UNITED STATES GENERAL WASHlNGTbN, D C. CIVIL DIVISION Jut.3 Qnn Dear Mr. Maughan' The General Accounting Office has examined Into selected aspects of the Title III Grant Program admlnlstered by the Water Resources Council CWRC). Our survey included an examination of selected State appllcatlons and was performed at the WRC Central Office In Washlngton, D.C. Section 301 of the Water Resources Planning Act of 1965 author- lzed annual approprlatlons of $5 mi llion to WRC for planning grants for fiscal years 1967 through 1976. These funds are to be allotted by the WRC as grants to States, on a 50 percent matching basis, to assist them In developing and partlclpatlng 1.n comprehensive water and related land resources plans. Since lnceptlon of the program in fiscal year 1967, through fiscal year 1971, funds amountlng to $12.5 million have been approprlatb1 by the Congress to carry out the provisions of the grant program. The stated purposes of the Title III program are to encourage (1) State partlclpatlon In Federal-State comprehensive water and related land resources planning, (2) State preparation of plans In light of reglonal and national plans, and (3) State tralnlng of per- sonnel, where necessary, to develop technical planning capablllty. WRC issued rules and regulations In November 1966 setting forth the guldellnes that States should follow In making appllcatlon for the Title III funds. The guidelines stated that non-Federal funds ellglble for matching Federal funds granted under Title III would be llmlted to the increased expenditures of non-Federal funds above the expenditure for the l&month period endlng June 30, 1965--base year costs. The guidelines lndlcated that once established, the base level of expenditures for such period was intended to remain as the base for calculating non-Federal funds ellglble for matching, During 1967, WRCadvised the States at the time It conveyed approval for their lnltlal appllcatlon for flnanclal assistance under the act that 'I* * * the intent of Title III, also, 1s to enhance State capability In comprehensive water and related land resources planning. Thus, Federal-or State- matching funds under Title III should not be utilized 50 TH ANNiVERSAfYf 1921_ 1971 for the services of consultants or for transfer to Federal agencies or local governments for data- gathering or planning actlvltles, to an extent that would impalr the development of State planning capabilIty." During the period June 1969 through January 1971, the Department of the Interior issued 26 audit reports to the WRC on the results of H thezr examination of grants made to States under the Title III program, Chr analysis showed that for 18 of the 26 reports, the auditors raised qu'estlons on the following matters Eleven instances mvolvmg the base year costs totaling $738,000; 3 instances involving the extensive use of consultants totaling $339,000; and 8 instances lnvolvlng cer- tam types of expenditures included by States for matchrng purposes totalmg $387,000. The remalnlng eight audit reports indicated that the grant funds received by these States had been expended In compliance with applicable WRCpolicies and procedures. Examples of the matters questioned by the Interior audit reports are as follows- 1. A report issued In April 1970 on the Louislana Department of Public Works indicated that the agency had entered Into three research agreements with the Gulf South Research Institute. The three agreements amounted to $238,800 and constituted 67.7 percent of the total amount $352,252 expended by the State under the WRC approved State aug- mented planning programs. The auditors concluded that little is being done with Title III funds to develop in- house State planning capabIlity in the State of Louisiana. 2. A report issued in December 1969 on the Kentucky Department of Natural Resources rndlcated that (1) contractual services costing $252,560 could not be related to WRC grant program, (2) personal service costs in the amount of $8,300 were not adequately supported, and (3) equipment acqulsltlons of $3,307 had not been adequately disclosed to WRC. In response to our inquiry as to what action had been taken on the audit findings submitted by Interror, we were informed by WRC offlclals that no further actlon 1s contemplated with respect to pro- viding additional instructrons for use in clarlfylng either the base year expenditures or the subsequent year expenditures. The reason offered was that the grant program has only 5 years remaining under the Water Resources Planning Act of 1965. With respect to the con- tinued use of consultants by certain States, we were advised that the WRC's action has been limited to bringing this matter to the attention of the States in question. We did note that the WRC had taken steps to improve the overall admlnlstration of the Title III program. -2- Fzrst, WRC established in June 1970 ee Liaison Teams--Eastern, Central, and Western. The Liaison Teams' r sponslbilltles with respect to the Title III program are. (1) ri eep Informed of grant pro- grams in their regions, (2) become acquainted with each State's water and related land resources planning activities, (3) assist in the coordination of State and Federal water and pelated land planning programs, and (4) report to the WRC Committee for State grants con- cerning any problems, conflicts, or opportunities for improvement in water and related land resources planning with Federal grants. Second, WRC established the posltlon of Regional Leader during February 1971. One of his duties will be to maintain contact with designated State water planning agencies and provide guidance to the States in making application for Title III funds. In summary, we believe that the actlons taken to establish the Liaison Teams and the position of the Regional Leader are steps m the right direction. We believe, however, that there is a need for criteria for use in determining the eligible expenditures that States can claim under the matching provisions of the Water Resources Plan- ning Act of 1965. Moreover, we believe that the questions raised by the auditors are significant and should be satisfactorily resolved. It appears to us that WRC is administering the Title III program inequitably as long as some States have included questionable expenditures in the determination, while other States' expenditures have complied with WRC policy. In this regard, we believe that if any revisions are made to the criteria for determining eligible expenditures under the Title III program, consideration should be given to whether such changes are to be prolective or retroactive. We acknowledge the cooperation given to our representatives during the survey. We would appreciate being advised of any actions taken or contemplated on the matter discussed herein. Sincerely yours, Mr. W. Don Maughan Director, Water Resources Council -3-
Administration of Title III Grant Funds by Water Resources Council
Published by the Government Accountability Office on 1971-07-30.
Below is a raw (and likely hideous) rendition of the original report. (PDF)