Grants Management:

Grantees' Concerns with Efforts to Streamline and Simplify Processes

GAO-06-566: Published: Jul 28, 2006. Publicly Released: Jul 28, 2006.

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Stanley J. Czerwinski
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At least 26 federal entities distribute grants, often with differing administrative requirements. As a result, grantees may be diverting resources from program objectives to comply with varying administrative requirements. Congress, attempting to reduce this inefficiency, passed the Federal Financial Assistance Management Improvement Act of 1999, commonly referred to as P.L. 106-107. It required the Office of Management and Budget (OMB) to ensure that agencies streamline processes, develop common systems, and consult with grantees; it also required GAO to evaluate the law's effectiveness. In response, this report discusses aspects of grant administration that grantees identified as inadequate to meet the act's goals and on which further action was needed. GAO reviewed grantee comments on changes needed, obtained views from grantee associations and users of the Web portal called, performed detailed site visits at selected grantees, and obtained views of OMB.

While some progress has been made since GAO issued its report last year on interagency reform initiatives (GAO-05-355), federal grantees continue to identify areas where the goals of P.L. 106-107 have not yet been met. These include continued lack of standardization and continued inefficiencies in grant administration across agencies and technological difficulties with implementing, the Web site where grantees can find and apply for grants. Grantees report they continue to need to use different application, reporting, and payment systems, and definitions differ across agencies. Further, some inefficiencies continue to exist, such as agency grant processes not aligning with typical grantee business practices. In addition, problems using, such as search engine problems and complex registration practices, have caused grantees frustration as they have used the site for identifying and applying for grant opportunities. The Program Management Office has taken actions to address some of these problems and has plans for further improvements. Grantees GAO interviewed were concerned that, while the three federal cross-agency initiatives underway to streamline grant, the Grants Management Line of Business, and the cross-agency workgroups--were moving forward, progress to date has been inadequate. Grantees identified two specific areas where the management of P.L. 106-107 initiatives contributed to the lack of progress. They pointed out that inadequate ongoing communication with grantees before decisions on changes were made resulted in poor implementation and prioritization of initiatives. Grantees also said lack of clear objectives and a public time line for the reform process sometimes prevented them from understanding the scope and timing of planned changes.

Matter for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: As of March 2008, Congress has not taken legislative action to extend the law, and its sunset date of November 2007 has passed. However, the Grants Policy Committee will continue to implement the grant streamlining initiatives. It has developed a strategic plan and is now developing an implementation plan that will contain specifics, including time frames. According to the Chairman of the Grants Policy Committee, this plan will be used to inform the grant community that although PL 106-107 has expired, the initiative of grant streamlining will continue. He noted that the decision to continue with an implementation plan was made with the approval of OMB's Office of Federal Financial Management.

    Matter: Given that the goals in P.L. 106-107 are not likely to be met by the sunset date of November 2007, Congress may wish to consider reauthorizing the law to make certain that federal agencies have clear requirements to continue these efforts and the momentum for progress in streamlining grant administration continues. As part of the reauthorization process, Congress may wish to consider ensuring that agencies and cross-agency teams are setting goals and making progress toward P.L. 106-107's objectives.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: OMB, the Grants Policy Committee, and the Grants Executive Board have increasingly reached out to obtain grantees input as they develop and implement policies. The Grants Policy Committee Implementation Plan for fiscal years 2008 to 2013, issued December 12, 2008, includes outreach initiatives, such as improving public engagement, expanding the Grants Policy Committee community, and improving mechanisms for the stakeholder community to comment on the committee's activities, and concludes that collaboration with federal and non-federal stakeholder communities in the development of products and initiatives detailed in the plan, will help the committee achieve its goals. According to an official from OMB's Financial Standards and Grants Branch, several outreach initiatives have been undertaken. Examples of such outreach include federal officials' involvement in meetings of grantee organizations and webcasts, in which they have updated participants on policy changes and obtained their views. As OMB developed and implemented the grant-related requirements imposed by the Recovery Act, they made a big effort to involve grantees through webinars and conference calls. Further, as OMB has been planning the implementation of the Federal Funding Accountability and Transparency Act, they have also been involving grantees and keeping them informed. For example, they met with several state and local grantees in a teleconference, discussed plans, and heard their concerns and suggestions about the implementation of the new requirements. The OMB grant official noted that going forward OMB expects to continue this focus on communicating with the grantee community; plans are underway to merge the Grants Executive Committee and the Grants Policy Committee, and they will be working out a communication plan for continuing to outreach to grantees as policies are being developed.

    Recommendation: OMB should ensure that the Grants Executive Board and the Grants Policy Committee identify and implement approaches to obtaining grantees' input as policies and procedures are being developed by these lead groups.

    Agency Affected: Executive Office of the President: Office of Management and Budget


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