oversight

Government Transparency: Efforts to Improve Information on Federal Spending

Published by the Government Accountability Office on 2012-07-18.

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

                            United States Government Accountability Office

GAO                         Testimony
                            Before the Committee on Homeland
                            Security and Governmental Affairs,
                            U. S. Senate

For Release on Delivery
Expected at 9:30 a.m. EDT
July 18, 2012               GOVERNMENT
                            TRANSPARENCY
                            Efforts to Improve
                            Information on Federal
                            Spending
                            Statement of Gene L. Dodaro
                            Comptroller General of the United States




GAO-12-913T
                                              July 18, 2012

                                              GOVERNMENT TRANSPARENCY
                                              Efforts to Improve Information on Federal Spending

Highlights of GAO-12-913T, a testimony
before the Committee on Homeland Security
and Governmental Affairs, U.S. Senate




Why GAO Prepared This                         What GAO Found
Testimony                                     The Office of Management and Budget (OMB) and other federal agencies have
It is important to ensure the                 taken steps to improve federal spending data available on USAspending.gov.
transparency of information detailing         This effort to publicly display comprehensive data arose from the Federal
how the federal government spends             Funding Accountability and Transparency Act of 2006, which required OMB to
more than $1 trillion annually in the         establish a free, publicly accessible website containing data on federal awards
form of contracts, grants, loans, and         and subawards. OMB launched USAspending.gov in December 2007 to meet
other awards. Toward this end, the            these requirements. As GAO reported in 2010, while OMB had satisfied most of
government has multiple initiatives           the requirements associated with the act, such as establishing the site with
under way to increase such                    required data elements and search capability, it had only partially satisfied the
transparency, including publicly              requirement to establish a pilot program to test the collection and display of
accessible websites providing                 subaward data and had not met the requirements to include subaward data by
information on federal spending, such         January 2009, or to report to Congress on the site’s usage. Also, GAO found that
as http://www.USAspending.gov and             from a sample of 100 awards on USAspending.gov, each award had at least one
http://www.Recovery.gov. While these
                                              data error and that USAspending.gov did not include information on grants from
efforts have increased the amount of
                                              programs at 9 agencies for fiscal year 2008. Subsequently, OMB and agencies
information available, challenges have
been identified to better ensure the
                                              have taken steps to improve the site and the quality of its data through increased
quality of data on these sites.               agency-level accountability and government-wide improvements. These efforts
                                              include directing agencies to appoint a senior-level official to be accountable for
GAO was asked to provide a statement          the quality of federal spending information disseminated on public websites, and
addressing (1) the status of efforts to       increasing the use of automated tools. However, OMB has not yet implemented
improve the quality of publicly available     plans to create a data quality dashboard on USAspending.gov and has produced
data on government awards and                 only one of the required annual reports to Congress on usage of the site.
expenditures and (2) lessons that can
be learned from the operation of              OMB, the Recovery Accountability and Transparency Board, federal agencies,
Recovery.gov that can contribute to           and funding recipients addressed several challenges in managing reporting
other spending transparency efforts. In       under the American Recovery and Reinvestment Act of 2009. Recovery.gov was
preparing this statement, GAO relied          established in 2009 to provide public access to information on Recovery Act
on its previous work in these areas, as       spending. Specifically, it was to provide timely information on projects or activities
well as discussions with OMB officials        funded by federal grants, contracts, or loans provided to recipients, such as state
and officials from the Recovery               or local governments. The transparency envisioned by the act was
Accountability and Transparency               unprecedented for the federal government, and GAO identified a number of
Board.                                        lessons learned from the operation of Recovery.gov:
What GAO Recommends                              OMB and the Recovery board used two-way communication with recipients
GAO previously made several                       to refine and clarify guidance.
recommendations to improve these                 Training and other assistance was provided to recipients to clarify reporting
transparency efforts, including that              requirements and address early system problems.
OMB clarify guidance on reporting                After early reporting and quality issues were identified, OMB required
award data and develop a procedure to             agencies to ensure data accuracy and completeness.
ensure agencies report required                  Recipients made errors in reporting data, but these could be reduced through
information. While GAO is not making              pre-populating data fields and other refinements to the reporting process.
new recommendations at this time, it
underscores the importance of fully           Recent legislative proposals and a newly created executive branch board aim to
implementing its prior                        expand and improve upon the transparency of federal spending. The challenges
recommendations.                              and lessons learned from implementing the existing reporting tools should help
                                              inform current and future efforts. In particular, attention should be given to
View GAO-12-913T. For more information,       stakeholder involvement, the effort required for reporting and oversight, and the
contact Stanley J. Czerwinski at (202) 512-
6808 or czerwinskis@gao.gov or David A.       need for clear objectives and priorities.
Powner at (202) 512-9286 or
pownerd@gao.gov
                                                                                        United States Government Accountability Office
Chairman Lieberman, Ranking Member Collins, and Members of the
Committee:
Thank you for the opportunity to discuss federal efforts to increase the
transparency of information detailing federal awards and expenditures. As
you know, the federal government makes more than $1 trillion in awards
annually in forms that include contracts, grants, loans, and other awards.
Since 2006, several efforts have been initiated to provide the public with
more specific information on these awards. For example, the government
currently operates several websites that provide access to detailed
information on federal spending, including http://www.USAspending.gov
(USAspending.gov) and http://www.Recovery.gov (Recovery.gov).
However, as you noted in a recent request to us to evaluate spending
transparency, while these sites represent important advances in
government transparency, challenges have been identified to better
ensure the quality of data on these sites.
My testimony today will address two topics: (1) the status of efforts to
improve the quality of publicly available data on government awards and
expenditures and (2) lessons that can be learned from the operation of
Recovery.gov that can contribute to other spending transparency efforts.
The statement is based on our prior work on USAspending.gov1 and
Recovery.gov.2 We also reviewed reports by the Office of Management
and Budget (OMB) and federal departments and agencies and discussed
spending transparency with officials from OMB and the Recovery
Accountability and Transparency Board. We conducted our work in
accordance with generally accepted government auditing standards or
with our quality assurance framework, as appropriate. Those standards
require that we plan and perform the audit to obtain sufficient, appropriate
evidence to provide a reasonable basis for our findings and conclusions
based on our audit objectives. We believe that the evidence obtained
provides a reasonable basis for our findings and conclusions based on
our audit objectives.




