Grants Management: Additional Actions Needed to Streamline and
Simplify Processes (18-APR-05, GAO-05-335).
The federal government distributed about $400 billion in federal
grants in fiscal year 2003 through about 1,000 different federal
grant programs administered by several federal agencies with
different administrative requirements. Congress, concerned that
some of these requirements may be duplicative, burdensome, or
conflicting--and could impede cost-effective delivery of
services--passed the Federal Financial Assistance Management
Improvement Act of 1999, commonly called P.L. 106-107, and
mandated that GAO assess the act's effectiveness. This report
addresses (1) progress made to streamline and develop common
processes for grantees and (2) the coordination among the Office
of Management and Budget (OMB), the agencies, and potential grant
recipients.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-05-335
ACCNO: A21838
TITLE: Grants Management: Additional Actions Needed to
Streamline and Simplify Processes
DATE: 04/18/2005
SUBJECT: Electronic government
Federal grants
Federal law
Government grants
Grant administration
Grant award procedures
Interagency relations
Internet
Policy evaluation
Program evaluation
Policies and procedures
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GAO-05-335
United States Government Accountability Office
GAO Report to Congressional Committees
April 2005
GRANTS MANAGEMENT
Additional Actions Needed to Streamline and Simplify Processes
a
GAO-05-335
[IMG]
April 2005
GRANTS MANAGEMENT
Additional Actions Needed to Streamline and Simplify Processes
What GAO Found
More than 5 years after passage of P.L. 106-107, grant agencies have made
progress in some areas of grant administration, but in other areas,
particularly the development of common reporting systems, progress is just
beginning. Grant-making agencies together developed a common plan for
streamlining processes. Several cross-agency teams identified changes that
should be made, and these plans are in various stages of completion. For
example, a Web-based system, Grants.gov, is now available to help
potential grantees identify grant opportunities and apply for them
electronically. Common forms are being developed to eliminate duplication
and unnecessary differences among agencies. However, efforts toward common
electronic systems for reporting financial and performance information
have not been developed, although the law requiring them sunsets in 2007.
Further, individual agencies have not all reported on their progress
annually, as required.
The individual agencies and the cross-agency work groups have a mixed
record of coordinating with grantees. For example, the cross-agency work
groups solicited public input to their early plan. Grants.gov publicizes
its plans and solicits ongoing grantee input through its Web site and user
surveys. However, the work groups generally have not made information
about their work public nor solicited ongoing grantee input. Without such
input, reforms are less likely to meet the needs of grantees. In general,
the oversight of streamlining initiatives has shifted, potentially
contributing to the lack of progress on all aspects of grant management.
United States Government Accountability Office
Contents
Letter
Results in Brief
Background
Some Progress Made in Streamlining Grant Administration across
Agencies, but More Progress Is Needed Coordination Activities Established
across Agencies, but Initiatives
Lack Continuing Input from Grantees Conclusions Recommendations for
Executive Action Agency Comments and Our Evaluation
1 3 4
8
18 25 27 27
Appendixes
Appendix I:
Appendix II: Appendix III: Appendix IV:
P.L. 106-107 Annual Reports Submitted to Congress as of March 1, 2005
Detailed Information on Grants.gov
Comments from the Office of Management and Budget
GAO Contacts and Staff Acknowledgments
GAO Contacts Acknowledgments 29
31
36
38 38 38
Tables Table 1: Current Cross-Agency Work Groups Addressing P.L.
106-107 Objectives 12
Table 2: Status of Streamlining Initiatives and Their
Expected
Impact on Grantees 14
Table 3: P.L. 106-107 Annual Reports Submitted to Congress as
of
March 1, 2005 30
Table 4: Status of Agency Participation in Grants.gov "Apply"
Component (as of April 6, 2005) 34
Figures Figure 1: Grant Life Cycle Figure 2: P.L. 106-107
Implementation and Oversight Groups 7 19
Contents
Abbreviations
FACA Federal Advisory Committee Act of 1972
OMB Office of Management and Budget
HHS Department of Health and Human Services
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. However, because this
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copyright holder may be necessary if you wish to reproduce this material
separately.
A
United States Government Accountability Office Washington, D.C. 20548
April 18, 2005
The Honorable Susan M. Collins
Chairman
The Honorable Joseph I. Lieberman
Ranking Minority Member
Committee on Homeland Security and Governmental Affairs
United States Senate
The Honorable Tom Davis
Chairman
The Honorable Henry A. Waxman
Ranking Minority Member
Committee on Government Reform
House of Representatives
The federal government distributed about $400 billion in federal grants in
fiscal year 2003, which accounted for almost one-fifth of the federal
budget.
Funds from these grants are used to implement about 1,000 different
federal grant programs, administered and overseen by 26 different federal
agencies as well as some smaller federal entities. These grant programs
generally have different objectives and strategies that are reflected in
their
application, selection, monitoring, and reporting processes. In seeking
out,
using, and reporting on these grants, grantees-with a wide variety of
resources and expertise-must adapt to the different requirements,
potentially spending valuable time and resources on administrative issues
rather than in advancing the causes that the grant funds were intended to
affect. Congress, concerned that some of these administrative
requirements may be duplicative, burdensome, or conflicting and could
impede the cost-effective delivery of services at the local level, passed
the
Federal Financial Assistance Management Improvement Act of 1999,
commonly referred to by the grants community as P.L. 106-107.1 The act
required coordination among federal grant-making agencies to streamline
administrative requirements and to improve coordination among federal
grantor agencies and their nonfederal partners.
1As defined in the act, "federal financial assistance" includes grants,
cooperative agreements, loans, loan guarantees, insurance, interest
subsidies, and other forms of assistance. Pub. L. No. 106-107, S:4. The
current streamlining efforts have focused on grants and cooperative
agreements. In our evaluation we have also limited our assessment to
grants and cooperative agreements and, for simplicity, refer to them as
grants.
When the act was passed, it specifically mandated a study by GAO that
would assess the act's effectiveness, make specific recommendations to
improve its implementation, evaluate each grantor agency's performance in
achieving its planned goals and objectives, and assess the coordination
among key players. In this report, we will address (1) what progress has
been made to streamline and develop common processes for grantees and (2)
the extent of coordination among the Office of Management and Budget
(OMB), the agencies, and potential grant recipients. We plan to focus
future work on assessing the impact of grant-process reforms on the
diverse array of grant recipients.
To address our objectives, we reviewed P.L. 106-107 to understand its
requirements. We also reviewed the common plan developed by the 26
grant-making agencies and the subsequent annual reports from the agencies
as submitted to OMB and Congress. We met with officials from (1) OMB, (2)
cross-agency work groups established to address the objectives of P.L.
106-107, and (3) two specific initiatives that are closely related to the
law's streamlining objectives-a common Web portal for potential grantees
to identify and apply for grants (referred to as Grants.gov) and an
initiative to streamline grant management within agencies (referred to as
the Grants Management Line of Business initiative). To assess agency
progress we analyzed the agencies' 2004 annual reports to identify
significant progress. We attempted to identify tangible and quantifiable
results that met the goals laid out in the common plan, as well as the
objectives of the act. To provide more in-depth perspective on the
implementation of grant streamlining efforts and coordination with other
agencies and grantees, we met with officials from four agencies-the
Department of Transportation, the Department of Health and Human Services
(HHS), the National Endowment for the Humanities, and the National Science
Foundation. In selecting these agencies, we considered the number of
subagencies, the types and amounts of grants dispersed, the types of grant
recipients, and the level of participation in specific streamlining
activities. To analyze the coordination within and among agencies and with
grantees, we compared agency coordination efforts with criteria developed
in our prior work, and we discuss the criteria in the report. Although we
had some initial discussions on grant administration with organizations
representing grantees, we plan to obtain views from a wider spectrum of
grantees in a second study responding to the P.L. 106-107 mandate. We
conducted our work in accordance with generally accepted government
auditing standards from March 2004 through March 2005.
Results in Brief More than 5 years after passage of P.L. 106-107,
cross-agency work groups have made some progress in streamlining aspects
of the early phases of the grants life cycle and in some specific aspects
of overall grants management; however, efforts toward common electronic
systems for reporting financial and performance information have not
progressed, although the law requiring these improvements sunsets in 2007.
