U.S. Ports of Entry: CBP Public-Private Partnership Programs Have Benefits, but CBP Could Strengthen Evaluation Efforts

International trade and travel to the United States is increasing. On a typical day in fiscal year 2016, CBP officers inspected nearly 1.1 million passengers and pedestrians and over 74,000 truck, rail, and sea containers at 328 U.S. land, sea, and air ports of entry, according to CBP. To help meet the increased demand for these types of CBP services, since 2013, CBP has entered into public-private partnerships under RSP and DAP. The RSP allows partners to reimburse CBP for providing services that exceed CBP's normal operations, such as paying overtime for CBP personnel that provide services at ports of entry outside normal business hours. The DAP enables partners to donate property or provide funding for port of entry infrastructure improvements.

The Cross-Border Trade Enhancement Act of 2016 included a provision for GAO to review the RSP and DAP. This report examines: (1) how CBP approves and administers RSP and DAP agreements, (2) the status of RSP and DAP agreements, including the purposes for which CBP has used funds and donations, and (3) the extent to which CBP monitors and evaluates program implementation. GAO reviewed partnership agreements and data on program usage. GAO also interviewed CBP and partner officials at 11 ports of entry selected based on a mix of port of entry and agreement types.

Within the Department of Homeland Security, U.S. Customs and Border Protection (CBP) uses criteria and follows documented procedures to evaluate and approve public-private partnership applications and administer the Reimbursable Services Program (RSP) and Donations Acceptance Program (DAP). For example, RSP applications undergo an initial review by CBP officials at the affected ports of entry before they are scored by an expert panel of CBP officials at headquarters. The panel evaluates RSP applications against seven criteria, such as impact on CBP operations. Similarly, DAP proposals are evaluated by CBP officials against seven operational and six technical criteria, such as real estate implications. Further, if the proposal involves real estate controlled by the General Services Administration (GSA), CBP and GSA officials collaborate on DAP selection decisions and project implementation. To administer the RSP and DAP, CBP has documented policies and procedures, such as standard operating procedures and implementation frameworks. For example, CBP uses a standard procedure to guide the process for RSP partners to request services and to provide reimbursement. For DAP projects, CBP, GSA (if applicable), and partners follow an implementation framework that includes a project planning and design phase.

The number of public-private partnerships is increasing, and partnerships provide a variety of additional services and infrastructure improvements at ports of entry. From fiscal years 2013 through 2017, CBP selected over 100 partners for RSP agreements that could impact 112 ports of entry and other CBP-staffed locations, and the total number of RSP partnerships doubled from fiscal year 2016 to 2017. According to CBP, since partners began requesting reimbursable services in 2014, CBP has provided its partners nearly 370,000 officer overtime hours of services, which led to over $45 million in reimbursed funds. As a result, CBP inspected an additional 8 million travelers and over 1 million personal and commercial vehicles at ports of entry. Similar to the RSP, the number of DAP partnerships more than doubled from fiscal year 2016 to 2017, and totals 16 projects that impact 13 ports of entry as of November 2017. The donations include improvements, such as the installation of new inspection booths and equipment and removal of traffic medians, and are intended to support over $150 million in infrastructure improvements.

CBP uses various processes to monitor and evaluate its partnerships, but could benefit from establishing an evaluation plan to assess overall program performance. For example, CBP conducts regular audits of RSP records to help ensure that CBP bills and collects funds from its partners accurately, and uses guidance, such as the DAP Implementation Roadmap, to identify and monitor project milestones and tasks. However, as of November 2017, CBP had not developed an evaluation plan—which could include, among other things, measurable objectives, performance criteria, and data collection plans—to assess the overall performance of the RSP and DAP, consistent with Office of Management and Budget guidance and leading practices. Given CBP's staffing challenges and anticipated growth of the RSP and DAP, an evaluation plan could better position CBP to further integrate evaluation activities into program management.

GAO recommends that CBP develop an evaluation plan to assess the overall performance of the RSP and DAP. DHS concurred with the recommendation.

On a typical day in fiscal year 2016, nearly 1.1 million passengers and  pedestrians and over 74,000 truck, rail, and sea containers worth  approximately $6.3 billion entered the United States through 328 U.S.  land, sea, and air ports of entry (POE), according to U.S. Customs and  Border Protection (CBP). Within the Department of Homeland Security  (DHS), CBP is the lead federal agency charged with a dual mission of  keeping terrorists and their weapons, criminals and their contraband, and  inadmissible aliens out of the country while facilitating the flow of  legitimate international travel and trade through the nation’s POEs.  CBP’s Office of Field Operations is responsible for enforcing passenger  and cargo processing activities related to security, trade, immigration, and  agricultural inspection at the nation’s POEs. In April 2016, the CBP  Human Resources Management Assistant Commissioner and Office of  Field Operations Deputy Assistant Commissioner testified before  Congress that the agency continues to face significant challenges in  meeting its staffing goals due to hiring and retention challenges;  meanwhile, the amount of international travel and trade to the United  States continues to increase. For example, from fiscal years 2014 to  2016, the number of international travelers entering the United States  increased about 4 percent, and the number of cargo containers entering  the country increased about 6 percent. Further, in 2015, CBP conducted  a study on its POEs that identified the need for $5 billion to meet its  infrastructure and technology requirements.

Since 2013, CBP has entered into public-private partnerships with  stakeholders, such as port authorities or local municipalities that own or  manage the ports or private companies that conduct business through the  ports, under its Reimbursable Services Program (RSP) to cover CBP’s  cost of providing certain services at POEs. Such services include those  supporting customs, agricultural processing, border security, or  immigration inspection matters. For example, the RSP enables entities to  pay the overtime costs of CBP personnel who may provide such services  outside normal business hours. A second public-private partnership  program—the Donations Acceptance Program (DAP)—enables entities,  such as local municipalities, to donate personal or real property,  nonpersonal services, or provide funding related to land acquisition,  design, construction, repair or alteration, and operations and maintenance  to CBP and the General Services Administration (GSA) at POEs. The  Office of Field Operations’ Alternative Funding Programs (AFP) office  manages and oversees both programs at the headquarters level for CBP.  GSA’s Public Building Services office manages and oversees the DAP at  the headquarters level for GSA.