1
 See GAO, Electronic Government: Implementation of the Federal Funding Accountability
and Transparency Act of 2006, GAO-10-365 (Washington, D.C.; Mar. 12, 2010).
2
 For a list of GAO products that addressed recipient-reported data available on
Recovery.gov, see appendix I. For additional GAO reports related to the recovery efforts,
see http://gao.gov/recovery.




Page 1                                                                       GAO-12-913T
OMB and Federal Agencies Have Taken Steps to Improve Federal
Spending Data
                     The first federal effort to publicly display comprehensive data on federal
                     awards was USAspending.gov. Among other things, the Federal Funding
                     Accountability and Transparency Act of 2006 (FFATA)3 required OMB to
                     establish a free, publicly accessible website containing data on federal
                     awards no later than January 1, 2008. In addition, OMB was required to
                     include data on subawards4 by January 1, 2009. The act specified a
                     number of required data fields, including the recipient’s name, funding
                     agency, amount of award, and a descriptive title. The act also authorized
                     OMB to issue guidance and instructions to federal agencies for reporting
                     award information and requires agencies to comply with that guidance.
                     OMB launched USAspending.gov to meet the act’s requirements, relying
                     primarily on federal sources of information.
                     In 2010, we reported on compliance with FFATA’s requirements. In that
                     report we presented several key findings, including:
                        OMB had satisfied six of the act’s nine requirements we reviewed and
                         partially satisfied another, but did not satisfy two requirements (see
                         appendix II for details). For example, OMB established the publicly
                         searchable website–USAspending.gov–in December 2007. The site
                         included the required data elements and search capabilities, and
                         OMB guidance required periodic updates from agencies consistent
                         with the act’s requirement for timeliness. OMB partially satisfied the
                         act’s requirement to establish a pilot to test the collection of subaward
                         data. Although it started pilots at two agencies, they were initiated
                         after the date provided for in the act. Also, OMB had not satisfied the
                         provision requiring the inclusion of subaward data on the website by
                         January 2009 or the provision regarding periodic reporting to
                         Congress.

