Summary: In fiscal year 2002, the federal government spent nearly $100 billion on capital investments intended to yield long-term benefits for its own operations. Interested in ensuring that good investment decisions are made, the Chairman and Ranking Minority Member, Subcommittee on Government Efficiency and Financial Management, House Committee on Government Reform, asked GAO to evaluate agency experiences with the capital planning principles embodied in the Office of Management and Budget's (OMB) Capital Programming Guide and GAO's Executive Guide on leading state, local, and private sector capital investment practices. This report examines selected agencies' implementation of this guidance and OMB's use of long-term capital planning data.
VA, the Park Service, BOP, and NOAA have had mixed success with implementing the planning phase principles found in OMB's Capital Programming Guide and GAO's Executive Guide. The agencies' capital planning processes generally link to their strategic goals and objectives, and they all consider a range of alternatives to bridge an identified performance gap--including nonownership options where appropriate. Most have established processes to review and select from competing project proposals--including the use of senior-level review boards and established criteria to rank project proposals--strongly emphasizing linkage to strategic goals. However, case study agencies have had limited success with using agencywide asset inventory systems and data on asset condition to identify performance gaps. Also, none of them prepares an agencywide long-term capital investment plan. Some have long-term capital planning documents that could serve as a base for development of a comprehensive agencywide plan. While two case study agencies indicated plans to develop agencywide asset inventories and condition data--one of these making substantial progress--only one plans to develop a comprehensive agencywide long-term capital plan. OMB resource management office (RMO) staff varied in their expectations about agency use of OMB's Capital Programming Guide. The RMO staff for the four case study agencies consider numerous factors in reviewing agency requests for capital funding, including strategic plans, obligation rates, and the overall budget request. OMB does not require long-term capital plans from agencies, but RMOs receive various documents for individual capital projects.
