State and local governments work together with the federal government to deliver a broad range of public services. GAO's prior work has shown that the state and local government sector will likely face fiscal pressures during the next 50 years due to a gap between spending and revenues. The fiscal sustainability of the state and local government sector is essential to effectively implement intergovernmental programs. GAO was asked to review recent trends in state and local government expenditures and revenues, fiscal pressures for state and local governments with intergovernmental implications, and the implications of federal policy for these pressures. This report (1) examines trends in state and local government expenditures and revenues during the past two decades; and (2) synthesizes expert views regarding the effects of federal policy on state and local government fiscal conditions. GAO analyzed data from the Bureau of Economic Analysis National Income and Product Accounts, the U.S. Census Bureau and the National Association of State Budget Officers. GAO also interviewed a nongeneralizable sample of experts from organizations that represent state and local governments, professionals who provide financial and credit risk information (credit rating agencies), and researchers from think tanks to better understand how federal policies affect state and local government fiscal conditions. During the past two decades, the state and local government sector experienced overall growth in spending and revenue. Specifically, inflation-adjusted spending increased from about $1.7 trillion in 1998 to about $2.8 trillion in 2018. Health spending accounted for the largest increase. Inflation-adjusted revenues increased from about $1.6 trillion in 1998 to about $2.6 trillion in 2018. Taxes comprised the largest revenue category. From 1997 to 2017, state and local government expenditures and revenues grew faster than state gross domestic product in most states. On average, growth in expenditures outpaced growth in revenues by 0.3 percentage points per year during the period. Increases in public welfare spending drove spending growth (spending largely for states' share of Medicaid), while federal grants and user charges drove revenue growth. Domestic Product (GDP) in Most States from 1997 to 2017 Source: GAO analysis of U.S. Census Bureau and Bureau of Economic Analysis data. | GAO 20-437 Experts identified a range of issues facing state and local governments that could affect the sector's fiscal condition. Those most frequently mentioned included: Health care. Experts expressed concerns regarding their ability to meet future Medicaid enrollment demands in an economic downturn. Federal budget uncertainty. Uncertainty in the future of federal assistance as well as the timing of federal appropriations, including federal government shutdowns, affected state and local governments' program planning. Physical infrastructure. Aging infrastructure costs and uncertainty in federal funding sources placed pressure on the sector to identify alternative revenue sources for transportation projects. Tax policy . Provisions of the law known as the Tax Cuts and Jobs Act had varied effects on the sector, but most experts agreed it is still too early to assess the act's full effects on state and local government revenues. Natural disasters . Experts acknowledged the important contribution of federal financial support for disaster response and recovery and noted some states' mitigation efforts to address the increasing frequency and cost of disasters. Credit rating firms are considering the effects of climate change in their credit analyses of state and local governments.


State has expressed a commitment to maintaining a diverse workforce and has undertaken efforts to increase diversity in its Civil and Foreign Services. EEOC directs federal agencies to regularly evaluate their employment practices to identify barriers to equal opportunity, take measures to eliminate any barriers, and report annually on these efforts. This testimony examines (1) the demographic composition of State's workforce in fiscal years 2002 through 2018; (2) any differences in promotion outcomes for various demographic groups in State's workforce; and (3) the extent to which State has identified any barriers to diversity in its workforce. For the January 2020 report on which this testimony is based (GAO-20-237), GAO analyzed State's data for its full-time, permanent, career workforce in fiscal years 2002 through 2018. GAO also analyzed the number of years until promotion from early career ranks to the executive rank in both the Civil and Foreign Services. (GAO's analyses do not completely explain the reasons for differences in promotion outcomes, which may result from various unobservable factors. Thus, GAO's analyses do not establish a causal relationship between demographic characteristics and promotion outcomes.) In addition, GAO reviewed State documents and interviewed State officials and employee group representatives. The overall proportion of racial or ethnic minorities in the Department of State's (State) full-time, permanent, career workforce grew from 28 to 32 percent from fiscal year 2002 to fiscal year 2018. The direction of change for specific groups varied. For instance, the proportion of African Americans fell from 17 to 15 percent, while the proportions of Hispanics, Asians, and other racial or ethnic minorities rose by varying percentages. The proportion of racial or ethnic minorities and women was lowest in the higher ranks of State's workforce. GAO's analyses of State data for fiscal years 2002 through 2018 found differences in promotion outcomes for racial or ethnic minorities and whites and for men and women. GAO found these differences in both descriptive analyses (calculating simple averages) and adjusted analyses (controlling for certain individual and occupational factors that could influence promotion). For example, GAO's descriptive analysis of data for State's Civil Service found that rates of promotion for racial or ethnic minorities were 16 to 42 percent lower, depending on the rank, than for whites. Similarly, after controling for certain additional factors, GAO's adjusted analysis of these data found that promotion for racial or ethnic minorites was 4 to 29 percent less likely than for whites. Also, both types of analysis generally found that promotion outcomes for women relative to men were lower in the Civil Service and higher in the Foreign Service. For example, women in the Foreign Service were more likely than men to be promoted in early to mid career. State has identified some diversity issues, but it should consider other issues that could indicate potential barriers to diversity in its workforce. State's annual reports to the Equal Employment Opportunity Commission (EEOC) for fiscal years 2009 through 2018 identified issues such as underrepresentation of Hispanic employees and underrepresentation of minorities in the senior ranks. However, GAO's analysis and GAO's interviews with State employee groups highlighted additional issues that could indicate barriers to diversity. For example, State's reports have not identified lower promotion outcomes for racial or ethnic minorities relative to whites, which GAO found in its analysis. Until State takes steps to explore such issues, it could be missing opportunities to investigate and remove barriers that impede members of some demographic groups from realizing their full potential.


Strategic human capital management plays a critical role in maximizing the government's performance and assuring its accountability to Congress and to the nation as a whole. GAO designated strategic human capital management as a government-wide, high-risk area in 2001. Since then, important progress has been made. However, retirements and the potential loss of leadership and institutional knowledge, coupled with fiscal pressures, underscore the importance of a strategic and efficient approach to acquiring and retaining individuals with critical skills. As a result, strategic human capital management remains on GAO's High-Risk List. This testimony is based on a large body of GAO work issued from May 2008 through May 2019. This testimony, among other things, focuses on key human capital areas where some actions have been taken but attention is still needed by OPM and federal agencies on issues including: (1) addressing critical skills gaps and (2) recruiting and hiring talented employees. GAO, along with the Office of Personnel Management (OPM) and individual agencies, has identified skills gaps in numerous government-wide occupations. According to GAO's 2019 analysis of federal high-risk areas, skills gaps played a role in 17 of the 35 high-risk areas. Causes vary but these skills gaps often occur due to shortfalls in one or more talent management activities such as robust workforce planning. Staffing shortages and the lack of skills among current staff not only affect individual agencies but also cut across the entire federal workforce in areas such as cybersecurity and acquisition management. Additionally, the changing nature of federal work and the high percentage of employees eligible for retirement could produce gaps in leadership and institutional knowledge, and threatens to aggravate the problems created from existing skills gaps. For example, 31.6 percent of permanent federal employees who were on board as of September 30, 2017, will be eligible to retire in the next 5 years with some agencies having particularly high levels of employees eligible to retire. GAO's work has identified a range of problems and challenges with federal recruitment and hiring efforts. Some of these problems and challenges include unclear job announcements and a lengthy hiring process. Further, the federal workforce has changed since the government's system of current employment policies and practices were designed. Strategies that can help agencies better manage the current and future workforces include: Manage the timing of recruitment . To address issues of funding uncertainty at the beginning of the fiscal year, agencies should recruit continuously, starting the hiring process early in the school year. Write user-friendly vacancy announcements . GAO has reported that some federal job announcements were unclear. This can confuse applicants and delay hiring. OPM stated that when hiring managers partner with human resources staff, agencies can develop more effective vacancy announcements. Leverage available hiring and pay flexibilities . To help ensure agencies have the talent they need, they should explore and use all existing hiring authorities. A variety of special pay authorities can help agencies compete in the labor market for top talent, but GAO has found that agencies only use them for a small number of employees. Increase support for an inclusive work environment . An increasingly diverse workforce can help provide agencies with the requisite talent and multidisciplinary knowledge to accomplish their missions. Encourage rotations and other mobility opportunities. Upward and lateral mobility opportunities are important for retaining employees, but few employees move horizontally because managers are sometimes reluctant to lose employees. Without these measures, the federal government's ability to address the complex social, economic, and security challenges facing the country may be compromised.