The Cross-Border Trade Enhancement Act of 2016 included a provision  for GAO to review the agreements and funds and donations that CBP and  GSA have received under the RSP and DAP. This report examines: (1)  how CBP approves and administers public-private partnership  agreements under its RSP and DAP, (2) the status of RSP and DAP  agreements, including the purposes for which CBP has used the funds  and donations from these agreements, and (3) the extent to which CBP  has processes in place to monitor and evaluate the implementation of  these programs.

To examine how CBP approves and administers public-private  partnership agreements under its RSP and DAP, we collected and  reviewed CBP’s criteria for evaluating and approving applications and  standard operating procedures, as well as policy documents for  administering the RSP and DAP. We attended an RSP application  evaluation review panel in September 2017 to observe how CBP officials  deliberate the merits of RSP applications and apply RSP selection  criteria. We also attended an AFP office visit to the Baltimore Field Office in October 2017 where we observed AFP officials train local CBP officials  and meet with new partner officials. We also interviewed CBP and partner  officials at 11 POEs—to reflect a range of POE types (land, air, and sea),  type of partnerships, and geographic diversity—and conducted site visits  at 10 of these POEs to observe local operations. We used a non- probability sample for our site visit selections and thus cannot generalize  our findings to all POEs with an RSP or DAP agreement; however, the  site visits provided insight into how these agreements are working at the  POEs. We also interviewed CBP and GSA officials at headquarters to  learn about how headquarters officials administer the programs.

To examine the status of RSP and DAP agreements, including the  purposes for which CBP uses funds and donations from these  agreements, we collected and analyzed all Reimbursable Services  Agreements, Donations Acceptance Agreements, and Memoranda of  Understanding (MOU) for both the RSP and DAP from fiscal year 2013  through 2017. As mentioned above, we interviewed CBP, GSA, and  partner officials at 11 POEs and conducted site visits at 10 of these POEs  to observe local operations and gain insights on how CBP is  administering the programs at the POEs. We also interviewed CBP  officials at headquarters, GSA officials at headquarters and in regional  offices, and officials from four travel and trade industry associations  selected based on the nature of the associations to gain insights on  public-private partnerships agreements. We collected and analyzed data  on the actual use of RSP agreements, such as the number of travelers  processed and cargo containers inspected since the program started, as  well as the amount that partners have reimbursed CBP through each  agreement. We reviewed existing information about the data and the  system that produced them and interviewed agency officials  knowledgeable about the data. We determined that these data were  sufficiently reliable for the purposes of our reporting objectives.

To examine the extent to which CBP has processes in place to monitor  and evaluate the implementation of these agreements, we collected and  reviewed CBP’s documentation for evaluating the programs, including  standard operating procedures, among other documents. We collected  and analyzed a selection of work ticket and billing data for the RSP from  fiscal years 2014 through 2017. We assessed the reliability of these data  by performing electronic testing for obvious errors in accuracy and  completeness, reviewing existing information about the data and the  system that produced them, and interviewing agency officials  knowledgeable about the data. We determined that the data were  sufficiently reliable for the purposes of this report. In October 2017 we  also received demonstrations on the systems that CBP uses to document  and audit work ticket and billing data. We interviewed officials at CBP and  GSA headquarters to gain insights on how the agencies use qualitative  information to monitor program performance and share best practices.  We assessed whether CBP’s efforts were consistent with Office of  Management and Budget guidance for making program expansion  decisions and leading practices for program evaluation from the American  Evaluation Association.

We conducted this performance audit from March 2017 to March 2018, in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.

In fiscal year 2017, approximately 24,000 CBP officers performed a  variety of functions at over 300 air, land, and sea POEs, including  inspecting travelers and cargo containers, among other activities.  According to CBP, increases in passenger and cargo volumes are  outpacing CBP’s staffing resources, resulting in increased passenger wait  times and cargo backups, among other things. For example, in fiscal year  2017, CBP identified a need for an additional 2,516 CBP officers across  all POEs. Further, as of 2017, CBP estimated that it needed  approximately $5 billion to meet infrastructure and technology  requirements at about 167 land POEs. To help identify and mitigate  resource challenges, CBP developed its Resource Optimization Strategy,  an integrated, long-term plan to improve operations at all POEs. The  Strategy consists of three components:

Business transformation: utilize new technology, such as  Automated Passport Control kiosks, or new processes, such as  trusted traveler programs, to increase CBP operational efficiencies;

Workload Staffing Model: utilize modeling techniques to help ensure  that existing staffing resources are appropriately aligned with threat  environments while maximizing cost efficiencies; and

Alternative funding strategies: utilize public-private partnership  agreements, such as RSP and DAP, to supplement regular  appropriated resources.

The RSP enables partnerships between CBP and private sector or  government entities, allowing CBP to provide new or additional services  upon the request of partners. These services can include customs,  immigration, or agricultural processing; border security and support at any  facility where CBP provides, or will provide, services; and may cover  costs such as salaries, benefits, overtime expenses, administration, and  transportation costs. According to authorizing legislation, RSP  agreements are subject to certain limitations, including that they may not  unduly and permanently impact existing services funded by an  appropriations act or fee collection. According to AFP officials, the  purpose of the RSP is to provide new or additional CBP services at POEs  that the component would otherwise not have been able to provide. From  2013 to 2017, the number of RSP agreements has increased as new  authorizing legislation has expanded participant eligibility and made the  program permanent. Table 1 below outlines the evolution of RSP through  its different legislative authorities.

The DAP permits CBP and GSA to accept donations from private and  public sector entities, such as private or municipally-owned seaports or  land border crossings. Donations may include real property, personal  property, money, and non-personal services, such as design and  construction services. Donated resources may include improvements to  existing facilities, new facilities, equipment and technology, and  operations and maintenance costs, among other things. In terms of the  types of locations that may accept donations, donations may be used for  activities related to land acquisition, design, construction, repair,  alteration, operations, and maintenance, including installation or  deployment of furniture, fixtures, equipment or technology, at an existing  CBP-owned land POE; a new or existing space at a CBP air or sea POE;  or a new or existing GSA-owned land POE. CBP and GSA may not  accept donations at a leased land POE, nor is CBP able to accept a  donation at or for a new land POE if the combined fair market value of the  POE and donation exceeds $50 million. Additionally, CBP may not use  monetary donations accepted under the DAP to pay salaries of CBP  employees performing inspection services. Finally, CBP may not accept  donations on foreign soil. Table 2 below depicts the evolution of DAP  authorizing legislation since the program’s inception in 2014.

