DOCUMENT RESUME

05398 - [B0945853J 6t1 CT6bAchieving Needed Organizational Change: A Customs ServiceDilemma. FPCD-78-29; B-114898. March 30, 1978. 34 pp. + 10appendices (12 pp.).

Report to Rep. Al Ullman, Chairman, louse Ccommittee on Ways andBeans; by Elmer B. Staats, Comptroller General.

Issue Area: Federal Personnel Management and Compensation: WorkForce Planning (313).

Contact: Federal Personnel and Compensation Div.Budget Function: General Government: Central Fiscal Operations

(803).Organization Concerned: Department cf the Treasury; United

States Customs Service.Congressional Relevance: House Committee on Ways and Means. Rep.

Al Ullman.Authority: 1 Stat. 29.

The United States Customs Service is organized on fourlevels, or tiers--headquarters, 9 regions, 45 districts, and 303ports. The four-tier structure stems from the Stover report, theresult of a Department of the Treasury management study, whichgave the impetus for the 1965-66 reorganization.Findings/Conclusions: While the four-tier structure hascontributed to management efficiency, the Stover report andlater studies recommended a reduction in the number of regionsand districts. Customs has been unwilling to make the reductionsbecause of external opposition to consolidation. Fever regionsand districts would allow Customs to reduce overhead andreassign personnel to day-to-day operations. This could beachieved without eliminating a Customs presence at affectedcommunities, and it would improve services. Reccmmendations:The Secretary of the Treasury should direct the Commissioner ofCustoms to: reduce the number of regions and districts inkeeping with workload requirements and sound organizationalprinciples, clarify the responsibilities of organizationallevels and units, realign responsibilities for functions amongand within organizational levels, and establish definitivecriteria for reviewing port status and use these criteria toidentify unneeded ports. (Author/HTW)

REPORT BY THE

Comptroller GeneralOF THE UNITED STATES

Achieving NeededOrganizational Change:A Customs Service Dilemma

At the request of the Chairman, Committeeon Ways and Means, GAO reviewed the orga-nization of the U.S. Customs Service.

While regional offices provide essential serv-ices, Customs could improve its efficiency byreducing the number of regional as well asdistrict offices. This has been known for atleast 10 years; numerous studies have all sup-ported fis.

Reducing the number of regions and districtswould allow Customs to reduce overhead andredirect personnel savings to day-to-day oper-ations.

iAe&oJdd, 1o* Op o p ·i ,4 4 ':

U~z%

-?(M AFPCD-78-29~~~~~f~~~~CCO~~U~~ ~MARCH 30, 1978

COMPTROLLER GENERAL OF THE UNITED STATESWASHINGTON. D.C. 2028

B-114898

The Honorable Al UllmanChairman, Committee on Ways and MeansHouse of Representatives

Dear Mr. Chairman:

As requested in your October 3, 1977, letter, we reviewedthe organization of the U.S. Customs Service.

The report discusses the need for Customs to reduce thenumber of regional and district offices and take other stepswhich would improve organizational efficiency and the deliveryof services. Reducing the number of Customs regional and dis-trict offices would not eliminate a Customs presence in thesecities.

As requested by your office we will make copies of thisreport available to interested parties upon request, bejin-ning 3 days after the report date. At that time we will alsosend copies to the Acting Director, Office of Management andBudget; the Chairmen, House and Senate Committees on Appropri-ations; the Secretary, Department of the Treasury; and theCommissioner, Customs Service.

S o y your

Comptroller Generalof the United States

COMPTROLLER GENERAL'S ACHIEVING NEEDED ORGANIZATIONAL

REPORT TO THE COMMITTEE ON CHANGE: A CUSTOMS

WAYS AND MEANS SERVICE DILEMMA

HOUSE OF REPRESENTATIVES

DIG EST

The U.S. Customs Service is a four-tier or-

ganization--headquarters, 9 regions, 45 dis-

tricts, and 303 ports. Internal studies since

1964 and GAO's review support the conclusionsthat:

-- Regions perform essential functions and area viable part of the organization. (Seep. 7.)

-- The number of regions can be reduced. (See

p. 13.)

-- The number of districts also can be reduced.(See p. 18.)

-- Responsibilities need to be clarified and

realigned. (See ch. 3.)

-- Criteria to review port status need to be

developed and applied. (See ch. 4.)

The four-tier organizational structure stems

from the Stover report, the impetus for the

1965-66 reorganization. That report recom-mended realigning Customs field activitiesinto 6 regions and 25 districts. Later stud-ies have continued to support the lesser num-ber of regions and districts. Yet, therestill are 9 regions and 45 districts.

The unwillingness of Customs to reduce thenumber of regions and districts comes fromperceived congressional concern over the im-pact on affected communities. Ironically,the negative effects of retaining the exist-ing structure are felt by all those servedby Customs because fewer resources are avail-able to meet day-to-day operating requirements.

Having fewer regions and districts would allowCustoms to reduce overhead and reassign person-nel to day-to-day operations. Reductions

I=RI ShSt. Upon removal, the report FPCD-78-29cover date should be noted hereon.

i

could be achieved without eliminating a Cus-toms presence at those locations and couldimprove the level of services provided. How-ever, Customs officials advised GAO that ex-ternal opposition to consolidation continuesand will remain a strong factor.

Regardless of the decision on consolidation,Customs needs to define more clearly the re-sponsibilities of all organizational levelsand units and to realign responsibilities forfunctions among and within organizational levelsto minimize fragmentation and unify fieldmanagement.

Customs also needs to establish and apply de-finitive criteria for reviewing port status.

RECOMMENDATIONS

GAO recommends that the Secretary of the Treas-ury direct the Commissioner of Customs to:

-- Reduce the number of regions and districtsin keeping with workload requirements andsound organizational principles.

--Clarify the responsibilities of organiza-tional levels and units.

-- Realign responsibilities for functions amongand within organizational levels.

--Establish definitive criteria for reviewingport status and use these criteria to iden-tify unneeded ports.

As requested by the Chairman's office, GAO didnot solicit written comments from Customs on thisreport. However, GAO discussed these matters withtop management officials and, in general, Customsagreed with the facts and conclusions presented.

ii

Contents

DIGEST Page

CHAPTER

1 INTRODUCTION 1Customs mission and responsibilities 1Customs organizational structure 3

Lines of authority 4Customs staffing 4

2 FEWER REGIONS AND DISTRICTS CAN FREE RESOURCLSFOR DAY-TO-DAY OPERATIONS 7Regions provide essential services 7

Basis for regionalization 7Rationale for retaining regions 8Personnel increases 11Conclusion 13

Reduction in the numbe-r of regions 13Basis for recon. -iding a six-

region configuration 14Reasons for establishing a nine-

region structure 15Conclusion 18

Reduction in the number of districts 18Basis for recommending a smaller

number of districts 18Reasons for 45 districts 20Conclusion 20

3 NEED TO CLARIFY AND REALIGN RESPONSIBILITIES 22Need to clarify responsibilities 22Need to realign responsibilities 23

Need to minimize fragmentation ofresponsibilities 23Evaluations 23Technical advice 24Air surveillance 25Investigations and enforcement 25

Need to unify field management 26Conclusions 28

CHAPTER Page

4 NEED TO REVIEW PORT STATUS 29Conclusions 30

5 OVERALL CONCLUSIONS AND RECOMMENDATIONS 33Recommendations to the Secretary ofthe Treasury 34

6 SCOPE OF REVIEW 35

APPENDIX

Letter from Chairman, Committee on Ways andMeans, requesting review of Customs Serviceorganization 36

II Listing of Customs field offices 38

III Regional boundaries of Customs 39

IV Organizational chart 40

V Customs staffing for selected years 41

VI Customs workload growth over 11 years 42

VII Studies of Customs organization 43

VIII Regional level staffing increases by principalfield offices 44

IX Regional office staffing increases 45

X Principal officialh responsible for admini-stering activities discussed in this re-port 46

CHAPTER 1

INTRODUCTION

In response to the October 3, 1977, request of theChairman, Committee on Ways and Means (see app. I), we re-viewed the organization of the U.S. Customs Service. Em-phasis was given to reviewing the role of regions and dis-tricts. (See ch. 2.) We also reviewed problems identifiedin earlier studies of the Customs organization and ascer-tained whether these problems continue. (See ch. 3.) Thescope of our work is presented in chapter 6. A listing ofrecent studies is shown in appendix VII.

