Limited Progress Made in Consolidating Grants to Insular Areas

GGD-81-61: Published: Jul 10, 1981. Publicly Released: Jul 10, 1981.

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GAO reported on the progress made in consolidating grants to insular areas. Title V of Public Law 95-134 was passed to ease the insular areas' burden of applying for and reporting on Federal grant and assistance programs. Under the law, Federal agencies are allowed to consolidate any or all grants to the U.S. insular areas of the Virgin Islands, Guam, American Samoa, Trust Territory of the Pacific Islands, and the Government of the Northern Mariana Islands.

GAO found that many Federal agencies have not offered consolidated grants to the insular area governments, and those agencies which have offered consolidated grants have limited the number of programs available for consolidation. For the most part, those agencies participating or planning to participate are not minimizing the administrative burden to the extent anticipated by the insular areas. Federal agencies have taken different approaches on which application, reporting, and matching requirements should be retained or modified for consolidated grants. Although some agencies have eliminated or modified these requirements, most have not. However, it is these program requirements that the insular area governments contend are causing the greatest administrative burden. Finally, the fund allocation flexibility of insular area governments participating in consolidated grants is being affected by Federal agencies although the act seems clear that fund determinations rest with the insular areas. Some agencies have placed specific restrictions on the insular areas' authority to shift funds among programs. Other agencies have retained existing program regulations which require compliance with financial set-aside provisions. The application of these restrictions and regulations may be undermining the fund allocation flexibility granted to the insular areas by title V.

Matter for Congressional Consideration

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    Matter: Congress should amend title V, where necessary, to address such questions as: (1) whether Federal agencies should be required to consolidate grants and which financial assistance grants should be required to be included in the consolidations; (2) whether Federal agencies might properly modify existing rules and regulations of programs included in consolidated grants and what the scope of their authority is to do so; (3) whether all Federal agencies should be required to waive all matching requirements; and (4) whether restrictions might properly be placed on the Insular Areas' flexibility to allocate funds under a consolidated grant.


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