Net Cost Summary

FY 2007 Department of State/USAID Joint Highlights
Bureau of Resource Management
February 2008

The table below show each agency's net cost, that is, gross costs less earned revenue, invested in each joint strategic goal, which is aligned with the Foreign Assistance Framework. Operating Unit Management and Executive Direction are costs that cannot be directly traced or reasonably allocated to strategic goals; however, these costs are captured and included in the total net cost of operations. In addition, total net cost includes intra-agency eliminations, but does not include eliminations between the Department and USAID.

The Department's total net cost increased nine percent from the prior fiscal year, with the strategic goal Achieving Peace and Security representing the largest investment for the agency at 35 percent of total net cost of operations. The increase in net cost was primarily due to increased spending on the HIV/AIDS program included under the Investing in People strategic goal. The Department's strategic goal of Strengthening Consular and Management Capabilities is presented as a negative figure because earned revenue exceeded gross cost. USAID's total net cost decreased 10 percent from the previous fiscal year due to the agency excluding reporting the net cost of operations related to budget authority transferred from other agencies.

For the Year Ended September 30, 2007
(Dollars in Thousands) STATE USAID
Strategic Goal Net Cost Percent of Total
Net Cost
Net Cost Percent of Total
Net Cost
Achieving Peace and Security $ 4,911,933   35% $  459,065   5%
Governing Justly and Democratically     650,108    5%  1,303,047  14%
Investing in People   2,300,648   17%  3,029,681  33%
Promoting Economic Growth and Prosperity   1,062,556    8%  3,000,895  32%
Providing Humanitarian Assistance   1,099,101    8%  1,386,054  15%
Promoting International Understanding   1,773,574   13%        N/A  N/A
Strengthening Consular and Management Capabilities     (52,440)   0%        N/A  N/A
Operating Unit Management         N/A   N/A    117,152   1%
Executive Direction and Other Costs Not Assigned   1,890,603   14%        N/A  N/A
Total Net Cost of Operations $13,636,083  100% $9,295,894 100%


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