Strengthening the U.S. retirement system to be more accessible and financially sound is important to ensuring that all Americans can retire with dignity and security, and to managing the fiscal exposures to the federal government from various retirement-related programs. Currently, the U.S. retirement system, and many of the workers and retirees it was designed to help, face major challenges. This testimony discusses (1) the fiscal risks and other challenges facing the U.S. retirement system, and (2) the need to re-evaluate our nation's approach to financing retirement. It is based on a 2017 report, GAO-18-111SP , on the nation's retirement system, with updated statistics when more recent estimates from publicly available sources were available. Fundamental changes over the past 40 years have led to various risks and challenges for the three main pillars supporting the U.S. retirement system. For example, current projections indicate that by 2034, the Old-Age and Survivors trust fund for Social Security's retirement program—the first pillar—will only be sufficient to pay 77 percent of scheduled benefits, due in part to the aging of the population (see figure). Other federal government retirement-related programs also face financial uncertainty. For example, the Pension Benefit Guaranty Corporation, which insures the pension benefits of most private sector defined benefit plans, estimates a greater than 90 percent chance the multiemployer program will be insolvent by 2025. Meanwhile, employer-sponsored plans—the second pillar—have experienced a shift from traditional defined benefit (DB) plans that generally provide set monthly payments for life, to defined contribution (DC) account-based plans, like 401(k)s. DC plans provide greater portability of savings that can be better suited to the needs of a more mobile workforce, but also require individuals to assume more responsibility for planning and managing their savings. While DC plans can provide meaningful retirement security for many, especially higher earners, lower earners appear more prone to having little or no savings in their DC accounts. Further, individuals' savings—the third pillar—may be constrained by economic trends such as low real wage growth and growing out-of-pocket health care costs. Combined with increased longevity, these challenges can put individuals at greater risk of outliving their savings and fiscal pressures on government programs will likely grow. Congress generally has sought to address retirement-related issues in an incremental fashion. Also, no one agency is responsible for overseeing the U.S. retirement system in its entirety, so there is no obvious federal agency to lead a comprehensive reform effort. It has been nearly 40 years since a federal commission has conducted a comprehensive evaluation of the nation's approach to financing retirement. Without a more comprehensive re-evaluation of the challenges across all three pillars of the system, it may be difficult to identify effective, enduring solutions. Unless timely action is taken, many older Americans risk not having sufficient means for a secure and dignified retirement.


Student parents face many challenges, including paying for child care, that can make it difficult for them to complete a degree. The federal government supports student parents through Education's CCAMPIS program, which provides colleges funding for child care services, and federal student aid, which can also help students pay for child care. GAO was asked to provide information on student parents and the federal programs that support these students. This report examines, among other objectives, what is known about the characteristics and degree completion of undergraduate students with children; what is known about the CCAMPIS program and how reliable Education's reported outcomes are; and to what extent selected schools publicize the option to increase federal student aid to help pay for child care. GAO analyzed 2009 and 2016 federal student data (the most recent available) and CCAMPIS program performance data, reviewed how the 62 schools that were awarded CCAMPIS grants in 2017 publicized the student aid option to help pay for child care, and reviewed relevant federal laws and regulations and agency documents. GAO interviewed officials from Education and selected schools. More than one in five undergraduate students were raising children, and about half of student parents left school without a degree, according to Department of Education (Education) data. In 2015-2016, an estimated 22 percent of undergraduates (4.3 million of 19.5 million) were parents. An estimated 55 percent of student parents were single parents, 44 percent were working full-time while enrolled, and 64 percent attended school part-time. Undergraduate student parents had fewer financial resources to fund their education than students without children. Nearly half of student parents reported paying for child care, with monthly costs averaging about $490. A higher percentage of student parents left school without a degree (52 percent) compared to students without children (32 percent) as of 2009 (the most recent data available). Education's Child Care Access Means Parents in School (CCAMPIS) program helped about 3,300 students pay child care costs for about 4,000 children in 2016-2017. Another 4,200 children were on waiting lists to receive assistance. Most CCAMPIS participants paid some child care fees after receiving subsidies—the median payment each month was about $160. Education measures participants' persistence in school and graduation rate to assess the performance of the CCAMPIS program. However, flaws in its calculations of these two measures prevented Education from reporting reliable results, making it difficult for Education and Congress to evaluate the program's effectiveness. Some student parents could be eligible to increase their federal student loans to help pay for child care by asking their schools to include an allowance for dependent care expenses in their financial aid calculations. However, schools do not always publicize this allowance to current and prospective students. GAO reviewed the websites—where schools post other college cost information—of schools serving student parents and found that about two-thirds of these websites did not mention the allowance. Schools are not required—and Education does not encourage them—to inform student parents about the allowance. As a result, eligible student parents may be unaware of this option to request additional financial support to help them complete their degree.


Substance abuse and illicit drug use, including the use of heroin and the misuse of alcohol and prescription opioids, is a growing problem in the United States. Individuals with a substance use disorder may face challenges in remaining drug- and alcohol-free. Recovery homes can offer safe, supportive, drug- and alcohol-free housing to help these individuals maintain their sobriety and can be an important resource for recovering individuals. However, as GAO reported in March 2018, some states have conducted investigations of potentially fraudulent practices in some recovery homes. This statement describes (1) what is known about the prevalence of recovery homes across the United States; and (2) investigations and actions selected states have undertaken to oversee such homes. It is largely based on GAO's March 2018 report (GAO-18-315). For that report, GAO reviewed national and state data, among other things, and interviewed officials from the Department of Health and Human Services, national associations, and five states—Florida, Massachusetts, Ohio, Texas, and Utah. GAO selected these states based on their rates of opioid overdose deaths, their rates of dependence or abuse of alcohol and other drugs, and other criteria. In March 2018, GAO found that the prevalence of recovery homes (i.e., peer-run or peer-managed drug- and alcohol-free supportive homes for individuals in recovery from substance use disorder) was unknown. Complete data on the prevalence of recovery homes were not available, and there was no federal agency responsible for overseeing recovery homes that would compile such data. However, two national organizations collected data on the prevalence of recovery homes for a subset of these homes. The National Alliance for Recovery Residences (NARR), a national nonprofit and recovery community organization that promotes quality standards for recovery homes, collected data only on recovery homes that sought certification by some of its state affiliates. As of January 2018, NARR told us that its affiliates had certified almost 2,000 recovery homes, which had the capacity to provide housing to over 25,000 individuals. Oxford House, Inc. collected data on the number of individual recovery homes it charters. In its 2018 annual report, Oxford House, Inc. reported that there were 2,542 Oxford Houses in 45 states. The number of recovery homes that were not affiliated with these organizations was unknown. In March 2018, GAO also found that four of the five states in its review—Florida, Massachusetts, Ohio, and Utah—had conducted, or were in the process of conducting, investigations of potentially fraudulent recovery home activities in their states. Activities identified by state investigators included schemes in which recovery home operators recruited individuals with substance use disorder to specific recovery homes and treatment providers, and then billed those individuals' insurance for extensive and unnecessary drug testing for the purposes of profit. For example, officials from the Florida state attorney's office told GAO that, in some instances, substance use disorder treatment providers were paying $300 to $500 or more per week to recovery home operators for every individual the operators referred for treatment. Then, in one of these instances, the provider billed an individual's insurance for hundreds of thousands of dollars in unnecessary drug testing over the course of several months. Further, these officials told GAO that as a result of these investigations at least 13 individuals were convicted and fined or sentenced to jail time. To increase oversight, officials from three of the five states—Florida, Massachusetts, and Utah—said they had established state certification or licensure programs for recovery homes in 2014 and 2015. Officials from the other two states—Ohio and Texas—had not established such programs, but were providing training and technical assistance to recovery homes.


Substance use and illicit drug use are a growing problem in the United States. SUDs occur when the recurrent use of alcohol or drugs causes significant impairment, such as health problems. The veteran population has been particularly at risk. Veterans are 1.5 times more likely to die from opioid overdose than the general population, according to VA and Centers for Disease Control and Prevention data. Furthermore, veterans live in rural areas at a higher rate than the general population, which may affect their ability to access SUD services. VA is the largest integrated health care system in the United States, providing care to about 6.2 million veterans. VA provides SUD services through outpatient, inpatient, and residential care settings and offers various treatment options, including individual and group therapy, medication-assisted treatment, and naloxone kits to reverse overdoses. Senate Report 115-130 included a provision for GAO to study VA's capabilities to treat veterans with SUDs. This report describes (1) trends in the number of and expenditures for veterans receiving SUD services, including specialty SUD services; and (2) any differences between veterans' use of SUD services in rural and urban areas, and the issues affecting access to those services in rural areas. GAO reviewed VA policies and data from fiscal years 2014 through 2018. GAO also interviewed officials from six VA health care systems, selected for their high percentage of veterans with an opioid use disorder and to achieve variation in geography and locations VA has designated as urban and rural. VA provided technical comments, which GAO incorporated as appropriate. The Department of Veterans Affairs (VA) treated 518,570 veterans diagnosed with a substance use disorder (SUD) in fiscal year 2018, a 9.5 percent increase since fiscal year 2016. Of these, 152,482 veterans received specialty SUD services in fiscal year 2018, a number that has remained relatively unchanged since fiscal year 2014. Specialty SUD services are those provided through a clinic or program dedicated to SUD treatment. Expenditures for VA's specialty SUD services increased from about $552 million in fiscal year 2014 to more than $600 million in fiscal year 2018. In the same year, VA expended about $80 million to purchase SUD services from non-VA community providers for more than 20,000 veterans, an increase since fiscal year 2014. The number receiving this care from non-VA providers may include veterans who also received services in VA facilities. Note: Specialty SUD services are those provided through a clinic or program dedicated to substance use disorder treatment. SUD services include services provided by any type of provider. VA data show that overall there was little difference in the percentage of veterans using SUD services, including specialty services, in rural and urban areas in fiscal year 2018. However, there were differences for some specific services. For example, in rural areas, 27 percent of veterans with an opioid use disorder received medication-assisted treatment—an approach that combines behavioral therapy and the use of medications—compared to 34 percent in urban areas. In providing SUD services in rural areas, VA faces issues similar to those faced by the general population, including lack of transportation. The agency is taking steps to address these issues, such as using local service organizations to transport veterans for treatment.


