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TO:	M/Associate Administrator for Space Flight
FROM:	W/Assistant Inspector General for Inspections, Administrative Investigations, and Assessments
SUBJECT:	Assessment of NASA's Financial Assistance to Foreign Visitors

This report outlines our concerns regarding the need for a formal policy and procedure regulating the disbursements of NASA funds to Russian cosmonauts and Ukrainian payload specialists while they are in the United States (U.S.).

Introduction

The Johnson Space Center (JSC) uses NASA funds to pay Russian cosmonauts (cosmonauts) and Ukrainian payload specialists (payload specialists) salary and living expenses during their stay in the U.S. However, NASA does not have a formal, documented policy or procedure to control this activity. We are bringing this concern to your attention for appropriate action.

Background

On October 5, 1992, and November 5, 1993, the NASA Administrator signed the Implementing Agreement and the Protocol for Human Space Flight Cooperation between NASA and the Russian Space Agency (RSA). ⁽¹⁾ The agreement, which permits cosmonauts to fly aboard the Space Shuttle and astronauts to fly aboard the Russian Space Station Mir, states:

All training, in-country travel and living arrangements, flight and other associated costs for each Party's crew members and dependents will be borne by the host country, in a manner it deems appropriate, at a standard afforded its own flight crews.

NASA calculates the standard to be approximately a GS-14/15 take home pay so that foreign visitors are provided a similar standard of living earned by U.S. astronauts (see Appendix A).

On May 22, 1996, the NASA Director of International Relations signed an agreement with the National Space Agency of Ukraine for a payload specialist ⁽²⁾ to fly on STS-87. The agreement states:

NASA will bear the costs of the comprehensive physical examination within the U.S., science training within the U.S., domestic per diem within the U.S., and other domestic air fare, excluding the domestic portion of the international travel.

Since 1992 and in keeping with the agreement, NASA has compensated those cosmonauts assigned to live in the U.S. ⁽³⁾ Likewise, NASA has compensated the payload specialists since January 1997. Compensation has included payments for rental cars, apartments, and living expenses. ⁽⁴⁾ NASA based its early payments to cosmonauts on actual expenses. More recent payments to cosmonauts have varied, but now are based on either short term or long term stays (see Appendix A). The current practice is as follows:

A. Cosmonauts:
1. Short term (up to 6 months)

• JSC pays for apartment and car rentals
• $60 per day subsistence paid biweekly
2. Long Term (longer than 6 months)
• Cosmonaut is responsible for all bills (including housing and transportation>
• Subsistence paid biweekly based on $4,500 per month
• Additional $300 per month paid for each dependent

B. Payload Specialists:

• JSC pays for apartment and car rentals
• $38 per day subsistence paid biweekly

JSC either disburses the funds through purchase orders directly to the provider of the services (e.g., apartment owner), or directly through electronic fund transfers to a JSC credit union account established for the foreign visitor by JSC personnel. ⁽⁵⁾

Recently, payments for rental cars for Russian visitors have been coordinated through RSC-Energia (Energia) in Russia. Energia directly pays for the rental cars and bills NASA for the amount (without added fees). In this way, Energia accepts liability for the cars and responsibility for supplemental insurance. However, no formal policy has been adopted for this practice.

Issues

• When calculating the payments, JSC did not consider compensation the visitor may simultaneously received from his/her own government. ⁽⁶⁾ Therefore, it is possible that NASA inadvertently raised the standard of living for some foreign flight crew members beyond that of U.S. flight crews.

• The credit union accounts established by JSC for the foreign visitors were established to provide the visitor immediate use of the funds. The accounts were held jointly by the visitor and a JSC civil servant. However, even after the visitor took control of the account, the JSC civil servant remained on the account--thereby giving the JSC civil servant continued access to the funds. This practice is not a U.S. requirement. A foreign visitor on official business with NASA may establish his/her own account at the Johnson Space Center Federal Credit Union without U.S. assistance by completing a Certificate of Foreign Status and an account card.

