Better Tomorrow” OJP, Office of Juvenile Justice and Delinquency Prevention (OJJDP) OJJDP National Conference Washington, D.C. Jan. 9 - 13, 2006 1,085,568
2005 Community Capacity Development Office (CCDO) National Conference: “Strengthening Communities One Block at a Time” OJP, CCDO Weed and Seed Conference Los Angeles, CA Aug. 22 - 25, 2005 875,000
2006 Project Safe Neighborhoods (PSN) National Conference OJP, Bureau of Justice Assistance (BJA) PSN National Conference Denver, CO May 2 - 5, 2006 864,110
4th National Symposium on Victims of Federal Crime OJP, Office for Victims of Crime (OVC) OVC National Symposium Atlanta, GA March 7 - 11, 2005 727,300
2006 CCDO Law Enforcement Conference: “The Spirit of Service: Enforce, Empower, and Revitalize” OJP, CCDO LEC Conference Phoenix, AZ Aug. 14 - 17, 2006 610,000
7th Annual Technologies for Critical Incident Preparedness Conference and Exposition OJP, National Institute of Justice (NIJ) NIJ Technology Conference San Diego, CA Oct. 31 - Nov. 2, 2005 575,550
FBI Annual Polygraph Examiner’s Conference FBI FBI Polygraph Conference Minneapolis, MN June 26 - July 1, 2005 532,000
2006 National Community Policing Conference: “Community Policing: Leading the Way to a Safer Nation” COPS COPS National Conference Washington, D.C. July 27 - 29, 2006 525,000
2006 FBI Information Technology Exchange Conference (ITEC) FBI FBI ITEC Conference San Antonio, TX Aug. 7 -10, 2006 500,000
FBI, Office of International Operations (OIO) Asia Unit Regional Training Conference FBI FBI Cambodia Conference Phnom Penh, Cambodia March 12 - 17, 2006 167,480
Sources: FY 2005 and 2006 conference expenditure listings compiled by JMD, as combined by the OIG
*  “Reported Costs” may be estimates that do not necessarily include personnel or travel costs.

AUDIT RESULTS

The DOJ does not maintain a single financial system capable of providing the costs of DOJ conferences. As a result, when asked to provide conference expenditures to Congress, DOJ components did not uniformly report these expenditures. Our audit found that some components reported budgeted, awarded, and estimated conference costs instead of actual expenses, while others did not uniformly include travel or personnel costs.2 Our audit also determined that although sponsors and planners for the 10 DOJ conferences reviewed by the OIG provided justifications to hold their events, comparisons of costs between different sites were not consistently performed or documented.

Federal agencies have considerable discretion in deciding how much to spend on a conference. In our review, we found that three types of costs – external event planning, food and beverages, and audio-visual – represented 71 percent, of the $6.2 million spent to plan and host the 10 conferences. As discussed in this report, some of the incurred expenses, while allowable, appear to have been extravagant. Furthermore, we found that OJP may have inappropriately charged and retained registration fees for one of its conferences.

Conference Justifications

Individual DOJ components manage and approve their respective participation in conferences. According to DOJ officials, the decision to host an event or send employees to attend a conference is subject to the availability of funds from individual component appropriations. We considered an adequate justification for a conference to include, at the very least, a programmatic reason to hold the event and an approval from an appropriate sponsoring agency official. Our review of conference justifications concluded that appropriate reasons and approvals for these 10 events were developed by their sponsoring components.

Site Comparisons

The Federal Travel Regulation (FTR) requires that agencies sponsoring conferences provide appropriate management oversight of the conference planning process. In this vein, the FTR requires that conference planners conduct site comparisons to consider lower cost conference locations and venues. The FTR defines a conference “site” as both its geographic location, and the specific facility used to hold the event. According to the FTR, adequate cost comparisons should compare the availability of lodging rooms at per diem rates, the convenience of the conference location, availability of meeting space, equipment and supplies, and the commuting or travel distance of attendees. The FTR states that conference planners must keep records showing both the comparisons and the rationale for selecting the specific place to hold a conference.3

Our audit found that not all conference event planners were certain what type of comparisons – whether by city, by venue, or by both city and venue – were specifically required by the FTR. For example, while the FTR requires a minimum of three cost comparisons, it does not specify whether these comparisons need to include different cities or just comparable facilities in the same market. As shown in the following table, conference planners performed inconsistent site comparisons.