                        Although USAspending.gov included required grant information from
                         29 agencies for fiscal year 2008, it did not include grant information
                         from 15 programs at 9 other agencies. The unlisted awards were
                         made by large agencies, including the Department of the Treasury


                     3
                      Pub. L. No. 109-282, §§ 1 to 4, Sept. 26, 2006, as amended Pub. L. No. 110-252, §
                     6202(a), June 30, 2008 (31 U.S.C. § 6101 Note).
                     4
                      OMB guidance defines a subaward as a monetary award made as a result of a federal
                     award to a grant recipient or contractor to a sub-recipient or sub-contractor respectively.




                     Page 2                                                                          GAO-12-913T
    and General Services Administration, and smaller agencies such as
    the U.S. Election Assistance Commission and Japan-U.S. Friendship
    Commission. We reported that incomplete reporting by agencies was
    due in part to OMB not implementing a process to identify agencies
    that did not report required award information and stated that without
    such a process, it risked continued data gaps that limited the
    usefulness of the site.

   In a sample of 100 awards from USAspending.gov that we reviewed,
    each had at least one data error in a required field, consisting of either
    a blank data field, an inconsistency between the USAspending.gov
    data and agency records, or a lack of sufficient agency information to
    determine consistency. In 73 of the sampled awards, 6 or more of the
    17 required data fields exhibited an error. Agency officials attributed
    the lack of sufficient information, in part, to procedures and systems
    that did not include documenting all of the data required by FFATA.
    For those awards where we had enough information to judge
    sufficiency, the data field with the most inconsistencies was the award
    title, which often lacked necessary specificity. This weakness was
    attributed, in part, to the lack of specific guidance from OMB and to
    the lack of tools to identify incomplete reports. We reported that until
    OMB addressed these issues, the ability of the public to find
    requested information and of OMB to correct errors would be limited.
To address these findings, we made several recommendations to the
Director of OMB. For example, we recommended that OMB revise its
guidance to agencies to clarify that award titles should describe the
purpose of each award and how agencies should validate and document
their submitted data. We also recommended that OMB develop and
implement a plan to collect and report subaward data, as well as a
procedure to regularly ensure that agencies report required award
information. OMB generally agreed with our findings and
recommendations.
Since we last evaluated FFATA compliance, OMB has taken steps to
improve USAspending.gov and the quality of its data through increased
agency-level accountability and government-wide improvements. First, in
OMB’s 2009 Open Government Directive,5 agencies were directed to
designate a high-level senior official to be accountable for the quality of,
and internal controls over, federal spending information disseminated on
public websites. A list of the agency-designated officials appears on


