Summary
The U.S. Department of Agriculture's (USDA) Natural Resources Conservation Service (NRCS), working with state and local partners, provides landowners with technical assistance for multiple programs to plan and implement conservation measures that protect soil, water, and wildlife. For years, the Congress has been seeking detailed cost information on this assistance as it examined USDA budget requests. In part, because NRCS's financial system was not designed for estimating future budgets, in 1998 NRCS began developing additional cost data and a computer model for estimating future technical assistance costs. GAO was asked to (1) review NRCS's technical assistance cost estimates and (2) identify causes of any differences between the estimates and actual costs ultimately reported by NRCS.
In 2003, NRCS started testing its computer model by comparing estimates of technical assistance costs for 10 Farm Bill conservation programs, with actual costs reported by NRCS. GAO's analysis of these comparisons shows that NRCS's model made estimates, program-by-program, which varied considerably from the agency's actual costs. For fiscal year 2003, for example, NRCS's model estimated that the technical assistance costs for seven Farm Bill programs would be higher by 9 to 50 percent, than NRCS ultimately incurred. For three other Farm Bill programs, the estimates were lower than the agency incurred by 16 to 60 percent. Most of the estimates fell outside NRCS's goal of estimating to within 10 percent of the agency's actual costs. In addition, for the 10 Farm Bill conservation programs combined, NRCS estimated its technical assistance costs at $295 million for fiscal year 2003, which is about 15 percent more than the $257 million that NRCS incurred. NRCS officials generally agreed with this analysis. GAO identified several reasons for the differences between the cost estimates and the actual costs. First, some of NRCS's technical assistance work was delayed, occurring later than NRCS assumed when it estimated its costs. This contributed to some overestimation by the model, according to NRCS officials. Second, NRCS's estimates include costs incurred by NRCS's partners. Such costs are generally not included in the actual costs reported by NRCS. Third, some data NRCS uses in its model are based on inaccurate assumptions. For example, when developing estimates about the time it takes NRCS staff to perform technical assistance tasks for use in the model, NRCS assumes, among other things, that its staff are fully trained and perform technical assistance work without interruption. These assumptions do not reflect actual workplace conditions and lead to underestimates. NRCS officials said they would reconsider these and other assumptions.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change
from "In process" to "Implemented" or "Not implemented" based on our follow up work.
Director:
Team:
Phone:
Robert A. Robinson
Government Accountability Office: Natural Resources and Environment
(202) 512-9692
Recommendations for Executive Action
Recommendation: To improve the accuracy, and therefore the usefulness of NRCS's program cost estimating, the Secretary of Agriculture direct the Chief of NRCS to clearly identify nonreimbursable costs incurred by NRCS's partners when presenting estimates of NRCS's costs, ensuring that its model's estimates are comparable with actual data.
Agency Affected: Department of Agriculture
Status: Implemented
Comments: The Natural Resources Conservation Service (NRCS) data collection for the Activity Based Costing model was carried out in November 2006 and this exercise required each survey respondent to enter a discreet percentage for contributions to each task by affiliation. Affiliations included NGOs, Soil and Water Conservation Districts, and others.
Recommendation: To improve the accuracy, and therefore the usefulness of NRCS's program cost estimating, the Secretary of Agriculture direct the Chief of NRCS to change the assumptions used for developing time per task data for the model so that they better reflect actual work conditions.
Agency Affected: Department of Agriculture
Status: Implemented
Comments: The Natural Resources Conservation Service (NRCS), in its data collection efforts eliminated certain assumptions such as a "fully trained staff" or for "complete vs. incomplete tasks" that had been used in its previous efforts. Instead, the agency asked respondents to enter the time to complete the task, based on the experience, issues, and customers for that specific location.
Recommendation: To improve the accuracy, and therefore the usefulness of NRCS's program cost estimating, the Secretary of Agriculture direct the Chief of NRCS to pilot test the feasibility of proposed changes in the development of the time per task data, including changes in development of typical work descriptions in several diverse areas of the country before proceeding with another nationwide workload analysis.
Agency Affected: Department of Agriculture
Status: Implemented
Comments: The Natural Resources Conservation Service (NRCS), as part of its 2006 data collection, allowed respondents to define a typical work unit for a job or practice, where the time estimate would vary significantly.