DOJ CONFERENCES SITE SELECTION METHODS

Conference Name City Venue Both Other
OVC National Symposium X      
FBI Polygraph Conference     X  
Weed and Seed Conference       X
NIJ Technology Conference     X  
OJJDP National Conference   X    
FBI Cambodia Conference       X
PSN National Conference X      
COPS National Conference   X    
FBI ITEC Conference     X  
LEC National Conference       X
Source: DOJ component and event planning files

Only FBI and NIJ conference planners examined and documented cost comparisons for both alternate cities and venues within the selected city. To ensure that the government obtains the best conference location for the best value, we believe that conference planners should compare multiple sites in multiple cities, unless an overriding operational reason is documented to hold the conference in a specific city.

Conference Costs

According to the FTR, an adequate conference planning process should minimize costs while maximizing the use of government-owned or publicly provided facilities. The FTR provides that t o minimize costs to the federal government, the planning agency should consider all direct and indirect costs incurred to sponsor the conference. These include: (1) attendee-related costs, such as travel, per diem, lodging, and time required to travel to and attend the conference; (2) rentals for audio-visual and other equipment; (3) computer and telephone access fees; (4) printing; and (5) light refreshments.

Because DOJ does not have a single financial reporting system that can consistently identify and report conference-related costs incurred by different components, we worked with the sponsoring DOJ components and external event planners to develop a consistent breakdown of expenses for all 10 conferences. As shown in the following table, planning and hosting the 10 conferences totaled nearly $6.2 million, while DOJ collectively spent an additional $1.9 million to send employees to these events.

CONFERENCE EXPENSES BY COST CATEGORY

Cost Category OJJDP National Conference
($)
Weed and Seed Conference
($)
PSN National Conference
($)
OVC National Symposium
($)
LEC Conference
($)
NIJ Technology Conference
($)
FBI Polygraph Conference
($)
COPS National Conference
($)
FBI ITEC Conference
($)
FBI Cambodia Conference
($)
TOTALS
No. of Days 5 4 4 5 4 3 6 3 4 6  
No. of Registrants 1,831 1,542 1,330 787 1,329 1,315 98 1,437 306 46  
Planning & Hosting (P&H) Costs
1.External Event
    Planning
605,619 197,565 196,798 310,394 145,767 409,535 n/a 213,174 n/a n/a 2,078,852
2.Speakers 35,742 82,229 31,561 55,356 96,759 95,473 3,682 94,486 0 3,947 499,235
3.Food and
    Beverages
291,940 394,008 108,866 98,350 181,002 175,101 7,468 274,546 8,334 4,219 1,543,834
4.Audio-Visual 62,930 147,779 143,469 148,738 122,577 38,976 1,496 89,185 7,747 0 762,897
5.Print Media 39,040 35,131 9,463 35,077 18,223 14,860 0 24,875 0 0 176,669
6.Subcontractors 313,914 27,623 69,052 103,744 38,972 82,531 0 69,683 0 924 706,443
7.Signs and
    Door Items
2,407 47,215 15,322 3,856 0 0 0 6,488 0 0 75,288
8.Miscellaneous 52,367 10,022 221,473 11,548 0 4,974 0 50,668 0 231 351,283
Total P&H Costs 1,403,959 941,572 796,004 767,063 603,300 821,450 12,646 823,105 16,081 9,321 6,194,501
Multi-Component Costs
9.DOJ Employee
    Travel
0 105,105 638,371 318,631 124,411 17,576 117,251 1,754 364,966 172,327 1,860,392
Total
Multi-Component
Costs
0 105,105 638,371 318,631 124,411 17,576 117,251 1,754 364,966 172,327 1,860,392
SUBTOTAL 1,403,959 1,046,677 1,434,375 1,085,694 727,711 839,026 129,897 824,859 381,047 181,648 8,054,893
Other Revenue (505,657) 0 0 0 0 (561,938) 0 0 0 0 (1,067,595)
FINAL DOJ COST $898,302 $1,046,677 $1,434,375 $1,085,694 $727,711 $277,088 $129,897 $824,859 $381,047 $181,648 $6,987,298
Source: OIG analysis of financial summary reports, drawdowns, and supporting invoices received from sponsoring components and external event
            planning companies and DOJ travel vouchers from DOJ attendees.