CUSTOMS MISSIONAND RESPONSIBILITIES

The U.S. Customs Service was, in effect, created by theCongress on July 31, 1789 (1 Stat. 29). At the time itsmission was relatively straightforward--to collect dutieson imports. Over the years, it has been given additionalresponsibilities that include the control of--terrorism;international trafficking in controlled substances, arms,and currency; and threats to public health and environment.

Among the specific responsibilities assigned to Customsare:

-- Assessing and collecting Customs duties, excise taxes,and penalties on imported merchandise.

--Controlling carriers, passengers, and articles enter-ing or departing the United States.

--Interdicting and seizing contraband, includingnarcotics and illegal drugs, being imported into theUnited States.

-- Detecting and apprehending persons engaged in fraudu-lent importing practices.

--Protecting American business and labor through en-forcement of such laws as the Antidumping Act; coun-tervailing duty laws; copyright, patent, and trademarkprovisions; quota restrictions; and marking require-ments.

-- Enforcing the Currency and Foreign TransactionsReporting Act, the Arms Export Control Act, numerousnavigations laws, and export control laws and requla-tions.

-- Enforcing over 400 laws and regulations administeredby some 40 other Federal agencies, including automo-bile safety and emission standards, counterfeit mone-tary instruments prohibitions, electronic product radi-ation material standards, and food and drug hazardoussubstance prohibitions.

Not only has the scope of Customs' mission expanded, butthe complexity has increased as well. Enforcing the laws andregulations requires both familiarity with them and the abil-ity to apply them in a variety of situations. These situa-tions range from the assessment and collection of duties todetection of the occasional smuggler, as well as increasinglysophisticated and well-financed smuggling operations.

Increased trade and travel have also affected Customs'mission requirements. The table below illustrates workloadincreases between fiscal year 1965 and fiscal year 1977.

Fiscal year Fiscal year PercentWorkload category 1965 1977 changeCommercial cargo 1.9 million 3.7 million +95entries (note a)

Vehicles processed 53.5 million 77.8 million +46Aircraft processed 220,100 372,600 +69Vessels processed 197,500 154,500 -22

Persons processed 181 million 263 million +45Number of seizures 22,000 90,700 +313Collections $2.1 billion $6.1 billion +190

a/These are referred to by Customs as formal entries.

2

CUSTOMS ORGANIZATIONAL STRUCTURE

Customs present organizational arrangement was es-tablished in a major reorganization in 1965 and 1966. (Soeapp. II for field office locations and app. III for juris-dictional boundaries.)

To accomplish its mission and responsibilities, Customshas approximately 13,900 employees assigned to over 300offices in the United States and others at various overseaslocations. These offices are linked together through fourorganizational levels, or tiers--a headquarters office lo-cated in Washington, D.C.; 9 regional offices located in de-signated U.S. cities; 45 district offices; 1/ and 303 portsof entry. The general functions of these tTers are:

-- Headquarters is the top tier of the organization andis responsible for setting policy, providing generalguidelines and procedures, making management evalu-ations and audits, and generally overseeing the en-tire field operation.

-- Regions are thc first of two intermediate organi-zational tiers and are responsible for overallsupervision and management of districts and ports.They also provide centralized administrative supportfor the districts and ports and perform certainoperational functions consolidated to achieveeconomies of scale.

-- Districts are the second of two intermediate tiersand principally carry out Customs operations at thedistrict city port. They are, in essence, a largeport. In addition, districts supervise operationsof other ports, collect revenues, and provide gen-eral day-to-day operational direction to the entiredistrict area.

-- Ports are the basic tier where Customs work isaccomplished and service is provided to the public.Ports are responsible for processirn commercialcargo, passengers, vessels, and aircraft.

1/ Includes the New York region's three area offices whichare organizationally structured like districts.

3

Lines of authority

Legislation authorizes the Secretary of the Treasury toenforce the tariff laws and regulate their administration.The Secretary has delegated to the Commissioner of Customshis rights, powers, and duties for implementing allPresidential directives and congressional legislation re-lating to Customs activities.

As shown on the overall organizational chart (seeapp. IV), authority flows to the field in four separatelines. The result is that field operations in each regionare directed by four principal field officials: a regionalcommissioner, a regional director of investigations, aregional director of internal affairs, and a regionalcounsel. (See p. 26 for a discussion of this matter.)

For the most pert, operational line authority flowsfrom the Commissioner to the regional commissioners to thedistrict directors and, from them, to the port directors.Not all line authority, however, flows in this manner. Forexample, authority for investigations flows to the AssistantCommissioner for Investigations who directs field operations.Thus, the Office of the Regional Director of Investigationsand the Special Agent-in-Charge Districts do not reportthrough the regional commissioners or district directors.(See app. IV.)

Customs staffing

The following chart shows the staffing levels for thefour organizational tiers as of September 24, 1977. (Seeapp. V for staffing levels for selected years since the1965-66 reorganization.)

Number of PercentOrganizational tier employees of total

Headquarters office 1,313 10

Regional offices 2,104 15

District offices 8,606 62(note a)

Port offices 1,855 13

TOTAL 13,878 100a/Most district office personnel are involved in port opera-

tions.

4

I3

zz

C,,

;1,~~~~~~~~~~.0C-L

ccIC,,z0

N

zD)Ir

0U

W

C

za v~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~,,

N

',

w

6~~~~~~

CHAPTER 2

FEWER REGIONS AND DISTRICTS CAN FREE

RESOURCES FOR DAY-TO-DAY OPERATIONS

With certain changes discussed in chapter 3, the four-tier structure is a viable organizational approach, butCustoms' mission can be accomplished with fewer regions anddistricts. Reduced numbers of regions and districts wouldallow Customs to reduce overhead and redistribute personnelsavings to district and port operating levels. This couldbe achieved without eliminating a Customs presence fromthese locations.

As recently as August 1977, the Commissioner advisedthe Under Secretary of the Treasury that, while the four-tier structure was appropriate, the numbers of regions anddistricts could be reduced. Such a reduction, according tothe Commissioner, would improve organization and managementof Customs and promote efficiency and economy of operations.

REGIONS PROVIDE ESSENTIAL SERVICES

The regional level of Customs four-tier organizationalstructure provides essential services. Various studies sup-port this; Customs officials at all levels agree that regionsare needed. Their rationale and our conclusions are presentedbelow.

Basis for regionalization

In response to many changes in tariff legislation, de-velopment of new trade patterns and relationships, and thegrowth of and changes in international commerce and travel,Treasury undertook a major management study of Customs in1963. The resulting report, referred to as the Stover re-port, basically was the impetus behind the regionalizationof certain Customs management and operational functions.

The Stover report noted that the growing emphasis oninternational trade and travel increased Customs' challengesand problems. These problems, the report contended, couldnot be adequately addressed with the existing structure,staffing, and procedures. Among the poblems were:

7

-- Too many field activities were reporting directly toCustoms headquarters to permit consistent and effec-tive direction.

--From three to five independent field activities wereoperating in a given location without unity ofcommand.

--Uniformity among field offices was lacking.

-- There was a need for better distribution of workloadand responsibilities. Maintaining small independentfield offices caused looseness in field managementand substantial unnecessary costs.

To address these problems, the Stover report recommendeda major reorganizatien of Customs. The essential elements ofthe proposed reorganization included creating a four-tierstructure by adding a regional level to the existing struc-ture; providing for unity of command and close supervisionat all levels; increasing the responsibility of field offices;and consolidating or abolishing small, uneconomical offices.

The anticipated benefits of the reorganization were re-flected in a number of administrative objectives--such asclarification of roles and responsibilities, reduction ofthe span of control, greater uniformity in applying Customslaws and regulations, and improvement of services to theimporting public.

Responding to the Stover report, Customs added the re-gional level to its organizational structure during 1965-66.