After P.L. 106-107 was passed in 1999, OMB designated HHS as the lead
agency in implementing the act. Grant-making agencies provided staff to
work groups, which developed a common plan and set goals for streamlining
procedures related to all phases of grant management. These plans are in
various stages of completion. For example, a new Web-based system, called
Grants.gov, is now available to help potential grantees identify grant
opportunities more easily and apply for them electronically. OMB has most
recently initiated a major cross-government effort called the Grants
Management Line of Business initiative, which seeks to provide a
governmentwide solution to manage agencies' grant activities. According to
the cross-agency team responsible for the initiative, it will attempt to
consolidate grant management systems across agencies and may include a
common system for financial and performance reporting, but development of
such a system has not begun. The cross-agency work groups have identified
other potential reforms. Some have been implemented, such as developing a
standard format for the announcement of grant opportunities. Other changes
have been proposed but have not yet been implemented, such as developing
standard reports for grantees to complete, which should reduce the
administrative burden of completing different reports for each associated
grant-making agency.
Several cross-agency groups have coordinated the grant streamlining
efforts of the federal grant-making agencies, but coordination with the
grantee community, required under P.L. 106-107, has been more limited. The
Grants Executive Board, which has members from 13 grant-making agencies,
oversees the implementation work groups and the Grants.gov initiative.
However, uncertainty about the roles of the various implementation groups
appears to have hampered progress. In their early work, the groups
undertook efforts to coordinate and consult with the grantee communities;
these efforts included public consultation meetings and solicitations of
public comments. The Grants.gov initiative has built coordination with the
users into the process; users have been surveyed three times, and there
have been continuing efforts to publicize its availability and provide
training to the grantee community. However, as the
work groups address other aspects of streamlining, they have not been
involving the grantee community to the same extent.
We are recommending that OMB take several actions to augment the progress
toward meeting the goals of P.L. 106-107. In its written comments on our
draft report, OMB generally agreed with our findings and recommendations,
and provided comments on its status related to the recommendations. In
addition, we received technical comments verbally from OMB officials,
which we incorporated in the report as appropriate.
Background Congress, concerned about the burden on grantees of multiple,
varying requirements imposed by different grant programs, passed P.L.
106-107 in 1999. The act's objective is to improve the effectiveness and
performance of federal financial assistance programs, simplify federal
financial assistance application and reporting requirements, improve the
delivery of services to the public, and facilitate greater coordination
among those responsible for delivering such services. The act required
agencies to establish common applications, systems, and uniform rules to
improve the effectiveness and performance of federal grants with the goal
of improved efficiency and delivery of services to the public. Under P.L.
106-107, OMB is required to direct, coordinate, and assist federal
agencies in developing and implementing a common application and reporting
system, including electronic processes with which a nonfederal entity can
apply for, manage, and report on the use of funds from multiple grant
programs that serve similar purposes but are administered by different
federal agencies. The act sunsets in November 2007.
The complexity and diversity of the grants system makes streamlining a
difficult endeavor. Multiple federal entities are involved in grants
administration; the grantor agencies have varied grants management
processes; the grantee groups are diverse; and grants themselves vary
substantially in their types, purposes, and administrative requirements.
The federal grant system continues to be highly fragmented, potentially
resulting in a high degree of duplication and overlap among federal
programs.2 Hundreds of federal grant programs implement various domestic
policies and have administrative requirements that may be
2GAO, Federal Assistance: Grant System Continues to Be Highly Fragmented,
GAO-03718T (Washington, D.C.: Apr. 29, 2003).
duplicative, burdensome, or conflicting-which can impede the effectiveness
of grants programs.
Multiple federal entities are involved in grants management. The Federal
Grant and Cooperative Agreement Act of 1977 gives OMB the authority to
issue supplementary interpretive guidelines to promote consistent and
efficient use of grant agreements.3 OMB publishes this guidance to federal
agencies in OMB circulars and federal agencies issue regulations
implementing the OMB guidance. The General Services Administration is the
lead agency in charge of disseminating information on funding
opportunities. It publishes, in both electronic and print form, the
Catalog of Federal Domestic Assistance, a searchable database of federal
financial assistance programs.
There is substantial diversity among the federal agencies that administer
grants. Some agencies administer many grants through multiple,
decentralized subagencies, while other agencies have small, centralized
grant-making offices that administer only a few, small grant programs. For
example, in fiscal year 2003, HHS administered 282 grant programs that
distributed approximately $246 billion through its 16 subagencies, while
the National Endowment for the Arts administered 3 grant programs that
distributed approximately $95 million.
Grant programs are diverse in their structure and purpose. Grants can be
grouped into three types based on the amount of discretion given to the
grantee for the use of funds. Each type strikes a different balance
between the desire of the federal grantor that funds be used efficiently
and effectively to meet national objectives and the desire of the grantee
to use the funds to meet local priorities and to minimize the
administrative burdens associated with accepting the grant. Categorical
grants allow the least amount of recipient discretion, general
revenue-sharing grants the most, and block grants an intermediate amount.
Grant funds may also be grouped by their method of allocating funds, that
is, by formula, through discretionary project grants, or both. Formula
grants allocate funds based on distribution formulas prescribed by
legislation or administrative regulation. Project grants are generally
awarded on a competitive basis to eligible applicants. Grant programs fund
a variety of types of programs, including training, research, planning,
evaluation, capacity building, demonstration projects, construction, and
service provision in many
3Pub. L. No. 95-224, S:9.
different areas including health care, education, law enforcement, and
homeland security. The diversity of grant programs is matched by the
diversity of grant recipients. Grant announcements identify the eligible
recipients, which may include states and their agencies, local
governments, tribal governments, nonprofit organizations, research
institutions, and individuals.
The opportunities to streamline grants administration differ throughout
the life cycle of a grant. While there is substantial variation among
grants, generally grants follow the life cycle as shown in figure 1:
announcement, application, award, postaward, and closeout. Once
established through legislation, which may specify particular objectives,
eligibility, and other requirements, a grant program may be further
defined by grantor agency requirements. For competitive grant programs,
the public is notified of the grant opportunity through an announcement,
and potential grantees must submit applications for agency review. In the
awards stage, the agency identifies successful applicants or legislatively
defined grant recipients and awards funding. The postaward stage includes
payment processing, agency monitoring, and grantee reporting, which may
include financial and performance information. The closeout phase includes
preparation of final reports, financial reconciliation, and any required
accounting for property. Audits may occur multiple times during the life
cycle of the grant and after closeout.
Figure 1: Grant Life Cycle
Agency processes Stage Grantee processes
1.
Announce opportunity Announcement stage Find opportunity
o Provide administrative (preaward) o Identify potential
and technical support opportunity
o Develop proposal
Receive applications Submit application
o Authenticate applicant, o Submit application
apply business rules, and 2. Application package for competitive
ensure administrative stage (preaward) grant or other preaward
compliance documents for
noncompetitive grant
Review and decision Status review
o Conduct reviews
(administrative, budget, o Check status of
policy, merit, business, application
application, certifications,
and
assurances)
Award notification Receive notification of
3. Award stage award
o Notify the grantee and o Complete award
Congress and publicly acceptance documents, if
announce the award required
Request and receive
Disburse payment payment
o Process payments to o Request disbursement of
grantee grant funds
4.
Postaward
Management and oversight stage Perform grant requirements
and submit reports
o Conduct site visits and o Comply with award terms
review grantee reports and conditions, including
general administrative
requirements and cost
principles
o Submit appropriate
financial, performance and
other reports
5.
Closeout Closeout Closeout
stage
o Review and reconcile o Submit final audit and
final audit and other other reports, as required
reports
Source: GAO.
Some Progress Made in Streamlining Grant Administration across Agencies,
but More Progress Is Needed
To implement P.L. 106-107's requirement to improve the effectiveness and
performance of federal grants, a common plan was developed and most, but
not all, grant-making agencies have submitted reports annually on their
progress toward this plan as required by the law. The work groups have
identified several changes that should be made, but many of these are
still in the developmental or approval stages. One particular extensive
effort- the development of a Web portal called Grants.gov that represents
a common face to grantees-has enabled grantees to identify relevant grant
opportunities and, to a limited extent, apply electronically for grants.