Neither the sponsoring components’ cost nor the total DOJ cost for each event matches the cost information reported to the Subcommittee for DOJ conferences held in FYs 2005 and 2006. We discussed the difference between the reported and actual DOJ costs with both JMD and sponsoring component officials. Despite specific instructions, components did not uniformly report their conference costs to JMD. Regarding the 10 conferences we selected for review, the discrepancies between the OIG-calculated conference costs and the JMD-reported costs stem primarily from components: (1) reporting budgeted, awarded, or estimated costs instead of actual expenses; and (2) inconsistently including travel and personnel costs in their figures.

We reviewed in detail the three largest cost categories – external event planning, food and beverages, and audio-visual for the 10 conferences. As shown by the following table, these three cost categories represent over 70 percent of the total planning and hosting costs.

PLANNING AND HOSTING COST CATEGORY EXPENSES

Cost Category Total Costs
Allocated
($)
% Other Categories-29%, External Event Planning-34%, Food and Beverages-25%, Audio-Visusl-12%.
1. External Event
Planning
2,078,852 34
2. Speakers 499,235 8
3. Food and
Beverages
1,543,834 25
4. Audio-Visual 762,897 12
5. Printed Media 176,669 3
6. Subcontractors 706,443 11
7. Signs and
Door Items
75,288 1
8. Miscellaneous 351,283 6
TOTALS $6,194,501 100
Source: OIG analysis of component and external event planning records

Event Planning

Although conference event planners play an important role in determining how much an event will cost, the FTR does not specify how a sponsoring agency should select a conference planner. Our audit found that the FBI internally planned its three events while OJP and COPS hired private contractors to plan their conferences. As shown in the following table, OJP procured external conference planners by either awarding a contract through its Acquisition Management Division (AMD) or through a cooperative agreement awarded by the individual OJP program office.4

PROCUREMENT VEHICLES USED TO HIRE
CONFERENCE EXTERNAL EVENT PLANNERS

Conference Name Contract Cooperative
Agreement
Weed and Seed Conference X  
NIJ Technology Conference   X
PSN National Conference X  
COPS National Conference   X
LEC National Conference X  
OJJDP National Conference5 X X
OVC National Symposium X  
Source: OIG analysis of event planning documents

To analyze how the event planners were hired and the costs they charged, we reviewed three large, national scope conferences identified in the following table.6

OJP EXTERNAL EVENT PLANNING COSTS

Conference External
Event
Planning
Cost ($)
Number of
Registrants
Percentage
of Planning
and Hosting
Cost
OJJDP National Conference 605,619 1,831 43
NIJ Technology Conference 409,535 1,315 50
CCDO LEC Conference 145,767 1,329 24
TOTALS $1,160,921 4,475  
Source: OIG analysis of external event planner financial records

All three reviewed event planners provided logistical and administrative support to help OJP program offices prepare for their respective conferences. These services included performing location visits and site selection analysis, establishing contracts with venues or hotels for meeting space and attendee rooms at per diem rates, and preparing budgets and reports for review by OJP officials.

Each of the event planners used by OJP examined in this review employed a different mechanism or rate to capture indirect costs, thereby causing event planning expenses to vary considerably. For example, OJJDP and NIJ event planners applied approved overhead rates of about 82 and 131 percent, respectively, on all direct labor charges. In addition, event planners also applied a general and administrative charge on all direct conference costs. The following table shows the impact of the NIJ event planner’s 131-percent overhead rate, as well as a 15-percent general and administrative rate, on conference planning costs.