Rationale for retaining regions

Concern with the four-tier structure centers principallyon the need for the regional tier. For example, a congres-sional task force of the Committee on Ways and Means heldhearings in 1977 to obtain the importing public's views onthe proposed Customs Modernization Act. Among the repeatedlyexpressed concerns were the shortage of operational personneland the need for regions. To illustrate:

8

In the Houston hearings, an import brokercited - need for more Customs officers at theoperational level. Then, in reference to whatregions do, he stated "* * * frankly I've beenwondering since 1966, my apologies to the Region,just what they do * * * all I can see is the Dis-trict level and their operation and know they areunderstaffed."

Thus, the justification for four organizational tiersis to a large degree related to justifying the regional tier.Numerous internal assessments of the four-tier structure sinceits establishment have provided favorable support for theregional tier. A 1970 Customs study, for example, notedthat the regional concept was sound and should be retained.The study concluded that the regional concept had proven tobe more effective in providing supervision over districtsand ports. The benefits attributed to the 1965-66 reorgani-zation included consolidation of field offices into unifieddistricts, better field supervision, improved administrativesupport to operating units, and significant financial savings.

The most recent internal study, completed in 1977, alsoconcluded that the basic structure of the organization wassound. The four-tier--port, district, region, headquarters--structure, according to this study, remains appropriate foraccomplishing the Customs mission. Although the study notedthat no valid reason had been found to seriously challengethis structure, the study team again considered the issueof structural realignment through elimination of the regionallevel but concluded that it was needed for span of controland administrative efficiency.

According to the 1977 study, the basic problem withthe existing structure concerns the roles, responsibilities,and number of units (regions and districts) rather than num-ber of tiers. This assessment was similar to that of an ex-terral group, the National Academy of Public Administration,which in its 1971 report recognized the appropriateness ofthe four-tier structure and the need for realigning author-ity and responsibility among the structural entities ofCustoms:

"Field structure and powers are centralto every major issue which the Bureau musteventually resolve. These issues include

9

the efficacy of nine regions and 42 districts,the division of labor and authority among theBureau's four tiers, and manpower requirementsto discharge its changing role * * *.

"The most significant finding to emerge * * * isthat no one would suggest a reversion to the for-mer system. Were it still in effect, most wouldanticipate a total collapse under currentw£rkloads."

Our discussions with Customs officials at all organiza-tional levels showed that many support the regional structureas an appropriate place for providing certain services forspan of control and economies of scale.

An example is personnel management; under the existingstructure, personnel services--for district and port hiring,promotions, equal employment opportunity, upward mobility,training, etc.--are provided at the regional level. From aspan of control perspective, headquarters can more effec-tively control pe-ronnel staffs at 9 regions than at 45 dis-tricts; in so doing, headquarters can set policy and assessits implementation while regions can tailor and administerthese policies by recognizing the specific concerns and needsof defined geographic areas. From an economy of scale per-spective, the 9 regions have 219 employees assigned to thepersonnel function; having this function assigned to the dis-tricts, we were told, would require approximately 324 employ-ees. Thus, from this perspective, providing personnel ad-ministration through the 9 regions is more economical thanhaving personnel staffs at each district or port office.

Thus, support and justification for the role of the re-gions can be demonstrated. The issues then are not so muchwhether regions are needed, but how many are needed and whatfunctions they should perform. Our review indicated that:

-- The numbers of regions and districts should be reduced.(See pp. 13 to 21.)

-- Realiqnment and clarification of responsibilitiesare needed. (See ch. 3.)

10

Personnel increases

Customs has historically experienced a continuallyincreasing workload prompted by increased trade and travel,as well as increased legislative responsibilities. Detailsof these workload increases are shown in appendix VI. Intestimony before the 1977 Ways and Means Committee taskforce, the importing public expressed concern that theinspection force at many Customs ports was understaffedand overworked. The often-repeated charge was that thenumber of inspectors assigned to ports were inadequate.A Civil Service Commission analysis released in 1970 alsoexpressed alarm over persistent insufficiency of manpower.The Commission reported that inspectors in Anchorage, forexample, were:

"* * * so groggy from overwork they didn't knowwhether a plane was landing or taking off.[Staff] in this condition can not be alert inprotecting the revenue, either on overtime or onregular time."

There have been increases in staffing levels. (Seeapp. V.) As shown in the following table, however, alarge share of these increases have been used to staffregions and headquarters. The table below illustratesthese staffing level changes and shows the organizationallevel in which they occurred.

Number of personnel Number PercentOrganizational for fiscal year ended change change

level 1966 1977

Headquarters 388 1,313 +Q25 +238Regions 811 2,104 +1,293 +159Districts and

ports 7,253 10,461 +3,208 +44

Total 8,452 13,878 +5,426 +64

While there have been numerous internal studies, onlyone specifically addressed regional personnel increases;none of these studies addressed headquarters personnel in-creases.

A 1976 study dealing with regional increases was under-taken in response to a growing concern within Customs over

11

the apparent disproportionate increases in regional officestaffing levels. The study, which analyzed staffing in-creases in the Houston, Boston, Chicago, and San Franciscooffices found no basis for concluding that these regions hadinappropriately allocated positions intended for line opera-tions; neither was there any basis for concluding thatthe growth was inappropriate.

Regional personnel increases, the study showed, were di-rected by headquarters or dictated by added responsibilitiesimposed on the regions. These added responsibilities in-cluded several new enforcement programs; patrol componentsof a drug interdiction program; audits of importer accounts;and a broad range of special-emphasis programs (many directedby law), such as the Equal Opportunity Program, UpwardMobility Program, Federal Women's Program, and the Labor-Management Relations Program. In concluding, the studyrecognized the possibility of reducing regional staffinglevels by reassessing and reapportioning regional responsi-bilities and reducing the number of regions rather thaneliminating the regional tier.

The five regions we reviewed devoted about 69 percentof their time to operational and administrative activities.Customs personnel at all levels believe regional involvementin these activities was appropriate. It was their view thatthe efficiencies gained from economies of scale warrantplacement of these activities at the regional level. Withthe exception of certain activities noted in chapter 3,we have no basis for disagreement.

Appendixes VIII and IX show staffing increases at theregional level from June 30, 1973, to September 24, 1977.As shown in appendix VIII, regional staffing increasedby 837; most of this increase (698 of the 837) was usedin staffing the offices of the regional commissioners.

Appendix IX provides data for analyzing staffing changesby region and by function. This appendix shows, for example,that 560 (or 80 percent) of the 698 additional personnelassigned to the regional commissioners were assigned to oa-trol, regulatory audit, air support, and personnel manage-ment. The patrol function accounted for an increase of 260,and 230 of these were assigned to the New York region wherepatrol is a regional function rather than a district one.Assignment of patrol to the region is preferred, we weretold, because New York is a geographically compact area,where increased control and flexibility can be realizedthrough assignment at the regional level. Regulatory audit,air support, and personnel management is better placed at

12

the regions, we were told, to realize economies of scaleand provide more efficient use of resources. (See p. 10for example.)

The importing public, however, continues to expressconcern with the ever-increasing workload and the apparentlack of Customs responsiveness to match these increases withadditional district and port operating personnel. AlthoughCustoms has increased its personnel, a large share of theincrease has been used to staff headquarters and regionallevels. The response has not yet fully met the needs of theimporting public.

Although we dii not evaluate the basis for staff in-creases at headquarters, our discussions with Customs offi-cials disclosed their plans to evaluate current headquartersfunctions (see p. 23) and to assess the need to realign re-sponsibilities to other organizational levels.

Conclusion

There appears to be a general concensus that Customsreorganization into four levels did improve its managementspan of control, produce economies of scale through consoli-dating certain functions, and provide a means for meetingincreased workloads--in effect, the added regional leveldoes perform essential services. This level and the four-tier structure continues to receive favorable support fromall levels of Customs management.

The principal issue, then, is whether Customs can,within its four-tier organizational structure, better handleits increasing workload and be more responsive to its cus-tomers and to its mission. We believe it can by

--reducing the numbers of regions,

-- reducing the number of districts, and

-- better defining and realigning the roles, responsi-bilities, and relationships of each organizationallevel.

