WASHINGTON, Sept. 30, 2015 - A requirement that some overseas food aid be carried on U.S.-flagged vessels adds an extra 23 percent to the shipping costs. But there are sharp variations depending on whether the U.S. Agency for International Development or the Agriculture Department is doing the shipping, according to the Government Accountability Office.
In 2012, Congress lowered the requirement for the amount of food aid that had to be shipped on U.S. vessels from 75 percent to 50 percent. However, USAID and USDA apply the 50-percent requirement in different ways with the result that USDA pays a lot more in shipping costs than USAID, auditors found.
The U.S. requirement increases USAID’s shipping costs by 16 percent, but USDA pays 36 percent more because a court order requires it to apply the requirement on a country-by-country basis, GAO found. USAID applies the lower requirement across the board.
USAID handles shipments funded through Title II of the Food for Peace Act, while USDA administers other programs, including McGovern-Dole.
Before the law was changed, U.S. ships carried 82 percent of USAID’s food aid. That’s now down to 54 percent. For USDA, the U.S.-carrier share only dropped from 89 percent to 76 percent. GAO said Congress should consider clarifying the law to ensure that agencies can take fully take advantage of the lower requirement.
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