CHAPTER TEN RESOURCES AND ECONOMIC DEVELOPMENT Responsibilities The Resources and Economic Development Division which has primary responsibility for carrying out our audit work at the Departments of Agriculture, Housing and Urban Development, the Interior, and Transportation; the Department of the Army, Corps of Engineers (civil functions); the Atomic Energy Commission; the Environmental Protection Agency; the Tennessee Valley Authority; and various commissions, boards, and councils. This division is under the supervision of Henry Eschwege, Director, and Philip Charam and Max Hirschhorn, Deputy Directors. An organization chart of this division appears on the following page. During fiscal year 1972 we submitted 79 reports to the Congress on reviews of activities of the departments and agencies for which the Resources and Economic Development Division has primary audit responsibility: 29 to the Congress and 50 to committees or Members of Congress on reviews made in response to their specific requests. In addition, 50 reports were issued to department or agency officials. A list of these reports is included in Section III of the Appendix. The following sections of this chapter briefly describe the principal audit work in the departments and agencies for which the Resources and Economic Development Division has primary audit responsibility and the audit findings and actions taken or comments made by the departments or agencies on our recommendations or suggestions for improving their operations. More detailed descriptions of these findings and recommendations and descriptions of those included in other reports prepared by this division are contained in Section I of the Appendix. National Environmental Policy Act of 1969 One of our reviews concerned the manner in which selected agencies were implementing section 102 of this act. Section 102 requires all agencies of the Federal Government to prepare detailed environmental impact statements on proposals for legislation and other major actions significantly affecting the quality of the human environment. Our review at seven agencies showed that the requirements were not being carried out uniformly and systematically. In our report on the review, made at the request of the Chairman, Subcommittee on Fisheries and Wildlife Conservation, House Committee on Merchant Marine and Fisheries, we stated that most of the agencies had not completed environmental statements in time to accompany proposals through all agency levels of review, had not completed their statements in time for use in the early stages of decisionmaking, and had not reviewed effectively the results of plans to insure that the environment had been protected as anticipated. The Council on Environmental Quality generally had adopted only an advisory approach; the Environmental Protection Agency had not met, on a timely basis, its legislative responsibilities to (1) make public its comments on agency environmental impact statements and (2) review and comment in writing on procedures proposed by Federal agencies for preparing impact statements; and the Office of Management and Budget had not required the agencies to furnish impact statements as a prerequisite for its legislative clearance, except for water resources projects. The agencies generally agreed that improvements were needed in implementing the act and that our findings and conclusions would be helpful in refining their procedures. On May 24, 1972, GAO representatives testified at hearings held before the Subcommittee concerning the matters discussed in our report. (See Appendix, Section I, Item 84.) Department of Agriculture We completed 16 congressional reports on reviews of Department of Agriculture operations other than international operations which are discussed in Chapter 12. Ten of these reports were submitted to the Congress and six were submitted to Members of Congress. In addition, 11 reports were issued to Department or agency officials. Our reviews covered farm program and commodity activities, marketing and consumer services, forestry and conservation, rural development, agricultural research and education, and departmental administration. Farm Program and Commodity Activities Title I of the Agricultural Act of 1970 limited to $55,000 the annual amounts of direct Federal payments a person could receive under each of the 1971-73 upland cotton, wheat, and feed grain programs. The authorizing legislation and subsequent regulations, however, did not prohibit producers who were subject to the limitation from changing their farming operations and organizations to reduce the financial impact of the limitation. We reported to the Congress that the $55,000 payment limitation had caused no significant reduction in the total amount of 1971 cotton, wheat, and feed grain program expenditures. For the 98 producers whose operations we reviewed, only about $356,000 of a potential $17.1 million in savings had been realized. A Department study showed nationwide savings of only $2.2 million. In response to our recommendations, the Department took or initiated actions which, if effectively implemented, should significantly strengthen the administration of the payment limitation. (See Appendix, Section I, Item 2.) The Department's Food and Nutrition Service (FNS) administers the commodity distribution program under which food is donated to needy persons, schools, and others. Our review of program costs showed that they could be reduced substantially if FNS enforced its requirement that commodities be requisitioned in the most economically sized packages practicable and required State distributing agencies to submit requisitions promptly to avoid special purchases, which are more costly. FNS subsequently took or proposed to take actions to reemphasize to State agencies the need to provide foods in larger containers to certain recipients and to eliminate unjustified special purchases. (See Appendix, Section I, Item 1.) As required by the Government Corporation Control Act, we made an audit of the