Economy 1 Dow

Economic development: Economic Development Programs (2011-09)

The efficiency and effectiveness of fragmented economic development programs are unclear.

Year Identified: 2011
Area Number: 9
Area Type: Fragmentation, Overlap & Duplication

Actions

Action 1
Addressed

The Departments of Commerce (Commerce), Housing and Urban Development (HUD), and Agriculture (USDA), and the Small Business Administration (SBA) need to further utilize promising practices for enhanced collaboration. The actions that the four agencies should consider include seeking more opportunities for resource-sharing across economic development programs with shared outcomes, and identifying ways to leverage each program's strengths to improve their existing collaborative efforts.

Type
Executive Branch
Last Updated
March 1, 2017
Progress:

The four agencies and the Office of Management and Budget (OMB) have taken steps to collaborate more in administering these programs, as GAO suggested in March 2011. In March 2017, Commerce's Economic Development Administration (EDA) noted that it established an economic development integration team in fiscal year 2016 to facilitate direct engagement between communities and federal agencies with complementary economic development resources to collaboratively support regional economic development across the nation. EDA added that the team has executed a memoranda of understanding (MOU) with HUD's Office of Community Planning and Development and USDA Rural Development and is working with SBA to collaborate, enhance relationships, and cross-promote resources. USDA's Rural Business-Cooperative Service (RBS) noted in March 2017 that it is engaged in several MOUs with other federal agencies that support coordination and collaboration on areas of mutual interest, including a MOU with Commerce's EDA to leverage programs and resources to support regional economic development. In addition, RBS noted that it is coordinating with HUD and others to leverage programs and resources to create healthy, economically vibrant neighborhoods through the development of local food systems. In March 2017, SBA noted that it has engaged in a number of collaborative efforts with the other agencies, including the development of a training module for small construction contractors with HUD enabling them to access performance bonds for HUD-funded construction projects, and a MOU between SBA's Office of Veterans Business Development and USDA to explore opportunities for supporting veteran-owned businesses in agriculture-related sectors. Finally, in November 2016 OMB noted that, in fiscal year 2016, the General Services Administration (GSA) took over the management of BusinessUSA, a federal website developed to make it easier for businesses to access the services and information they need. Through the website, federal agencies are able to increase public awareness of the resources they offer. The one-stop shop website directs customers to federal services that match their requirements (i.e., financing, export assistance, federal contracting), so a customer does not need to visit disparate websites. OMB added that GSA has integrated BusinessUSA's content and services in the USA.gov website. This provides users with a more accessible and centralized one-stop platform for entrepreneurs to access the services that could help them grow. Finally, the BusinessUSA Steering Committee, composed of staff from across several agencies, continues to meet regularly and assemble agency stakeholders to collect feedback and create the strategic vision for moving the tool forward.

Implementing Entity:
Department of Agriculture
Department of Commerce
Department of Housing and Urban Development
Small Business Administration
Action 2
Partially Addressed

The Departments of Commerce (Commerce), Housing and Urban Development (HUD), and Agriculture (USDA), and the Small Business Administration (SBA) need to collect accurate and complete data on program outcomes and use the information to assess each program's effectiveness.

Type
Executive Branch
Last Updated
March 31, 2020
Progress:

The four agencies have completed actions and have actions under way or planned that are intended to improve data collected on program performance, as GAO suggested in March 2011. For example, according to HUD the department implemented improvements to its Integrated Disbursement and Information System in 2012, which were intended to upgrade HUD's ability to track Community Development Block Grant (CDBG) grantee progress in implementing activities and gather improved data with regard to performance. In addition, HUD completed an extensive CDBG data clean-up effort in response to a HUD Inspector General audit. According to Commerce's Economic Development Administration (EDA), the agency continues to test a pilot evaluation framework and related performance measures with grantees that represent EDA's non-infrastructure programs. According to EDA, the agency expected to fully implement the pilot evaluation framework for all grantees at the start of fiscal year 2020. GAO will continue to monitor EDA's implementation of this framework. According to SBA, in August 2017 the agency finalized a program evaluation framework that outlines the structure of the agency's program evaluation function, defines roles and responsibilities, and establishes guiding principles. SBA also noted that the agency published evaluation reports for seven programs and initiatives under the framework as of February 2018. In addition, SBA stated that the agency has requested authority from Congress to collect unique client data from the resource partners, including Small Business Development Centers and Women's Business Centers, for internal evaluation purposes. According to USDA's Rural Business-Cooperative Service, it tracks five key performance measures related to its programs and develops a specific target each fiscal year for these measures based on a number of factors, including actual performance, program demand, available funding, and administration priorities. As of February 2020, USDA had not responded to GAO's request for an update regarding the agency's efforts to implement this action. Finally, Commerce, USDA, and SBA participated in the Office of Management and Budget-chaired Evaluating Business Technical Assistance Program interagency working group, which publically released its guide titled, Building Smarter Data for Evaluating Business Assistance Programs: A Guide for Practitioners, in May 2017. The guide identifies critical data and best practices that support the use and improvement of administrative data and other existing data sources for rigorous impact evaluations. As of February 2020, the working group appears to no longer be active. When they complete the actions under way or planned, the four agencies should have better information that can be used to assess the effectiveness of programs that support entrepreneurs.

Implementing Entity:
Department of Agriculture
Department of Commerce
Department of Housing and Urban Development
Small Business Administration
Action 3
Addressed

Additional work to assess progress in collaboration and evaluation could identify areas for improvement, consolidation, or elimination. More analysis is needed by the Departments of Commerce, Housing and Urban Development, and Agriculture, and the Small Business Administration and the Office of Management and Budget (OMB) to determine the actual amount of duplicative spending in programs that are designed to target similar economic development activities, locations, and applicants.

Type
Executive Branch
Last Updated
March 6, 2013
Progress:

In January 2012, the administration recommended a broad reorganization of agencies, including economic and business development activities in the Departments of Commerce, Agriculture, Health and Human Services, and the Treasury, as well as SBA. According to the administration's assessment, the existing structure is inefficient and redundant. To address this redundancy, the administration's proposal would consolidate many of its economic development programs. The proposed reorganization, if implemented, could eliminate duplicative spending that may be present.

Implementing Entity:
Department of Agriculture
Department of Commerce
Department of Housing and Urban Development
Office of Management and Budget
Small Business Administration
GAO Contacts