• Because JSC deposited funds in these accounts prior to the arrival of the visitor, the payments could represent an over-payment if the visitor's tour was curtailed. Based on information related to us by a JSC civil servant, ⁽⁷⁾ we believe this may have occurred on at least two occasions. Our source informed us that the over-payments were recovered and returned to NASA. However, we could not verify this assertion.

Recommendations

We recommend NASA develop an official policy and directive to manage the disbursement of and account for funds to foreign visitors to cover the remainder of Phase I activities and any follow on application of similar disbursements. Further, if this practice continues beyond Phase I of the ISS program, we specifically recommend that:

1. JSC should factor payments made to the foreign visitors by their respective government or other sponsoring organization when calculating compensation by NASA.

2. The bank account of a foreign visitor should not be held jointly with a JSC civil servant. Accounts should be established exclusively for the foreign visitors.

3. JSC procedures should include a specific review of accounts in the event that a visit covered by the Russian or Ukrainian agreements concludes before the scheduled end date to assure that portions of payments are recouped accordingly.

4. Formal agreements should be established for payments to Energia for rental car expenses.

Summary of NASA Management's Response

NASA JSC management's response partially concurred with the OIG's General Recommendation to implement a formal policy for disbursing and accounting for subsistence costs paid to visiting foreign mission crew members while in the United States (U.S.). JSC management stated that although it does not have a formal policy directive, these processes are ". . .coordinated carefully and formally tracked, and easily audited." Nevertheless, in response to our recommendation, JSC will implement a Corrective Action Response through the ISO 9000 process to adequately document the International Partner invitation and subsistence process. The Phase I Program Office at JSC is to provide that documentation by July 31, 1998.

JSC management does not concur with Recommendation 1 that payments received by foreign visitors from their respective governments or sponsoring organizations should be a factor in calculating subsistence disbursements received from NASA. JSC stated that the payments were specifically designed as subsistence, not salary. JSC likens the foreign visitor subsistence allotments to those provided to JSC personnel on travel and the fact that an employee receives salary and a travel subsistence cost. JSC stated that equivalent fair treatment is afforded to international mission crew persons in expectation of equitable treatment of U.S. crew persons when working at foreign sites. JSC also believes that adjusting U.S. subsistence allowances to include home country salary would not recognize the liabilities and responsibilities of foreign mission crew persons at their home site.

JSC concurs with Recommendation 2 that foreign visitor's bank accounts should not be held jointly with JSC civil servants and will take appropriate corrective action.

JSC partially concurs with Recommendation 3. Management stated that careful coordination between budget analysts, managers, and foreign visitors is maintained to ensure "just-in-time" funding. In keeping with the intent of the recommendation, JSC will formally define and document the process of checking in and out foreign visitors. The process will be included in JSC's ISO 9000 documentation in response to our General Recommendation.

JSC does not concur with Recommendation 4 and believes the current processes for renting cars and purchasing coverage through Energia USA is cost effective and ". . .focuses responsibility and liability where it belongs." JSC stated that if additional process documentation is required, it will document the processes and agreements under ISO 9000.

NASA's complete response to our draft report dated May 6, 1998, is provided in Appendix B.

Evaluation of Management Response

Documenting processes via a Corrective Action Response as part of JSC's ISO 9000 mechanism will help define the coordinated processes of providing financial assistance to foreign visitors at JSC. Nonetheless, we believe that the addition of policy or directives at the Headquarters Office of Space Flight level would establish formal Agencywide guidance to be applied to all Space Flight Centers that may, over the course of the ISS program, provide subsistence assistance to foreign space flight program visitors.

Salary to compensate home site liabilities may not be the only subsistence payments made to foreign visitors by their home countries. We believe NASA should determine whether home countries are providing financial assistance beyond base salaries (such as per diem or other subsistence payments) to foreign visitors on temporary duty in the United States. If so, NASA should offset its financial assistance to the foreign visitor by the additional amount provided by the visitor's home country. Considering this, we believe Recommendation 1 should be reevaluated and included in the July 31, 1998, deadline for the ISO 9000 Corrective Action Response. In addition, we believe processes and agreements with Energia USA should also be included in the Corrective Action Response.