REDUCTION IN THE NUMBER OF REGIONS

Since the 1965-66 reorganization, there have been numer-ous internal studies )L£ the nine-region organizational struc-ture. Each concluded that there were too many regions; eachrecommended reducing the number of regions. To date, nochanges have been made--there are still nine regions.

13

Ba3is for recommendinga ;ix-region configuration

The Stover report recommended establishing the regionaltier to obtain uniformity and unity of command, to permit in-c:eased delegation of authority, to permit centralization ofcertain functions, and to improve field administrative pro-grams. The study concluded that the number of regions shouldbe "as small as possible to gain the maximum benefits ofcentralization and keep down unnecessary overhead expense."The report recommended that six regions be established usingthe following criteria:

--Grouping geographical areas having similar Customsactivities and problems.

--Achieving a balance of workload among regions.

--Maintaining a reasonable number of ports to be super-vised.

We discussed the appropriateness of these criteriawith Customs officials at all tiers of the organization;most believed that they were as appropriate today as be-fore the 1965-66 reorganization. Furthermore, most agreedthat fewer regions are needed.

Within 3 years after the 1965-66 reorganization, theOffice of Management and Budget requested a review to deter-mine the feasibility of reducing the number of regions fromnine to six. A subsequent Customs study concluded that thenumber of regions could be reduced. Many other internal as-sessments have universally supported the need to reduce thenumber of regions. These studies examined workload indica-tors and personnel distributions and recommended suchreductions to remedy the imbalances created by the nine-region configuration. Action has never been taken.

The most recent study (1977) recommends six regionswith a single region to manage the activities on theMexican border. Customs believes this offers the greatestpotential for economies and efficiencies.

14

The charts on pages 16 and 17 show the current imbal-ances in workload and personnel among regions.

Reasons for establishinga nine-region structure

Numerous internal Customs studies have concluded thatcongressional concern was the basis for establishing nine,rather than six, regions. According to these studies, thiswas prompted by constituent concern over

-- economic and competitive advantage believed to accrueto communities having higher level offices, for ex-ample, region as compared to district or port;

-- convenience perceived to accrue to importers andconsumers by having local access to the full rangeof Customs services; and

-- status symbol perceived by communities able to claima higher Customs office.

Customs officials believe that external opposition toand congressional concern over consolidations still exist.Ironically, the negative effects of retaining nine regionsis felt by those served by Customs--nine rather than sixregions require personnel that could be used to handledistrict and port wcrkloads.

Many external and internal Customs groups have viewedthe existing number of regions as a problem. An exampleof one such group is the National Academy of Public Admini-stration. In its report on the 1965-66 reorganization,the group identified this problem and the reason for it:

"Proponents [of the six-region concept] also ex-hibited a willingness to reconsider decisionswhen hesitancy appeared in order. Such am-bivalence as to details, especially over theissue of location and number of regional anddistrict sites, helped them to deflect criti-cism [in responding to congressional criticsof the concept]. Yet the resulting compromiseon regional and district consolidation, how-ever practical in 1965, are presenting dif-ficulties today."

15

24 PERSONNEL IMBALANCES

22

20

PE 18RMA 16N

N 14T

P 12

0NN aE

4

I II Itl IV V VI VII VIII REGIONS

Psronnel in office of the regional commisioner

o Personnel in region at district end port offices

NOTE Each unit represents 100 personnel. The above data isbased on personnel assigned to the RegionalCommissioner's offics as of September 24, 1977.The chart excludes personnel asigned to the otherprincipal field offices.

16

IMBALANCES IN70 NUMBER OF DISTRICTS/PORTS SUPERVISED

N 6UM

50

O 4CF

30F

20

CE 10

11 III IV V VI VII VIII IXREGIONS

* Number of districts

o Number of ports

WORKLOAD IMBALANCES

9

8

W 70

K 6L0A 5

U 4N

T 3S

2

11 III IV V VI VII VIII IXREGIONS

Represents number of commercial cargo entries; eachunit represents 100,000 entries; range is 67.000 to87/,000.

Q Represents number of persons entering; each unitrepresents 10 million persons; range is 1 million to 83million.

NOTE: Data is for the fiscal year ended September 30. 1977.

17

Conclusion

The issue of reducing the number of regions has beenrepeatedly examined and the same conclusion reached--reducethe number of regions. Such a reduction appears feasible,even necessary, in view of the increasing workload at dis-tricts and ports and the potential for providing betterservice.

REDUCTION IN THE NUMBER Oi DISTRICTS

Since the 1965-66 reorganization, the many internalstudies have also addressed the 45-district structure.Nearly all of these studies concluded that there aretoo many districts. Some also concluded that reducingthe number would be cost effective. As of September 24,1977, no changes had been made--there were still45 districts.

Basis for recommendinga smaller number of districts

One of the Stover report recommendations was to reducethe number of districts to 25 to ensure uniformity and betterdistribution of workload and functions previously Performedby 113 principal field offices. The Stover recommendationwas aimed at consolidating certain operatin(, functions at25 district offices and redesignating smaller districtoffices (having approximately 60 employees) to port status.The overriding objective was to achieve more efficientoperations. The report stressed that the redesignationswould not result in any curtailment of services to localareas--all essential Customs services would continue tobe provided. Despite these assurances a number of smalldistricts were retained.

Reducing the number of districts has also been rec-ommended in various studies since the 1965-66 reorganiza-tion. Some of these studies addressed the issue thatfewer districts would be economically desirable. A 1977internal study, for example, concluded that reducing thenumber of districts to 33 would eliminate administrativepositions.

18

The number was arrived at by applying a set of standardsto the existing 45 districts to determine where consolidationwould produce economies and efficiencies. Quoting from thisstudy,

"* * * in order to promote effective management atthe district level and allow for more balanced op-erational programs each district ideally shouldcontain:

"a. A diverse workload which requires the perform-ance of multiple functions (inspection andcontrol, classification and value, patrol,investigations).

"b. A sufficient number of personnel to justify adistrict management structure as well as tojustify administrative support personnel.

"c. A relatively small geographic territory witha large concentrated workload, or a homogenousworkload within a large geographic area.

"d. All large workload centers relatively close tothe district headquarters (within 200 miles)to promote easy communication and bettercontrol.

"e. Enough cargo ,trk concentrated within the dis-trict to justify truly specialized importspecialist teams.

"f. Allowances for the growth or decline of tradein each area.

"In addition to these standards, certain logicalcontraints present themselves for considerationbefore any realignments may be suggested. Thecurrent structure was arrived at through an evo-lutionary process which derived from the necessityto get the work done * * *."

The 45 district organization, according to a 1970Customs study, was described as causing:

"* * * great differences in the size, staffing,workload, and characteristics of the * * * dis-tricts. These are of such vast magnitude that theydestroy all but the grossest sort of comparabilityamong the districts and negate their utility as

19

fundamental structural units in the Customs fieldorganization. Moreover, retention of the dis-tricts which do not have a meaningful size andworkload imposes excess costs * * *."

These differences in workload and staffing levels amongdistricts continue to exist. (See chart on p. 21 forstaffing differences.)

Customs officials generally agree that the number ofdistricts should be reduced. Many also agree that workloadand personnel comparability standards are valid measures forevaluating whether specific locations should be designated asdistricts.

Reasons for45 districts

Public and congressional concern, similar to that pre-viously discussed, also contributed to a greater number ofdistricts. (See p. 15.)

Conclusion

Studies have concluded that the number of districtsshould be reduced. Such a reduction appears feasible.Reducing the number of districts would reduce overhead;the resulting personnel savings could be used to meetday-to-day operating personnel needs.

20

0 100 200 300 400 500 600 7000 800 900 1000 1100

Port Arthur, TX. (17)

Providence. R.I. (17) .

