The U.S. House of Representatives Committee on Homeland Security earlier this month scrutinized the U.S. Department of Homeland Security's conference spending practices during fiscal years 2005 through 2007 after the department failed to properly document expenses to prove they were "legitimate." During a hearing conducted this month by the House Subcommittee on Management, Investigation and Oversight, a DHS official admitted to a lack of proper conference spend oversight during the first seven years of its existence, but said the department was taking steps to better track expenses.
"DHS doesn’t have a way to measure the success or the value of conferences," said Carlton Mann, assistant to the DHS Inspector General. "We don’t question necessarily the number or purposes of the conferences, but we do believe that they do add value to the department. It doesn’t mean the activities were criminal … the real issue here was no documentation [of spend]."
Following a request to investigate DHS conference spending by committee Chairman Rep. Bennie Thompson, D-Miss., the DHS Office of Inspector General found that conference cost data during the three-year timeframe "did not contain sufficient supporting documentation, and were unreliable, unverifiable and provided little assurance that all conferences and related costs were tracked and accounted for properly," according to Mann.
During those years, DHS spent $110 million on 8,359 conferences, just 1 percent of the overall DHS cost base. Committee member Rep. Al Green, D-Texas, said the purpose of the hearing was not to "create an atmosphere where a person will not be able to go to legitimate conferences and legitimate training that would be job related," but to track and report spend transparently.
The committee granted Thompson’s investigation request after questionable spending patterns were revealed in other government agencies. "The report revealed a troubling picture," Thompson said, and insight was gained into the "lack of internal controls, minimal oversight and insufficient reporting throughout the entire department."
Subcommittee Chair Rep. Christopher Carney, D-Pa., agreed and said the report was "most alarming" because a DHS official was quoted in the report saying, "There is no reason to track conference expenditures because there are no spending restrictions." Additionally, since there's "no approval or tracking process," how do we make sure that we are getting the kind of value that we need and there are not folks gaming the system?" asked Carney.
DHS could just make the "assumption" that the conference spend was appropriately allocated, according to Mann. However, Elaine Duke, DHS undersecretary for management, who is responsible for travel procurement, defended DHS when she testified, assuring the subcommittee that the conferences were "mission critical."
"The department encourages and supports employee participation in federal and non-federal meetings and conferences," Duke said. "Such events are excellent means to exchange and communicate ideas and knowledge. However, there is also a need to ensure that attendance at meetings and conferences is mission critical, as prescribed in management directives and other policies."
During the investigation, OIG reviewed the most expensive 11 conferences attended by several different DHS agencies, and requested receipts, invoices and other documentation to justify the costs of those conferences.
For the 11 conferences, "DHS officials were unable to produce precise and consistent numbers on conference spending," said Mann. "DHS needs to develop better management controls to ensure that conferences are funded and attended only for mission-critical purposes and that costs are minimized to the greatest extent possible. In assessing, tracking, and monitoring conferences, DHS must use innovative tools, methods and systems to ensure accountability and cost minimization across the department."
DHS was only able to provide about 65 percent of the travel vouchers that OIG requested, meaning the examiners were "unable to determine or verify costs,” according to Mann. Many of these conference attendees were reimbursed for duplicate items, meals they did not eat, taxi fares that "seemed excessive" and costly first-class or business-class tickets, Mann added.
Committee member Rep. Bill Pascrell, Jr., D-N.J., asked Mann if "there might be something crooked or indictable here," and said the "lack of transparency and no checks and balances is a systemic problem" within DHS. But Mann suggested that many of the employees seemed to be unaware of the travel policy.
Mann said during this time period. conference planners were required to receive quotes from three or more venues if the total attendees exceeded 30, and had to consider using government facilities. However, OIG claimed "conference planners frequently did not take into consideration all of the information required to estimate potential costs or account for actual costs. In particular, the costs incurred during the planning and preparation stages and other staff-related costs, such as salaries, travel and incidentals were overestimated in some cases and underestimated in others."
In many cases, the ballpark cost of conferences, according to documents submitted to Congress, were underestimated, Mann testified. OIG found that DHS reported an estimated spend for one conference to be $190,000 and was given a $426,637 budget for the conference. However, the total cost of the conference came to $288,888, and OIG could not "confirm whether the remaining funds were spent and what they were spent on."
Changes Under The New Administration
During fiscal-year 2009, DHS made some improvements to better manage and control spend, Duke claimed. In March 2009, DHS launched a department-wide efficiency review initiative to "trim costs, streamline operations, eliminate duplication and better manage resources." DHS has assigned a central contact within each agency to book and oversee travel. Duke is responsible for the entire department’s travel oversight.
Now, an approving agency official must review a conference planner’s request, and the agency CFO must approve the spend. However, the process is still manual, and DHS requested additional funding in its budget to automate the system. Duke said DHS "will make every effort to use conference calls, local area event [locations] and Web-based communication to reduce costs" and has "tightened up business- and first-class travel" as well.
"We are requiring each [division] to have a senior accountable official to ensure that everyone adheres to DHS policies in making sure all travel is mission critical and having the appropriate documentation," Duke said.
Conference planning is not supported by one travel agency unlike other travel spend, which is booked through Carlson Wagonlit Travel, Duke said.
During the hearing, the National Business Travel Association weighed in, recommending DHS "immediately implement a new government travel management program" to be led by a certified government travel buyer, according to written testimony. Following the strategies used by most private-sector entities, the federal agencies "have a responsibility to wisely manage travel and meetings cost, while providing transparency and accountability," according to the statement.
Highlighting expense reporting, cost containment and policy compliance, NBTA also attested to the importance of a travel manager whose purpose is to regularly assess travel spend. NBTA suggested DHS procurement officers should achieve certification in the Government Travel Executive Program created by the organization to better educate the department on travel.
The subcommittee determined the department must begin following 12 suggestions in order to clean up its conference spending act:
- Assume oversight responsibility for department-wide conference planning activities;
- Develop and adopt a common department-wide definition for what constitutes a conference, making the distinction between a conference, retreat, seminar, symposium, workshop, training and routine meeting;
- Revise conference planning and attendance policies;
- Establish a department-wide methodology to uniformly and consistently capture and report on conference-related planning and cost information;
- Develop a plan to approve, track, report and conduct periodic reviews of department-wide conference-related costs and attendances;
- Conduct a cost-benefit analysis;
- Develop a department-wide record-keeping standard;
- Designate a central point within each DHS division responsible for maintaining component-specific documentation related to conference expenditures;
- Develop measures to ensure compliance with federal regulations;
- Ensure that justifications for travel expenses are properly documented and records are retained;
- Develop a plan to standardize managerial practices and systems to allow coordination, cross-communication and interconnectivity in conference planning and spending activities; and
- Explore using more cost-effective means and technologies as alternatives to sponsoring conferences and related travel.