Conclusion

JSC should improve the current practices for disbursing funds to representatives of NASA's foreign partners. An official Headquarters level policy directive would provide formal Agencywide guidance for civil servants and improve management controls over and accountability for the disbursements of funds to these visitors. Management controls are becoming increasingly important in light of the growing involvement with and visibility of foreign partnerships in NASA's space flight programs and in the atypical manner in which NASA renders subsistence assistance to foreign visitors. ⁽⁸⁾ We look forward to reviewing JSC's Corrective Action Response process changes prior to inclusion within its ISO 9000 documentation. We will continue to monitor policy guidance in this area as well as the equitable financial treatment of foreign visitors in the U.S. and NASA employees in Russia.

Original Signed By

David M. Cushing

Enclosure

cc:
Distribution

Distribution

National Aeronautics and Space Administration (NASA) Officials-In-Charge
A/Administrator
AD/Acting Deputy Administrator
AT/Associate Deputy Administrator (Technical)
B/Chief Financial Officer
F/Acting Associate Administrator for Human Resources and Education
G/General Counsel
H/Associate Administrator for Procurement
I/Associate Administrator for External Relations
J/Acting Associate Administrator for Management Systems and Facilities
L/Acting Associate Administrator for Legislative Affairs
P/Associate Administrator for Public Affairs

NASA Advisory Officials
Chairman, Advisory Committee on the International Space Station
Chairman, Shuttle-Mir Rendezvous and Docking Missions and ISS Operational Readiness Task Force

Chairman and Ranking Minority Member of Each of the Following Congressional Committees and Subcommittees:
Senate Committee on Appropriations
Senate Subcommittee on VA-HUD-Independent Agencies
Senate Committee on Commerce, Science and Transportation
Senate Subcommittee on Science, Technology and Space
Senate Committee on Government Affairs
House Committee on Appropriations
House Subcommittee on VA-HUD-Independent Agencies
House Committee on Government Reform and Oversight
House Subcommittee on National Security, International Affairs, and Criminal Justice
House Committee on Science
House Subcommittee on Space and Aeronautics

Appendix A

Current Guidelines for Cosmonaut Funding

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Appendix B

Management Response

FOOTNOTES

1. ¹ The Space Act of 1958 gives the NASA Administrator authority to enter into and perform cooperative agreements and other transactions on such terms as he may deem appropriate with any entity, and gives NASA authority to engage in a program of international cooperation.

2. ² One primary and one backup specialist.

3. ³ The Associate Administrator for Space Flight issued a letter to the JSC Center Director in September 1992, authorizing funds for Russian Cosmonaut Living Arrangements. In response, JSC assigned responsibilities to various organizations (e.g., budget, financial accounting, legal, medical, human resources, procurement).

4. ⁴ A review of the records available at JSC showed that NASA disbursed $362,826 on 20 purchase orders between April 1996, and March 1998. Because JSC's closed files over 2 years old have been shipped to records retention, we could not determine the total amount of funds disbursed since 1992 under these arrangements.

5. ⁵ JSC Chief Financial Officer directed the program offices (Space Station, Phase I, and Shuttle Program Offices) benefiting from the cosmonaut's activities to provide funding.

6. ⁶ Russian compensation for cosmonauts or payload specialists is not known to JSC.

7. ⁷ Joint member on the account.

8. ⁸ According to officials contacted at the Department of State, United States Information Agency, United States Agency for International Development, Voice of America, and the National Institutes of Health, financial assistance for foreign visitors is typically handled through standard Federal per diem, fixed stipends, or excepted Federal appointments and is usually of a smaller financial amount compared to the level of assistance provided by JSC. JSC did not consult any other Federal agencies in determining subsistence amounts or processes.