For the later phases of the grant life cycle, a new initiative is under
way, the Grants Management Line of Business, that will encompass all
phases of the grant life cycle and specifically address simplifying the
administration and management of grants.
In 2001 Agencies Developed a Common Plan to Guide Federal Grant
Streamlining Efforts
P.L. 106-107 requires that under OMB leadership, agencies develop common
applications, systems, and administrative rules to improve the
effectiveness of federal grants. To implement this requirement, a
crossagency committee established cross-agency work groups. The work
groups then identified needed changes and developed a common plan for
implementing P.L. 106-107. Twenty-six federal grant-making agencies agreed
to use this common plan to meet the law's requirements, since meeting its
objectives required them to work together to a large extent. The plan,
submitted to Congress and OMB in May 2001, was developed under the
oversight of the initial interagency governance structure established to
implement P.L. 106-107. A series of five public consultation meetings was
held with representatives from states, local governments, Native American
tribes and tribal organizations, universities and nonprofit organizations
that conduct research, and other nonprofit organizations. Comments from
these meetings were considered in developing the plan.
The common plan contained goals and objectives intended to meet the
requirements of P.L. 106-107. It included progress, accomplishments, and
planned activities for streamlining and simplifying the award and
administration of federal grants. The plan addressed the life cycle of the
grant process, supporting processes, systems and standards, as well as
other issues. Some specific objectives included (1) streamlining,
simplifying, and improving announcements of funding opportunities and
related business processes, application requirements and procedures, and
award documents; (2) streamlining and simplifying standard and unique
report forms, allowing for electronic submission of reports, achieving
greater uniformity in federal business processes for reporting, and
improving reporting by recipients; (3) simplifying and standardizing, to
the extent appropriate, general administrative requirements and agency
treatment of them in the terms and conditions of award; and (4) fully
developing and implementing a portal for identifying and applying for
grants, and ensuring that any revised electronic data standards are
interoperable and present a common face to grant-making agencies,
applicants, and recipients.
The common plan also included some process improvements that began before
passage of P.L. 106-107 and were completed prior to adoption of the plan
or are still continuing today. For example, since 1998 the federal
government has required grant-making agencies to transition from various
payment systems to one of three designated systems. The common plan
included objectives and milestones directly related to such past
activities that have been incorporated into the plan. The plan is also
built on successful models resulting from earlier initiatives of
individual agencies or interagency groups. For example, one objective of
the common plan was to ensure that federal agencies' grant financial
systems comply with requirements established by the Joint Financial
Management Improvement Program.
Agency Progress Varies, and Not All Have Filed Annual Reports
Annual governmentwide progress reports describe the collaborative efforts
of 26 federal agencies. Each agency also reports annually on its progress
implementing the plan, although not all agencies have regularly submitted
these reports. The annual governmentwide progress report describes the
collaborative efforts to streamline and simplify the award and
administration of federal grants. The report includes the federal
government's steps toward simplification of the grant policy framework.
For instance, the establishment of a central location for OMB guidance to
federal agencies and agency regulations implementing that guidance will
make it easier for the applicants and recipients to find and follow
administrative requirements. It also includes completed initiatives, such
as the development and use of a standard format for agencies' funding
announcements, which aims to make it easier for potential applicants to
quickly find specific information in the announcements.
P.L. 106-107 requires each federal grant-making agency to provide an
annual progress report that evaluates its performance in meeting the
common plan's goals and objectives. However, only 22 of the 26 agencies
have submitted their 2004 annual report to Congress. (See app. I for
information on agencies submitting reports for 2002 to 2004.) Agencies
have reported progress in implementing some streamlining activities. For
example, HHS has worked toward the internal consolidation from nine to two
grant management systems, one primarily supporting research grants and the
other primarily supporting nonresearch, or service grants. Another agency,
the National Science Foundation, reported it is conducting a comprehensive
business analysis that will highlight areas where grant processes can be
streamlined and simplified. Also, the National Endowment for the
Humanities reported it has streamlined the internal agency clearance
process, which is the mechanism by which all grant applications'
guidelines and forms are reviewed and updated every year.
Some factors, both internal and external to the grant-making agencies, may
have slowed agencies' progress in fully implementing streamlining
activities and have contributed to the lack of progress in adopting common
governmentwide systems. The different business processes at various
agencies was one reason agencies reported a hesitation to migrate to a
common grant management system. For example, the National Science
Foundation reported that it conducts peer reviews of broad research grant
programs, which require an entirely different type of management system
when compared to the Department of Transportation, which generally manages
noncompetitive formula grants to state and local governments.
The structure and size of an agency's grant management program is another
factor that may affect the agency's progress toward grant streamlining.
For example, some smaller agencies such as the National Endowment for the
Humanities, which has a highly centralized grant management operation,
reported being able to more quickly adopt some of the governmentwide grant
streamlining initiatives. However, other agencies that manage grant
programs from many different operating divisions may take longer to make
changes due to the decentralized organizational structure and the larger
number of grant programs.
Lastly, some agencies had existing online grant management systems before
the passage of P.L. 106-107 and the development of Grants.gov. The
integration of preexisting grant streamlining achievements in some
agencies, such as the common announcement form adopted from National
Science Foundation and National Endowment for the Humanities work, allows
those agencies to realize more immediate benefits because much of the work
was completed prior to implementation of the common plan. Agencies, such
as the Department of Transportation, that have not fully implemented
internal streamlining initiatives need to do so before they can
fully benefit from the approaches adopted by other agencies or the
crossagency work groups.
P.L. 106-107 also required agencies to establish performance measures and
a process for assessing the extent to which specified goals and objectives
have been achieved. In developing these performance measures, the agencies
were to consider input from applicants, recipients, and other
stakeholders. The annual agency progress reports did not include any such
performance measures or evaluations. Each of the agencies' progress
reports varied in detail and included a narrative of some of the actions
taken to meet identified goals and objectives. Attempts to compare the
progress of federal agencies to each other are difficult due to the
missing reports and the lack of performance measures.
Cross-Agency Work Groups Developed Policies to Streamline, but Many Are
Not Implemented Yet
After P.L. 106-107 was enacted, several cross-agency work groups were
created to facilitate the law's implementation; while some of their
developments have been implemented, others are still in progress. The
teams, which focused on different phases of the life cycle of grants,
identified initiatives that should be undertaken. To identify priorities
for action, the teams relied on comments from the grantee community on
what streamlining should occur and on their own knowledge of grants
management. With many potential areas on which to focus, some work group
representatives commented to us that they addressed the "lowhanging
fruit," preferring to work on those tasks that were more readily
accomplished while yielding strong results. The current work groups and
their responsibilities are shown in table 1. In addition, some groups have
subgroups that have taken responsibility for key products. The work groups
are supported to some extent by additional contract staff funded initially
by the Chief Financial Officers Council.
Table 1: Current Cross-Agency Work Groups Addressing P.L. 106-107 Objectives
Work groups Responsibilities
Pre-Award Identifying streamlining and simplification opportunities in the
phase of the grants life cycle during which potential applicants for
discretionary grants identify funding opportunities, and prepare and
submit applications, and applicants are notified if their applications
were unsuccessful or, if their applications were successful, receive
awards.
Post-Award Identifying streamlining and simplification opportunities in
the phase of the grants life cycle during which recipients perform their
awards and submit progress, financial, and other required reports (other
than audit reports) and request and receive payment, and federal agencies
monitor awards for compliance, oversee progress, and provide technical
assistance.
Mandatory Grantsa Identifying streamlining and simplification
opportunities for mandatory grants, which include block grants, some
formula-based grants, and entitlement grants.
Audit Oversight Improving the OMB Circular A-133 single audit process to
ensure that audits provide useful and reliable information to federal
agencies and pass-through entities and that recipient audits are in
compliance with federal audit requirements.
Training and Certification Addressing governmentwide issues concerning the
grants management workforce. Developing the grants management series as a
professional series and developing standards for grants management
training programs. (This group began organizing in January 2005.)
Source: Grants.gov.
aThese are noncompetitive grants for which eligibility is defined in
statute.
