Survey of the Cooperative Area Manpower Planning System

Published by the Government Accountability Office on 1971-05-28.

Below is a raw (and likely hideous) rendition of the original report. (PDF)


Dear       Dr,     Fdeber:

         The General       Accounting        Office     has made a survey of two Department                  of
Labor      6DOL) contracts         awarded to the Chicago              Urban League        (CULj for the
purpose      of promoting         on-the-job        (OJT) training        in the Chicago         area under
the Manpower Development                an’d Training       Act of 1962, as amended.                our survl2~’
was directed         primari3.y      to CUL*s contract           performance     during       the period     f;oa~
St!]:JtCIEibCY: 15, 1968, t0 May 31, 1969,                 but also included         some review       of Ci’L’s
O.I’T contract      operations         prior     to this    period.       Our survey was made pura:~nL
to authority         contained       in the Budget and Accounting               Act,     I.921 (31 U,S.C..531
and the Awounting              and A*uditin g Act of 1950 (31 U.S.C.                 t57)2ubd to speciiic
n.uthority      contained       in the contracts.

           CUL has received     two             contracts      from DCL, the first           dating    back to
\:I L117L?
         I 30 3 1965”   The first               contract      called     for CUL to subcontract           with local
I~U1’1i nc s s and industry     for             the training         of a minimum       of 300 unempLoycd      or
u~lcl.~~rc~;cipl~ycd persons    in            entry-level,         skill    improvement      or ski 1.1 convers icjn
t\.rp~ ~~~~sitions    during    the             period     from June 30, 196.5, through             July 31, l%ij,,
i'lnt.:: cmri l.ract      amlount      was   $237 1 324,      Six modifications          were ma.de to the ci):i-'
I, ~~'i'b:::.l.bilich    cxtcnded       the contrt;ct        pcl"e'iod   tci   Sept,ember     15 1 I.967 1 and           inc~-~2~cd
1 ili:   number         of   trainee      positions     to    525 with         no increase       in     the       contract
cl IIUJLLZ? 1: 0

      ?“hc saxmd             contract       called      for CUL to subcontract            for the training             05
?iiQ unc~n~ployed           and underemployed             persons ) primarily-in          entry-level        positions,
,il      ;R ~0~1  01    $421,712       during      the period       September      15, L967, to Sei2tember               iii,
 i. 9 ;I s m i2dclitional       funds     of $84,O(sO        from the Office        of Economic        Op?ortuniiy
x:::I*c Ixovidccl         for administration              in connection        with a separate         CUL agree-5                    SST
IIK~R-~~..with The Woodlawn Organization,                        This agreement         was incorporated           in?o
ill K? hasi c nor, contra,ct            and allocated           500 of the 900 QJT positions               for     -Lra;w~~
 iii:,: 01 yr~uths from the target                   area of The Woodlawn Organization.                    The Zili.nois
L-li.,at:c: ~hploymcnt         Service      (ISES)      was responsible         under this       contract      for       -I
8ccr~if)rin&         the eligibility            of persons       participating        in the OJ’T program,
):*   :’        *                                             -3-

              As a result     of our survey we questioned            payments      totaling     about   $2,000
      which were made to subcontractors               for (1) periods when trainees              were not on
      the job,     (2) training      which was apparently         not received         by the trainees,       and
      (3) trainees      who were apparently          never employed       by the subcontractors          to
      whom reimbursements         were made.       An additional      $5,800 was paid to subcon-
      tractors     for training      certain     persons under The Woodlawn Organization
      agre’ement     who were not connected          with that organization.              These payments
      were made in contravention            of DOL requirements         placed     on The Woodlawn
      Organization      subcontract.        We found also that,         although       CUL's first    contract
      had terminated       on September       15, 1967, an unexpended           balance      of about   $1,300
      had been retained         by CUL as of July        17 1 1969.

                We noted      that     prior      to awarding       subcontracts      for QJT, CUL did not
      ascertain        either      the number of employees               normally     trained     by the subcon-
      tractors       or the subcontractors                f precontract        level  of expenditures       for
      I: raining    0 We believe             that there       is a need to establish          the level     of the
      subcontractors           I prior       efforts    P to help avoid          the payment    of training     expend-
      itures      that     subcontractors            should     bear under the maintenance-of-effort
      requirements          of their         contracts      s

                 We believe     that  a number of the weaknesses          which we found in CUL
      op’erations        in Chicago,    as discussed  above,     could have been identified          and
      corrected         earlier    if more effective  monitoring       had been performed       by DOL.
      Our survey         show’ed that    the Regional Manpower Administration          OJT staff
      ~dcvoted most of its time to administrative                matters      and that up until    the
      initiation         of our review only one monitoring          visit     had been made of the OJT
      cnntrci.ct s with GUL,

               Monitoring       responsibilities,        as ‘defined    by DOL, generally       involve     site
      inspections         and reviews      of reports      submitted    by the contractors.         The objec-
      Live of such monitoring,                it is stated,      is to ensure   compliance      with the 1053:
      cc~~tra.ct     provisions      and with the Departmenrs Ds instructions)              procedures)      and
      poIic:icG,       and to recommend          program  and administrative       improvements       where
      neeeseary       oa