Successive Administrations have used sanctions extensively to try to change Iran's behavior. Sanctions have had a substantial effect on Iran's economy but little, if any, observable effect on Iran's conventional defense programs or regional malign activities. During 2012-2015, when the global community was relatively united in pressuring Iran, Iran's economy shrank as its crude oil exports fell by more than 50%, and Iran had limited ability to utilize its $120 billion in assets held abroad. The 2015 multilateral nuclear accord (Joint Comprehensive Plan of Action, JCPOA) provided Iran broad relief through the waiving of relevant sanctions, revocation of relevant executive orders (E.O.s), and the lifting of U.N. and EU sanctions. Remaining in place were a general ban on U.S. trade with Iran and U.S. sanctions on Iran's support for regional governments and armed factions, its human rights abuses, its efforts to acquire missile and advanced conventional weapons capabilities, and the Islamic Revolutionary Guard Corps (IRGC). Under U.N. Security Council Resolution 2231, which enshrined the JCPOA, nonbinding U.N. restrictions on Iran's development of nuclear-capable ballistic missiles and a binding ban on its importation or exportation of arms remain in place for several years. JCPOA sanctions relief enabled Iran to increase its oil exports to nearly pre-sanctions levels, regain access to foreign exchange reserve funds and reintegrate into the international financial system, achieve about 7% yearly economic growth (2016-17), attract foreign investment, and buy new passenger aircraft. The sanctions relief contributed to Iranian President Hassan Rouhani's reelection in the May 19, 2017, vote. However, the economic rebound did not prevent sporadic unrest from erupting in December 2017. And, Iran has provided support for regional armed factions, developed ballistic missiles, and expanded its conventional weapons development programs during periods when international sanctions were in force, when they were suspended, and after U.S. sanctions were reimposed in late 2018. The Trump Administration has made sanctions central to efforts to apply "maximum pressure" on Iran's regime. On May 8, 2018, President Trump announced that the United States would no longer participate in the JCPOA and that all U.S. secondary sanctions would be reimposed by early November 2018. The reinstatement of U.S. sanctions has driven Iran's economy into mild recession as major companies exit the Iranian economy rather than risk being penalized by the United States. Iran's oil exports have decreased significantly, the value of Iran's currency has declined sharply, and unrest has continued, although not to the point where the regime is threatened. But, the European Union and other countries are trying to keep the economic benefits of the JCPOA flowing to Iran in order to persuade Iran to remain in the accord. To that end, in January 2019 the European countries created a trading mechanism (Special Purpose Vehicle) that presumably can increase trade with Iran by circumventing U.S. secondary sanctions. On November 5, 2018, the Administration granted 180-day "Significant Reduction Exceptions" (SREs) to eight countries—enabling them to import Iranian oil without penalty as long as they continue to reduce purchases of Iranian oil. On April 22, 2019, the Administration announced it would not renew any SREs when they expire on May 2, 2019, instead seeking to drive Iran's oil exports as close to zero as possible. On May 3, 2019, the Administration ended some waivers for foreign governments to provide technical assistance to some JCPOA-permitted aspects of Iran's nuclear program. The economic difficulties and other U.S. pressure measures have prompted Iran to cease performing some of the nuclear commitments of the JCPOA. See also CRS Report R43333, Iran Nuclear Agreement and U.S. Exit, by Paul K. Kerr and Kenneth Katzman; and CRS Report R43311, Iran: U.S. Economic Sanctions and the Authority to Lift Restrictions, by Dianne E. Rennack.


Supreme Court precedent establishes that inherent principles of sovereignty give Congress "plenary power" to regulate immigration. The core of this powerâthe part that has proven most impervious to judicial reviewâis the authority to determine which non-U.S. nationals (aliens) may enter the United States and under what conditions. The Court has also established that the executive branch, when enforcing the laws concerning alien entry, has broad authority to do so mostly free from judicial oversight. Two principles frame the scope of the political branches' power to exclude aliens. First, nonresident aliens abroad generally cannot challenge exclusion decisions because they do not have constitutional rights with respect to entry and cannot obtain judicial review of the statutory basis for their exclusion unless Congress provides otherwise. Second, even when the exclusion of a nonresident alien burdens the constitutional rights of a U.S. citizen, the government need only satisfy a "highly constrained" judicial inquiry to prevail against the citizen's constitutional challenge. The Supreme Court developed the first principleâthat nonresident aliens generally cannot challenge exclusion decisionsâin a line of late 19th to mid-20th century exclusion cases. These cases culminated in the 1950 decision United States ex rel. Knauff v. Shaughnessy , in which the Court declared that "it is not within the province of any court, unless expressly authorized by law, to review the determination of the political branch of the Government to exclude a given alien." This rule forms the basis of the doctrine of consular nonreviewability, which in almost all circumstances bars nonresident aliens abroad from challenging visa denials by U.S. consular officers. But the rule set forth in Knauff applies with less force to decisions to exclude aliens arriving at the border. Aliens at the cusp of entry into the United States may be detained by immigration authorities pending their removal. Their cases can trigger habeas corpus proceedings for that reason and may also implicate complex statutory frameworks on judicial review. The second principle, concerning exclusion decisions that burden the rights of U.S. citizens, has been the primary subject of the Supreme Court's modern exclusion jurisprudence. In four cases since 1972â Kleindienst v. Mandel , Fiallo v. Bell , the splintered Kerry v. Din , and Trump v. Hawaii âthe Court has recognized that U.S. citizens who claim that the exclusion of aliens violated the citizens' constitutional rights may obtain judicial review of the exclusion decisions. Yet the standard of review that the Court applies to such claims is so deferential to the government as to all but foreclose U.S. citizens' constitutional challenges. In the most recent case, Trump v. Hawaii , the Court applied a "highly constrained" level of review to uphold a broad executive exclusion policy notwithstanding some evidence that the purpose of the policy was to exclude Muslims. The Mandel line of cases reaffirms the unique scope of Congress's power to legislate for the exclusion of aliens. Exclusion statutes draw minimal judicial scrutiny even when they classify people by disfavored criteria, such as gender or legitimacy. With respect to the executive power, the cases reaffirm generally that, in the absence of statutory provisions to the contrary, courts play almost no role in overseeing the application of admission and exclusion laws to nonresident aliens abroad. However, the cases leave some questions about executive exclusion power unresolved, including whether the Executive has inherent, constitutional power to exclude aliens and whether U.S. citizens may bring statutory challenges against executive decisions to exclude aliens abroad.


Suspension of the rules is the most commonly used procedure to call up measures on the floor of the House of Representatives. As the name suggests, the procedure allows the House to suspend its standing and statutory rules in order to consider broadly supported legislation in an expedited manner. More specifically, the House temporarily sets aside its rules that govern the raising and consideration of measures and assumes a new set of constraints particular to the suspension procedure. The suspension of the rules procedure has several parliamentary advantages: (1) it allows non-privileged measures to be raised on the House floor without the need for a special rule, (2) it enables the consideration of measures that would otherwise be subject to a point of order, and (3) it streamlines floor action by limiting debate and prohibiting floor amendments. Given these features, as well as the required two-thirds supermajority vote for passage, suspension motions are generally used to process less controversial legislation. In the 115 th Congress (2017-2018), measures considered under suspension made up 64% of the bills and resolutions that received floor action in the House (952 out of 1,498 measures). The majority of suspension measures were House bills (83%), followed by Senate bills (10%) and House resolutions (5%). The measures covered a variety of policy areas but most often addressed government operations, such as the designation of federal facilities or amending administrative policies. Most measures that are considered in the House under the suspension procedure are sponsored by a House or Senate majority party member. However, suspension is the most common House procedure used to consider minority-party-sponsored legislation regardless of whether the legislation originated in the House or Senate. In 2017 and 2018, minority-party members sponsored 27% of suspension measures, compared to 14% of legislation subject to different procedures, including privileged business (27 measures) and unanimous consent (48 measures). There were no minority-party sponsored bills that were considered under the terms of a special rule. Most suspension measures are referred to at least one House committee before their consideration on the floor. The House Committee on Natural Resources was the committee of primary jurisdiction for the plurality of suspension measures considered in the 115 th Congress. Additional committeesâsuch as Energy and Commerce, Homeland Security, Oversight and Government Reform (now Oversight and Reform), Foreign Affairs, and Veterans' Affairsâalso served as the primary committee for a large number of suspension measures. Suspension motions are debatable for up to 40 minutes. In most cases, a fraction of that debate time is actually used. In the 115 th Congress, the average amount of time spent considering a motion to suspend the rules was 12Â½ minutes. The House adopted nearly every suspension motion considered in 2017 and 2018. Approval by the House, however, did not guarantee final approval in the 115 th Congress. The Senate passed or agreed to 37% of the bills, joint resolutions, and concurrent resolutions initially considered in the House under suspension of the rules, and 316 measures were signed into law. This report briefly describes the suspension of the rules procedure, which is defined in House Rule XV, and provides an analysis of measures considered under this procedure during the 115 th Congress. Figures and one table display statistics on the use of the procedure, including the prevalence and form of suspension measures, sponsorship of measures by party, committee consideration, length of debate, voting, resolution of differences between the chambers, and the final status of legislation. In addition, an Appendix illustrates trends in the use of the suspension procedure from the 110 th through the 115 th Congresses (2007-2018).