Milwaukee, WI. (27) * NUMBER OF PERSONNEL BY DISTRICTBridgeport, CT. (29) (As of June 1. 1977)

Minneapolis, MN. (38)

St. Louis, MO. (40

Duluth, MN. (47)

Galveston, TX. (54)

Great Falls, MT. (55)

Anchorage, AK. (57)

Wilmington, N.C. (66)

Virgin Islands (67)

Savannah, GA. (70)

Washington, D.C. (74)

Charleston, S.C. (75)

Mobile, AL. (79)

Portland, OR. (84)

Pembina, N.D. (103)

Tamps, FL. (115)

Cleveland. OH. (120)Portland, ME. (129)

St. Albans, VT. (161)

Norfolk, VA. (157)

Honolulu, HI. (160)

Ogdenburg. N.Y. (166)

Baltimore, MD. (206)

Houston, TX. (215)

New Orleans, LA. (243)

Nogalees, AZ. (266)

Sen Juan, P.R. (273)

El Paso, TX. (280)

Boston, MA. (286)

Philadelphia, PA. (286)

Chicasio, IL. (303)

Miami, FL. (338)

Buffalo, N.Y. (345)

Seattle, WA. (346)

Detroit, Mi. (366)

San Diego, CA. (356l

San Francisco, CA. (400)

Newark. N.J. (427)

Laredo, TX. (442)

Los Angeles, CA. (500)

JFK Airport (646)

New York Seaport (1137)

0 100 200 300 400 500 800 7000 800 900 1000 1100

21

CHAPTER 3

NEED TO CLARIFY AND REALIGN RESPONSIBILITIES

Although Customs has been reorganized into four tiers,many of the problems that the 1965-66 reorganization at-tempted to resolve remain. Customs has not adequatelydefined the responsibilities of the various organizationallevels and units. This has contributed to fragmentationof responsibility and has created the potential for dupli-cation of effort and inappropriate location of responsibil-ities.

NEED TO CLARIFY RESPONSIBILITIES

The need to clarify responsibilities has long been recog-nized, and Customs officials agree that it still exists. Inour view, it is time to do something about it. We believethat clarification of responsibilities should be a priorityconsideration for Customs. Many of the problems discussedin the following segments cannot be adequately resolved untilthis has been done.

Policies and procedures manuals and handbooks providebroad, general descriptions of responsibilities of variousCustoms groups. Contrary to a goal of the reorganization,however, Customs has not yet identified specific responsi-bilities of each tier or of groups within tiers. As a re-sult, it is difficult to identify the specific limit orscope of responsibility for particular functions of a groupor tier. For example, we were told that to determine thescope of responsibilities for groups in one region wouldrequire a review of personnel files of each individual ineach group.

Customs officials at all levels express concern thatorganizational responsibilities have not been adequatelydefined. One official believes this has contributed to theproblems facing Customs today. Another says the effective-ness of management at all levels could be improved by moreclearly defining responsibilities. A 1976 study notedthat:

"Roles and relationships for each functional areashould be clarified. Likewise, the role of theregion vis-a-vis the district in directing fieldoperations should be clarified."

22

The 1976 study recommended that clearer definition be givenfull consideration in a thorough study of the organization.

A 1977 study also recognized this need but again post-poned dealing with the issue until other intra- and inter-agency reorganization matters were resolved. Subsequently,Customs proposed a study of the responsibilities and func-tions of the headquarters office. The plan is to evaluatethe headquarters offices to determine whether proper func-tions are being performed; consider if functions should beperformed at lower organizational tiers; and determine theappropriate number, kind, and size of organizational unitsat headquarters. There are presently no plans to expandthis effort to the other organizational tiers.

NEED TO REALIGN RESPONSIBILITIES

Clarification of responsibilities will provide the basisfor needed realignment of responsibilities among and withinorganizational tiers. Realignment is necessary to minimizefragmentation of responsibilities and to unify field manage-ment.

Need to minimize fragmentationof responsibilities

Fragmentation has been cited as a Customs organizationalproblem since before the 1965-66 reorganization. The Stoverreport noted:

"There should be specific assignment of author-ity and responsibility for completion of a singlefunction. Yet the field service * * * of Customsis so fragmented that no single office has author-ity or responsibility * * *.0"

Inmprovements have been made, but responsibilities still arefragmented. This continuing problem produces the potentialfor duplication of effort and inappropriate location ofresponsibilities.

Discussions with Customs officials at various organiza-tional levels revealed an awareness of and concern for frag-mentation. Several functions having fragmented responsibil-ities are discussed below.

Evaluations

At the regional level, responsibility for evaluations ofdistrict and port operations is shared by the Office of

23

Operations and the Office of Internal Affairs. This fragmen-tation of responsibility has resulted in apparent duplicationof efforts and inefficient use of staff resources.

Officials interviewed were concerned with the similarnature of the evaluations performed by regional operationsofficers and internal affairs personnel. They questionedthe need for two groups to perform evaluations and pointedto cases of apparent duplication. For example, in oneregion both groups conducted, within several months ofeach other, similar evaluations of control procedures overconfiscated drugs at various ports. In another region,both groups evaluated, within a 9-month period, a three-man port operation; again the evaluations were similar.

While improved coordination between the two groups mighthave avoided these apparently duplicated efforts, consolida-tion of responsibilities within one group would seem to bemore appropriate and to offer the potential to redirect re-sources to meeting personnel needs in other areas.

Technical advice

Another function with fragmented responsibility istechnical advice. Responsibility for providing technicaladvice is vested in three tiers--headquarters, regions,and districts. Fragmentation of this function, we weretold, results in lack of responsiveness from one leveldue to inadequate knowledge or expertise and lack oftimely response from another level causing unnecessarydelays.

Regions have responsibility for providing technicaladvice to district and port operating personnel. In theorganizational structure, regions are an intermediate tierlocated between headquarters where policy ix formulatedand districts and ports where day-to-day policy is imple-mented.

Because of their location in the organization, regions,according to various officials, do not have the expertisenecessary to respond to day-to-day operations problems atdistricts and ports. Region and district personnel werecritical of region capabilities in providing this service.Some districts, as a result, resolve technical issues them-selves because they have day-to-day operational expertise,or they may direct their inquiries to Customs groups out-side the region. Regions, however, devote Personnel re-sources to this function; if responsibility for this

24

function is realigned, these resources could be redirectedto meeting personnel needs in other areas.

Another technical advice source available to districtsis the Customs "national experts" at a New York area (dis-trict) office. Because lines of responsibility are notclearly defined, however, districts can also request similaradvice from the headquarters Office of Regulations andRulings. The headquarters office, we were told, often re-directs district questions to the "national experts" fordata to formulate the headquarters response. This processcould cause unnecessary delays and encourage unnecessaryheadquarters involvement.

Air surveillance

Responsibility for air surveillance of border areasis, in at least one region, split between two groups--thedistrict Patrol group and the regional air support group.

Pilots are assigned to both groups. Because of ashortage of aircraft, however, all aircraft are assignedto the regional air support group. As a result, pilotsfor the district Patrol group do not always have aircraftavailable for patrolling. When aircraft are unavailable,the pilots are assigned routine land patrol functionsthat are usually performed by lower grade personnel.

Thus, in addition to illustrating apparent duplicationbetween two groups, the above example also illustrates howfragmentation could contribute to misassignment of personnel.Customs officials said they were planning to reassign thedistrict patrol pilots to the regional air support branches.

Investigations and enforcement

Another area of fragmentation is the responsibility forinvestigative and enforcement functions. Responsibility forthese functions is horizontally fragmented at each of threeorganization tiers--headquarters, regions, and districts. Atboth the headquarters and regional levels, the investigativeand enforcement functions are the responsibility of the Officeof Investigations, the Office of Internal Affairs, the PatrolDivision, the Regulatory Audit Division, and the Office ofEnforcement Support. At the district level, the investigativeand enforcement functions are fragmented between the Officeof Investigations and the district patrol group. Becausethese responsibilities are so widely fragmented, the poten-tial exists for inefficient utilization of resources and un-coordinated and overlapping efforts.

25

For example, two groups conduct smuggling investiga-tions--the district patrol group and the Office of Investi-gations. Currently, patrol is responsible for interdictingsmuggled merchandise and contraband. The Office of Investi-gations is responsible for general investigations, includingsmuggling conspiracies and other smuggling (excluding drugs).Upon interdicting smuggled merchandise, the patrol groupshou4 ' refer smuggling cases to the Office of Investigations.There is, however, a "gray area" between the responsibilitiesof the two groups which, according to various officials, hasresulted in patrol's involvement in investigative matterscausing duplication and overlap. Officials also stated thatlack of clear responsibility definition has caused confusionin determining which Customs group is actually conductina aspecific investigation.