The cross-agency work groups have accomplishments that are expected to
streamline grant activity for grantees, as described in table 2. For
example, the Pre-Award Work Group focused on reducing the time a grantee
must spend searching for information on grants. One concern was
inconsistent announcement formats. The team believed that a consistent
format for grant announcements would save time and reduce frustration for
grantees that applied to different programs. The group also developed the
standard set of data elements for the Grants.gov "find" feature, thereby
ensuring that users of Grants.gov will find similar information in the
same places for different grant descriptions. The Audit Work Group
developed and distributed a pamphlet clarifying the single audit process.4
It also ensured that OMB Circular A-133, Compliance Supplement, was
updated annually. This update should ensure that grantees' auditors can
more easily identify the criteria that they should use as they assess
whether grantees are in compliance with grant requirements.
4Single audits, required by the Single Audit Act of 1984 (Pub. L. No.
98-502) as amended by the Single Audit Act Amendments of 1996 (Pub. L. No.
104-156), streamline and improve the effectiveness of audits of federal
awards and reduce the audit burden on states, local governments, and
nonprofit entities receiving federal awards by replacing multiple grant
audits with one audit of a recipient as a whole.
One area on which the work groups made progress was establishing a common
electronic system through which information on available grants could be
found and applicants could apply for grants, now called Grants.gov.5 At
that point, identifying grant opportunities required searching information
from many agencies and applying for them using a variety of application
forms and processes. The work groups developed a common format for the
full announcement to be used governmentwide and a related set of data
elements for an electronic synopsis of the announcement. Grants.gov, now
administered by a program management office based in HHS, has provided the
ability for potential grantees to search open grant opportunities by these
key components, such as by the type of activity funded (e.g., education or
the environment) and the agency providing funds. Grantees also can request
notification of grant opportunities that meet certain parameters that they
identify. Grant opportunities were initially provided on the system in
February 2003, and in November 2003, OMB required that federal agencies
post information on all discretionary grant-funding opportunities at the
Web site. The Grants.gov Program Management Office reports that since
October 2003 all 26 grant-making agencies have listed their discretionary
grant opportunities. They also report high growth in usage of the portal;
Grants.gov reports that in November 2004, the "find" activity on the site
received about 2.2 million page requests, up from about 633,000 in
November 2003, and applicant e-mail notifications have averaged 600,000 to
700,000 weekly.
More recently, Grants.gov has provided the capability to apply for grants
electronically at a common portal and, to some extent, use common forms
across agencies. Applicants can download an application package; complete
the application off-line; and submit it electronically to Grants.gov,
which transmits the application to the funding agency. Grant-making
agencies work with the program management office staff to identify the
forms needed, sometimes using the same forms as other programs and other
agencies use. Grant applicants are notified electronically when agencies
receive their applications. In some cases, agencies can download the grant
application data directly to their own internal systems, thus eliminating
the need for staff to input data. Use of the online applications, however,
has been slow to grow. As of April 6, 2005, 6 of the 26 key grantmaking
agencies had not yet posted "apply" packages, and about 2,600
5Formerly, Grants.gov was referred to as E-Grants. It is one of the
"E-gov" initiatives and supports the President's Management Agenda goal of
expanding electronic government.
electronic applications had been received. Use of the system requires
agencies to set up internal systems and, to some extent, have their forms
loaded onto the site. Grantees must also complete a registration process,
which we were told is time-consuming and might be viewed by some
applicants as intimidating but is necessary, according to OMB officials,
to ensure privacy and to maintain the security of the system.
Funding for Grants.gov has shifted from obtaining contributions from key
partners to obtaining a set amount from grant-making agencies. For fiscal
years 2002 through 2004, Grants.gov was funded by contributions totaling
about $29.4 million. Beginning with fiscal year 2005, it will be funded
with payments from 26 grant-making agencies, based on an agency's total
grant dollars awarded. For 2005 and 2006, the 6 large agencies will be
assessed $754,467, the 10 medium agencies will be assessed $452,680, and
the 10 small agencies will be assessed $226,340, for a total of about
$11,300,000 each year. Appendix II provides more detailed information on
Grants.gov and individual agency information on progress toward
implementing its "apply" component.
Table 2: Status of Streamlining Initiatives and Their Expected Impact on
Grantees
Initiative by grant phase Status Expected impact on grantee Announce/find grant
opportunity
Standard announcement format Accomplished Enable potential grantees to
find grant information, such as eligibility requirements, in the full
announcement more quickly.
Grants.gov "find" feature Accomplished Provide a common, searchable online
location for all open discretionary grant opportunities, with a link to
the full announcement, and reduce the administrative burden on potential
grantees of finding relevant grants.
Grant application
Data Universal Numbering Accomplished No direct benefit for grantees.
System (DUNS)
requirement
Provide a common online location
Grants.gov "apply" feature Accomplished for obtaining grant
application forms and submitting
a grant application.
Benefit applicants and
Update the debarment and recipients by reconciling
suspension and drug- Accomplished unnecessary
free workplace common rules differences, using plain
language, and simplifying the
requirements of the rules.
Adopt the SF-424 a standard Reduce the number of different
federal form for In progress forms that grantees need to
research and related grant complete when applying to
applications different agencies.
Expand Grants.gov "apply" Provide common location for
feature to accept In progress submitting annual plans and
electronic plans and updates.
applications for mandatory
grants
(Continued From Previous Page)
Initiative by grant phase Status Expected impact on grantee
Application review and decision
None
Notification of grant award
Standard award notice and standard governmentwide terms and conditions
In progress Reduce unnecessary burden on recipients by making federal
agencies' awards as alike as practicable.
Post announcement of mandatory grant awards on Grants.gov
In progress Enable potential grantees to find pass-through grant funding
opportunities. Increase the transparency of federal grants policy.
Payment
Consolidate to three payment systems (applies only In progress Reduce the
number of payment systems with which grant to the agencies subject to the
Chief Financial recipients will need to interact, potentially saving
software and Officers Act) staff training costs.
Reporting
Streamline cost principles Accomplished Provide consistent descriptions
and clarifying language for similar cost items across the three OMB cost
principles circulars.
Develop: In progress Reduce the administrative burden of
having different reports to
o Standard Federal complete for each associated
Financial Report grant-making agency.
o Standard Non-research
Performance Progress
Report
o Standard Research
Progress Report
o Standard Personal
Property Report
o Standard Real Property
Report
o Standard Summary Report
of Inventions
Audit
Improve agency access to No direct benefit expected for
audit information, Accomplished grantees. (Primarily will
benefit
including delinquent audits federal agencies by helping them
to determine whether certain
grantees are delinquent in
submitting their audits, and
enabling
agencies to make better use of
audit results in managing their
grant programs and awards.)
Update the OMB Circular A-133, Provide auditors with accurate and
Compliance Accomplished up-to-date information for
Supplement, annually the conduct of single audits.
Distribute a pamphlet, Highlights of
the Single Audit
Process, to federal recipients and
federal agencies
Accomplished Ensure a better understanding of the single audit process and
improve audit timeliness.
Increase the audit threshold for single audits from $300,000 to $500,000
Accomplished Fewer grantees will be subject to single audit requirements.
Closeout
None
Crosscutting issues
Colocate OMB guidance to agencies and agency In progress Make OMB guidance
and agency regulations on grants easier
regulations implementing the guidance in Title 2 of to find and use.
the C.F.R.
Source: GAO analysis of cross-agency annual reports and discussions with
agency officials.