As a member of the World Trade Organization (WTO) agreements, the United States has committed to abide by WTO rules and disciplines, including those that govern domestic farm policy as spelled out in the Agreement on Agriculture (AoA). Since establishment of the WTO on January 1, 1995, the United States has complied with its WTO spending limits on market-distorting types of farm program outlays (referred to as amber box spending). However, the addition of large, new trade assistance payments to producers in 2018 and 2019, on top of existing farm program support, has raised concerns by some U.S. trading partners, as well as market watchers and policymakers, that U.S. domestic farm subsidy outlays might exceed the annual spending limit of $19.1 billion agreed to as part of U.S. commitments to WTO member countries. CRS analysis indicates that the United States probably did not violate its WTO spending limit in 2018 but could potentially exceed it in 2019. A farm support program can violate WTO commitments in two principal ways: first, by exceeding spending limits on certain market-distorting programs, and second, by generating distortions that spill over into the international marketplace and cause significant adverse effects. Program outlays are cumulative, and compliance with WTO commitments is based on annual aggregate spending levels. Under the WTO's AoA, total U.S. amber box outlays (that is, those outlays deemed market distorting) are limited to $19.1 billion annually, subject to de minimis exemptions. De minimis exemptions are spending that is sufficiently small (less than 5% of the value of production)ârelative to either the value of a specific product or total productionâto be deemed benign. Since 1995, the United States has apparently stayed within its amber box limits. However, U.S. compliance has hinged on judicious use of the de minimis exemptions in a number of years to exclude certain amber box spending from counting against the amber box limit. These exemptions have never been challenged by another WTO member. According to CRS analysis, projected U.S. amber box spending for 2018 (inclusive of $8.7 billion in product-specific outlays under the 2018 trade assistance package) could exceed $14 billion. This would be the largest U.S. amber box notification since 2001. However, despite its magnitude, it still would fit within the U.S. spending limit of $19.1 billion. A more ambiguous result is projected for 2019. The expansion of direct payments under a second trade assistance package to $14.5 billion in 2019 and their shift to a non-product-specific WTO classificationâwhen combined with currently projected spending under other non-product-specific programs such as the Price Loss Coverage (PLC) and Agricultural Risk Coverage (ARC) programsâcould push U.S. amber box outlays above $24 billion. This would be in excess of the U.S. amber box spending limit of $19.1 billion. However, this projection hinges on several as-yet-unknown factors, including market prices, output values, and program outlays under traditional countercyclical ARC and PLC programs. If the final price and revenue values are higher than currently projected, then program payments under ARC and PLC could be smaller than those used in this analysis. This could decrease both aggregate non-product-specific outlays and the possibility of exceeding the amber box spending limit. If cumulative payments in any year were to exceed the agreed-upon spending limit, then the United States would be in violation of its commitments and could be vulnerable to a challenge under the WTO's dispute settlement mechanism. Furthermore, to the extent that such program outlays might induce surplus production and depress market prices, they could also result in potential challenges under the WTO.


TBML involves the exploitation of international trade transactions to transfer value and obscure the origins of illicit funds. Various observers have noted that although TBML is a common form of international money laundering, it is one of the most difficult to detect due to the complexities of trade transactions and the sheer volume of international trade, among other things. This report examines (1) what the available evidence indicates about the types and extent of international TBML activities, (2) the practices international bodies, selected countries, and knowledgeable sources have recommended for detecting and combating TBML, and (3) the extent to which ICE has effectively implemented the TTU program and steps the U.S. government has taken to collaborate with international partners to combat TBML. GAO analyzed U.S. agency and international body data and documentation, conducted a literature review, and interviewed U.S. officials and selected knowledgeable sources. Different types of criminal and terrorist organizations use trade-based money laundering (TBML) to disguise the origins of their illicit proceeds and fund their operations. TBML schemes can rely on misrepresenting the price, quantity, or type of goods in trade transactions, but other methods are also used. For example, some drug trafficking organizations from Latin America have used a type of TBML scheme known as the Black Market Peso Exchange (BMPE) to launder funds. BMPE schemes involve merchants who—wittingly or not—accept payment in illicitly derived funds, often from third parties to a trade transaction, for exports of goods. In carrying out TBML schemes, criminal and terrorist organizations use various goods, including precious metals and automobiles (see fig.). U.S. officials and other sources have identified a number of countries as being at particular risk for TBML schemes. Available evidence indicates that the amount of TBML occurring globally is likely substantial. However, specific estimates of the amount of TBML occurring around the world are not available. Officials and reporting from relevant international bodies and selected partner countries, and knowledgeable sources recommended various practices for countries to consider to combat TBML, which GAO grouped into five categories: (1) partnerships between governments and the private sector, (2) training, (3) sharing information through domestic interagency collaboration, (4) international cooperation, and (5) further research on challenges to combating TBML. The U.S. government's key international effort to counter TBML is the Trade Transparency Unit (TTU) program under the Department of Homeland Security's (DHS) Immigration and Customs Enforcement (ICE). ICE set up TTUs in 17 partner countries with the goal of exchanging and analyzing trade data to identify potential cases of TBML. While TTUs have played a role in some TBML investigations, the TTU program has experienced various challenges, including lapses in information sharing between ICE and the partner TTUs, differing priorities between ICE and partner TTUs in pursuing TBML investigations, and limitations in the data system that ICE and the TTUs use. However, ICE has not developed a strategy to increase the effectiveness of the TTU program or a performance monitoring framework to assess the results of its work with partner TTUs. As a result, ICE does not have a clear guide on how best to operate the TTU program and cannot make management decisions based on program results. In addition to the TTU program, the U.S. government collaborates with partner countries and international bodies through a range of other activities, such as developing international anti-money laundering standards, providing training and technical assistance, establishing information-sharing methods, and providing ongoing law enforcement cooperation.


TRIA created a federal program to help ensure the availability and affordability of terrorism risk insurance. Insurers must make terrorism risk coverage available to commercial policyholders. The federal government and insurers share losses on such policies resulting from a certified act of terrorism causing at least $5 million of insurance losses. Annual coverage for losses by insurers (who have met their insurer deductible) and the government is limited to $100 billion. The program is set to expire December 31, 2027. GAO was asked to review TRIA. This report examines (1) the current market for terrorism risk insurance and the program's role in the market, and (2) Treasury's processes to certify acts of terrorism and fulfill claims. GAO reviewed Treasury reports and related industry studies, Treasury's guidance and procedures for the program, and insurance policy language. GAO also interviewed Treasury officials and industry stakeholders, including a nongeneralizable sample of insurers of different sizes providing various types of insurance. With the support of a program established under the Terrorism Risk Insurance Act (TRIA) in which the federal government and insurers would share losses in the event of a certified act of terrorism, terrorism risk insurance is generally available and affordable in the United States. For example, the majority of commercial policyholders generally purchased terrorism risk insurance in recent years, according to Department of the Treasury (Treasury) data. The insurance market would be significantly disrupted without a loss-sharing program such as that established under TRIA. Specifically, insurers generally would not have to offer terrorism risk coverage and likely would charge higher premiums in the absence of a loss-sharing arrangement and cap on losses, according to GAO's review of policies and interviews with industry stakeholders, including insurers and insurer associations. Without access to affordable coverage, new building ventures could be delayed and employers could struggle to find affordable workers' compensation coverage. Treasury has processes for certifying terrorist events and fulfilling claims under the program, but a lack of communication about aspects of Treasury's certification process could pose challenges for insurers. Some industry stakeholders, such as insurers and representatives of insurer associations, raised issues about Treasury communications on certification. They cited confusion over why the 2013 Boston Marathon bombing was not certified when they clearly viewed it as a terrorist attack. These industry stakeholders also expressed concern that Treasury never communicated whether it was reviewing the event for certification or its reasons for not certifying it. Most insurers GAO interviewed said such lack of communication by Treasury again could lead to uncertainty about whether to pay claims, putting them at risk of violating state laws and their policyholder agreements. TRIA regulations on certifying acts of terrorism include some public notification requirements but do not require Treasury to communicate when it is considering reviewing an event for certification. One purpose of TRIA is to stabilize the insurance market after a terrorist attack. Public communication of when Treasury is considering an event for certification would reduce uncertainty about which claims insurers should pay and lessen potential disruptions to the market after an attack. One step in determining when to certify an event is Treasury's consultation with offices in the Department of Homeland Security (DHS) and Department of Justice (DOJ) to obtain law enforcement, intelligence, and homeland security information. However, GAO found that DHS had a different understanding of its role in this staff consultation process, and Treasury had not documented agreements with either agency. By documenting agreements between Treasury and the two consulting agencies, Treasury can better ensure a smooth and timely certification process. Once an event is certified as an act of terrorism, Treasury has a process for fulfilling claims that uses a web-based system developed and operated by a contractor. As of February 2020, the system had not yet been used because Treasury had not certified any acts of terrorism or paid claims under the program.


