DHS trade processing system lacks realistic goals, GAO says

The Homeland Security Department's multibillion-dollar trade processing system lacks realistic performance goals and remains a risky program, according to a new report from the Government Accountability Office.

The goals established for the Automated Commercial Environment (ACE) have nebulous benefits, and the benefits that are defined are not linked with performance measures, the report released Wednesday stated. Absent realistic measures, the department will find it difficult to establish an accountability framework for ACE to ensure the program provides the expected benefits, GAO said. For instance, in fiscal 2006 program officials set a target that 11 percent of all Customs and Border Protection bureau employees would use the system, but this does not reflect the fact that many agency employees will never need to use it.

The report also found that the relationship among the six program goals, 11 business results, 23 benefits and 17 performance measures was not fully defined.

The $2.8 billion project is being implemented in phases.

An Office of Management and Budget requirement for the use of earned value management -- a technique for tracking a project's progress against its planned performance, cost and schedule - is not being used in the development of the project's two most recent releases, the report stated. In one case, it was because the staff members who transferred to work on the program lacked familiarity with the method.

The ACE program is under a high level of congressional scrutiny and must undergo six measures of compliance and certification, including GAO's review, before the department may obligate appropriated funds.

The report (GAO-06-580) found that the ACE expenditure plan did not fully satisfy congressionally mandated conditions for the use of appropriated funds.

In a written response, the department agreed with the GAO's report and recommendations. The agency said it will align and fully define program goals, benefits, business results and performance measures by July 1.

"Mindful of the imperative to detect terrorist efforts to exploit our nation's supply chain, while also facilitating legitimate trade, CBP is focused on ensuring that ACE will meet high standards for usability and operational effectiveness within cost and on schedule," wrote Steven Pecinovsky, director of the department's GAO liaison office. "CBP looks forward to working with GAO to address previous and new GAO recommendations, and will continue efforts to make transparent the agency's progress toward satisfying these recommendations."

The department, however, asked Congress in its fiscal 2007 budget request to remove a requirement that CBP's expenditure plan for ACE be approved by OMB and the House Appropriations Committee before new money can be spent on the program. Appropriators maintain the requirement in the 2007 DHS appropriations bill, but allow CBP to spend up to $100 million on ACE before the expenditure plan is approved. The bill allocates a total of about $317 million for ACE in 2007. Chris Strohm of CongressDaily contributed to this report.