Figures 1 and 2 depict the location and number of RSP and DAP  agreements in place through fiscal year 2017.

CBP Uses Criteria and Documented Procedures to Evaluate and Approve Public-Private Partnership Applications and Administer Programs

CBP Uses Criteria and Procedures to Approve Public-Private Partnership Applications and Coordinate with Partners

CBP has developed detailed guidance on the RSP application process,  including application timeframes, requirements, and evaluation criteria,  and this guidance is on CBP’s website. According to this guidance, in  2017, CBP expanded the RSP application submission period. Whereas in  prior years applications were accepted during a single one-month  window, prospective partners may now submit applications throughout  the year. Under this new process, CBP evaluates submissions three  times per year—beginning in March, July, and November. According to  CBP, the submission period was expanded in part because new  legislative authorities removed previous restrictions on the number of  RSP agreements CBP can enter into each year. The overarching RSP  application process—from application submission through CBP  evaluation and applicant notification—is depicted in figure 3.

According to CBP’s procedures for accepting and reviewing applications,  potential partners first submit a letter of application that includes a variety  of logistical information concerning the stakeholders, services to be  requested, location of services to be requested, available facilities, and  funding. For example, in submitting a letter of application, an applicant is  to estimate how many hours of services it may request per month and  identify the applicant’s available budget for the first fiscal year of the  partnership, among other things. According to the application guidance,  prospective applicants are encouraged to work with local CBP officials at  individual POEs to develop letters of application. After submission, CBP  officials at the affected POEs, including affected CBP Field Offices,  review applications and communicate their findings and  recommendations to the AFP office. In addition, the CBP Office of Chief  Counsel reviews the applications for legal sufficiency and may suggest  that CBP request additional information from applicants.

Next, CBP convenes an expert panel consisting of two senior CBP  officials who are not part of the AFP office to consider POE and legal  comments on the applications, among other information provided by AFP  officials. The panel deliberates and scores each proposal based on seven  criteria, and all proposals that achieve a certain minimum score are  accepted. The seven evaluation criteria used to weigh the merits of  potential new partnership agreements are listed in table 3.

The scoring scale ranges from -5 to 5, and the 7 criteria are weighted  based on potential impact. For example, impact to CBP operations is  weighted more heavily than other agency support. In September 2017,  we observed an RSP application review panel. Among other things, we  observed senior CBP officials, who were independent from the AFP  office, score 31 RSP applications that impacted 46 CBP Field Office  locations. The panel members based their deliberations on set criteria  and reached consensus on which applications to approve. Finally,  Congress and approved partners are notified of the selections. Where  CBP denies a proposal for an agreement, it is to provide the reason for  denial unless such reason is law enforcement sensitive or withholding the  reason for denial is in the national security interests of the United  States.

Once CBP approves an application, CBP and its prospective new  partners follow documented procedures to formalize the agreements and  prepare all involved stakeholders, including new partners and local CBP  officials, for Reimbursable Services Agreement implementation. The  process to establish new RSP partnerships at specific POEs is depicted  in figure 4 below.

After CBP notifies the applicant of its selection, officials from the AFP  office schedule a site visit to meet with local CBP officials at the POEs  and the new partners. According to CBP program requirements, the  purpose of the site visit is to discuss workload and services, and to verify  that the POE facilities and equipment meet CBP’s required specifications.  AFP officials also provide program training to CBP Field Office and POE  officials, as well as to new partners on the processes to request and fulfill  RSP service requests, among other things. We attended an AFP office  visit to CBP’s Baltimore Field Office in October 2017 and observed AFP  officials sharing best practices with local CBP officials and new RSP  partners. According to CBP’s procedures, before any RSP services can  be provided, CBP and the prospective partners must sign a legally  binding Reimbursable Services Agreement. Among other things, the  Reimbursable Services Agreement establishes that the partner will  reimburse CBP for the costs of services provided under the RSP  authorizing legislation, including the officer overtime rates, benefits, and a  15 percent administrative fee. Further, the partner agrees to reimburse  CBP for these services within 15 days of billing through a Department of  the Treasury system. Finally, local CBP Field Office and partner officials  negotiate a local MOU that outlines the services, schedules, and other  conditions for the POE location(s) covered by the Reimbursable Services  Agreement.

Similar to the RSP application process, CBP, in conjunction with GSA,  utilizes criteria and documented processes to evaluate DAP proposals  and implement the program. More specifically, in alignment with the  most recent DAP authorizing legislation, CBP and GSA developed the  Section 482 Donation Acceptance Authority Proposal Evaluation  Procedures & Criteria Framework (Framework) for receiving, evaluating,  approving, planning, developing, and formally accepting donations under  the program. The initial steps of the Framework, which encompass the  DAP application process, are depicted in figure 5.

In prior years, CBP accepted large-scale proposals, defined by CBP as  $5 million or more, during one application and evaluation cycle per year.  Beginning in fiscal year 2017, CBP accepts large-scale proposals on a  rolling basis, using a streamlined process for expedited review. CBP also  accepts small-scale proposals, defined by CBP as less than $5 million, on  a rolling basis. According to AFP officials, CBP undertakes considerable  effort to provide early education about the program to potential partners  who plan to apply for a DAP agreement, including discussing CBP’s  operational needs at the POEs. The Framework notes that this outreach  helps prospective donors gauge their willingness and ability to work  cooperatively with CBP and GSA on potential POE improvements and  also helps applicants enhance the viability of their submissions.

After a DAP proposal is submitted and checked for completeness, CBP  and GSA subject matter experts evaluate the proposal against seven  operational and six technical criteria (see table 4 below). The evaluators  reach consensus on proposed recommendations and submit their  evaluation results to CBP and GSA senior leadership for consideration.  Leadership reviews the recommendations and other pertinent information  and determines whether or not to select proposals.