TSA is responsible for overseeing security operations at roughly 440 TSA-regulated airports as part of its mission to protect the nation's civil aviation system. TSA uses technologies to screen passengers and their bags for prohibited items. The TSA Modernization Act includes a provision for GAO to review TSA's deployment of screening technologies, and GAO was asked to review the detection standards of these screening technologies. This report addresses, among other things, (1) how TSA operationalizes detection standards, (2) the extent to which TSA considered risk when making deployment decisions, and (3) the extent to which TSA ensures technologies continue to meet detection requirements after deployment. GAO reviewed DHS and TSA procedures and documents, including detection standards; visited DHS and TSA testing facilities; observed the use of screening technologies at seven airports, selected for varying geographic locations and other factors; and interviewed DHS and TSA headquarters and field officials. The Department of Homeland Security's (DHS) Transportation Security Administration (TSA) operationalizes, or puts into effect, detection standards for its screening technologies by acquiring and deploying new technologies, which can take years. Detection standards specify the prohibited items (e.g., guns, explosives) that technologies are to detect, the minimum rate of detection, and the maximum rate at which technologies incorrectly flag an item. TSA operationalizes standards by adapting them as detection requirements, working with manufacturers to develop and test new technologies (software or hardware), and acquiring and deploying technologies to airports. For the standards GAO reviewed, this process took 2 to 7 years, based on manufacturers' technical abilities and other factors. TSA's deployment decisions are generally based on logistical factors and it is unclear how risk is considered when determining where and in what order technologies are deployed because TSA did not document its decisions. TSA considers risks across the civil aviation system when making acquisition decisions. However, TSA did not document the extent risk played a role in deployment, and could not fully explain how risk analyses contributed to those decisions. Moving forward, increased transparency about TSA's decisions would better ensure that deployment of technologies matches potential risks. Technology performance can degrade over time; however, TSA does not ensure that technologies continue to meet detection requirements after deployment to airports. TSA certifies technologies to ensure they meet requirements before deployment, and screeners are to regularly calibrate deployed technologies to demonstrate they are minimally operational. However, neither process ensures that technologies continue to meet requirements after deployment. In 2015 and 2016, DHS tested a sample of deployed explosives trace detection and bottled liquid scanner units and found that some no longer met detection requirements. Developing and implementing a process to ensure technologies continue to meet detection requirements after deployment would help ensure that TSA screening procedures are effective and enable TSA to take corrective action if needed.


TSA is responsible for screening millions of airline passengers and their baggage each day at the nation's commercial airports for items that could threaten aircraft and passengers. In carrying out its mission, TSA requires its screener workforce to complete various trainings on screening procedures and technologies. TSA updated its security screening procedures and technologies in recent years to address risks identified through covert tests in 2015 and reports of emerging threats. The TSA Modernization Act of 2018 included a provision for GAO to examine the effectiveness of TSA's updated screener training. This report addresses: (1) changes TSA made to screener training since 2015; (2) how TSA updates and evaluates screener training; and (3) how TSA ensures screener compliance with training requirements. GAO analyzed TSA documentation on training development, compliance monitoring, and a non-generalizable sample of six recently updated training courses—selected to reflect a range of training types and topics. GAO also reviewed TSA data on airport screener training compliance rates from fiscal years 2016 through 2018, and interviewed TSA officials. Since 2015, the Department of Homeland Security's (DHS) Transportation Security Administration (TSA) developed and updated screener training to address potential risks to commercial airports identified through covert testing and reports on emerging threats. From May 2015 through June 2019, TSA identified 62 potential risks that warranted review for a potential change in training. TSA made training changes in response to 56 of the identified risks—affecting 40 different training courses. TSA also responded to risks by developing or updating job aids or briefings for screeners. TSA uses established models for developing, updating, and evaluating its screener training. The figure below shows TSA's process for updating and evaluating its screener training, in accordance with a training development model that is widely accepted and used across the federal government. TSA relies on an online database to monitor screener compliance in completing required training at the nation's commercial airports. However, TSA has not documented its process for monitoring screener training compliance, including for analyzing compliance data and reporting and addressing instances of noncompliance at airports. Moreover, while TSA monitors airport compliance rates in a given year, it does not analyze the data across fiscal years for potential trends in noncompliance by individual airports that may warrant corrective action at the headquarters level. GAO found that in fiscal years 2016 and 2017, screeners at 435 commercial airports met TSA's 90 percent target compliance rate, while in 2018, five airports had compliance rates well below this target, dropping 15 to 26 percentage points from the prior year. TSA officials stated they were unaware of this development. By documenting its screener training compliance monitoring process and monitoring screener training compliance data across fiscal years, TSA would be better positioned to ensure it is aware of potential noncompliance trends warranting corrective action at the headquarters level.


TSA uses covert testing to identify potential vulnerabilities in checkpoint and checked baggage screening systems at U.S. airports. In 2015, TSA identified deficiencies in its covert testing process, and in 2017, the Department of Homeland Security Office of Inspector General's covert testing identified deficiencies in screener performance. Since these findings, TSA has taken steps intended to improve its covert test processes and to use test results to better address vulnerabilities. GAO was asked to review TSA's covert test programs, including how the results are used to address vulnerabilities. This report analyzes the extent to which (1) TSA covert tests are risk-informed, (2) TSA covert tests for fiscal years 2016 through March 2018 produced quality information, and (3) TSA uses covert test results to address any identified security vulnerabilities. GAO observed 26 TSA covert tests, reviewed TSA guidance, analyzed test data for fiscal years 2016, 2017, and through March 2018, and interviewed TSA officials. Two offices within the Transportation Security Administration (TSA) conduct covert tests at U.S. airports—Inspection and Security Operations. The Department of Homeland Security requires that agencies use risk information to make decisions, and TSA issues annual risk assessments of threats that its program offices should consult when making risk-based decisions, such as what covert tests to conduct. Of the two TSA offices that conduct covert tests, Inspection officials used TSA's risk assessment to guide their efforts. However, Security Operations officials relied largely on their professional judgment in making decisions about what scenarios to consider for covert testing. By not using a risk-informed approach, TSA has limited assurance that Security Operations is targeting the most likely threats. Both Inspection and Security Operations have implemented processes to ensure that their covert tests produce quality results. However, GAO found that only Inspection has established a new process that has resulted in quality test results. Specifically, for the two reports Inspection completed for testing conducted in fiscal years 2016 and 2017 using its new process, GAO found that the results were generally consistent with quality analysis and reporting practices. On the other hand, Security Operations has not been able to ensure the quality of its covert test results, and GAO identified a number of factors that could be compromising the quality of these results. Unless TSA assesses the current practices used at airports to conduct tests, and identifies the factors that may be impacting the quality of covert testing conducted by TSA officials at airports, it will have limited assurance about the reliability of the test results it is using to address vulnerabilities. In 2015, TSA established the Security Vulnerability Management Process to leverage agency-wide resources to address systemic vulnerabilities; however, this process has not yet resolved any identified security vulnerabilities. Since 2015, Inspection officials submitted nine security vulnerabilities identified through covert tests for mitigation, and as of September 2018, none had been formally resolved through this process. GAO found that in some cases, it took TSA officials overseeing the process up to 7 months to assign an office responsible to begin mitigation efforts. In part, this is because TSA has not established time frames and milestones for this process or established procedures to ensure milestones are met, in accordance with best practices for program management. Without doing so, TSA cannot ensure efficient and effective progress in addressing security vulnerabilities. This is a public version of a classified report that GAO issued in January 2019. Information that TSA deemed classified or sensitive security information, such as the results of TSA's covert testing and details about TSA's screening procedures, have been omitted.


Taxpayers who elect to itemize their deductions may reduce their federal income tax liability by claiming a deduction for certain state and local taxes paid, often called the "SALT deduction." The 2017 tax revision (commonly referred to as the Tax Cuts and Jobs Act, TCJA; P.L. 115-97 ) made a number of changes to the SALT deduction. Most notably, the TCJA established a limit, or "SALT cap," on the amounts claimed as SALT deductions for tax years 2018 through 2025. The SALT cap is $10,000 for single taxpayers and married couples filing jointly and $5,000 for married taxpayers filing separately. The changes enacted in the TCJA will considerably affect SALT deduction activity in the next several years. The increased value of the standard deduction (roughly doubling from its pre-TCJA value for tax years 2018 through 2025), along with the reduced availability of SALT and other itemized deductions, are projected to significantly reduce the number of SALT deduction claims made in those years. The Joint Committee on Taxation (JCT) projected that repealing that SALT cap for tax year 2019 would increase federal revenues by $77.4 billion. The SALT deduction reduces the cost of state and local government taxes to taxpayers because a portion of the taxes deducted is effectively paid for by the federal government. By reducing the deduction's value, the SALT cap therefore increases the cost to the taxpayer of state and local taxes. That may affect state and local tax and spending behavior, as any reduction in state and local revenues from increased sensitivity to SALT-eligible tax rates must be offset by reductions in outlays or increases in other revenue to maintain budget outcomes. The SALT cap's effect on the SALT deduction's value is in part a function of state and local tax policies. Nationwide, there is considerable variation in both the combined level of income and sales taxes levied by states and the property taxes and other charges levied by local governments. Differences in incomes and price levels that serve as the base for those taxes are another source of disparity in SALT cap exposure. Internal Revenue Service (IRS) data showed that in 2017, the average SALT deduction claimed in New York ($23,804) was more than four times the average in Alaska ($5,451). The SALT cap predominantly affects taxpayers with higher incomes. State and local tax payments tend to increase with income, both as a direct function of the income tax structure and because higher incomes lead to increased consumption and thus sales and property tax payments. Increased income, therefore, makes higher-income taxpayers more likely to make SALT-eligible tax payments in amounts exceeding the SALT cap value. The benefit of SALT deductions in terms of tax savings is also larger for taxpayers with higher incomes because a federal tax deduction's value is proportional to the taxpayer's marginal income tax rate. JCT projected that more than half of 2019 benefits for the SALT deduction will accrue to taxpayers with incomes exceeding $200,000. Several pieces of legislation introduced in the 116 th Congress would modify the SALT cap, including legislation that would (1) repeal the SALT cap entirely; (2) increase the SALT cap's value for all taxpayers; (3) increase the SALT cap's value for some taxpayers; (4) make the SALT cap permanent; and (5) repeal IRS regulations affecting SALT cap liability. Following enactment of the TCJA, several states proposed or passed legislation that provided possible avenues to reduce the SALT cap's effect on taxpayers without reducing their relevant state or local tax burdens. Subsequent guidance by the IRS, however, makes it unclear or unlikely that those laws will prevent taxpayers from experiencing the SALT cap's effects.