Several reforms are partially under way but have not yet completed the
approval process or been implemented, as shown in table 2. For example, a
separate standard application form for research (and related) grants has
been proposed, which will ensure that multiple agencies will be able to
use the same application. This should simplify applications for grantees
who apply for grants at multiple agencies, but this form is not yet
approved. Similarly, the Post-Award Work Group has developed a common
Performance Progress Report for nonresearch grants and has received agency
comments on the proposed form. The group expects that this will reduce the
concern that too many different progress reports are used, which poses a
substantial administrative burden for grantees. The work group also
developed several common forms, such as a Real Property Report (which
addresses real property built with grant funds) and a federal financial
report, which, as of December 22, 2004, was with OMB for approval. The
Mandatory Work Group is developing a set of core data elements that could
be used to post mandatory awards to the Grants.gov Web site, which an OMB
official commented would enable potential contractors to be aware of funds
that states and other entities were receiving. Additionally, based on an
initiative begun by the Pre-Award Work Group, OMB has moved one of its
circulars, which provides guidance, to a newly created Title 2 of the Code
of Federal Regulations and plans that agencies will eventually colocate
their grant regulations in the same title.6
Common Systems for Managing Although the Grants.gov portal has provided a
common, electronic system
Later Parts of Grant Life Cycle for helping grantees identify and apply
for grants, development of common,
Are at Early Stages of electronic systems for managing later stages of the
grant life cycle has not
Development progressed. When originally planned, the Grants.gov portal was
envisioned as providing a common face to grantees for managing all phases
of grants, from grantees' identification of appropriate grant
opportunities through application, awarding, and management of the grants.
However, in early 2004, OMB instructed Grants.gov officials to cease their
efforts to develop common systems for the grant phases beyond application
and to concentrate on ensuring that electronic applications were fully
implemented at all grant-making agencies, since some agencies still were
not participating or were participating at minimal levels.
In March 2004, OMB initiated a governmentwide analysis of five lines of
business that would support the President's Management Agenda goal of
6Although located in the Code of Federal Regulations, the OMB circulars
and policy documents will still be guidance to federal agencies, not
regulations.
expanding electronic government, with one of them focusing on grants
management.7 The team was to draft and finalize common solutions and a
target architecture and present them for the fiscal year 2006 budget
review. The grants management initiative was headed by representatives
from the Department of Education and the National Science Foundation.
The Grants Management Line of Business initiative has the specific
objective of developing a governmentwide solution to support end-to-end
grants management activities8 that promote citizen access, customer
service, and agency financial and technical stewardship. To provide
information, the team requested and analyzed information from interested
parties on possible solutions and approaches. The team also surveyed
grant-making agencies on their internal grant-making systems and found
that about 40 different internal agency systems were operating, ranging
from systems operating with almost no automation to systems that are fully
automated. In evaluating the information, the team did not identify any
endto-end business or technical solution for grants management that would
be able to meet the needs of all 26 agencies without large investments in
configuring and customization. Further, it found that while the early
stages of the grant life cycle (i.e., connecting potential grantees with
grant opportunities and the application process) were already handled
consistently across grantor agencies, postaward activities are handled
less consistently across agencies and would require flexibility in
business rules.
As a result, the team is proposing a consortia-based approach to continue
streamlining and consolidating the end-to-end grant management process,
but development of this system is not yet under way. It would use
Grants.gov as a "storefront" to support grantees and would expand it
beyond the current processes to include additional functions that
interface with the grantees. Rather than develop one system that all
agencies would use to manage grants internally, consortia of agencies with
similar systems, such as agencies that primarily fund research grants,
would be formed. Government, industry, or both will provide information
technology service centers for agencies throughout the grant life cycle,
an approach that is expected to reduce or eliminate the costs of multiple
agencies developing and maintaining grants management systems.
7The other groups address financial management, human resources
management, federal health architecture, and case management.
8End-to-end activities would address steps in the entire grant life cycle
from informing potential grantees of a funding opportunity to closing out
and auditing grants.
Coordination Activities Established across Agencies, but Initiatives Lack
Continuing Input from Grantees
As P.L. 106-107 and the common plan emphasized, coordination among the
agencies and with grantees in the planning and implementation of
grantstreamlining initiatives can increase the likelihood that the
standard processes and policies developed will meet the diverse needs of
all the stakeholder groups. While the agencies have established
cross-agency processes to facilitate coordination activities, progress has
been hampered by frequent changes in the groups that are implementing and
overseeing the implementation of P.L. 106-107. The various
grant-streamlining initiatives have had different levels of coordination
activities with grantees. The P.L. 106-107 work groups solicited input
from the grantee community during their early planning stages, but do not
have ongoing coordination activities. The Grants.gov initiative solicits
ongoing input from grantees in a variety of ways. It is not yet clear if
the Grants Management Line of Business initiative will include
coordination activities with grantee groups.
P.L. 106-107 requires OMB to direct and coordinate the federal agencies in
establishing an interagency process for achieving grant streamlining and
simplification. Furthermore, the act directs the federal agencies to
actively participate in this interagency grant-streamlining and
simplification process. Because the agencies are developing common
policies and processes to meet their diverse grants management needs, a
wellimplemented interagency process can improve the likelihood of success
of the grant-streamlining initiatives. In examining coordination issues,
we have identified key practices that affect the likelihood for success of
crossorganizational initiatives.9 These practices include establishing a
collaborative organizational structure, maintaining collaborative
relationships, and facilitating communication and outreach.10
Agencies and OMB A collaborative organizational structure, characterized
by strong Coordinated Initiatives to leadership and a comprehensive
structure of participants' roles and Implement P.L. 106-107
responsibilities, can facilitate coordination activities. As shown in
figure 2,
OMB established several groups to lead and coordinate the effort to
9GAO, Electronic Government: Potential Exists for Enhancing Collaboration
on Four Initiatives, GAO-04-6 (Washington, D.C.: Oct. 10, 2003).
10Two other key coordination practices identified in the report,
contributing resources equitably and adopting a common set of standards,
are more relevant for formal collaboration agreements and less relevant to
the varying levels of coordination needed in the grant-streamlining work.
implement P.L. 106-107. The act allows OMB to designate a lead agency and
establish interagency work groups to assist OMB in implementing the
requirements of the act. OMB designated HHS as the lead agency for the
implementation of P.L. 106-107. In the spring of 2000, OMB charged the
Grants Management Committee of the Chief Financial Officers Council with
coordinating and overseeing the governmentwide implementation of P.L.
106-107. The Grants Management Committee included two representatives from
each of the grant-making agencies. The committee established four working
subcommittees: the Pre-Award Work Group, the Post-Award Work Group, the
Audit Oversight Work Group, and the Electronic Work Group. In addition,
the committee established the General Policy and Oversight Team, which was
co-chaired by OMB and HHS, and included the chairs of each of the work
groups. The team was intended to oversee the progress of the work groups
and examine issues that cut across the responsibilities of the individual
work groups.
Figure 2: P.L. 106-107 Implementation and Oversight Groups
P.L. 106-107 P.L. 106-107 P.L. 106-107 enacted common plan sunsets November 1999
May 2001 November 2007
Grants.gov:
Develops common electronic processes
Grants Management Line of Business:
Initiatives implementing requirements of P.L. 106-107 Develops
consolidated grants management systems
Groups overseeing the implementation initiative(s)
Source: GAO.
According to officials involved with P.L. 106-107 implementation, the
Grants Management Committee was ineffective, creating a stumbling block
for the initiative. In May 2004, the Grants Executive Board assumed the
responsibility for the coordination and oversight of P.L. 106-107
initiatives. In an update to its charter, the Grants Executive Board
(previously the Grants.gov Executive Board) expanded its oversight to
include both the Grants.gov initiative and the P.L. 106-107 initiative.
The Grants Executive Board has 13 members, one representative from each of
the 11 larger grantmaking agencies and two seats that rotate among the
other 15 grant-making agencies. The Grants Executive Board meets monthly
and, with the assistance of the HHS-led grant streamlining Program
Management Office, oversees the work of the interagency grant streamlining
work groups. The board's oversight duties include reviewing work group
recommendations to determine if they should be referred to OMB for
governmentwide implementation, defining accountability and reporting
requirements to be met by the work groups, and preparing the annual
progress reports for Congress. The Grants Executive Board also oversees
the Grants.gov initiative, which is charged with implementing the
grant-streamlining policies in the preaward phase of grants
administration.
The P.L. 106-107 Planning and Oversight Committee is the coordinating body
for the grant-streamlining work groups and advises the Grants Executive
Board. Its membership consists of the chairs of each of the work groups, a
representative of the Grants.gov Program Management Office, the P.L.