In accordance with legislative requirements, CBP must notify DAP  applicants of the determination to approve or deny a proposal not later  than 180 days after receiving the completed proposal. Figure 6 depicts  all three phases of the DAP Framework from selecting a proposal to  signing a formal Donations Acceptance Agreement.

Phase 2 of the Framework begins shortly after CBP notifies new partners  of DAP selections. CBP officials then initiate a series of biweekly calls  with GSA officials, if applicable, and the partner. AFP officials provide  partners with documentation in the form of a high-level roadmap which  contains a sequence of activities and deliverables CBP expects from the  partners, and all stakeholders convene to track progress against planned  activities and milestones. CBP, GSA, and the partner also meet to  discuss the technical implementation of the donation.

AFP and GSA officials conduct a site visit to meet with new partners;  obtain a visual understanding of how CBP, GSA, and the partner will  implement the donation; and help the partner begin the planning and  development phase. CBP, GSA, and the partner negotiate a MOU on  roles and responsibilities and terms and conditions of the donation. CBP  then provides the partner with its technical standards and other  operational requirements, such as space and staffing needs, under a non- disclosure agreement. The partner then begins to plan and develop its  conceptual proposal into an executable project in close coordination with  CBP and GSA. By the end of Phase 2, CBP, GSA, as applicable, and the  partner confirm that all pre-construction development activities are  complete, no outstanding critical risks exist, and that the appropriate  agencies are prepared to request future funding, as applicable.

Finally, stakeholders move to Phase 3 of the Framework to formalize the  terms and conditions under which either CBP, GSA, or both, may accept  the proposed donation. After CBP, GSA and the partner agree to the  provisions of the project plan, they sign the legally binding Donations  Acceptance Agreement, and stakeholders proceed to project execution.

CBP Administers the Public-Private Partnerships Using Documented Policies and Procedures, and Implementation of the Programs Can Vary by Port

CBP has documented standard operating procedures, roadmaps, and  other formally documented policies and procedures to administer the RSP  and DAP. In addition, as mentioned above, AFP officials conduct site  visits to the POEs with new RSP and DAP agreements, and provide  formal training for CBP personnel at Field Offices and POEs.

The general process for administering RSP–from requesting and fulfilling  services to billing and collecting payments–is dictated by standard  operating procedures, as shown in figure 7.

In general, RSP partners submit a formal request for services by  completing an electronic form and calendar access via CBP’s Service  Request Portal. Once the partner submits the request, the portal sends  an electronic copy of the request to the partner’s email and the port’s  RSP email inbox. CBP supervisors at the POE access the Service  Request Portal to review, edit, approve, deny, or cancel requests. The  system tracks and requires CBP officials to comment on any requests  that CBP edits, denies, or cancels, and sends an email notification of  CBP’s decision to the partner. If CBP approves the request, the Service  Request Portal creates a line item with information about the request,  such as codes for the location and partner, as well as the hours CBP  officers will work.

Next, CBP officers enter line item information—information on accounting  codes for the location and partner and the actual hours CBP officers  worked to fulfill the request—into CBP’s overtime management system.  At the end of every shift, CBP supervisors review and approve the  amount of overtime and other data entered into the overtime  management system. In addition, data from this system is checked for  accuracy and certified weekly by both CBP POE and AFP officials. After  the overtime and request information is checked, payroll data generated  from the overtime management system, including salary and benefits  information for each officer that worked RSP overtime, uploads to CBP’s  financial accounting system at the end of each pay period, or every 14  days. CBP bills its partners for two full pay periods, and the partner has  15 days to make a full payment through the partner’s account with the  Department of the Treasury. After the partner makes the payment through  the Department of the Treasury collection system, CBP National Finance  Center officials reimburse the CBP annual Operations & Support account  initially used to pay its officers for all of the RSP overtime worked during  that pay cycle by moving the expenses to the RSP officer payroll fund.

Although the general request and billing processes for RSP services are  the same across all POEs regardless of location or mode—air, land, or,  sea—CBP and its partners have flexibility to tailor RSP implementation  based on local conditions or needs. Some of this implementation variation  is documented in locally negotiated MOUs. For example, CBP’s partner at  Miami International Airport in Florida relies on CBP to schedule RSP  overtime daily based on CBP expertise. CBP officials at the airport  developed their own software templates to plan, track, and manage CBP  officers for RSP overtime for a given amount of available overtime funding. At the Pharr land POE in Texas, CBP staff at the POE submit  recommended RSP overtime request proposals to the partner based on  local conditions, including staffing, and the partner decides whether to  submit a formal request to CBP. In all of these instances, RSP partners  and CBP Field Office and POE officials expressed satisfaction with their  more customized administration processes.

CBP and its partners also noted some challenges to implementing RSP  and DAP agreements, but partners generally agreed that the program  benefits outweighed the challenges. For example, some DAP partners we  met with mentioned that navigating GSA requirements was difficult and  sometimes caused delays. GSA officials we met with noted that they are  educating partners on GSA building standards and the GSA approvals  process for donations, among other things, to help partners manage their  timelines and expectations. GSA officials noted that they are working with  CBP and partner officials to manage and learn from these early  implementation challenges.

CBP, GSA, and DAP partners also acknowledged a lack of clarity about  which entity or entities are responsible for the long-term operations and  maintenance costs of DAP infrastructure projects, although CBP has  taken steps to address this issue. GSA pricing procedures dictate that  once a POE receives an improvement, it charges the customer (CBP) for  the additional operating costs, such as utilities. CBP officials  acknowledged that the long term sustainability of donations, specifically  the costs of operations, maintenance, and technology for infrastructure- based donations, needs to be addressed, and officials reported taking  initial steps. For example, once CBP and its partner complete the  planning of a project and GSA has calculated the project’s estimated  operating expenses, the AFP office begins working with the CBP Office of  Facilities & Asset Management to budget for such costs with the goal of  reaching a mutually acceptable partnership for donations that will have  long-term sustainability.