Technological advances in digitization and data processing and storage have greatly increased the availability and convenience of electronic payments. New products and services offer faster, more convenient payment for individuals and businesses, and the numerous options on offer foster competition and innovation among end-user service providers. Currently, many new payment services are layered on top of existing electronic payment systems, which may limit their speed. Most payments flow through both retail and wholesale payment systems before they are completed. Consumers access retail payment systems to purchase goods and services, pay bills, obtain cash through withdrawals and advances, and make person-to-person transfers. Consumers' financial institutions access wholesale systems to complete the payment. In the United States, systems accessed by consumers are operated by the private sector, whereas systems accessed by banks to complete those transactions are operated by the Federal Reserve (Fed) or the private sector. Regulation of retail payment systems is dispersed across multiple state and federal regulators. For example, payment systems are subject to federal consumer protection regulation under the Electronic Fund Transfer Act ( P.L. 95-630 ), anti-money laundering requirements under the Bank Secrecy Act (P.L. 91-508), and various state licensing, safety and soundness, anti-money laundering, and consumer protection requirements. Private wholesale payment systems are regulated by the Fed, and if they are systemically important, they can be designated as "financial market utilities" and subject to heightened oversight. Although faster and potentially less costly payment systems may benefit consumers and businesses, the use of new technology in existing and new payment systems raise a number of questions for policymakers. Some observers have argued that certain innovative financial technology, or fintech, payment companies would be more effectively regulated through the federal banking regulatory framework, whereas opponents of this idea assert it would result in the preemption of important state-level consumer protections and in an inappropriate combination of banking and commercial activities. The increased prevalence of data generation, collection, and analysis in payment systems has caused observers to question whether existing regulation adequately addresses issues related to data privacy and cybersecurity. Although the traditional high-levels of industry concentration and the recent entry by technology giants have raised concerns over market power and industry competition, competition to date has been robust and certain analysts argue that internet-based payments that do not require a large investment in infrastructure will prevent the market concentration that exists in older payment services. What effect technological innovation in payments will have on consumer access and whether consumers are adequately protected against potential problems, such as fraudulent or erroneous transactions, are also subjects of debate. In August 2019, the Fed announced plans to create an interbank real-time payments (RTP) system by 2023 or 2024. The Fed stated that the new system will be available to all banks with a reserve account at the Fed, and it will require banks using this new system to make those funds available to their customers immediately after being notified of settlement. In addition, several private-sector initiatives are also underway to implement faster payments, some of which would make funds available to the recipient in real time (with deferred settlement) and some of which would provide real-time settlement. Businesses and consumers would benefit from the ability to receive funds more quickly, particularly as a greater share of payments are made online or using mobile technology. The main policy issue regarding the Federal Reserve and RTP is whether Fed entry in this market is desirable, given similar private-sector developments are already underway. There is debate about whether competition from the Fed would be beneficial in terms of cost, efficiency, safety, innovation, ubiquity, and financial stability. In the 116 th Congress, H.R. 3951 and S. 2243 , among other bills, would require the Fed to create a RTP system and would require banks to make payments to account holders in real time.


Technological convergence, in general, refers to the trend or phenomenon where two or more independent technologies integrate and form a new outcome. One example is the smartphone. A smartphone integrated several independent technologies—such as telephone, computer, camera, music player, television (TV), and geolocating and navigation tool—into a single device. The smartphone has become its own, identifiable category of technology, establishing a $350 billion industry. Of the three closely associated convergences—technological convergence, media convergence, and network convergence—consumers most often directly engage with technological convergence. Technological convergent devices share three key characteristics. First, converged devices can execute multiple functions to serve blended purpose. Second, converged devices can collect and use data in various formats and employ machine learning techniques to deliver enhanced user experience. Third, converged devices are connected to a network directly and/or are interconnected with other devices to offer ubiquitous access to users. Technological convergence may present a range of issues where Congress may take legislative and/or oversight actions. Three selected issue areas associated with technological convergence are regulatory jurisdiction, digital privacy, and data security. First, merging and integrating multiple technologies from distinct functional categories into one converged technology may pose challenges to defining regulatory policies and responsibilities. Determining oversight jurisdictions and regulatory authorities for converged technologies can become unclear as the boundaries that once separated single-function technologies blend together. A challenge for Congress may be in delineating which government agency has jurisdiction over various converged technologies. Defining policies that regulate technological convergence industry may not be simple or straightforward. This may further complicate how Congress oversees government agencies and converged industries due to blending boundaries of existing categories. Second, converged technologies collect and use personal and machine data which may raise digital privacy concerns for consumers. Data collection and usage are tied to digital privacy issues because a piece or aggregation of information could identify an individual or reveal patterns in one's activities. Converged or smart technologies leverage large volumes of data to try to improve the user experience by generating more tailored and anticipatory results. However, such data can potentially identify, locate, track, and monitor an individual without the person's knowledge. Such data can also potentially be sold to third-party entities without an individual's awareness. As the use of converged technologies continues to propagate, digital privacy issues will likely remain central. Third, data security concerns are often associated with smart devices' convenient ubiquitous features that may double as vulnerabilities exploited by malicious actors. Data security, a component of cybersecurity, protects data from unauthorized access and use. Along with digital privacy, data security is a pertinent issue to technological convergence. As converged devices generate and consume large volumes of data, multiple data security concerns have emerged: potentially increased number of access points susceptible to cyberattacks, linkage to physical security, and theft of data. Relatively few policies are in place for specifically overseeing technological convergence, and current federal data protection laws have varied privacy and data security provisions for different types of personal data. To address regulatory, digital privacy, and data security issues, Congress may consider the role of the federal government in an environment where technological evolution changes quickly and continues to disrupt existing regulatory frameworks. Regulating technological convergence may entail policies for jurisdictional deconfliction, harmonization, and expansion to address blended or new categories of technology. One approach could be for Congress to define the role of federal government oversight of digital privacy and data security by introducing new legislation that comprehensively addresses digital privacy and data security issues or by expanding the current authorities of federal agencies. When considering new legislation or expanding the authorities of federal agencies, three potential policy decisions are (1) whether data privacy and data security should be addressed together or separately, (2) whether various types of personal data should be treated equally or differently, and (3) which agencies should be responsible for implementing any new laws.


Technology advancements have increased the overall accuracy of automated face recognition over the past few decades. This technology has helped law enforcement agencies identify criminals in their investigations. However, there are questions about the accuracy of the technology and the protection of privacy and civil liberties when face recognition technologies are used to identify people for investigations. This statement describes the extent to which the FBI (1) ensures adherence to laws and policies related to privacy regarding its use of face recognition technology, and (2) ensures its face recognition capabilities are sufficiently accurate. This statement is based on GAO's May 2016 report regarding the FBI's use of face recognition technology (GAO-16-267) and includes agency updates to GAO's recommendations. To conduct its prior work, GAO reviewed federal privacy laws, and DOJ and FBI policies and operating manuals. GAO interviewed officials from the FBI and the departments of Defense and State, which coordinate with the FBI on face recognition. GAO also interviewed two state agencies that partner with the FBI to use multiple face recognition capabilities. For updates, GAO reviewed FBI data, as well as materials provided by DOJ and the FBI on the status of GAO's recommendations. In May 2016, GAO found that the the Department of Justice (DOJ) and the Federal Bureau of Investigation (FBI) could improve transparency and oversight to better safeguard privacy and had limited information on accuracy of its face recognition technology. GAO made six recommendations to address these issues. As of May 2019, DOJ and the FBI had taken some actions to address three recommendations—one of which the FBI has fully implemented—but has not taken any actions on the other three. Privacy . In its May 2016 report, GAO found that DOJ did not complete or publish key privacy documents for FBI's face recognition systems in a timely manner and made two recommendations to DOJ regarding its processes for developing these documents. These included privacy impact assessments (PIA), which analyze how personal information is collected, stored, shared, and managed in federal systems, and system of records notices, which inform the public about, among other things, the existence of the systems and the types of data collected. DOJ has taken actions to expedite the development process of the PIA. However, DOJ has yet to take action with respect to the development process for SORNs. GAO continues to believe both recommendations are valid and, if implemented, would help keep the public informed about how personal information is being collected, used and protected by DOJ components. GAO also recommended the FBI conduct audits to determine if users of FBI's face recognition systems are conducting face image searches in accordance with DOJ policy requirements, which the FBI has done. Accuracy . GAO also made three recommendations to help the FBI better ensure the accuracy of its face recognition capabilities. First, GAO found that the FBI conducted limited assessments of the accuracy of face recognition searches prior to accepting and deploying its face recognition system. The face recognition system automatically generates a list of photos containing the requested number of best matched photos. The FBI assessed accuracy when users requested a list of 50 possible matches, but did not test other list sizes. GAO recommended accuracy testing on different list sizes. Second, GAO found that FBI had not assessed the accuracy of face recognition systems operated by external partners, such as state or federal agencies, and recommended it take steps to determine whether external partner systems are sufficiently accurate for FBI's use. The FBI has not taken action to address these recommendations. GAO continues to believe that by verifying the accuracy of both systems—its system, and the systems of external partners—the FBI could help ensure that the systems provide leads that enhance criminal investigations. Third, GAO found that the FBI did not conduct an annual review to determine if the accuracy of face recognition searches was meeting user needs, and recommended it do so. In 2016 and 2017 the FBI submitted a paper to solicit feedback from system users. However, this did not result in formal responses from users and did not constitute a review of the system. GAO continues to believe that conducting such a review would help provide important information about potential factors affecting accuracy of the system.


