Economy 1 Dow

Economic development: Support for Entrepreneurs (2012-07)

Overlap and fragmentation among the economic development programs that support entrepreneurial efforts require the Office of Management and Budget and other agencies to better evaluate the programs and explore opportunities for program restructuring, which may include consolidation, within and across agencies.

Year Identified: 2012
Area Number: 7
Area Type: Fragmentation, Overlap & Duplication

Actions

Action 1
Consolidated or Other

Congress may wish to consider ways to tie funding more closely to a program's demonstrated effectiveness. One way to increase accountability and elevate the importance of program evaluation activities is to tie these factors to funding decisions. Therefore, Congress may want to consider requiring agencies to provide greater support for funding requests and requiring information on demonstrated results of program effectiveness.

Type
Congressional
Last Updated
March 6, 2014
Progress:

As a result of GAO's August 2012 report, Entrepreneurial Assistance: Opportunities Exist to Improve Programs' Collaboration, Data-Tracking, and Performance Management (GAO-12-819), GAO is no longer assessing this action. In February 2012, GAO reported that it expected to recommend in a subsequent report that Congress tie funding more closely to a program's demonstrated effectiveness. However, based on additional analysis, GAO concluded that agency performance and evaluation information had a number of deficiencies. As a result, GAO recommended in August 2012 that the Secretaries of Commerce, Housing and Urban Development, and Agriculture and the Administrator of the Small Business Administration consistently collect information that would enable them to track the specific type of assistance programs provide and the entrepreneurs they serve and use this information to help administer their programs. Such performance information is needed before Congress can more closely link funding decisions with the programs' effectiveness.

Implementing Entity:
Congress
Action 2
Partially Addressed

Agencies should improve program evaluation and performance metrics. In order to identify options to better structure these programs for Congress to consider, the Small Business Administration (SBA) and the Departments of Commerce (Commerce), Housing and Urban Development (HUD), and Agriculture (USDA) should conduct program evaluations and collect data on performance measures. This action was revised in GAO's August 2012 report, Entrepreneurial Assistance: Opportunities Exist to Improve Programs' Collaboration, Data-Tracking, and Performance Management (GAO-12-819) Specifically, in that report, GAO made two recommendations related to this action. One recommendation was to the Secretaries of USDA, Commerce, and HUD and the Administrator of the Small Business Administration to conduct more program evaluations to better understand why programs have not met performance goals and their overall effectiveness. A second recommendation was to the Secretaries of USDA, Commerce, and HUD and the Administrator of SBA to consistently collect information that would enable them to track the specific type of assistance programs provide and the entrepreneurs they serve and use this information to help administer their programs.

Type
Executive Branch
Last Updated
March 31, 2020
Priority Rec.
This is a priority recommendation.
Progress:

The four agencies—HUD, Commerce, SBA, and USDA--have taken some steps to improve program evaluation and collect information to help track program activities and administer programs that support entrepreneurs, as GAO recommended in August 2012. 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 grantee progress in implementing activities and gather improved data with regard to performance. In addition, HUD completed an extensive block grant data clean-up effort in response to a HUD Inspector General audit. According to Commerce's Economic Development Administration (EDA), the agency continues to implement its pilot evaluation framework and associated new performance measures for eight pilot grantees representing EDA's non-infrastructure programs. EDA also noted that it expects to begin collecting the new performance information for all non-infrastructure 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. The initiatives described above should help the agencies improve the collection of information on the assistance provided to entrepreneurs, and the evaluation of programs that provide such assistance. It will be important for the agencies to follow through on them.

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

The Office of Management and Budget (OMB); the Departments of Commerce (Commerce), Housing and Urban Development (HUD), and Agriculture (USDA); and the Small Business Administration (SBA) should explore opportunities to restructure programs through means such as consolidation, elimination, and collaborative mechanisms, both within and across agencies. As OMB works with the agencies to identify programmatic areas that should be better coordinated and tracked, the agencies should look for ways to consolidate programs or opportunities for greater collaboration. In addition, to better ensure the most efficient and effective delivery method for federal assistance to entrepreneurs, SBA, Commerce, HUD, and USDA should individually, and collectively, explore options for restructuring programs that target particular types of businesses or communities and report the results of their efforts to the Congress. This action was revised in GAO's August 2012 report, Entrepreneurial Assistance: Opportunities Exist to Improve Programs' Collaboration, Data-Tracking, and Performance Management (GAO-12-819). Specifically, in that report, GAO recommended that the Director of the OMB, the Secretaries of Agriculture, Commerce, and Housing and Urban Development, and the Administrator of the Small Business Administration work together to identify opportunities to enhance collaboration among programs, both within and across agencies.

Type
Executive Branch
Last Updated
March 1, 2017
Priority Rec.
This is a priority recommendation.
Progress:

The four agencies and the Office of Management and Budget (OMB) have taken steps to collaborate more in administering these programs, as GAO recommended in August 2012. 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 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. 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:
Office of Management and Budget
Department of Agriculture
Department of Commerce
Department of Housing and Urban Development
Small Business Administration
GAO Contacts