CBP officials noted that the agency cannot commit to funding that is not  guaranteed for the future. To mitigate budget uncertainty, CBP now  includes language in its MOU and Donations Acceptance Agreement  templates stating that upon project completion, the partner will be  responsible for all costs and expenses related to the operations and  maintenance of the donation until the federal government has the  available funding and resources to cover such costs. According to AFP  officials, CBP also makes efforts to educate its DAP partners on the  budgeting process and associated timeframes with project completion.

CBP officials noted that the majority of projects are in the early stages of  development, and it will be years before the projects are complete.  Furthermore, GSA officials stated that the actual operating and  maintenance costs associated with DAP projects will not be known until  about 1 year after the projects are completed.

Public-Private Partnerships Are Increasing and Provide a Variety of Additional Services and Infrastructure Improvements

RSP Partnerships are Increasing and Provide a Variety of Additional Services at POEs

As noted previously, as CBP’s authorities to enter into new RSP  agreements expanded to an unlimited number of agreements per year,  and in total, for all types of POEs in 2017, the number of applications that  CBP has selected has also increased. For example, in fiscal year 2013,  CBP received 16 applications from interested stakeholders and selected  five of these applications for partnerships, while in fiscal year 2017 cycle  2, CBP received 31 applications from interested stakeholders and  tentatively selected 30 for partnerships. From fiscal year 2013 through  fiscal year 2017 cycle 2, CBP has tentatively selected over 100 partners  for RSP agreements. This figure includes RSP agreements under the  authorities provided in Section 481 that allow CBP to enter into  agreements with small airports to pay for additional CBP officers above  the number of officers assigned at the time the agreement was reached.  Figure 8 details this information for each application cycle.

As mentioned above, once CBP selects an application for a new  reimbursable services partnership, CBP and its partner sign a legally  binding Reimbursable Services Agreement. From fiscal years 2013  through 2017 cycle 2, CBP selected 114 applications and entered into 69  Reimbursable Services Agreements with partners. As mentioned  previously, local CBP officials also work with the partner to negotiate the  terms of an MOU, which outlines how the partnership will work at the  POE. As of November 2017, CBP and its partners were implementing 54  MOUs from partnerships that they entered into from fiscal years 2013  through 2017. Of those 54 MOUs, 10 cover agreements at land POEs, 22  cover agreements at sea POEs, and 23 cover agreements at air POEs.   According to AFP officials, during the process of negotiating the MOUs  with its partners, CBP and the partner often agree to include a variety of  services that the partner can request, so that if a need arises, there is a  record that CBP has agreed to provide those services under the MOU.  CBP and its partners also negotiate a variety of other terms for the  agreements in the MOUs, including the types of requests for services the  partner can make, expectations for how often CBP and its partners  communicate, and how to amend the MOU, among others terms. Table 5  provides details about the existing 54 MOUs.

As noted in the above table, MOUs detail a variety of services that CBP  officers can provide at the POEs, and the types of services vary by POE  type. For example, most MOUs across land, air, and sea POEs allow  partners to request services for freight or cargo processing, while a  majority of the MOUs at air POEs allow CBP to provide services for  traveler processing and to address unanticipated irregular operations or  diversions. In addition, all MOUs allow partners to submit ad-hoc requests  that partners make for services in advance. Most of these MOUs also  allow partners to make urgent requests for immediate services.

In examining the MOUs, we found that 44 of the 54 MOUs, or 81 percent,  indicate that CBP and its partner meet at least quarterly to discuss how  the partnership is going. Further, CBP and some of its partners meet  more often. For example, CBP and its partners agreed to meet monthly in  accordance with 23 MOUs, while CBP and its partners agreed to meet  weekly according to 3 MOUs. All partners we interviewed that have  utilized their RSP agreements reported that maintaining strong  communication between CBP and the partner is important to  implementing the RSP agreements at the POEs. Appendix I has  additional information about each of the 54 current MOUs.

Tables 6 and 7 provide the amount that partners reimbursed CBP for  overtime services, the total number of overtime hours that CBP officers  worked for each fiscal year from 2014 through 2017, and the total number  of travelers and vehicles that CBP officers inspected during RSP partner  requests for services from fiscal years 2014 through 2017 respectively.

DAP Partnerships Provide for Infrastructure Improvements at POEs

Similar to the RSP, the number of DAP partnerships more than doubled in  fiscal year 2017. In fiscal years 2015 and 2016, CBP selected seven DAP  proposals. In fiscal year 2017, CBP selected 9 DAP proposals.  Combined, these 16 DAP projects affect 13 POEs.

The donations that partners will provide CBP and GSA, as applicable,  include a variety of POE improvements such as the installation of new  inspection booths and equipment, removal of traffic medians, and new  cold inspection facilities, as well as smaller items such as a high-capacity  perforating machine, which reduces document processing time and  allows CBP officers to focus on more critical operational duties, among  other donations. According to CBP, these 16 donation proposals  combined are intended to support over $150 million in infrastructure  improvements at U.S. POEs. CBP also expects a variety of benefits from  these donations, including support for local and regional trade industries  and tourism, reductions in border wait times, and increased border  security and officer safety, among others. Table 8 provides information on  the scope and status of DAP projects that CBP and GSA have selected  since CBP established the DAP in fiscal year 2015.

As noted in the table above, CBP has fully accepted six donations,  including the donation of a high capacity perforating machine to facilitate  the processing of titles and other documents at the Freeport Sea POE in  fiscal year 2016, the removal of traffic medians at the Ysleta Land POE,  and recurring luggage donations in fiscal year 2017. Figure 9 is a photo of  the high capacity perforating machine that CBP accepted at the Port of  Freeport Sea POE from its partner Red Hook Terminals in 2016.

As mentioned above, once CBP selects an application for a new donation  partnership, CBP, GSA, if applicable, and partner officials negotiate the  terms of a MOU, which outlines intentions of the partnerships for projects  that require coordinated planning and development. CBP currently has  MOUs for 9 of its 16 DAP projects. The MOUs contain a variety of project- specific information, including the scope of the project, a list of documents  that CBP and GSA may request to determine whether the project is ready  for execution, and details on donor warranty and continuing financial  responsibility after CBP and GSA accepts the donation. As mentioned  previously, CBP classifies donations under the DAP into two categories:  small-scale donations, which are reviewed on an expedited basis, and  large-scale donations. For example, the Salvation Army’s recurring  donation of six to nine pieces of luggage per year to support Office of  Field Operations canine training activities is a small-scale donation.  Large-scale donations are donations with an estimated value of $5 million  or more and are moderate to significant in size, scope, and complexity.  For example, the City of Laredo’s donation for construction of four  additional commercial vehicle lanes and booths, roadways and  infrastructure, and exit booths and related technologies is a large-scale  donation.