NIJ TECHNOLOGY CONFERENCE
EVENT PLANNING COSTS

Type of Cost Amount ($)
Direct Labor (3,525 hours) 126,077
Overhead (131% of direct labor cost) 164,669
NIJ Event Planner Travel 14,074
General and Administrative
(15% of all conference costs)
104,715
TOTAL $409,535
Source: OIG analysis of NIJ event planner records

In contrast to the OJJDP and NIJ conference event planners, the LEC event planner charged a flat hourly labor rate that included all direct and indirect labor costs. This event planner then charged a 3 percent handling fee to all non-labor conference planning costs as shown in the following table.

SUMMARY OF LEC EVENT PLANNER COSTS

Type of Cost Amount ($)
Labor Charges (1,464 hours) 121,691
Travel and other related costs 4,355
Fixed Fee (3% handling charge applied to costs totaling $458,246) 13,748
NIH Fee (1% of all costs totaling $597,327) 5,973
TOTAL $145,767
Source: Event planner invoices and accounting records

Event planners told us they provided different levels of logistical support for the various OJP conferences, which could impact the number of hours necessary to plan an event. However, the number of hours billed by event planners does not speak to the level of indirect rates charged to plan a conference. As a general rule, indirect rates are determined by a company’s overhead and equipment costs, facility fees, debt payments, and administrative expenses. This means that companies performing technical or scientific services may charge high indirect cost rates.

No single entity within OJP monitors conference costs to ensure they are appropriate or that the event planners hired actually offer the best value for the fees they charged. As a sponsor of many large, national-scope conferences each year, we believe that OJP should evaluate how it solicits, hires, and assesses event planners. As exhibited by the wide-range of hours and indirect rates charged by these three event planners, we believe that oversight is necessary to ensure that event planning costs comply with FTR and DOJ conference planning guidelines.

Food and Beverages

The Government Employees Training Act (Training Act) states that a federal agency may serve food and beverages at sponsored conferences concerned with the functions or activities for which they receive funding.7 Under the Training Act, the Government Accountability Office has identified three circumstances where federal agencies may provide food and beverages to conference attendees.

To review food and beverage costs, we selected the four conferences identified in the following table.8

REVIEWED FOOD AND BEVERAGE COSTS

Conference Food and
Beverage
Cost ($)
Number of
Registrants
Percentage
of Planning
and Hosting
Cost
Weed and Seed Conference 394,008 1,542 42
COPS National Conference 274,546 1,437 33
FBI Polygraph Conference 7,468 98 59
FBI Cambodia Conference 4,219 46 45
TOTAL $680,241 3,123  
Source: OIG analysis of conference financial records

Of the four selected conferences, the Weed and Seed Conference and the COPS National Conference were attended primarily by non-DOJ employees, while FBI employees constituted the majority of attendees at both of its conferences. To review the amount and cost of food and beverages served at each conference, we identified the list price of the items and calculated the actual price charged by the venue, which included applicable taxes and service charges paid for each menu item. We also examined the purpose of the functions where food and beverages were provided, and whether food and beverage costs were in compliance with applicable rules and regulations.

Our audit found that the food and beverages provided to attendees at the Weed and Seed and COPS conferences were furnished by large hotels that applied significant service charges. For example, as part of the Weed and Seed Conference, OJP spent $394,008 on continental breakfasts, lunches, snack items, beverages, and a “themed networking reception.” As shown in the following table, the $394,008 cost included the food and beverage menu price (list price), a 20 percent service charge applied to the list price, and an 8.25 percent sales tax applied to the subtotaled list price and service charge.9