The "flag code" is the federal law that sets forth guidelines for the appearance and display of the U.S. flag ("flag") by private citizens. These guidelines specify times and conditions for display of the flag, manners and methods of display, and buildings where such display should occur. The guidelines for flag display vary based on the context and occasion, and there are detailed specifications for displaying flags at "half-staff." The flag code also specifies how to deliver the Pledge of Allegiance to the flag and appropriate conduct while watching a performance of the National Anthem. Most of the flag code contains no explicit enforcement mechanisms, and relevant case law would suggest that the provisions without enforcement mechanisms are declaratory and advisory only. Efforts by states to punish verbal flag disparagement or prevent disrespectful flag display ("flag-misuse laws") have been struck down by the Supreme Court in Street v. New York and Spence v. Washington as free speech violations under the First and Fourteenth Amendments of the U.S. Constitution. Federal and many state laws also specify punishments for physical mistreatment of the U.S. flag ("flag-desecration laws"), although under Texas v. Johnson and U nited S tates v. Eichman , the Court held that application of these laws against expressive conduct violates free speech precepts. A separate issue is that federal and many state flag-misuse laws provide punishment for placing advertising images on a U.S. flag or displaying an image of a flag on merchandise. While these laws have not been challenged on free speech grounds, the Court has reserved the question whether the Johnson and Eichman holdings would apply in a commercial context, and it seems likely these laws would survive judicial scrutiny. Finally, while federal courts of appeals have rejected Establishment Clause challenges to recitation of the Pledge of Allegiance in classrooms despite language in the Pledge describing "one Nation under God," the Court in West Virginia State Board of Education v. Barnette held that a state law mandating that students participate in a recitation of the Pledge of Allegiance violates free speech precepts.


As agreed to in the House, H.Res. 6 , a resolution adopting the rules of the House of Representatives, provided amendments to the rules, as well as separate orders, that affect floor procedure in the 116 th Congress (2019-2010). These amendments changed procedures in the full House and in the Committee of the Whole. The rules changes altered when a resolution that would cause a vacancy in the Office of Speaker would qualify as a question of privilege. Under a new provision to clause 2 of Rule IX, resolutions declaring a vacancy of the chair are not privileged unless they are offered by direction of a party caucus or conference. H.Re s. 6 established a Consensus Calendar for the consideration of certain broadly supported measures that have not been reported by their committees of primary jurisdiction. One rules change allows the Speaker to schedule consideration of legislation that has been on the Private Calendar for seven days. Another change requires the Speaker to schedule the consideration of a motion to discharge that has garnered the necessary 218 signatures to be placed on the Discharge Calendar (and has been on that calendar for at least seven legislative days). Prior to the rules change, measures on the Private Calendar and motions on the Discharge Calendar were to be considered on specified days of the month. The 116 th rules package mandates that certain legislative texts must be available to the public for 72 hours before legislation can be raised on the House floor. The earlier rules provided a three-day layover, not including weekends and holidays, which could provide a review period of fewer or more than 72 hours. Rules changes allow the Speaker to postpone votes on amendment votes that occur in the House proper and no longer require a notice that a voting period on the amendment will be reduced to five minutes. In the Committee of the Whole, the chair is afforded greater flexibility to reduce voting periods to two minutes on record votes. Several rules changes concerned the five Delegates and the Resident Commissioner of Puerto Rico. Most significantly, H.Res. 6 enables these individuals to vote in the Committee of the Whole. The 116 th rules reinstated the policy from previous Congresses that allowed for voting in the Committee of the Whole but also mandated a revote in the House proper if the initial vote was decided within the margin of votes cast by the Delegates and the Resident Commissioner. The 116 th rules package clarified that the provision in Rule XVII that bans hats in the House chamber allows Members to wear "religious headdress." In the 116 th Congress, Members can wear religious head coverings in the chamber at any time. Finally, H.Res. 6 included a separate order governing action in the 116 th Congress that clarified procedures concerning measures introduced pursuant to the War Powers Resolution. The separate order stated that motions to discharge such measures from committee would not be subject to a motion to table.


The 101 HBCUs play an important role in higher education and in their local and regional economies. Among African Americans who obtained a doctorate in science, technology, engineering, or mathematics in 2005–2010, more than one-third earned their undergraduate degrees from an HBCU. SBA is part of a long-standing White House initiative to strengthen the capacity of HBCUs, including their ability to access and participate in federal programs. SBA's mission includes business development, and SBA also works with colleges and universities to provide entrepreneurial training and counseling. GAO was asked to review SBA's entrepreneurship-related efforts with HBCUs. This report examines (1) SBA efforts to foster entrepreneurship with HBCUs in recent years, (2) SBA's plans for the White House Initiative on HBCUs, and (3) the extent to which SBA collected information specific to HBCUs. GAO analyzed SBA information on HBCU participation in programs and activities for fostering entrepreneurship and reviewed related standard operating procedures. GAO also interviewed officials at SBA headquarters and eight SBA district offices, and representatives of nine Small Business Development Centers (selected for a high number of agreements with HBCUs and other factors). The Small Business Administration (SBA) worked with Historically Black Colleges and Universities (HBCU) to foster entrepreneurship, primarily through its Small Business Development Center program (which provides counseling and training), strategic alliance memorandums, and co-sponsorship agreements. Two HBCUs—Howard University and the University of the Virgin Islands—have hosted SBDC “lead centers” since the 1980s. SBA also signed at least 35 strategic alliance memorandums with HBCUs and at least 16 co-sponsorship agreements in 2013–2018. In 2018, SBA developed a plan to support HBCUs (including goals and measures) for the White House Initiative on HBCUs. However, SBA headquarters did not communicate this plan or its goals to key Small Business Development Centers or SBA district offices (those with HBCUs in their service areas). As a result, SBA may have missed opportunities to collaborate with HBCUs and help achieve the goals of its plan. SBA has collected limited information about its programs and activities with HBCUs. SBA could not establish a baseline for performance measures developed in its 2018 plan because SBA district offices and the Small Business Development Centers are not required to collect or report information about their HBCU-related outreach and other activities. For example, while representatives from the nine Small Business Development Centers with whom GAO spoke said they conducted outreach to HBCUs, this information was not reported to SBA headquarters. Without collecting relevant information about its HBCU-related efforts, including data for performance measures, SBA cannot assess the extent or effectiveness of its efforts to support HBCUs.