CBP Uses Various Processes to Monitor and Evaluate Its Partnerships, but Could Benefit from Establishing an Evaluation Plan to Assess Overall Program Performance

CBP Has Various Processes to Monitor and Evaluate the Implementation and Benefits of Its Public- Private Partnership Programs

RSP Audits, Metric Reports, and Partner Satisfaction Surveys

Given that partner requests for RSP services are predominately for the  purposes of CBP officer overtime, CBP primarily monitors the RSP  through audits. Specifically, CBP conducts regular audits using  information from its Service Request Portal, its overtime management  system, and its internal accounting system to ensure partners  appropriately reimburse CBP for the overtime services officers provide  under the RSP. Figure 10 describes how and when CBP uses these tools  to conduct audits as part of the RSP request, fulfillment, and billing  processes.

As noted previously, CBP officers who work RSP overtime enter  information from the Service Request Portal, such as the partner code  and POE code, into CBP’s overtime management system for the actual  hours that the officer worked to complete the request. At the end of every  shift, CBP supervisors review and approve the information entered into  the overtime management system, which contains the information needed  for CBP to bill its RSP partner for the services that it performed, such as  the number of hours each CBP officer worked to fulfill RSP requests and  the salary and benefits information for those officers. POE supervisors  then update the Service Request Portal records so that they reflect what  CBP officers actually worked. On Mondays, AFP officials and CBP POE  supervisors conduct concurrent audits of weekly overtime management  system reports and reconcile these data with the information from the  Service Request Portal to ensure that CBP will bill the partner  appropriately. At the end of two pay period cycles, or every 28 days,  officials at CBP’s National Finance Center review the payroll and benefits  information that was uploaded from the overtime management system  into CBP’s financial management system to confirm that it matches the  appropriate partner code. This ensures that the correct partner is billed for  the reimbursable services that CBP provided.

Generally, CBP and partner officials we met with did not have any  problems with the billing and payment process, and CBP officials noted  that any discrepancies in the billing information between the Service  Request Portal, the overtime management system, or the financial  accounting system, such as the partner code or the number of hours that  CBP officers worked, are usually identified and corrected during the  weekly audits. Further, in October 2017, we received a demonstration of  how partners and CBP manage requests for services in the Service  Request Portal, how CBP officers and supervisors at the POEs enter and  review overtime information, and how CBP runs reports in its financial  accounting system during the audit process. In addition, we conducted a  test of the data from the overtime management system and the billing  information from the financial accounting system for a selection of  partners across eight pay periods from fiscal years 2014 through 2017 to  determine if CBP billed its partners appropriately. Specifically, for each of  the eight selected pay periods, we randomly selected one RSP partner  from the universe of partners who used RSP services during the period.  We then compared the number of RSP overtime hours logged in CBP’s  overtime management system for the selected partners and pay periods  with the number of hours on the corresponding partner bills. In all eight  cases, the amount of RSP overtime hours logged by CBP officials  matched the overtime hours billed to the partners. Our observations,  review of applicable documentation, and testing provided reasonable  assurance that CBP is being appropriately reimbursed by partners for the  services that it provided under the RSP.

To evaluate the benefits of RSP services, the AFP office develops metrics  reports on the services that CBP performed while fulfilling RSP requests  throughout the billing cycle that it provides its partners. These metrics  reports include data, such as the number of overtime hours CBP officers  worked, the number of travelers CBP processed, the number of  containers CBP inspected, and the average wait times CBP recorded  during RSP overtime services, among other data. According to AFP  officials, this information about the impact of reimbursable services helps  partners make informed decisions when assessing their future requests.  The AFP office works with partners to ensure that the information CBP  provides in these reports is useful and will provide additional data upon  the partners’ request, as applicable.

CBP also conducts annual RSP partner satisfaction surveys to obtain  feedback and evaluate overall satisfaction with program implementation.  In 2015 and 2016, RSP partners expressed high levels of satisfaction  about the level of services CBP provided, the request and fulfilment  process, the billing and payment process, the monthly and annual metrics  reports that CBP provides its partners, and the program’s ability to meet  partner goals. Additionally, partners generally responded that the program  allowed them to achieve their goals, which primarily focused on reducing  wait times and increasing their own customer satisfaction levels.

Monitoring and Evaluation of DAP Implementation and Benefits

CBP has guidance that it follows to monitor and evaluate the  implementation of DAP projects, and CBP and its partners use tools such  as implementation roadmaps and other policy documents, such as  standard operating procedures, to administer and monitor the progress of  DAP projects at the POEs. For example, CBP develops project roadmaps  for all donation projects in close collaboration with its partner, GSA (as  applicable), and other entities involved in the project, and shares them  with project participants. The roadmap identifies a variety of project  milestones and tasks, such as drafting the MOU and completing the  technical requirements package, among other things. The roadmap also  tracks the number of days that CBP expects will be required to complete  each task, which helps CBP to ensure that all stakeholders meet project  milestones.

CBP also monitors overall DAP implementation by collecting quantitative  data on the efficiency of DAP processes to inform program and process  improvements. For example, from 2015 to 2016, CBP consolidated  certain elements of its application evaluation process to reduce the  number of days it takes to evaluate and approve applications from an  average of 144 days to 75 days for large-scale donations. Similarly, from  2015 to 2016, CBP determined that it could gain efficiencies by  establishing a separate application evaluation and approval process for  small-scale donation applications to better accommodate small-scale  donations, and delegated approval and acceptance authority to the Office  of Field Operations Executive Assistant Commissioner. This new  process expedited the proposal evaluation timeline for small-scale  donations from approximately 27 days to 14 days. In addition, GSA  implemented a similar delegation authority for approval and acceptance  of small-scale donations in fiscal year 2017, which decreased GSA’s  application evaluation process from approximately 57 days to 25 days  from fiscal year 2016 to 2017.