5
OMB, Open Government Directive, M-10-06 (Washington D.C.: Dec. 8, 2009).




Page 3                                                                GAO-12-913T
USAspending.gov. Subsequently, in an April 2010 memorandum to senior
accountable officials, OMB required agencies to establish a data quality
framework for federal spending information, including a governance
structure, risk assessments, control activities, and monitoring program.6
Agencies were directed to submit plans for addressing these
requirements to OMB. To address government-wide weaknesses, OMB
issued guidance to agencies on improving the quality of data in the
Federal Procurement Data System, a contract database that is one of the
main sources of USAspending.gov data.7 In addition, OMB’s April 2010
memo established a deadline for the agency collection of subaward data
and announced technical improvements to USAspending.gov, including a
move to a cloud computing environment, and a control board to
coordinate policies and systems that support the collection and
presentation of federal spending data. One result of these efforts is the
current availability of subaward data on USAspending.gov.
Agencies have also reported taking steps to improve their
USAspending.gov data. For example, automated tools have been
developed through interagency electronic government initiatives that are
expected to improve the quality of data on grants and cooperative
agreements by making it easier for agencies to regularly report their
awards.8 Additionally, individual agencies reported efforts to improve data
quality in open government plans released earlier this year. For example,
the Department of Commerce established a formal process to ensure that
all grant offices are reporting awards in a timely manner, and the General
Services Administration developed an "Information and Data Quality
Handbook" that contains a framework for consistent data management.
Agencies also reported ongoing efforts to improve data quality. For
example, the Department of Homeland Security plans to improve the
accuracy and timeliness of data posted on USAspending.gov by
promulgating best practices, and the Department of Transportation is
working with its components to develop memorandums of understanding
to ensure they meet quality assurance reporting guidelines.




6
 OMB, Open Government Directive – Federal Spending Transparency (Washington, D.C.:
Apr. 6, 2010).
7
 OMB, Improving Acquisition Data Quality for Fiscal Years 2009 and 2010 (Washington,
D.C.: Oct. 7, 2009).
8
 OMB, Report to Congress on the Benefits of the President’s E-Government Initiatives,
Fiscal Year 2012 (Mar. 19, 2012).




Page 4                                                                      GAO-12-913T
While the steps discussed above could contribute to improvements in the
quality of spending data, their impact is not yet known because OMB’s
recent reporting on data quality and user feedback has been limited.
Specifically:
   Previously available information on the timeliness and completeness
    of agency-submitted data is no longer provided on USAspending.gov.
    We previously reported that OMB maintained a page at
    USAspending.gov that addressed the completeness of the agency-
    submitted data by field. That information is no longer available on the
    site.

   In its April 2010 memo, OMB discussed the creation of a dashboard
    on USAspending.gov to track the timeliness, completeness, and
    accuracy of agencies’ reported data. After establishing a baseline,
    these data were to be updated quarterly. However, the
    USAspending.gov site does not currently include such a dashboard.

   OMB has produced only one of the required annual reports to
    Congress that were to include data on usage of the site and public
    feedback on its utility. In July 2010, OMB reported that
    USAspending.gov had been used extensively by the public, and that it
    had adopted or planned improvements based on user feedback.
    However, OMB has not produced any subsequent reports, as required
    by FFATA.
On July 13, 2012, officials with OMB’s Office of Federal Financial
Management told us that OMB no longer plans to rely on a public
dashboard to improve data quality. Instead, the officials said, OMB is
pursuing several other efforts, including ensuring the implementation of
the data quality framework established through its prior guidance and
identifying best practices for improving data quality. As we initiate work to
address your recent request on spending transparency, we will reassess
the quality of data on USAspending.gov, including the extent to which
agencies report award data, the accuracy of the data that are reported,
and the quality assurance processes used by agencies.