             Tn June and July    1969, we discussed   our findings                                       with   officials   of   GUL,
      “ihe ISES,   and the Regional    Manpower Administrator,

              Regional  Manpower Administration             officials        agreed     with most of our
      findings      andoutlined      certain    corrective         actions     planned.      The DOL Regional
      Manpower Administrator           and OJT staff       stated       that   the CUL-OJT program        had
      been d’ecreasing       in effectiveness        and attributed          this    decrease,   in part,     to
      the nBon41JT activities          ‘carried  out by the CUL project                staff 0

               C[K, proje’ct officia.1.s    advised      us that 1 in their            opinion,      the contract,
      c*s ~~,odFEiecl on June 11, 1969, p#ermitted               the enrollment           of non-Woodlawn
      10l”p2niza.t ion youth * They also advised               us that     eligibility          certification             was
      the    responsibility      of the employment          service     and they did not qwstion                      its
      ~clcterminat    ions I TSES officials         informed       us that     they determined            eligibility

                                                      ,,    ,, ,,,   ,,,,,,,   ,e   ,,,,,   0   ,;

                                                                                                     %             “‘I
on the basis     of criteria                        established   by various                                                    DOL manpower directives
and gave no consideration                            to any special    terms                                                  that might   be included          in
an OJT contract.

        We believe                     it is incumbent      on CUL, as program        manager,        to monitor
efforts    of the                     employment    service    and perform     in-house       evaluations      for
the purpose       of                  ensuring   the enrollment     of eligible        individuals,

              Regional               Manpower Administration        officials                                                   informed         us that    they
would          discuss                the need for adherence      to eligibility                                                       criteria       with CUL
o.Efiscials.                      Me wer’e advised     by the CUL projecr                                                     director         that   the necessary
covnseling                       was provided,     but he agreed,       as did                                                DOL officials,            that more
definitive                       guidelines    and specific   responsibjlities                                                         should bme established.

       Ynle discussed      the limited       monitoring         coverage      of CUL operations       with
Regional     Planpower Administration              offi’cials      who agreed     that    the monitoring
provided      was inadequate.            The officials        informed       us, however,     that  ix)L had
only two OJT field           representatives            to monitor      over 200 OJT contracts          in the
State    of Illinaiis      and expressed         the belief        that    they could not be expected
to provide       inmadepth     monitoring     with such a workload.

             On the basis of the foregoing,           we believe       that  the Department        should
r~~c~xa.m:inc its present           contractual    arrangements       with CUL and determine
r~.r:~c:~her    iliiprovements    in CUL’s performance           can be effected       to bring   results
up CQ a level.             that would sufficiently       -satisfy    program    objectives      at a
r.I’E‘I:sc)l:n~1,e,l.e cost.          I,

          WC recommend          that the Department            of Labor take appropriate                       steps to
ak~J)rise CUL of its contractual.                  obligation            to (1) devote           staff    tine      exclu-
sivr~1.y to the furtherance               of the OJT program                  where such time           is charged          to
cwntract          costs,      121 m&e appropriate             eligibility            determinations           on OYT
~!r~relbces         and document      such determinations,                  (3) provide          adequate        counseling
LO t:nroli.lees         1 (4) give appropriate             consideration             to potential         subcontractors’
existing          level. of training        effort      before         entering        into OJT agreemects,                and
I.51 rcv~.ew the questionable                 paym’ents       described           above and effect            appropriate
rrccoveri~cs         of overpayments       made to subcontractors,                         We presented          the details
<:IE o :i. 1. E in d in gs concerning       the questionable                payments        to both CUL z.nd the
Ro;;ioila.l       Nanpower Administration             OJT staff            during      our survey,           Also,     we
l.C’Cibl~lm~nd that         the Department       of Labor improve                 its monitoring          of CLJL-QJT
activities            to ensure early identification                     and correction           of weaknesses
found in CiJi 1s operations              d

              We would               appreciate  being advised    of your views on the matters     presented
ii\    Lhis      ‘Letter              as we1.I as any action   taken or contemplated   as a result     of
o!dr     ii’ecomtilenclat~cDns              *

            Me wish to acknowledge                      the    cooperation                                   given                to our     representativses
crli1,3:i ;rag t 17i S SulY.rey 1D

                                                                   ,,   *   ,1,,,,,,I   ,,,   ,,   II   ,I    ,,,,   ,,,,I,
      Copies  of this     latter      are being   sent today       to      the      Secretary    of Labor,
the Assistant   Secretary        of   Labor for Administration,                  and to the     Administrator
of the Manpower Administration.              ‘L .

                                                   Sincerely      yours,

                                                   Henry Eschwege
                                                   Associate  Director

The Honorable      Arnold     2%. Weber
Assistant    Secretary      for Manpower
Deparitment   of Labor