106-107 Program Manager, and an OMB representative. Agency volunteers
staff the work groups. Volunteer staffing is a challenge for the work
groups because the volunteers maintain their regular agency
responsibilities. According to work group chairs, the volunteer staff
members are dedicated, knowledgeable, and experienced in grants policy and
processes. HHS selects the chair of each work group, but does not limit
the size of the work groups so that all interested agencies may
participate. According to the P.L. 106-107 Program Manager, not all
agencies are participating in the work groups. Agencies that do not
participate will not have input into the design of governmentwide grant
policies, increasing the risk that the new policies will not meet the
needs of all grant-making agencies.
Interagency efforts toward a second key element of coordination-
maintaining collaborative relationships-have been mixed. The major
elements of maintaining collaborative relationships include a shared
vision among participants and formal agreements with a clear purpose,
common performance outputs, and realistic performance measures. The
agencies helped to establish a cooperative, shared vision by jointly
developing the initial implementation plan, which establishes goals and
objectives to meet the requirements of P.L. 106-107. However, while the
plan outlines
preliminary steps toward achieving its objectives, it does not outline a
comprehensive plan beyond those first steps. Furthermore, the time targets
in the plan are primarily short-term targets related to preliminary steps.
The annual cross-agency progress report can be a tool to maintain the
shared vision established in the initial plan. According to work group
leaders, the work group volunteers from the agencies are committed to the
goals of grant streamlining and simplification. In addition to the
crossagency progress report, each agency is required to submit an annual
agency progress report. This requirement has the potential to be an
effective management tool for monitoring the compliance and progress of
individual agencies. However, because the reports do not frame annual
achievements in the context of a comprehensive plan and use performance
measures to track progress, they are not an effective management tool.
Furthermore, not all the agencies have submitted their annual reports, and
OMB's position is that it is not their role to police agency compliance
with this requirement. Because the agencies have not developed a
comprehensive plan and are not reporting on their progress using common
performance measures, they are less likely to maintain the shared vision
that was established with the common plan.
Implementation of a third key element of coordination practices,
communication and outreach, has not always been effective. Leaders of the
initiatives hold regular meetings to share information with one another.
For example, the P. L. 106-107 Planning and Oversight Committee meets
monthly to facilitate coordination between the work groups. However, the
Audit Oversight Work Group Chair position has been vacant for the past 18
months, so although the audit subgroups continue their work, they have
little contact with the other grant-streamlining groups. Informal
coordination between the various grant-streamlining initiatives occurs
because often the same people serve on multiple committees. Outreach from
the initiatives to the agencies has also not always been effective. For
example, the Post-Award Work Group sends proposals or draft reports to the
agencies, but they do not always reach the necessary people because some
agencies are very large and have complex organizational structures.
OMB and Grant Executive Board Working on Resolving Governance Issues, but
Overlapping Responsibilities and Lack of Clarity Are Hampering Progress
The future relationship between the Grants Management Line of Business,
P.L. 106-107 work groups, and the Grants.gov Program Management Office is
unclear. This management situation appears to have hampered progress. OMB
plans to form a Grants Governance Committee to oversee three program
management offices working on grant streamlining and simplification. The
Grants Governance Committee will oversee the Grants.gov initiative, the
P.L. 106-107 initiative, and the Grants Management Line of Business
initiative. However, there will be a separate program management office
for each initiative, and there appears to be overlap between the
responsibilities of the three initiatives. Representatives of two of the
work groups reported that there has been little communication between the
Line of Business initiative and the P.L. 106-107 work groups. Work group
members said they are reluctant to go forward with new projects because
they do not know if their priorities will be consistent with those of the
Line of Business initiative. For example, the Line of Business initiative
appears to be planning to rely on Grants.gov for its "find" and "apply"
functions, but it is not yet clear if Grants.gov will be the portal used
by the grantee in the later stages of the grant life cycle. In
anticipation of the start of the Line of Business initiative, OMB has
directed Grants.gov to focus its efforts on the functionality of the
"find" and "apply" functions. The Grants.gov Program Manager reported
that, accordingly, the Grants.gov office is holding off on efforts to
incorporate processes related to the later stages of the grants life
cycle. Because grant management and reporting rely on information gathered
in the "apply" stage, there should be some integration between these
functions.
Efforts to Solicit and Use Input from Grantees Have Been Mixed
P.L. 106-107 obligates OMB and the agencies to consult with
representatives of nonfederal entities during the development and
implementation of grant-streamlining plans, policies, and systems. In
addition to its general directive to consult and coordinate with grantees,
the act requires the agencies to publish the implementation plan in the
Federal Register for public comment; hold public forums on the plan; and
cooperate with grantees to define goals, objectives, and performance
measures related to the objectives of the act. In prior work, we have
found that collaborative activities include communication strategies that
facilitate two-way communication among the project team, partners, and
other stakeholders, and that outreach programs keep those affected by the
initiative informed of new developments and provide structured means for
feedback and questions.11 By failing to involve important stakeholders,
the initiatives increase the risk that they will not fully achieve the
objectives defined in P.L. 106-107 and the common plan.
In its early work, the groups established by OMB and its lead grant
streamlining agency, HHS, undertook efforts to coordinate and consult with
the grantee communities. The Grants Management Committee created a Web
site that provided information about the work groups' activities in
implementing the act and invited public input. Individual agencies also
sought input through invitations to comment posted on their Web sites. In
the fall of 2000, the Grants Management Committee held a series of five
interagency public consultation meetings with (1) states, (2) local
governments, (3) Native American tribes and tribal organizations, (4)
universities and nonprofit organizations that conduct research, and (5)
other nonprofit organizations. Throughout this process, the teams built a
database of the public comments and used them to develop the common plan.
The plan considers those comments and, in large part, is based on them. In
January 2001, the agencies jointly published the interim/draft plan in the
Federal Register and requested public comment.
The common plan outlines two processes for maintaining ongoing
communication with grantee groups. First, it envisions the establishment
of an ombudsman, a third party operating apart from the individual
grantmaking agencies and OMB that could provide grantees with an avenue
for making their concerns known if agency requirements appear to exceed
the standards adopted. Second, the agencies planned to establish
performance measures12 related to the purposes and requirements of the act
and a process for assessing the extent to which specified goals and
objectives have been achieved. In developing the performance measures, the
agencies were to consider input from applicants, recipients, and other
stakeholders. The agencies planned to develop multiple measures to assess
performance, including progress as perceived by the public and federal
staff as well as objective process and outcome measures. The agencies
expected to use these performance measures to evaluate their performance
in meeting the plan's goals and objectives and report annually on their
progress as required by P.L. 106-107.
11GAO-04-6.
12The agencies planned to use a "balanced scorecard" approach to measure
success in implementing the act.
As the streamlining reforms have been developed and implemented, the
agencies and work groups have not fulfilled the envisioned processes for
soliciting ongoing input from grantees. By failing to involve important
stakeholders, the initiatives increase the risk that they will not fully
achieve the objectives defined in P.L. 106-107 and the common plan. The
plan envisioned the establishment of an ombudsman that could provide
applicants/recipients an avenue for making their concerns known if agency
requirements appear to deviate from the common systems or standard
processes. The common plan set a target date of March 31, 2002, for
finalizing the job description of the ombudsman. The agencies have not
established the ombudsman position and do not currently plan to establish
one due to changing priorities. In addition, the agencies have neither set
specific annual goals and objectives nor used concrete performance
measures in the annual progress reports, as was required by P.L. 106-107
and envisioned in the common plan. However, the P.L. 106-107 Program
Manager is currently conducting an analysis of progress to date in meeting
the requirements of P.L. 106-107 and an analysis of how the reforms have
addressed the concerns expressed in the public comments.
Furthermore, only one of the four active cross-agency work groups
consistently uses the public comments during the development of its
initiatives. The Pre-Award Work Group, which addresses the streamlining of
announcements, applications, and award processes, has continued to use the
public comments to inform its work. The other work groups informally vet
their proposals with selected grantee groups. Grantees are not formally
involved in the development of grant-streamlining proposals. The
grant-streamlining teams solicit public comment only once a proposal is
posted in the Federal Register. Representatives from a group of research
grantees told us that this one-way communication is not sufficient to
produce reforms that simplify the grant process for recipients. For
example, they commented that the reform of the cost principles focused
only on reducing the discrepancies in definitions used by the three
different cost principles circulars and actually increased the
administrative burden for the research community. The work groups have
expressed concern that in seeking public input, they must take care not to
violate the Federal Advisory Committee Act of 1972 (FACA), which
establishes requirements pertaining to the creation, operation, duration,
and review of covered advisory committees. However, because nonfederal
participants do not act as full members, the work groups should not be
subject to the FACA
requirements.13 Furthermore, FACA would not limit the work groups' ability
to widely publicize their initiatives and invite public comment on an
ongoing basis.