In addition to monitoring the implementation of the overall program and  the progress of specific DAP projects, CBP works with its partners to  evaluate the benefits of each project. Specifically, during the planning and  development phase of a donation, AFP officials coordinate with local CBP  officials and DAP partners to develop a plan for identifying, measuring,  and reporting on the local benefits to be derived from accepted donations  upon project completion. CBP has completed its evaluation of the benefits  of one completed small-scale project. For example, CBP estimated that  the donated perforating machine at the Freeport Sea POE will save CBP  166 officer hours and approximately $7,450 in salary and maintenance  costs per year. For large-scale projects, CBP is working with its partners  to develop these evaluation plans, but it is too early for CBP to evaluate  the benefits given that most of these projects are in the early planning  and development phases. CBP shares its findings on benefits with its  partners to help them assess their return on investment and so that they  can share that information with their own local stakeholders.

CBP Is Taking Steps to Plan for the Expansion of Its RSP and DAP, but Could Benefit from Establishing an Evaluation Plan to Assess Overall Program Performance

CBP is taking steps to monitor the existing use and impacts of RSP and  DAP and to plan for further expansion of these programs. For example, in  addition to the monthly metrics reports that CBP provides its RSP  partners, AFP officials told us that they monitor the fulfillment rates of  formal partner requests for RSP services. The current fulfillment rate  across all of CBP’s RSP agreements is over 99 percent. In addition, as  noted previously, AFP officials coordinate with local CBP officials and  DAP partners to develop a plan for identifying, measuring, and reporting  on the local benefits to be derived from accepted donations upon project  completion. Furthermore, with regard to planning for future program  expansion, CBP has taken steps to plan for the additional oversight  activities that it expects at the headquarters level as the RSP expands.  For example, CBP is hiring new staff members and contractors for the  AFP office, as well as reimbursing the Office of Finance for one staff  position and embedding one staff member in the Budget Office to help  complete the increased number of financial transactions and audits. In  addition, the AFP office is considering the future impact of DAP projects  on staffing and other resources at the affected POEs, and is working with  Field Office, POE, and partner officials to identify and budget for  anticipated operational needs, with assistance from CBP’s Workload  Staffing Model and Planning, Program Analysis and Evaluation offices.

These efforts to monitor and evaluate the impacts of the programs and  plan for further expansion are positive steps that should help position  CBP to manage anticipated increases in the number of agreements going  forward. Furthermore, prior to Sections 481 and 482 authorities, in  accordance with the report of the Senate Appropriations Committee  accompanying the Department of Homeland Security Appropriations Act,  2013, CBP submitted semiannual reports to Congress on its Section 560 partnerships for fiscal years 2014 through 2016. CBP included  information in these reports on the benefits of RSP services. For  example, CBP compared baseline traveler and vehicle volume and wait  times at participating POEs from previous years to the traveler and  vehicle volume and wait times during time periods when CBP provided  reimbursable services.

Subsequently, in accordance with the Consolidated Appropriations Act,  2014, CBP developed an evaluation plan with objectives, criteria,  evaluation methodologies, and data collection plans to be used to  evaluate RSP and DAP performance on an annual and aggregated  basis. However, the provision requiring that an evaluation plan be  established for the section 559 pilot program was repealed by the Cross- Border Trade Enhancement Act of 2016. This Act requires that CBP  report to Congress annually to identify the activities undertaken and the  agreements entered into under the RSP and DAP but does not require  that CBP develop or report on an evaluation plan for these programs.  As of November 2017, CBP had not decided whether it will use a  performance evaluation plan going forward. However, in December 2017,  AFP officials acknowledged that such a plan—that examines RSP and  DAP performance at the programmatic level—could benefit program  management and augment evaluation activities already conducted by the  AFP office. We reviewed draft versions of CBP’s fiscal year 2017 reports  to Congress on new Section 481 fee agreements and new Section 482  donation agreements. Both reports detailed how CBP responded to  changes in legislative authorities for the RSP and DAP and listed its fiscal  year 2017 selections for public-private partnership agreements, but did  not include an evaluation plan or identify measures for tracking program  performance going forward.

Further, while the AFP office tracks the fulfillment rates of requests for  RSP services and is working with its partners and other CBP components  to monitor and plan for program expansion, CBP could benefit from a  more robust assessment of possible impacts of staffing challenges on  program expansion. As mentioned above, as of fiscal year 2017, CBP  has an overall staffing shortage of 2,516 officers, according to CBP’s  Workload Staffing Model analysis, and CBP officer hiring remains an  agency-wide challenge. We identified some staffing challenges that could  affect CBP’s management and implementation of its RSP and DAP  programs, which roughly doubled in the number of agreements from fiscal  year 2016 to 2017. As of November 2017, public-private partnership  agreements were in place at approximately one-third of all U.S. POEs.  With the removal of the limit on the number of air agreements that CBP  can enter each year, some POEs have or are anticipated by CBP to have  more than one RSP agreement in place. According to AFP officials, if  there are multiple RSP partnerships at the same POE, CBP will try to  accommodate all partner requests. Generally, the AFP office expects the  POEs to handle requests on a first-come, first-serve basis. As the number  of RSP partners increase across POEs, requests for services are likely to  also increase, according to CBP officials. While it is too soon for CBP to  assess the extent to which fulfillment rates may change over time, if at all,  with the expansion of the program, officials noted that RSP agreements  do not guarantee that CBP will be able provide all services that partners  request, and that RSP services are above and beyond what CBP would  normally provide. According to CBP, the recent increase in the mandated  cap on officer overtime pay from $35,000 to $45,000 has allowed CBP  officers to work more RSP overtime. Nevertheless, it is unclear how  CBP will evaluate and address any increase in RSP agreements that may  outpace the staff available to fulfill service requests.

