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Summary

On December 7, 2010, we issued our final report on the Title XI Loan Guarantee Program. The program currently has a portfolio of guarantees that covers over $2 billion in loans, and has the funding to expand it to almost $4 billion.  We conducted this review in response to a directive in Senate Report 110-131 to certify to the House and Senate Committees on Appropriations whether or not MARAD is in compliance with the recommendations contained in our 2003 and 2004 reports.  Our audit objectives were to determine: (1) the extent to which MARAD has implemented procedures to improve its oversight of borrowers in the Title XI portfolio; and (2) whether the information necessary for conducting this oversight is readily accessible. 

We found that MARAD developed new Title XI guidance and information systems to address the recommendations in our 2003 and 2004 reports, but did not effectively implement them.  As a result, administration and oversight of the $2.3 billion program still needs improvement.  We made three recommendations to strengthen MARAD's oversight of the Title XI program.  MARAD fully concurs with all of our recommendations.