financial statements of the Commodity Credit Corporation as of June 30, 1971, and submitted a report thereon to the Congress on January 14, 1972. Marketing and Consumer Services We had recommended after an earlier review that the Consumer and Marketing Service (C&MS) strengthen its enforcement of sanitation standards in federally inspected poultry plants. C&MS took some actions to improve enforcement, but we found in a followup review at 68 plants that these actions had not been successful in achieving adequate enforcement. The situation was indicative of a lack of strong day-to-day enforcement by C&MS plant inspectors and a lack of effective supervisory review. We recommended that the Secretary reevaluate an earlier recommendation, made by departmental consultants, that a separate agency be established within the Department for administering consumer protection programs but that, in the interim, C&MS explore other and more immediate avenues to improve and emphasize the enforcement of sanitation standards. We were informed, in response to our recommendations, that C&MS was attempting to correct deficiencies in its supervisory structure and was taking or planning other actions to improve enforcement of sanitation standards. However, on April 2, 1972, the meat and poultry inspection activities of C&MS were transferred to another agency within the Department. (See Appendix, Section I, Item 10.) In another report to the Congress, we stated that C&MS needed to strengthen its administration of the import meat inspection program. Some foreign meat plants had not been delisted (did not have their certifications to export to the United States withdrawn) even though they had not fully complied with U.S. requirements. Of the plants that were delisted, considerable time generally had elapsed between the time deficiences were found and the time delistments took effect. Meat products processed in the interim were eligible for export to the United States unless C&MS had determined that the plant constituted a health hazard. C&MS also permitted meat products from delisted. plants to be imported if the foreign country inspection officials certified that they were processed prior to the effective date of delistment and if they passed inspection at the ports of entry. Also C&MS had not reviewed foreign meat plants as often as it considered desirable and needed to improve inspections at U.S. ports of entry or other destination points. The Department stated, in response to our report, that many of our recommendations for improvement had been implemented. Because a review of C&MS records showed apparently serious deficiencies at some delisted plants which did not result in the plants' being classified as health hazards, we expressed the belief that C&MS might need to broaden its criteria for determining when products produced prior to delistment should be prohibited from entering the United States. (See Appendix, Section I, Item 11.) Forestry and Conservation Activities The Agricultural Stabilization and Conservation Service shares with farmers the cost of carrying out practices to build soil and conserve soil and water. Our review in five States showed that, although significant benefits had been realized under the program, substantial amounts had been spent on practices that had not produced any appreciable benefits, that had stimulated agricultural production rather than provided lasting conservation benefits, or that were otherwise questionable. Also, improvements were needed in the method of allocating funds to States, in directing efforts toward solving the most urgent conservation problems, and in reporting procedures. The Department informed us that it had taken or proposed to take action to correct these problems. We found also that nominal payments ranging from 40 cents to $14 each-designed to provide additional assistance to operators of small farms-did not further program objectives and were an administrative burden. Consequently, we recommended that the Congress amend the act to eliminate the nominal payments and thereby free about $7 million annually which could be used to enable thousands of additional farmers to participate in the program. (See Appendix, Section I, Item 86.) Construction of many watershed improvement and flood control projects administered by the Soil Conservation Service (SCS) had been delayed or terminated prior to completion. In a survey to determine the reasons for the terminations or delays, we found that the major cause was the failure or delay of local sponsors to acquire the land, easements, or rights-of-way needed for the projects. The failures and delays resulted in (1) expenditures of Federal, State, and local funds on projects that may never be completed, (2) significant increases in project costs due to general rises in construction price levels, and (3) long delays in realizing benefits from projects that may eventually be completed. SCS agreed that difficulty in acquiring land rights was a major deterrent to steady progress in completing watershed projects. Actions taken or planned by SCS should provide greater assurance that future projects will not be unduly delayed or terminated prior to completion because of landrights problems. We suggested alternative actions, including possible legislation, for the Congress to consider concerning the projects that were being delayed many years beyond original target dates. (See Appendix, Section I, Item 90.) The Forest Service, in carrying out a research program authorized by the McSweeney-McNary Forestry Research Act of 1928, had not fully identified and exploited the opportunities for assisting Federal, State, and private landowners in managing forest resources. Procedures needed to be established to insure that (1) the best possible use was made of research program results and (2) research officials were furnished with feedback of information which could be useful in planning and directing future work. We recommended, among other things, that an official or officials desig |