Comments from officials, at various organizational levelsindicate that some functions, such as smuggling investigations,could be more effectively and efficiently carried out ifresponsibilities were consolidated. Regardless, the aboveagain illustrates the need for clear and specific responsibil-ity definitions to minimize fragmentation and eliminateduplication.

A principal goal of the 1965-66 reorganization was thereduction or elimination of fragmentation; this was to beachieved through clearly defining responsibilities andassigning responsibilities for individual functions to sin-gle offices. As shown in the preceding discussion, neitherof these objectives has been fully achieved. In fact, aswill be shown in the following segment, the issue of frag-mentation has been exacerbated with the establishment ofthe principal field officer concept.

Need to unify field management

The issue of unifying field command is of concern toCustoms managers. The lack of clearly defined responsibili-ties and the number of independent officers responsible forfield operations have contributed to disunity as well asfragmentation. Field activities at an individual locationare, as a result, the responsib'1ity of more than one offi-cer. Customs has unified some activities; however,additional improvements can be made.

26

The disunified field structure was one of the principalproblems addressed in the 1965-66 reorganization. The Stoverreport stated that in 1964 as many as five separate Customsoffices might be located in one city--each had independentauthority, but all were concerned with a Dart of the overallCustoms mission. A major Stover report recommendation, asa result, was that activities at an individual location beassigned to a single field manager.

Contrary to the Stover report recommendation, a fullyunified field structure was never established; in fact, thestructure has been further disunified in recent years. Theresult is there are four, rather than one, principal officersresponsible for managing activities at each region. (Seep. 4 f3r their titles.) This structure is also partly duplic-a ed at districts where district directors and special inves-tigative agents manage activities. The region and districtstructures are then duplicated at some ports. For example,at one port there are five managers responsible for Customsactivities.

In September 1972, in response to a growing concern offield managers over the lack of communication and coordinationbetween the several field activities, Customs management ini-tiated the "One Customs Service Concept." This concept de-signated the four principal field officers as co-equal man-agers of activities within a region.

To further enhance unity of field activities, the "OneCustoms Service Concept" required the collocation of theprincipal field officers in the same building. This require-ment was extended to the district level by collocating dis-trict directors and special agents whenever stationed inthe same city. These management efforts have promoted, ineffect, a sharing of field command and responsibility ratherthan a unity of command.

Disunity of field commands contributes to some of thefragmentation problems previously discussed. Thus, withoutresolving the unity-of-command issue, many of the problemspreviously discussed in this chapter will be difficult tocorrect. Notwithstanding this need, the internal audit func-tion should properly remain separate from the field officestructure and report to the highest level of the Customs or-ganization.

27

CONCLUSIONS

To adequately address the concern over whether oneorganizational group or tier is assuming functions whichcan be better performed by another, clear and specificdelineation of responsibilities and functions are essential.Although considered of immediate importance 13 years ago,this delineation has not yet been clearly and specificallydeveloped.

Lacking these organizational design elements, however,Customs implemented its 1965-66 reorganization. While thereorganization did consolidate responsibility assignmentsfor some functions, it and later organizational changescreated other areas of fragmentation. Fragmentation of re-sponsibility creates the potential for duplication of effortand inappropriate location of assignment of responsibilitywhich, in turn, promote inefficient use of personnel. Rec-ognizing the importance of minimizing organizational frag-mentation, Customs should make needed realignments; however,these changes should be preceded by a detailed assessment andclarification of essential responsibilities at all organiza-tional levels.

28

CHAPTER 4

NEED TO REVIEW PORT STATUS

Customs has identified potential ports for closure;to date no closures have been made. The inaction hasbeen due in Part to congressional concern and communityopposition to the proposed closures. Such opposition maybe reduced by developing specific criteria for reviewingport status.

There is wide variance in the workload among the 303Customs ports. At one extreme, there are unmanned portswhich have processed no people or merchandise for severalyears; at the other extreme, there are ports that processmillions of passengers and thousands of commercial cargoentries in a single year. (See photos on following pages.)

A 1977 internal study identified 29 ports, having lit-tle or no activity, which could be abolished without adver-sely affecting performance of the Customs mission. Follow-ing are descriptions of some ports that the studyrecommended closing.

--One port with a director, three inspectors, and oneentry aide processed 297 commercial cargo (formal)entries and 8,567 persons in fiscal year 1977.

--One port with a director and one entry aide processed192 commercial cargo entries and 194 persons in fis-cal year 1977.

-- At one port that had no personnel, Customs processed4,715 persons but no commercial cargo entries infiscal year 1977.

There are no guidelines or specific criteria for deter-mining whether a port should be deactivated or abolished.Guidelines are available, however, to determine whether aport should be established. Applying available guidelinesshows that the 29 ports above would not meet the minimumworkload requirements for port status.

Our analysis identified other ports, in addition tothe 29 previously identified, which may also be candidatesfor closing because of low workload. Customs officials,however, indicated that reasons other than workload justifyretaining port status:

29

"* * * workload studies may indicate that there areonly 30 crossings at a border point per day. How-ever, if these 30 are workmen crossing for validemployment reasons, economic hardship could bewrought on both sides of the border if the portis closed. Another example could be a case wherethe only doctor within 100 miles is just acrossthe border."

Customs should, in our opinion, seek an alternative to meetthe needs of residents in low activity ports that otherwisedo not require Customs presence.

CONCLUSIONS

We believe that Customs needs to establish and applyclear and definitive criteria for reviewing port status.Using such criteria, Customs will be better able to iden-tify and close unneeded ports.

30

PHOTOGRAPHS SHOWING THE VARIANCE IN CUSTOMS WORKLOAD

LOS EBANOS, TX. THIS STATION IS UNDER THE SUPERVISION OF HIDALGO, TX., AND IS OPEN8 HOURS A DAY. DURING HOURS THE STATION IS CLOSED, VEHICLES REPORTTO HIDALGO OR RIO GRANDE CITY. TX.

SAN YSIDRO CA THIS STATION IS PART OFTHE CUSTOMS PORTOF SAN DIEGO AWD IS OPEN24 HOURS A DAY

3124 HOU RS A 31

PHOTOGRAPHS SHOWING THE VARIANCE IN CUSTOMS WORKLOAD

O'HARE AIRPORT. CHICAGO ILL. PASSENGER CLEARANCE

DAY. CURING THE HOURS

7

r : :- ~: _ e A- ......... -EASTON, ME.

THIS STATION IS CLUNDOSER

FAIRFIELD, lyE., AND IS

DAY. DURING THE HOURS

OR PRIDGEWATER, MAINE.

32

CHAPTER 5

OVERALL CONCLUSIONS AND RECOMMENDATIONS

The question of the most appropriate organizationalstructure for Customs is not a simple one to address orresolve. Most likely, there is more than one orqaniza-tional form that could effectively accomplish Customs'increasingly complex and demanding mission.

In recent years, however, the delegations of authorityand responsibility and the relationship of the regional of-fices have been studied. These studies have identified or-ganizational problems. They have made recommendations tomodify Customs organization, including the role and numberof regional offices, district offices, and ports, and haveproposed organizational alternatives. Customs has not initi-ated action on most of these recommendations. This reluctanceto act results essentially from actual or anticipated con-gressional concern over the impact of reductions on the af-fected communities.

Yet, from the studies, as well as from documents wereviewed and the numerous discussions we held with Customsofficials at all levels, certain consistent facts and conclu-sions emerge. Within Customs existing organizational form,regional offices provide essential services. However, Cus-toms can streamline its organization if it reduces the num-ber of regions and districts; these reductions could beachieved without eliminating a Customs presence at those lo-cations and could improve the level of services provided.Reducing the number of ports also appears feasible; thesereductions would eliminate a Customs presence at locationswhere it is not justified on the basis of workload andmission requirements.

