FHWA REASSESSMENT EFFORTS

GAO Recommendations

The June 2000 GAO report addressed the processes for (1) collecting and reporting accurate information on highway tax receipts and (2) distributing highway program funds to the States. The report discussed the Treasury Department's process for allocating highway user tax receipts to the Highway Account of the HTF, FHWA's attribution and appropriation processes (as discussed in the previous section of this brochure), and the impact of the Treasury and FHWA processes on the amount of highway funds received by each State.

A discussion of the GAO findings and recommendations for improvements to the Treasury Department's processes is not included here. The GAO report expressed two concerns about the reliability of the FHWA attribution process:

• State data were not thoroughly and independently reviewed to verify their accuracy, reliability, and consistency; and
• The FHWA attribution methodology (1) was not fully documented or independently reviewed, (2) was very complicated, using almost 200 formulas to accommodate for differences among States' taxation laws and methods, and (3) had been repeatedly "patched" over the years to adapt to new laws and program requirements.

GAO provided four specific recommendations to address these concerns:

• Ensure that detailed independent verifications of motor fuel data are performed for each State, perhaps on a rotational basis over a period of years;
• Fully document the methodologies, processes, procedures, and rationale for attribution;
• Conduct an independent, comprehensive review of the attribution models and methodology; and
• Evaluate the potential use of IRS data systems currently under development which may provide data on highway motor fuel usage.

FHWA agrees with these conclusions and is implementing actions to address each recommendation. These plans for improvement are discussed in the section, "Implementation/Action Plan."