Summary: Since fiscal year 1992, the Coast Guard has assumed increased responsibilities while cutting its workforce by nearly 10 percent and operating with a budget that has increased by about one percent a year in actual dollars. The Commandant of the Coast Guard told Congress last year that funding was no longer sufficient to sustain the normal pace of operations over time. Yet the Coast Guard, like other federal agencies, faces the prospect of further budget cuts to meet deficit reduction targets during the next several years. By fiscal year 2002, the Coast Guard is projected to have a gap of as much as $493 million between the Office of Management and Budget's budget target and the estimated cost of maintaining services at current levels. Whether the Coast Guard can close the gap with its current budget strategy is highly uncertain at this point and is likely to remain so for some time. GAO believes that the Coast Guard needs to quantify the extent of likely savings from ongoing or planned actions. Except for a recent streamlining program, the Coast Guard has relatively incomplete knowledge about the savings that it can expect in coming years from cost-saving measures that are in various stages of implementation. In addition, the Coast Guard may have to consider significant changes in its operating culture, such as changing its military rotation policy, or measures that stir public opposition, such as closing small boat stations.