The Grants.gov initiative has been more active in soliciting grantee
input, but it is unclear if the Line of Business initiative will include
activities to coordinate with grantees. In contrast to the P.L. 106-107
initiative, the Grants.gov initiative has institutionalized processes to
inform the grantee community about its plans and activities and to gather
ongoing input from the grantee community. Throughout development and
implementation of Grants.gov, users' comments from pilots and actual
systems have been used to identify and address problems. Grants.gov has
also conducted three user satisfaction surveys and maintains a Web portal
for user comments. The Web site of the grant-streamlining teams was
recently integrated into the Grants.gov Web site. The site invites public
comment on both the Grants.gov system and broader grant-streamlining
issues and initiatives. In addition, the Grants.gov Program Management
Office conducted training and outreach to the various applicant
constituencies and to agency staff to increase awareness of the Grants.gov
initiative. Outreach efforts included monthly stakeholder meetings,
train-the-trainer workshops, and grantor workshops. A help desk was
established to address federal staff and applicants' questions and provide
assistance. At this time, it is unclear if the Grants Management Line of
Business initiative will include a process for consultation and
coordination with grantee groups.
Conclusions Several initiatives to simplify and streamline the
administration of grants have been proposed in response to P.L. 106-107.
Some of these have been implemented and likely will help grantees to
identify and apply for grants and meet the needs of federal grant-making
agencies when they receive grants. The Grants.gov common portal is clearly
used by many to identify grants and undoubtedly has simplified that
process for grantees. As more
13FACA does not apply to committees or work groups that are composed
wholly of full-time or permanent part-time officials or employees of the
federal government. See Federal Advisory Committee Act, Pub. L. No.
92-463, S:3(2) (codified as amended at 5 U.S.C. App. 2). However, if
nonfederal participants regularly attend and fully participate in the work
group meetings as members, the issue may arise as to whether the
nonfederal participants could be construed as full members of the work
group. See in Association of American Physicians and Surgeons, Inc. v.
Clinton, 997 F.2d 898, 302 (D.C. Cir. 1993), for a discussion of when a
working group composed of federal employees may constitute a FACA advisory
committee.
agencies allow for electronic application through Grants.gov and more
grantees begin to use the system, it should also simplify grant
management. However, other initiatives that have been proposed have not
yet been completed. Some have languished in the approval process. Others
have not yet been adequately developed to even reach the approval stage.
The lack of clear goals and timelines for the cross-agency work groups to
complete tasks and for agencies to implement systems undoubtedly has
contributed to the lack of progress in implementing these proposals.
Further, agencies need to be held accountable internally for implementing
these programs and should have performance measures and clear deadlines on
which they report. To date, agencies have not even been held accountable
for submitting annual reports required by P.L. 106-107, which may indicate
to agencies that moving forward quickly on grant administration
streamlining is not a high priority.
In addition, the lack of continuity toward meeting P.L. 106-107's
requirement to develop a common reporting system (including electronic
processes) for similar programs administered by different agencies may
potentially prevent agencies from reaching the act's goals before it
sunsets in November 2007. As overarching committees have evolved and
management of the cross-agency programs have been moved around among
various parties, progress has been slowed. Clearer governance is needed to
ensure that each group sunderstands its roles and coordinates with the
others to prevent overlap and collaborate on common initiatives.
The various initiatives that are implementing P.L. 106-107 have a mixed
record of coordinating with grantees. Grants.gov publicizes its plans and
meeting minutes on its Web site and solicits ongoing grantee input through
its Web site, regular satisfaction surveys, and outreach meetings with
grantees. In planning for the implementation of the act, the cross-agency
work groups also solicited and used grantee input. In addition, they
incorporated several means for soliciting ongoing grantee input in the
plan. However, they did not implement the portions of the initial plan
that would have provided for ongoing coordination with grantees. Unlike
Grants.gov, the work groups have neither made information about their work
public nor solicited ongoing grantee input, and approaches outlined in the
common plan, such as establishing an ombudsman position, have not been
implemented. Without ongoing grantee input, the reforms are less likely to
meet the needs of the grantees and achieve the purposes of the act.
Recommendations for Executive Action
In order to augment the progress toward meeting the goals of P.L. 106-107
for streamlining grant administration, we recommend that the Director,
OMB, take the following five actions:
o ensure that individual agency and cross-agency initiatives have clear
goals for completion of their initiatives;
o ensure that agency annual progress reports to Congress and OMB on
implementation of P.L. 106-107 are prepared and contain information on
their progress toward goals;
o ensure that efforts to develop common grant-reporting systems are
undertaken on a schedule that will result in significant progress by the
time P.L. 106-107 sunsets in November 2007;
o ensure that OMB's strategy for addressing P.L. 106-107 integrates the
three individual initiatives: HHS's overarching P.L. 106-107 efforts, the
Grants.gov program, and the Grants Management Line of Business initiative;
and
o solicit grantee input and provide for coordination with grantees on an
ongoing basis.
Agency Comments and Our Evaluation
We provided a draft of this report to OMB for comment. OMB's formal
comments are reprinted in appendix III. In addition to written comments,
OMB provided us with technical comments verbally, which we incorporated as
appropriate.
In its formal comments, OMB stated that it agreed with many of the
report's recommendations and provided comments on the status of grant
reform efforts. OMB stated it will continue to work aggressively with
agencies to meet their annual reporting responsibilities and is committed
to achieving E-Gov solutions and deploying technical solutions for
streamlining policies and practices. Further, OMB commented that it will
continue to facilitate the integration of the three grants initiatives
related to P.L. 106-107 requirements and will continue to seek grantee
input on an ongoing basis.
We believe that these steps constitute progress toward ensuring that the
goals of P.L. 106-107 are attained, although OMB needs to aggressively
push forward. For example, while it has established a new grants
committee, it
needs to ensure that progress does not slow while this transition occurs.
Although the Grants Management Line of Business initiative is under way,
OMB needs to ensure that efforts to address P.L. 106-107 requirements,
such as the development of common electronic systems to manage and report
on the use of funding from similar federal grant programs administered by
different agencies, move forward. Similarly, while public input was sought
heavily during the development of the common plan and is sought once
proposals are developed, the grantee community's views need to be
solicited throughout these processes and as new initiatives are selected.
We are sending copies of this report to the Director of OMB. In addition,
the report will be available at no charge on the GAO Web site at
http://www.gao.gov. Should you have any questions about this report,
please contact me at (202) 512-6806 or Thomas James, Assistant Director,
at (202) 512-2996. We can also be reached by e-mail at [email protected] and
[email protected], respectively. Additional key contributors to this report
are listed in appendix IV.
Paul L. Posner Managing Director, Federal Budget Analysis and
Intergovernmental Relations Issues, Strategic Issues
Appendix I
P.L. 106-107 Annual Reports Submitted to Congress as of March 1, 2005
P.L. 106-107 requires each agency to report annually on its progress
implementing the plan, although not all agencies have regularly submitted
these reports. The annual agency progress report summarizes agency efforts
in meeting the goals and objectives of the common plan.
The annual governmentwide progress reports describe the collaborative
efforts of 26 federal agencies to streamline and simplify the award and
administration of federal grants. (See table 3.)
Appendix I
P.L. 106-107 Annual Reports Submitted to
Congress as of March 1, 2005
Table 3: P.L. 106-107 Annual Reports Submitted to Congress as of March 1, 2005
2002 2003 2004
Governmentwide x x x
Agency for International Development x
Corporation for National and Community Service x x
Department of Agriculture x
Department of Commerce x x x
Department of Defense x x x
Department of Education x x
Department of Energy x x
Department of Health and Human Services x x x
Department of Homeland Security/Federal Emergency Management Agency x x
Department of Housing and Urban Development x x
Department of the Interior x
Department of Justice x x x
Department of Labor x x x
Department of State x x x
Department of Transportation
Department of the Treasury x x
Department of Veterans Affairs x
Environmental Protection Agency x x x
Institute of Museum and Library Services x x
National Aeronautics and Space Administration x x
National Archives and Records Administration x x
National Endowment for the Arts x x x
National Endowment for the Humanities x x x
National Science Foundation x x
Small Business Administration
Social Security Administration x x
Source: HHS.