The 116 th Congress is considering multiple proposed changes to U.S. mineral policy. Currently certain types of mineral production on federal lands provide the federal government and some states and industries with sources of revenue, while other production does not generate similar revenue. Proposed changes to federal mineral policy could impact these revenue streams, industries, and states in a variety of ways. The processes and requirements to mine on federal lands vary by mineral category, surface/subsurface management agencies, and estate ownership. Three main statutes create the three categories of minerals applicable to mining on federal lands. The General Mining Law of 1872 covers locatable (or hardrock) minerals, which are now defined as those minerals not defined by other statutes; typical examples include gold, silver, copper, and gemstones, when not found on acquired lands. Leasable minerals are defined by the Mineral Leasing Act of 1920, and include coal, phosphate, potassium, and sodium, among others (leasable minerals also include otherwise locatable minerals on acquired land, per the Mineral Leasing Act for Acquired Lands of 1947). Salable minerals are defined by the Materials Act of 1947, and include common minerals such as sand and gravel. Additional processes and requirements apply when the surface rights above the federal mineral estate are privately owned (i.e., split estate), commonly resulting from the Stock Raising Homestead Act of 1916. Similarly, coordination is required between the surface management agency and the agency managing the mineral estate. Two statutes generally apply to mining on federal lands, including the Surface Mining Control and Reclamation Act of 1977 (only applicable to coal) and the Federal Mine Safety and Health Act of 1977, while others may apply, including the Federal Land Policy Management Act of 1976; the National Environmental Policy Act of 1969; the Clean Water Act of 1972; the Clean Air Act; the Endangered Species Act of 1973; and the National Historic Preservation Act of 1966, among others. Data regarding mineral production for locatable minerals on federal lands are not collected by the federal government. This lack of data can hinder the development and analysis of policies intending to affect mineral production on federal lands. The 116 th Congress is considering H.R. 2579 , the Hardrock Leasing and Reclamation Act of 2019, which would, among other provisions, require mining operations on federal lands to report production volumes and values, with these data made public. Locatable mineral production on federal lands is not subject to royalties. Some interested parties see not charging royalties as a means of encouraging mineral exploration and production, while others may argue the public is not recovering fair market value for the transfer of a public asset to a private entity. H.R. 2579 would also establish a federal royalty policy for all new hardrock mineral mining operations on federal lands, and use these and other fees for the reclamation of abandoned hardrock mines and other environmental conservation activities on lands and waters affected by past hardrock mining. Federal land withdrawals may close a given area to mining. Advocates for a specific land withdrawal generally see the proposed use (e.g., military base, national park, national monument, wilderness area) as superseding the potential use of the public land by other interests (e.g., for mining). Proponents of mining generally advocate for limited withdrawals from the mineral estate, as access to public lands for mining represents opportunities for ongoing and future operations. H.R. 1373 would permanently withdraw about one million acres surrounding the Grand Canyon National Park from new mineral entry; it passed the House, and a companion bill, S. 3127 , has been introduced in the Senate. H.R. 5598 would withdraw 234,328 acres of federal lands in the Superior National Forest, including lands covered by previously disputed mineral leases. Several bills in the 116 th Congress would address U.S. critical mineral supply (i.e., those minerals defined by the U.S. Geological Survey that meet certain net import dependence criteria and perceived necessity to the U.S. economy). For example, S. 1317 would instruct the U.S. Geological Survey (USGS) to publish information regarding domestic critical mineral resources and would authorize an ongoing research and development program for critical minerals in the Department of Energy. The text of S. 1317 was incorporated into a substitute amendment to S. 2657 . Another example is H.R. 4410 , which would establish a federal cooperative and a federal corporation to process and sell certain critical minerals commonly found with thorium, which is radioactive.


The 1976 covenant defining the political relationship between the CNMI and the United States exempted the CNMI—a U.S. territory north of Guam—from certain federal immigration laws. However, the covenant preserved the right of the U.S. government to apply federal law in these exempted areas. The CNRA, which amended a joint resolution approving the covenant, generally established federal control of CNMI immigration beginning in 2009. In 2009, DHS began implementing, among other things, a foreign worker permit program to address CNRA provisions specific to the CNMI. DHS also began using its discretionary authority under the INA to parole certain groups of individuals into the CNMI (i.e., allow them to be temporarily present). Congress has amended the CNRA several times with provisions that affected the total number of permits allocated and the distribution of permits. Proposed bill H.R. 560 would further modify the CNRA by establishing a CNMI resident status for certain individuals. Among its other provisions, the CNRA allows CNMI employers to petition for H-2 visas for temporary workers without counting the visas against a numerical restriction. Drawing from ongoing work, this testimony discusses DHS's implementation of (1) selected CNRA provisions regarding foreign workers, among others, in the CNMI and (2) its discretionary parole authority under the INA as applied in the CNMI. GAO updated information from May 2017 ( GAO-17-437 ) and February 2018 ( GAO-18-373T ), reviewed relevant legal documents, and analyzed DHS data. Under the Consolidated Natural Resources Act of 2008 (CNRA), the Department of Homeland Security (DHS) established the nonimmigrant Commonwealth of the Northern Mariana Islands (CNMI)–Only Transitional Worker program in 2011. Through the program, eligible foreign nationals can obtain CNMI-Only Transitional Worker (CW-1) permits to work temporarily in the CNMI. Under H.R. 560, foreign nationals who meet additional eligibility requirements could be eligible to receive CNMI resident status if they were admitted annually to the CNMI as a CW-1 worker in fiscal years 2015 through 2018. GAO's preliminary analysis of DHS data found that 2,875 (about 32 percent) of 8,995 workers with CW-1 permits for fiscal year 2018 had maintained continuous employment each fiscal year since 2015 (i.e., received a CW-1 permit annually). While DHS data show the number of approved CW-1 permit holders declined from fiscal year 2017 to fiscal year 2018 (see figure), the number of H-2B beneficiaries—who often fill construction jobs—increased from 0 to 3,058. In January 2019, DHS removed the Philippines from the list of countries eligible for the H-2B program. In 2009, DHS began granting discretionary parole that authorized temporary stays for certain CNMI residents, such as spouses and children of U.S. citizens. These individuals may have been inadmissible or otherwise ineligible for admission to the United States, according to DHS. However, in December 2018, DHS announced that it was terminating parole for certain categories of residents in response to Executive Order 13767, issued in 2017. The order called on DHS to take appropriate action to ensure that parole authority is exercised only on a case-by-case basis, among other things. According to DHS, 1,039 individuals in the terminated categories had been granted parole until December 31, 2018. Under H.R. 560, some of these individuals could be eligible to apply for CNMI resident status.


The 2017 tax revision, P.L. 115-97, often referred to as the Tax Cuts and Jobs Act, and referred to subsequently as the Act, substantially revised the U.S. tax system. The Act permanently reduced the corporate tax rate to 21%, made a number of revisions in business tax deductions (including limits on interest deductions), and provided a major revision in the international tax rules. It also substantially revised individual income taxes, including an increase in the standard deduction and child credit largely offset by eliminating personal exemptions, along with rate cuts, limits on itemized deductions (primarily a dollar cap on the state and local tax deduction), and a 20% deduction for pass-through businesses (businesses taxed under the individual rather than the corporate tax, such as partnerships). These individual provisions are temporary and are scheduled to expire after 2025. The Act also adopted temporary provisions allowing the immediate deduction for equipment investment and an increase in the exemption for estate and gift taxes. The Joint Committee on Taxation (JCT) estimated that these changes would reduce tax revenue by $1.5 trillion over 10 years. In 2018, gross domestic product (GDP) grew at 2.9%, about the Congressional Budget Office's (CBO's) projected rate published in 2017 before the tax cut. On the whole, the growth effects tend to show a relatively small (if any) first-year effect on the economy. Although growth rates cannot indicate the tax cut's effects on GDP, they tend to rule out very large effects particularly in the short run. Although investment grew significantly, the growth patterns for different types of assets do not appear to be consistent with the direction and size of the supply-side incentive effects one would expect from the tax changes. This potential outcome may raise questions about how much longer-run growth will result from the tax revision. CBO, in its first baseline update post enactment, initially estimated that the Act would reduce individual income taxes by $65 billion, corporate income taxes by $94 billion, and other taxes by $3 billion, for a total reduction of $163 billion in FY2018. Corporate revenues were about $40 billion less than projected whereas individual revenues were higher, with an overall revenue reduction of about $9 billion. From 2017 to 2018, the estimated average corporate tax rate fell from 23.4% to 12.1% and individual income taxes as a percentage of personal income fell slightly from 9.6% to 9.2%. Real wages grew more slowly than GDP: at 2.0% (adjusted by the GDP deflator) compared with 2.9% for overall real GDP. Such slower growth has occurred in the past. The real wage rate for production and nonsupervisory workers grew by 1.2%. Although significant amounts of dividends were repatriated in 2018 compared with previous years, the data do not appear to show a significant increase in investment flows from abroad. While evidence does indicate significant repurchases of shares, either from tax cuts or repatriated revenues, relatively little was directed to paying worker bonuses, which had been announced by some firms. Although the legislation contained a number of provisions that discouraged inversions (shifting headquarters of U.S. firms abroad), these inversions had apparently already been significantly slowed by regulations adopted in 2014, 2015, and 2016.


The 2018 National Defense Strategy emphasizes that restoring and retaining readiness across the entire spectrum of conflict is critical to success in the emerging security environment. The top priority for Army leadership is readiness. The Army has undertaken a variety of efforts since 2016 to prepare for potential large-scale combat operations against major adversaries. This statement provides information on the Army's progress and challenges in readiness rebuilding in the areas of (1) force structure and personnel, (2) equipment repair and modernization, and (3) training for potential large-scale conflict. Also, GAO summarizes recommendations to address these challenges and actions taken by the Army to address them. This statement is based on previously published GAO work since 2016. This prior work related to, among other things, Army readiness, skills shortages, equipment maintenance and modernization, acquisition, training, force structure. GAO also updated information and incorporated preliminary observations from ongoing work related to warfighting concepts. In GAO's prior and ongoing work, GAO found that the Army has made progress in rebuilding readiness and projects that it will reach its readiness goals by 2022. While the Army continues to make progress, it faces challenges in staffing its evolving force structure, repairing and modernizing its equipment, and training its forces for potential large-scale conflicts (see table). Looking to the future, the Army plans to grow its forces, provide them with modernized equipment, and train units to conduct large-scale, decisive-action operations. All of these efforts are underway as the Army contemplates the implications of future warfare—which it reports is likely to require operations in multiple domains, especially cyber. As a result, it is important for the Army to balance its efforts to rebuild and sustain the operational readiness of its existing force with its preparations for future threats.