At the same time, regardless of any consolidations,Customs needs to clearly define the responsibilities of allorganization levels and units; and realign responsibilitiesfor functions among and within organizational levels tominimize fragmentation and unify field management. Customsalso needs to establish and apply definitive criteria forreviewing port status.

33

RECOMMENDATIONS TO THE SECRETARYOF THE TREASURY

Accordingly, > recommend that the Secretary direct theCommissioner of Customs to:

-- Reduce the number of regions and districts in keepingwith workload requirements and sound organizationalprinciples.

-- Clarify the responsibilities of organizational levelsand units.

--Realign responsibilities for functions among andwithin organizational levels.

--Establish definitivecriteria for reviewing port sta-tus and use these criteria to identify unneededports.

34

CHAPTER 6

SCOPE OF REVIEW

We reviewed, analyzed, and summarized reports pertainingto Customs organizational structure and overall management.While most were internal studies, some were performed by out-side groups. (See app. VII.) To supplement tne studies, weindependently discussed the findings and recommendations wichCustoms officials at various organizational levels.

To a more limited extent, we reviewed the policies, pro-cedures, and practices relating to various Customs functionsand obtained flow charts identifying and analyzing pertinentfunctional decision points. We also reviewed congressionalhearings which related concerns of the importing public re-garding Customs organization.

The following table identifies the locations andorganizational levels with which discussions were heldor site visits made.

OrganizationalLocation level

Washington, D.C. HeadquartersBoston, Mass. Region, district, portHouston, Texas Region, district, portLos Angeles, Calif. RegionNew Orleans, La. Region, districtNew York, N.Y. Region, district (area)San Diego, Calif. District, portLaredo, Texas District, portEl Paso, Texas District, portProvidence, E.I. District, portSan Ysidro, Calif. PortMadawaska, Maine PortCalexico, Calif. Port

Most of our review work was done in November and Decem-ber of 1977. Throughout the review, we discussed our find-ings as they were developed with responsible Customs offi-cials and obtained their comments. At the conclusion of ourwork, we held conferences with Customs' top management offi-cials. Their views have been considered in preparing thisreport. In general, they agreed with the facts and conclu-sions presented in the report.

35

APPENDIX I APPENDIX I

NINETY-FIFTH CONGREISAL ULLMAN. c0.l .CHAIIMAN

JAMBS A. UII t. MAS. IAN·O D. CUA . J., fC.y.DA 1USTE , AUI. L.. JOHN J OIUNCAN. TI .CHAoLES A. VANIKI. ESM MuIL ACHR. YTE.

A.,. ,·,,TM. GM.VANJ. . COMMITTEE ON WAYS AND MEANSSAM M. U S. FLA. PMIU P CRAN. ILL-Joe 0. WASSONM. JR~a ., [A. .. ILL FRUEL~. MINN.OS Da. PWA Je, I.. A E. D, . A, .C. U.S. HOUSE OF REPRESENTATIVESJ. J. PcL., TEX. L. A. (1KIP) BSAmUi. PLA.CMAMS S. KANM,. N.V. WILLIAM M KETCHUM* CALJF. W GT , D 2055WILLIAM P. COT1 CONNII. UI . CWASHINGTON D.C. 20515

VPOEW H. I' ( I ,) S CA. C lUW. U .L _ ADISCOh. 0CLJAMES I. JONES. OKLA.AMOT JAC .JR.. ID.MM J. JmwA. Iu.. TELEPHONE (MI) -25-3MnA KEYS. KAS.JOSD L. IFlo . VA

HAHOLLAPOW ~. TURNOctober 3, 1977

ED JIMKP, M.MIAD A. uW ,. O.JIM TUY eCS. AME

AYiMND rF. LIMEmRI. PA.

JOCN M. MARTIN, nJ.. CHII? CUNReJ. P. ER. ASISATr CWv CouIJ·oe M. OEaU MINIIy cainno.L

Honorable Elmer B. StaatsComptroller General of the United StatesGeneral Accounting OfficeGeneral Accounting Office Building441 G Street

Washington, D.C. 20548

Dear Elmer:

The Subcommittee on Trade has been engaged in anongoing study of the United States Customs Service. Thescope of this effort will also include an assessment ofthe effectiveness of Customs utilization of personnel.

It is my belief that the General Accounting Officecan be of assistance to our effort. Accordingly, Iam requesting that the General Accounting Office examinethe following matter of major concern to the Subcommittee:

-- The area of concern involves the organizationof the Customs Service, and specifically thestructure and responsibilities of the Service'sregional and district offices. It appears tothe Committee that, over the years, regionaloffices have been assuming functions and respon-sibilities which more appropriately belong atthe district office level. This may be contri-buting to the inefficient use of personnel andalso negatively impact the effective function-ing of the organization. The Committee, there-fore, requests GAO to review the role of theregional and district offices in the Customsorganization, particularly to ascertain whether

36

APPENDIX I APPENDIX I

Honorable Elmer B. StaatsPage 2 October 3, 1977

regional offices perform functions whichwere intended and more appropriately be-long at the district level.

So as to be of maximum benefit to the Committeein conducting hearings, we would appreciate receivingyour report on the area by early March, 1978.

Your cooperation is greatly appreciated.

Since ly,

Al ImanChairman

AU/DBRn

cc: Hon. James R. Jones

37

APPENDIX II APPENDIX IIAPPENDIX II

'~' Y } O- V

V ., M - , -r, v:,,c 6 3 8 8 ) 0 0 '

=l ° Sn. - 'ow ,4

98

,) 0.,' Y)) 'U, 8UU, -l I

0 vt gVv^ ;g -I 3 A .

eFI , 8 U @|- l 8 oi 4 > @

ul _ @v .m I a au

IQI U) Er 0o e e d c9ld: Q 1 Cu0fi 0 ul 1 L

co > e) c e Cg 0 _

· ~ ~~~ olrP1 " fi 5~~~~~~~~~~~~~~~~~l

f 81 81~~~~~~dl ~~1 L, f S 3 le Q aur LIE~~f

>,

~,a~e~u vlS'" m~" 38

APPENDIX III APPENDIX III

" M I P y i i;

. · ' ' ' ; i G * '

. ,.~ ~o .2 !

.C S I , ,

_ iS~s~b O., Ao.. . o o .I .

o fii ' "

U }sOIos 1.o' J ;4 P

.Z . ._ -'40 _

APPENDIX IV APPENDIX IV

D-g

LL '22

oo~~~~w[

0 I~~~~~~~~~~~~~~~~L

-- Mo~

(0~~~~~~~~~

8- I

zJz3e

oo2~~~~~~~~~~~

LU 0 z

40

0 IC

~~o a a r r, ,

(3 Y)L~L 3co

LU LL. 0

z g~~~~~~~~zrL~~~

z zri

w10~~~~~~~~~~~~~~~~~~~

z o~~~~~~~L

2 0

r w~~~~~~~~~I

g arw~~~~~~~~~~~r

40

APPENDIX V APPENDIX V

CUSTOMS STAFFING FOR SELECTED YEARS

Organizational tier 1966 1969 1973 1977

Customs headquarters 388 412 1,026 1,313Customs regional

headquarters (note a) 811 859 1,098 2,104Customs district

(note a) 7,253 6,103 8,112 10,461

Total customs service 8,452 7,374 10,236 13,878

a/New York Region statistics have been estimated for 1966and 1969. The estimates assume 13.6% of total regionalpersonnel are at the regional headquarters.