Appendix II
Detailed Information on Grants.gov
As cross-agency teams identified the need for streamlining, agency
representatives and the Office of Management and Budget (OMB) recognized
that potential grantees needed a simpler and more consistent way to
identify and apply for federal grant opportunities. The process in place
for identifying grant opportunities resulted in applicants searching for
applications from many different agencies and then having to apply to the
various agencies using different application forms and processes. Public
comments from the grantee community identified the lack of a central
source for obtaining information about all federal agencies' current
funding opportunities and the variation in the way agencies' grant
announcements were organized. P.L. 106-107 required that OMB coordinate
grant-making agencies in establishing an interagency process to streamline
and simplify these procedures for nonfederal entities. Further, it
required that the agencies allow applicants to electronically apply and
report on the use of funds from grant programs they administer. The Egrant
initiative, along with other E-government approaches, was undertaken to
meet these needs. It was implemented initially by the E-Grants Program
Management Office based in the Department of Health and Human Services,
which was the lead agency for P.L. 106-107 implementation. More recently,
it has been referred to as Grants.gov, the Internet portal through which
it is accessed.
The first service that Grants.gov implemented was the "find" capability,
which established a single Web site to provide information on federal
grantfunding opportunities. This enabled applicants to search these
opportunities by several components, such as the type of activity funded
(e.g., the arts and humanities, education, and the environment) and the
agency providing funds. Further, it provided the capability of notifying
potential fund recipients by e-mail of new opportunities that met
parameters they identified. In addition, descriptions of funding
opportunities were organized uniformly to simplify finding key
information. Agencies began posting summaries in February 2003. A key
aspect of its full implementation was OMB's requirement that by November
7, 2003, all federal agencies were to electronically post information on
funding opportunities that award discretionary grants and cooperative
agreements at the Grant.gov Web site, using a standard set of data
elements. Grants.gov's program management office reports that since
October 2003, all 26 grant-making agencies have listed grant opportunities
in the "find" activity of Grants.gov. The public's use of the portal has
grown significantly; according to the Program Management Office, the
"find" activity on Grants.gov received about 2.2 million page requests in
Appendix II
Detailed Information on Grants.gov
November 2004 and applicant e-mail notifications have averaged 600,000 to
700,000 weekly.
More recently, Grants.gov has provided the capability to apply for grants
electronically through the portal. The "apply" activity allows an
applicant to download an application package from Grants.gov and complete
the application off-line. After an applicant completes the required forms,
they can be submitted electronically to Grants.gov, which transmits the
application to the funding agency. Grant-making agencies must take several
steps to provide the capability to apply electronically. They work with
Grants.gov Program Management Office staff to identify the forms needed
and make them accessible. Previous forms that grant-making agencies have
used for similar application packages are readily available as are forms
that other agencies have used that might be appropriate, thus simplifying
the process of adding new applications. The agencies identify how long
they would like the application packages to be retained on the site after
they close; after that, they are archived on the site. While some agencies
have enabled applicants to apply electronically directly on Grants.gov,
some announcements link to a grant announcement in the Federal Register or
link to more detail on the "find" site, which the applicant completes in
hard copy. To apply for grants electronically, the applicant must download
specific free software-Pure Edge Viewer. After an application is
submitted, the Grants.gov system checks the application to ensure all the
required forms are included and sends the applicant an e-mail saying that
it has been accepted, or rejected if a problem has been identified. If
accepted, the application is then forwarded from Grants.gov to the grantor
agency; when that agency downloads the data, it informs the Grants.gov
system and the applicant is informed by Grants.gov that data have been
downloaded to the agency. In some cases, agencies can download data
directly to their own grant management systems, thus eliminating the need
for staff time to input data.
Usage of the electronic "apply" component has been slower to grow than the
use of the "find" component for a number of reasons. As shown in table 4,
as of April 6, 2005, 20 of the 26 key federal grant-making agencies have
posted "apply" packages, 723 electronic application packages were
available, and 2,621 electronic applications have been received. For
agencies, forms must be uploaded to the system. Further, some are
struggling with setting up their systems to handle the data from
Grants.gov. For grantees, some necessary registration steps require lead
time-an estimated 6 days that must be allowed for the entire registration
process the first time. This verifies that the grantee point of contact is
the
Appendix II
Detailed Information on Grants.gov
appropriate person to submit an application. Grant.gov's surveys to
determine users' satisfaction with the system have also identified
dissatisfaction on other aspects, such as the adequacy of the status page
and the ease of submitting the applications.
Appendix II
Detailed Information on Grants.gov
Table 4: Status of Agency Participation in Grants.gov "Apply" Component
(as of April 6, 2005)
Number of
Number of apply electronic
packages applications
Agency posted received
Agency for International Development 1
Corporation for National and Community 0
Service
Department of Defense 0
Department of Agriculture 38 188
Department of Commerce 178 532
Department of Education 26 196
Department of Energy 28 120
Department of Health and Human Services 325 860
Department of Homeland Security 1
Department of Housing and Urban 44
Development
Department of Justice 5
Department of Labor 6
Department of the Interior 11 175
Department of State 4
Department of the Treasury 2
Department of Transportation 17
Department of Veterans Affairs 1 1
Environmental Protection Agency 10 58
Institute of Museum and Library Services 0 0
National Aeronautics and Space Administration 0 0
National Archives and Records Administration 0 0
National Endowment for the Arts 5 23
National Endowment for the Humanities 13 38
National Science Foundation 0 0
Small Business Administration 2 7
Social Security Administration 6 226
Total 723 packages 2,621
(20 agencies)
Source: Grants.gov Program Management Office.
Grants.gov staff members have reached out to both agencies and the grantee
community, sometimes through the use of a contractor, to solicit input and
to increase its usage. They have provided training and workshops
Appendix II
Detailed Information on Grants.gov
to grant-making agencies and have hosted monthly stakeholder meetings to
update users on changes. The Grants.gov Program Manager meets monthly with
the Grants.gov Executive Board, comprising senior executives of partner
agencies, to update them on activities and get guidance on strategic
issues. As outreach to the grantee community, staff members have given
presentations and provide resources to agencies to inform their grantee
communities. Also, a "contact center" is available for grant applicants to
assist with the electronic applications.
With the growth of its services, the operations of the Grants.gov office
Program Management Office have evolved. As of December 2004, the Program
Management Office has several full-time employees, including a Program
Manager and a Deputy Program Manager, and additional detailees from
grantor agencies. It has not received direct appropriations but was funded
during the period from 2002 to 2004 by contributions from 13 grantmaking
agencies, the Chief Financial Officers Council, and the General Services
Administration (for maintenance of the Grants.gov "find" mechanism).
Funding for those 3 years totaled about $29.4 million. Beginning with
fiscal year 2005, Grants.gov has moved to a fee-for-service model. Funding
will be from 26 grant-making agencies, with payments based on an agency's
total grant dollars awarded. Based on natural break points in data on
funds that the agencies award, the grant-making agencies were divided into
three categories. For 2005 and 2006, the 6 large agencies will be assessed
$754,467, the 10 medium agencies will be assessed $452,680, and the 10
small agencies will be assessed $226,340, for a total of about $11,300,000
each year.
Appendix III
Comments from the Office of Management and Budget
Appendix III
Comments from the Office of Management
and Budget
Appendix IV
GAO Contacts and Staff Acknowledgments
GAO Contacts Paul L. Posner, (202) 512-6806 Thomas James, (202) 512-2996
Acknowledgments In addition to the above contacts, Jack Burriesci, Martin
De Alteriis, Patricia Dalton, Susan Etzel, Ronald La Due Lake, Hannah
Laufe, Donna Miller, Melissa Mink, and Carol Patey also made key
contributions.
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