Ohio – September 20, 2010

The content below was excerpted from the Ohio Appendix (PDF, 33 pages) of GAO's most recent bimonthly review of the Recovery Act.[1]

What We Did

To continue our ongoing analysis of the use of the Recovery Act funds in Ohio, we updated information on the U.S. Department of Transportation's Highway Infrastructure Investment Program and the U.S. Department of Energy's Home Weatherization Assistance Program. We also continued our review of two programs that provide capital investments in low income housing tax credit projects—the Tax Credit Assistance Program administered by the U.S. Department of Housing and Urban Development (HUD) and the Section 1602 Tax Credit Exchange Program administered by the U.S. Department of the Treasury, that we previously reviewed in our May 2010 report. We also collected information on one program that we have not covered in the past, the Early Head Start Program, administered by the U.S. Department of Health and Human Services (HHS). For descriptions and requirements of the programs we covered, see appendix XVIII of GAO-10-1000SP.

We continued to gather information about the state's economic condition and met with officials from one local government—the City of Cincinnati—that we had visited for our December 2009 report. We also contacted officials from oversight entities in Ohio responsible for monitoring Recovery Act funds to discuss their most recent, ongoing, and planned audit results; as well as Ohio's participation in the Office of Management and Budget's (OMB) Single Audit pilot program.

What We FoundBack to top

Following are highlights of our review:

Early Head Start Program

The Recovery Act provided funding for the expansion of Early Head Start programs that afford comprehensive early childhood development services to low–income children from birth to 3 years old. The Office of Head Start awarded approximately $22.7 million in Recovery Act funds to grantees in the state of Ohio to provide services to an additional 2,158 children. We visited three program grantees to see how the Recovery Act funds are being used and found that some grantees have encountered challenges, such as obtaining facility space, recruiting income–eligible families into the program, and concerns with service delivery, as they get their programs up and running.

Low Income Housing Tax Credit programs

Ohio received about $83.5 million in Tax Credit Assistance Program funds and approximately $118.1 million in Section 1602 Tax Credit Exchange Program funds. As of July 26, 2010, the state had committed all but $1.6 million of the funding from the two programs. OHFA has disbursed $39.5 million (about 20 percent) for 80 projects to support the construction of nearly 4,000 tax credit units. The state plans to commit the remainder of its funds during August 2010 and expects to meet the Recovery Act deadlines for disbursement of the funds during the next 2 years.

State and local government use of Recovery Act funds

In Ohio, the state and City of Cincinnati continue to feel the effects of the economic downturn and reduced revenues. Ohio has received about $7.9 billion in Recovery Act funds as of August 1, 2010, but the state still faces budget challenges as state tax revenues remain significantly below fiscal year 2008 levels. We visited the City of Cincinnati again and found they continue to use Recovery Act funds to provide additional services and save jobs, but will need to address a $50.4 million structural budget deficit during the next fiscal year. Recent Recovery Act awards will allow the city to build and rehabilitate rental housing, invest in energy–efficiency initiatives, improve services, and save nursing jobs.

Accountability

There are a number of state entities identified as having responsibility for monitoring Recovery Act–funded projects in Ohio, namely the State Audit Committee, the Office of Internal Audit, the Auditor of State, and the state–appointed Deputy Inspector General for Recovery Act funds. As previously reported, these entities work in conjunction with one another to monitor Recovery Act–funded projects. In addition, Ohio participated in OMB's Single Audit pilot program and according to state officials will be participating in the next phase of the pilot program.

Highway Infrastructure Investment Program

As of August 24, 2010, the Ohio Department of Transportation (ODOT) had awarded contracts worth an estimated $930 million for 385 out of 426 Recovery Act funded projects. As previously reported, Ohio continues to award contracts an average of 10 percent below original cost estimates and as a result, has been able to fund 89 more projects than originally planned. ODOT officials also said the state anticipates meeting the Recovery Act's maintenance–of–effort requirement to maintain the level of spending for the types of transportation projects funded by the Recovery Act that it had planned to spend the day the Recovery Act was enacted.

Home Weatherization Assistance Program

In our December 2009 report, we reviewed three grantees and raised a number of concerns about how Recovery Act funds were being used to weatherize homes and concluded that real–time monitoring and early assessments of grantees' activities could help ensure program success. In response, the Ohio Department of Development (ODOD) hired additional staff and developed a monitoring program designed to ensure that its grantees were in compliance with program requirements set forth in the state plan. ODOD officials said that the reviews completed as part of this monitoring program helped keep the state's program on track and ensure its grantees adhered to the program requirements.

State Fiscal Stabilization Fund

In our May 2010 report, we identified weaknesses in how the Ohio Board of Regents (BOR) monitored State Fiscal Stabilization Fund (SFSF) monies allocated to institutions of higher education (IHE). In response to our findings, BOR submitted an amended monitoring plan to the U.S. Department of Education. The revised monitoring plan requires IHEs to identify quarterly and cumulative SFSF receipts and expenditures and attest that their institution used SFSF funds only for allowable educational and general expenditures. According to the plan, if BOR discovers any indications of noncompliance, it will follow up with additional reviews, which may include site visits to the IHEs.

Full September ReportBack to top

Recovery Act: Opportunities to Improve Management and Strengthen Accountability over States' and Localities' Uses of Funds
GAO-10-999
Recovery Act: Opportunities to Improve Management and Strengthen Accountability over States' and Localities' Uses of Funds
(Appendixes)
GAO-10-1000SP
  • [1] Pub. L. No. 111-5, 123 Stat. 115 (Feb. 17, 2009).
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