41

APPENDIX VI APPENDIX VI

o~~~~~~n+ r ~ ~ ~ ~ ~~++

00*+ * 40 04*C 00 CCNt n

ai .++ 1 + om NC *~~~~~~~~~~~~~~~~~~~~~~t ~ ~1~1~141 4 1 + 4+ 4 4 404 04 .0

c4 I- I- *04 - 0

I{:~~~~~~~~~~~~~~~~~~~~1 t.°c ~ ~ ~ ~ ~ ~ ~~~~c

04040 * 0 *0% 0%C It U rm m c

040 - - t 4 = +4-+ 0 C .. 04 ". 0404

00? WU)- f * . 0

40 + ++ I O +0

04 04 44 004 0 40 0 r 40-0 040 40 P

"I4 -I-- I 0- 400 0

044004 40 04 040 400 04 4 00 04 +-0 ,. 0 0

4IC 0040404* ii

[. .. o 04 N 0%

c~~~ 1 1

., M. ,.,-- + W. -- r4 ,7 0 0 °..

aY ,+o +

. ~ ~~~~~~~~~~~~~~~~~~~~~~~~ W

M =. 040401 404O~ 04 0404 C 0% 0-0 *04N0 0 0404 NC

- ::. .+m l

11 C W 1 .1 W I 11 C W W

5 ua

0404 04 04 NM 0% .W-E

40 - u 0 40040 40 04 0* 4 00 4

04 04 ~~0% 040440 4 00 04 0% M 0 40

0 0 0 0 - .4 00 -

0 0 4*04 4 % t > 40 40 . .. .

oll'n 4c00 4 4 0I N 4 - 4

31 0. > .- l 04004 >% 4 03C

N 4 to 04404 N 0 0404 0404 0->44~~~~ 040 -aN ~ ,, ~ , ~ P C

CI ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ No .24 0-4 4 04 04 Y

0: 01 04 O' " 0004 -4 .0 0 44.N -Il 04 NO 0 04 % 4-+ 4 +~ *40 +4 44n 4* 04>

.2 4 C 4 *044 04 40 *04 040 040 04 4 04 4 4 040 400 0I~~N 044· O ·

41 ,e u~~~04 . . . . 4*

2*24~~~ ~~~~~~ 4O . -( n -C 40.

0' ~ ~ ~ ~ ~ ~ ~ ~ ~ 04 04o 04 04 - 04 04 40 0+ * 04

40 rt 04 40 O wov ~ n r

040* ~ ~ ~ f~ C 04 40a 044 04444.

II ~ ~* .* . 04 -r .* 004 0444 4 0 04 4 4- 40

0.u + 044

~~~I40 *,i 0l 040 044 040 004 44400-C.. 0004 4 0 040 404 040 44404*0 04 4 4* 4-00 0-040 04 4 0 0-4 00- 0440 0- 0 * 44 40 4

UL·0 I. I t*

VI ~ ~ 4* 4 0 4,aU 0- ~ r 04) 04 0.,4 0 % 4 % 0 . 004C~ 04 04 04 04 40

-- -- - - -- - -04 0 - 44 4

304 ~ ~ ~ ~ 0 'A 04 04>4 4 O

04 C 04o + u, \or ~· 44 4 . 4 4 04'4 0000 44 0 04000 4-P 0 4J 1.'4044 4~ 0 o c

.44 4 044444 124 4444 0 4) 444-.4444400444 0, 44 ..44..44 144 444O *-I 0.V244'4444 0 0'4.0444044.4 0' Q.404444004 440* Y~

0444>44 44+ 0 ]1+ 44 440. 44 0 4 4>4( 4 0 ..444 4 44

4f4044444 '4 4444 . 44244444444 0* 4f404 400" 44.4

4-0400-4 .0 >00 4o ~ N 00 l4 4-4-4'4-4 040 >00 4--444044 04 >00 44404.

U~~V~N 0 0 C Na Nt0. 0 NP04 ' ~ m 7 44>> 04 0 ~ 0 m 1-) 41

mr r ( , CII · a Y) 0 N NYoO ( (42+P E

APPENDIX VII APPENDIX VII

STUDIES OF CUSTOMS ORGANIZATION

Studies GAO Need to reduce SubjectDate reviewed Regions Districts Ports discussed

1964 Stover Report Establish regionsand districts

1967 Review of Stover Re- Review of reorgani-organization X X zation 1965-66

1970 Wolfe Report Review of field orqan-Survey of Organization X X X ization 1965-66

1971 National Academy of Reorganization PlanPublic Administration X X No. I of 1965-66:

A struggle for status

1972 Standard Federalregional structure X Realign regiona

offices

1972 Subregional struc- Realign districtture under standard officesFederal regionalstructure X

1974 District consolidation X Reduce district officesby consolidation

1976 Customs Organization I X X Organizational issues

1976 Customs Organization II X 1976 Review of CustomsOrganization

1977 Customs Field Orqaniza- Consolidation/Elimina-tion III X X tion of Regions/Dis-

tricts

1977 Webster study X X X Customs Service Organi-zation review 1977

Other studies performed:Office of Drug Abuse Policy studies:

Drug law enforcement studyNarcotics intelligence studyBorder management and interdiction studyInternational narcotics control initiatives study

Office of Management and Budget studies:Border management studyFederal law enforcement study

43

APPENDIX VIII APPENDIX VIII

trr lo n

l ~o _ ,, .D I

C +

0 0% .D U' 10 0

o o 4, 4 4 o

uN l 0 '0 0% -

o o% N -o O

0% 0 O (4 .

01~~~~~~~L

O O O _ O

N N .0 -

N (4 (4 U'

o O

WI 4 U' 0 (0% 0

e NH 0°

N~ ~ 00 ' 4 0

o ~ ~ ~ ~.. n u, . N rs

N ~ 0 4 HO n In U

UN C _

9~~~~ _a rw o _

-4 ~~0%

Z o _ _-ct·o o N

* _ ON - I (4 S' ( (

N -D - (I 4*. o0 _4 -4 o

o C~~~~_ o _ , N I

3N 0 % N 10

r 0 r.

_ .0_ , b _ ..

4..

oH I

aN C ( .4 (4

4.10 '

o o -Io

- I " r I _ 00 % eN 0%D N ^

U 0

o O0 _ _ l

o. _ _ --

ac _* e I O F

-·Is0 ~ ~ bu -O N_

-5 C 0- 4. 0%00

O _4 _

_ 0t

0 4. .W ~ 0. 0V .. 0 S 44O I H 1-

C _ 03 C0 0 .

OV e 0 0o 04 60a4 o

U0o4 -- V'4 4. --r.* 44

4. 4. ' a. 0 N

Q.4 '0 5 5 '0 0% OF eo°

44

APPENDIX IX APPENDIX IX

Ir I0 N Gen Io -,-

ilN~~~CO"~~N .4

,. I I + I I I .

INnI

4 -- 4

In 1 o - , - rn c r

wo m q.r , I I I I ,-

o 7 V - i -

| O bi ^.Xrsi @ Fi so e o sn - b i ~ , !

APPENDIX X APPENDIX X

PRINCIPAL OFFICIALS

RESPONSIBLE FOR ADMINISTERING

ACTIVITIES DISCUSSED IN THIS REPORT

'i'enure of officeFrom To

DEPARTMENT OF THE TREASURY

SECRETARY OF THE TREASURY:W. Michael Blumenthal Jan. 1977 PresentWilliam E. Simon May 1974 Jan. 1977George P. Schultz June 1972 May 1974John B. Connally Feb. 1971 June 1972David M. Kennedy Jan. 1969 Feb. 1971Henry H. Fowler Apr. 1965 Jan. 1969Douglas Dillon Jan. 1961 Apr. 1965

UNDER SECRETARY OF THE TREASURY(note a):Bette B. Anderson May 1977 Present

ASSISTANT SECRETARY, ENFORCEMENT,OPERATIONS, AND TARIFF AFFAIRS(note b):John H. Harper (acting) Jan. 1977 May 1977.erry Thomas (acting) Sept. 1976 Jan. 1977David R. Macdonald May 1974 Sept. 1976Edward K. Morgan Jan. 1973 Feb. 1974Eugene T. Rossides Aar. 1969 Jan. 1973Joseph M. Bowman Mar. 1968 Jan. 1969W. True Davis Sept. 1965 Jan. 1968James A. Reed Dec. 1961 Sept. 1965

COMMISSIONER, U.S. CUSTOMSSERVICE:

Robert E. Chasen July 1977 PresentVernon D. Acree May 1972 Apr. 1977Myles J. Ambrose Aug. 1969 Feb. 1972Lester D. Johnson Aug. 1965 Aug. 1969

a/Functions and responsibilities of the Assistant Secretarywere transferred to the Under Secretary on May 3, 1977.

b/This position was disestablished on May 3, 1977.

(961063)

46