Job Training Partnership Act:

Inadequate Oversight Leaves Program Vulnerable to Waste, Abuse, and Mismanagement

HRD-91-97: Published: Jul 30, 1991. Publicly Released: Jul 30, 1991.

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Pursuant to a congressional request, GAO provided information on the: (1) Job Training Partnership Act (JTPA) Program's vulnerability to waste, abuse, and mismanagement; and (2) adequacy of JTPA program oversight to prevent and detect such practices.

GAO found that: (1) the majority of service delivery areas (SDA) underreported administrative expenditures, causing a misrepresentation of program costs and amounting to a circumvention of the statutory limitation placed on administrative costs; (2) 9 of the 12 SDA reviewed often reported administrative salaries as training costs and other administrative expenditures as participant costs; (3) if those administrative expenditures had been charged properly, 7 of those SDA would have exceeded the specified administrative cost limitation by an average of 68 percent; (4) most SDA visited wasted JTPA funds on excessive on-the-job training (OJT), and used OJT contracts to subsidize portions of employers' salary and training expenses; (5) two-thirds of SDA used questionable contract administration and monitoring practices, making contracting with training vendors vulnerable to potential waste, abuse, and mismanagement; (6) state agencies failed to identify improper cost reporting, questionable uses of OJT, and inadequate procurement practices occurring at SDA; (7) the Department of Labor's (DOL) program oversight is limited, and its policy guidance lacks a definition of administrative costs, acceptable OJT contracts, or adequate state monitoring; and (8) required independent financial and compliance audits did not compensate for inadequate state and federal monitoring and oversight.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: Enacted amendments to JTPA address the intent of this recommendation. In addition, DOL has initiated other actions that respond in part to the recommendation.

    Recommendation: DOL should provide policy guidance to clarify regulations for maintaining adequate control over property purchased with JTPA funds to ensure that it is used for its intended purposes.

    Agency Affected: Department of Labor

  2. Status: Closed - Implemented

    Comments: Enacted amendments to JTPA address the intent of this recommendation. In addition, DOL has initiated other actions that respond in part to the recommendation.

    Recommendation: DOL should provide policy guidance to clarify regulations for developing OJT contracts that appropriately reflect the job requirements as well as the individual's work experience.

    Agency Affected: Department of Labor

  3. Status: Closed - Implemented

    Comments: Enacted amendments to JTPA address the intent of this recommendation.

    Recommendation: DOL should provide policy guidance to clarify regulations for accounting for and reporting administrative costs to accurately reflect program expenditures.

    Agency Affected: Department of Labor

  4. Status: Closed - Implemented

    Comments: Enacted amendments to JTPA address the intent of this recommendation. In addition, DOL has initiated other actions that respond in part to the recommendation.

    Recommendation: To reduce JTPA potential for waste, fraud, and abuse, and to address questionable management practices at the local level, DOL should provide technical assistance to states for the development and implementation of monitoring procedures directed at detecting waste, fraud, and abuse within the program.

    Agency Affected: Department of Labor

  5. Status: Closed - Implemented

    Comments: Enacted amendments to JTPA address the intent of this recommendation. In addition, DOL has initiated other actions that respond in part to the recommendation.

    Recommendation: DOL should provide policy guidance to clarify regulations for monitoring service providers to ensure that incidents of waste and abuse are detected and corrective active taken.

    Agency Affected: Department of Labor

 

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