COSTS OF FOOD AND BEVERAGES PROVIDED
AT THE WEED AND SEED CONFERENCE
August 22 to 25, 2005

Food/Beverage Total
Number
List Price
Per Unit
or
Serving
($)
Paid Price
Per Unit
or
Serving *
($)
Adjusted
Total Cost *
($)
Breakfasts
Continental Breakfasts 4,600 16.75 21.76 100,096
Lunches
Deli Lunch Buffets 45 29.00 37.67 1,695
Salmon Lunches 1,476 38.50 50.01 73,815
Chicken Lunches 1,316 29.75 38.65 50,863
Working Groups Lunch Buffets 120 41.00 53.26 6,391
CCDO Staff Meeting Lunches 30 34.00 44.16 1,325
Snacks
Cookies and Brownies 3,804 2.67 3.47 13,199
Granola Bars 40 3.00 3.89 156
Bags of Chips 2,280 2.50 3.25 7,410
Yogurt 6 3.75 4.87 29
1 Large Fruit Display 50 Servings 3.90 5.06 253
1 Small Fruit Display 15 Servings 3.33 4.33 65
CCDO Staff Meeting Snacks 30 19.00 24.68 740
Beverages
Cups of Columbian Coffee 15,520 2.15 2.79 43,301
Bottles of Water 4,304 3.75 4.87 20,960
Cans of Soda 2,872 3.50 4.55 13,067
CCDO Staff Meeting Soft Drinks 27 3.25 4.22 114
Reception
“Stars and Stripes” Networking Reception 1,000 41.00 53.26 53,260
3 Cheese Trays 300 Servings 4.40 5.72 1,716
3 Vegetable Trays 300 Servings 3.65 4.74 1,422
6 California Roll Trays 300 Pieces 7.30 9.48 2,844
6 Roasted Vegetable Wrap Trays 300 Pieces 3.30 4.29 1,287
TOTAL $394,008 *
Source:  OIG analysis of component and external party planner documents
         *   Certain costs and amounts are rounded to equal the total charge

Applying the total $394,008 cost to each of the 1,542 conference registrants, OJP spent an average of $256 per person, or $64 per day, on food and beverages. The average conference attendee received four breakfasts, two lunches, one reception, and an assortment of light refreshments over the four days of the conference.

OJP also provided its employees with lunch during a staff meeting held on the last day of the Weed and Seed Conference. Unlike the rest of the conference, which was attended primarily by representatives of Weed and Seed program grantees, this staff meeting was composed of only OJP employees traveling on a per diem rate. OJP provided, at no cost to 30 of its employees, a sandwich buffet lunch that cost $44 per person and a themed “at-the-movies” snack, consisting of candy, popcorn, and soft drinks, for $25 per person.

The Weed and Seed Conference also featured a $60,000 networking reception for 1,000 attendees after the first full day of the conference. The following menu details the items served at the Weed and Seed Conference’s networking reception.

OJP WEED AND SEED NETWORKING RECEPTION

menu of items served at the Weed and Seed Conference's networking reception

Source: Venue catering menu

Similarly, the COPS National Conference provided attendees a $60,000 networking reception with carved beef and turkey and penne pasta. Besides the reception, the COPS conference also provided attendees with two themed breaks that cost a total of $42,000.

COPS NATIONAL CONFERENCE THEMED BREAKS

Thursday, July 27, 2006
3:15 to 3:45 PM

menu of items served at a themed break titled The Big Chill


Note: “Attendants Required” means hotel staff (attendants) were required to serve themed break items.
Friday, July 28, 2006
3:15 to 3:30 PM

menu of items served at a themed break titled At the Stadium
Source: Venue event order form

The sheer volume of food and beverages resulted in OJP and COPS spending, respectively, an average of $64 and $83 on food and beverages each day for each person. The meals and incidental expenses (M&IE) rate for government employees attending the Weed and Seed Conference was $51 per day, while the rate at the COPS National Conference was $64.10 We examined planning documents for these conferences and found no written explanations justifying the need to offer conference attendees such costly meals and networking receptions.

Considering the provision of full meals to DOJ employees at 8 of the 10 conferences we examined in this audit, we reviewed a sample of 253 vouchers to determine if attendees deducted conference-provided meals from their travel vouchers. According to the FTR, federal travelers should adjust their per diem reimbursement requests and deduct for meals furnished by the government. To ensure that federal employees deduct the proper amount, GSA has calculated predetermined figures that a traveler should deduct depending on the meal that was provided by the government.

When federal attendees do not deduct meals provided at government expense, the government effectively pays for the employee’s meal twice – once at the conference, and again when the employee receives reimbursement after submitting their travel voucher. Of the 253 tested vouchers, we found that only 62 properly deducted all meals provided at the conferences, 41 deducted some of the meals, and 150 vouchers did not deduct any of the provided meals.

