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Highlights

GAO examined Georgia community action agencies' (CAA) use of federal funds to pay for costs of administering the Department of Health and Human Services' (HHS) Low-Income Home Energy Assistance Program (LIHEAP).

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Health and Human Services 1. Since CAA in Georgia planned to spend other federal funds for LIHEAP administrative costs, which probably would have caused the state to exceed the 10-percent cost cap, and the fact that HHS compliance reviews are not designed to detect this spending, the Secretary of Health and Human Services should direct the Assistant Secretary, Family Support Administration, to require states to have a clear policy on whether other federal funds can be used to pay LIHEAP administrative expenses.
Closed - Implemented
HHS issued a memorandum, dated April 11, 1991, advising states and other grantees to adopt and implement specific policies and procedures on the use of other federal funds for LIHEAP planning and administration activities or costs.
Department of Health and Human Services 2. Since CAA in Georgia planned to spend other federal funds for LIHEAP administrative costs, which probably would have caused the state to exceed the 10-percent cost cap, and the fact that HHS compliance reviews are not designed to detect this spending, the Secretary of Health and Human Services should direct the Assistant Secretary, Family Support Administration, to require states that use CAA to provide LIHEAP services to have adequate procedures in place to ensure that CAA using community services block grants or other federal funds to administer LIHEAP do not cause the state to exceed the 10-percent ceiling on the use of federal funds for administrative costs.
Closed - Implemented
HHS issued a memorandum, dated April 11, 1991, advising states and other grantees to adopt and implement specific policies and procedures on the use of other federal funds for LIHEAP planning and administration activities or costs. HHS specifically noted that these policies and procedures should also apply to subrecipients.
Department of Health and Human Services 3. Since CAA in Georgia planned to spend other federal funds for LIHEAP administrative costs, which probably would have caused the state to exceed the 10-percent cost cap, and the fact that HHS compliance reviews are not designed to detect this spending, the Secretary of Health and Human Services should direct the Assistant Secretary, Family Support Administration, to revise HHS compliance review guides to include steps to assess whether other federal funds are being used for LIHEAP administrative and planning costs to ensure that states and their local administering agencies are adhering to the 10-percent ceiling on the use of federal funds for administrative costs.
Closed - Implemented
In March 1991, HHS revised its LIHEAP compliance review guide to include steps to identify if other federal funds are used for LIHEAP administrative costs and whether such funds would exceed the 10-percent ceiling.

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