As noted previously, new authorities for the RSP also allow CBP to enter  into agreements that allow partners to reimburse CBP for up to five  additional officers, above the number assigned at the time the agreement  was reached, at small airports. In fiscal year 2017, CBP selected four  partners for this type of reimbursable services agreement. For its  agreement with the Rhode Island Airport Corporation, CBP relocated  three officers from the Boston-Logan International Airport, one of the  busiest U.S. international airports, to T.F. Green State International  Airport, which inspects less than 100,000 international travelers annually.  AFP officials noted that, in accordance with legislation, the Port Director  overseeing the port of origin for the CBP officer(s) added to small airports  must determine that the movement of the officer(s) from one POE to  another in fulfilling RSP agreements for additional CBP officers does not  permanently affect operations at any other POE, including the POE that  the officer(s) depart. However, CBP has not planned for how individual  POEs or the agency more broadly would make these determinations or  how CBP would evaluate any longer term impacts on overall CBP officer  staffing resulting from the movement of officers among POEs.

Office of Management and Budget guidance for making program  expansion decisions indicates that agencies should evaluate cost- effectiveness in a manner that presents facts and supporting details  among competing alternatives, including relative costs, benefits, and  performance tradeoffs. Further, in September 2016 we developed a list  of leading practices for evaluation based on the American Evaluation  Association’s An Evaluation Roadmap for a More Effective Government,  including development of an evaluation plan or agenda, a description of  methods and data sources in evaluation reports, procedures for assuring  evaluation quality, and tracking the use of evaluation findings in  management or reforms, among others. CBP is taking steps to monitor  its RSP and DAP and plan for program expansion. However, given its  staffing challenges, CBP could benefit from developing and implementing  an evaluation plan for assessing overall RSP and DAP performance.  Such a plan could further integrate evaluation activities into program  management and could better position CBP to assess relative costs,  benefits, and performance trade-offs as CBP expands its RSP and DAP,  and consider the extent to which any future program changes may be  needed.

The amount of legitimate travel and trade entering through the nation’s  POEs continues to increase each year. To date, CBP and its partners  have utilized public-private partnerships to help meet an increased  demand for CBP services and infrastructure improvements at POEs, and  agency officials and program partners have generally concurred that the  RSP and DAP have been effective in helping to bridge CBP resource  gaps and improve partner operations. However, given CBP’s officer hiring  and retention challenges and its finite resources for addressing  infrastructure needs at POEs, CBP’s ability to monitor and evaluate the  implementation of its public-private partnership programs is essential to  ensuring that CBP leaders have the information that they need to make  program decisions and identify and respond to challenges as the  programs expand. As CBP continues to expand its public-private  partnership programs, evaluating the RSP and DAP at the program level  could better position CBP leaders to assess the relative costs, benefits,  and performance trade-offs of continuing to expand the programs. It could  also better position CBP to identify and respond to expansion challenges,  such as CBP officer staffing.

The CBP Commissioner should develop and implement an evaluation  plan to be used to assess the overall performance of the RSP and DAP,  which could include, among other things, measurable objectives,  performance criteria, evaluation methodologies, and data collection plans  to inform future program decisions. (Recommendation 1)

We provided a draft of this report to DHS and GSA for their review and  comment. GSA indicated that it did not have any comments on the draft  report via e-mail. DHS provided written comments, which are noted below  and reproduced in full in appendix II, and technical comments, which we  incorporated as appropriate.

DHS concurred with our recommendation and described the actions it  plans to take in response. Specifically, DHS stated that CBP will develop  and implement a plan to assess the overall performance of the RSP and  DAP to inform future program decisions. The plan will evaluate current  partnerships, including but not limited to: service denial rate; trend  analysis of frequency and type of requests; annual stakeholder survey  results; impact of multiple stakeholders in one port location on levels of  service provided; impact of unanticipated operations and maintenance  costs associated with property donations; and staffing implications on  donations of upgraded port infrastructure. If implemented effectively,  these planned actions should address the intent of our recommendation.

We are sending copies of this report to the appropriate congressional  committees, the Secretary of Homeland Security, the Administrator of the  General Services Administration, and other interested parties. In addition,  the report is available at no charge on the GAO website at  http://www.gao.gov.

If you or your staff have any questions about this report, please contact  me at (202) 512-8777 or gamblerr@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report. Key contributors to this report are listed in  appendix III.

Appendix I: Details of U.S. Customs and Border Protection Reimbursable Services Program Agreement Memoranda of Understanding

Since 2013, U.S. Customs and Border Protection (CBP) has entered into  public-private partnerships with private sector or government entities  under its Reimbursable Services Program (RSP) to cover CBP’s cost of  providing certain services at U.S. ports of entry (POE) upon the request of  partners. As of the end of fiscal year 2017, CBP approved 114  applications for reimbursable fee agreements. These services can include  customs, immigration, agricultural processing, border security and  support at any facility where CBP provides, or will provide services and  may cover costs such as salaries, benefits, overtime expenses,  administration, and transportation costs. Once CBP selects an  application for a new reimbursable services partnership, CBP and its  partner sign a legally binding Reimbursable Services Agreement, which is  a standard legal form that CBP uses for all new RSP agreements. Local  CBP officials then work with the partner to negotiate the terms of a  Memorandum of Understanding (MOU), which outlines how the  partnership will work at the POE.

In the following table, we provide select details from the 54 existing MOUs  between CBP and its partners in the RSP.

In addition to the partners listed in the table above, CBP has also signed  Reimbursable Services Agreements with the following partners, but has  not completed negotiating the terms of an MOU as of the end of fiscal  year 2017.

Fiscal year 2016 partners:  1.  City of Charlotte Aviation Department  2.  Dole Fresh Fruit Company (Port of Wilmington, Delaware; Port  Everglades; and Port of Freeport)

3.  GT USA LLC  4.  Port of Galveston  5.  Presidio Port Authority Local Government Corporation  6.  Red Hook Container Terminal, LLC  7.  United Parcel Service Co.

Appendix II: Comments from the Department of Homeland Security

Appendix III: GAO Contact and Staff Acknowledgments

In addition to the contact named above, Kirk Kiester (Assistant Director),  Dominick Dale, Michele Fejfar, Eric Hauswirth, Stephanie Heiken, Susan  Hsu, Elizabeth Leibinger, David Lutter, and Sasan J. “Jon” Najmi made  significant contributions to this report.