OIG VOUCHER TESTING RESULTS

150 Vouchers did not deduct any government provided meal, 62 vouchers deducted all government provided meals, 41 vouchers deducted some, but not all government provided meals.

Source: OIG analysis

Audio-Visual Equipment and Services

Since audio-visual equipment and services comprised the third largest category of conference expenditures, we selected three conferences and reviewed their audio-visual costs.11

REVIEWED AUDIO-VISUAL COSTS

Conference Audio-Visual
Cost ($)
Number of
Registrants
Percentage
of Planning
and Hosting
Cost
PSN National Conference 143,469 1,330 18
OVC National Symposium 148,738 787 19
FBI ITEC Conference 7,747 306 48
TOTALS 299,954 2,423  
Source: OIG analysis of conference financial records

Similar to rules governing food and beverage costs, federal agencies have considerable discretion in how much they choose to spend on audio and visual equipment and services at government-sponsored conferences. We reviewed the audio-visual costs and compared costs of rentals with the services provided at the three selected conferences. Our review found no unallowable audio-visual equipment costs.

However, OJP and FBI conference sponsors achieved cost savings by bargaining with audio-visual subcontracting firms for services and equipment rentals. For example, the OVC subcontractor provided the National Symposium a discount rate on equipment rentals during the last two days of its conference. The FBI ITEC Conference received nearly a 30-percent discount from its total audio-visual bill by booking services more than 30 days in advance.

Registration Fees

OJP event planners for the OJJDP National Conference and the NIJ Technology Conference solicited and retained registration fees from conference attendees and vendors. According to 31 U.S.C. § 3302(b), an official or agent of the government receiving funds “from any source shall deposit the money in the Treasury as soon as practicable without any deduction for any charge or claim.” The rationale underlying this rule, also known as the miscellaneous receipts statute, is that in order to maintain Congress’s “power of the purse,” an agency should not augment its appropriations from sources outside the government without statutory authority.

In March 2005, the GAO, applying § 3302(b), held that neither federal agencies nor contractors acting on their behalf may charge and retain conference fees without specific statutory authority to do so. In light of this ruling, we considered the decision to charge conference fees in connection with the OJJDP and NIJ conferences. We concluded that, in the absence of specific statutory authority, outside entities retained by OJP should not charge conference fees in those cases where they have been retained primarily to provide conference planning services.

As discussed previously, OJJDP originally entered into a contract with an event planner to provide conference planning services for the OJJDP National conference. Thereafter, OJP and the event planner entered into a cooperative agreement pursuant to which these planning activities would continue. The Federal Grant and Cooperative Agreements Act of 1977, 31 U.S.C. § 6305, directs executive agencies to use cooperative agreements to reflect the relationship between the federal government and another entity when:

  1. the principal purpose of the relationship is to transfer a thing of value to the... recipient to carry out a public purpose... authorized by law... instead of acquiring property or services for the direct benefit or use of the... government; and

  2. substantial involvement is expected between the executive agency and the... recipient when carrying out the activity contemplated in the agreement.

By contrast, executive agencies are directed to use contracts when “the principal purpose is to acquire... property or services for the direct benefit or use of the... government.” Id. at § 6303. Pursuant to DOJ regulations, such as 28 C.F.R. § 70.24, non-profit organizations that enter into cooperative agreements with the Department may retain program income earned during the project period.12

We inquired as to why OJJDP entered into a cooperative agreement with the conference planner when a contract for such services was already in place. According to conference planning documents, OJP officials believed that the event planner would be prohibited from charging conference fees if they proceeded under the contract.13 By opting for a cooperative agreement instead, OJP believed that it would be permissible for the event planner to charge and retain registration fees as program income.

We believe there are two problems with OJP’s approach. First, it does not appear that a cooperative agreement was the proper vehicle for OJJDP to use in this case. As is evident from the choice of a contract as the original procurement vehicle, the primary purpose of the agreement between OJJDP and the conference planner was for OJJDP to acquire conference planning services. As discussed above, a contract is the proper vehicle when federal agencies are securing such services for their use. Second, even if a cooperative agreement would have been appropriate in these circumstances, the regulations relating to program income do not apply to agreements with for-profit entities like the event planner involved in the OJJDP conference. Accordingly, we believe that absent specific statutory authority to charge conference fees, it was inconsistent with the miscellaneous receipts statute for the OJJDP conference planner to charge and retain registration fees.

In September 2005, NIJ entered into a cooperative agreement with a non-profit entity related to the technology conference. As part of the agreement, the non-profit was to provide planning and other services for the technology conference. The agreement provided that the event planner would collect anticipated program income generated by charging fees to conference exhibitors and attendees.

In light of the March 2005 GAO decision concerning conference registration fees, we asked OJP officials whether NIJ had statutory authority to collect fees in connection with the technology conference. According to OJP, such authority was not required. OJP reasoned that because the event planner in this case provided more than just pure planning services, a cooperative agreement was the appropriate funding vehicle and the fees collected were allowable program income under that agreement. Specifically, OJP noted that in addition to purely logistical support, the NIJ conference planner also performed such programmatic tasks as identifying possible participants and coordinating among the sponsoring government agencies.14

We believe that whether it was appropriate to charge registration fees in connection with the NIJ conference is a close question. We recognize that: (1) cooperative agreements may be appropriate funding vehicles in cases where OJP is transferring funds to a non-profit entity primarily to permit that entity to carry out a programmatic function of OJP; and (2) the governing regulations permit the retention of program income when such agreements are utilized. However, we believe that OJP must ensure that cooperative agreements are not utilized inappropriately as a means of avoiding the strictures of the miscellaneous receipts statute. Accordingly, we recommend that OJP develop and implement clear guidance outlining the specific circumstances under which event planners retained to assist with OJP conferences may charge and retain conference fees.

Conclusions and Recommendations

DOJ components sponsoring conferences have a responsibility to: (1) justify sponsoring a conference; (2) conduct cost comparisons to consider lower cost conference locations and venues; and
(3) reduce costs incurred by hosting and traveling to these events. Our audit determined that DOJ sponsors adequately justified their conferences, but inconsistently performed and documented comparisons of costs between different potential sites. In addition, our analysis of event planning costs found that such expenses varied widely. We also found that using appropriated funds to pay for expensive meals and snacks at certain DOJ conferences, while allowable, appear to have been extravagant.

As a result of our review, we provide 14 recommendations to DOJ and its components, including the following:



Footnotes
  1. According to 41 C.F.R. § 301-74 (2006), a conference is a “meeting, retreat, seminar, symposium, or event that involves attendee travel.”

  2. For FY 2006, the JMD Budget Staff received another conference expenditure request from the Subcommittee and compiled conference expenditure information in a similar manner.

  3. 41 C. F.R. § 3 01-74 (2006).

  4. According to the OJP Financial Guide, a cooperative agreement is a type of award used when OJP anticipates substantial involvement with the recipient during performance of the contemplated activity. Cooperative agreements can be awarded to states, units of local government, or private organizations.

  5. The OJJDP National Conference initially used a contract to hire an external event planner to provide logistical support. At some point while planning the event, OJP issued a cooperative agreement with this event planner to continue planning activities.

  6. Appendix I outlines the methodology used to choose conferences to review their event planning costs.

  7. 5 U.S.C. § 4110 (2006).

  8. Appendix I outlines the methodology used to choose conferences to review their food and beverage costs.

  9. The 8.25 percent sales tax for food and beverages amounted to $30,028. Although the federal government is exempt from local taxes on direct payments, the external event planning contractor for the Weed and Seed Conference paid the hotel directly and was therefore assessed the sales tax on all goods, rents, and services provided.

  10. Federal employees may receive reimbursement for meals incurred during official travel according to a locality’s M&IE per diem rate established by GSA.

  11. Appendix I outlines the methodology used to choose conferences to review their associated audio-visual costs.

  12. This provision is part of the Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and other Non-Profit Organizations. It does not apply to agreements with for-profit corporations such as the event planner for the OJJDP conference.

  13. This document, dated August 9, 2005, suggests that OJP was aware of the GAO decision and its potential implications for the OJJDP conference.

  14. For purposes of this review, programmatic support means a service designed to achieve the award or agreement’s mission or objectives.



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