Page 5                                                            GAO-12-913T
OMB and the Recovery Board Addressed Several Implementation
Challenges with Recovery Act Recipient Reporting
                    As Congress and the administration crafted the American Recovery and
                    Reinvestment Act of 2009 (Recovery Act),9 they built into it provisions to
                    increase transparency and accountability over spending. It required
                    recipients of Recovery Act funds, including grants, contracts, or loans, to
                    submit quarterly reports with information on each project or activity,
                    including the amount and use of funds and an estimate of the jobs
                    created or retained.10 Similar to FFATA, the Recovery Act called for the
                    establishment of a website through which the public could gain easy
                    access to this information. Initial establishment of the website was to take
                    place 30 days after the Recovery Act’s enactment. The Recovery.gov site
                    was launched in 2009 to fulfill these requirements, and a second site—
                    http://www.FederalReporting.gov—was established for recipients to report
                    their data. Recipients first reported in early October 2009 on the period
                    from February through September 2009, and reporting has continued for
                    each quarter since then.
                    The transparency envisioned under the Recovery Act for tracking
                    spending and results was unprecedented for the federal government.
                    Tracking billions of dollars disbursed to thousands of recipients promised
                    to be an enormous effort. Further, the need to get a system developed
                    and operating quickly added to the challenge, as did the fact that the
                    public would be able to access the system and form its own views as to
                    the system’s transparency. The system also needed to be operational
                    quickly for a variety of programs, across which even the basic question of
                    what constituted a project could differ. Given this daunting task, OMB and
                    the Recovery Board implemented an iterative process involving many
                    stakeholders that can provide insight into challenges and solutions for
                    establishing procedures to increase spending transparency.
                    As part of our oversight of the Recovery Act and in response to a
                    mandate to comment quarterly on recipient reporting, we issued a
                    number of reports addressing procedures related to recipient reporting
                    and the quality of data on Recovery.gov, and we made several
                    recommendations for improvements. Initially, we reported that a range of


                    9
                     Pub. L. No. 111-5, 123 Stat. 115 (Feb. 17, 2009).
                    10
                      Recovery Act, div. A, § 1512. Neither individuals nor recipients receiving funds through
                    entitlement programs, such as Medicaid, or tax programs are required to report.




                    Page 6                                                                        GAO-12-913T
                          significant reporting and data quality issues needed to be addressed; our
                          later reports, however, documented both progress and further
                          refinements needed, and progress in making them. Our
                          recommendations included that OMB clarify the definition of full-time
                          equivalent (FTE) jobs and encourage federal agencies to provide or
                          improve program-specific guidance for recipients. In general, OMB and
                          agencies acted upon our recipient reporting-related recommendations
                          and implemented changes in guidance and procedures.

OMB and Recovery Board Procedures and Guidance Evolved with Input from
Recipients
                          Throughout the development of guidance and the early months of
                          implementing recipients reporting, OMB and the Recovery Board used
                          several opportunities for two-way communication with recipients. Early
                          on, OMB and Recovery Board officials held weekly conference calls with
                          state and local representatives to hear comments and suggestions from
                          them and share decisions made. State and local governments, with their
                          difficult fiscal situations, were concerned about being able to meet the
                          added reporting requirements, and the tight timeframes made this
                          particularly difficult. Federal officials heard the concerns and made
                          changes to their plans and related guidance in response.
                          For example, initial guidance in February 2009 began to lay out
                          information that would be reported on Recovery.gov and steps needed to
                          meet reporting requirements, such as including recipient reporting
                          requirements in grant awards and contracts. In response to requests for
                          more clarity, OMB, with input from an array of stakeholders, issued more
                          guidance in June 2009. The June guidance clarified requirements on
                          reporting jobs, such as which recipients were required to report and how
                          to calculate jobs created and retained. In December 2009, responding to
                          concerns regarding the calculation of FTEs, including some we
                          expressed,11 OMB issued further changes in guidance resulting in
                          simplified jobs-reporting guidance.




                          11
                            GAO, Recovery Act: Recipient Reported Jobs Data Provide Some Insight into Use of
                          Recovery Act Funding, but Data Quality and Reporting Issues Need Attention, GAO-10-
                          223 (Washington, D.C.: Nov. 19, 2009).




                          Page 7                                                                   GAO-12-913T
Assistance Was Available as Recipients Became Familiar with Reporting Procedures and
Addressed Early System Problems
                            Recipients of Recovery Act funds needed to quickly learn reporting
                            requirements and develop procedures for meeting them. This was
                            particularly difficult for entities that had not previously received federal
                            funding and were not familiar with federal reporting requirements.
                            Outreach from OMB and the Recovery Board, including conference calls,
                            webinars, and websites, along with guidance were instrumental in
                            bringing recipients up to speed. In addition, agencies provided information
                            and training on reporting for their specific programs through conference
                            calls and webinars. States, as the prime recipients in many cases,
                            ensured that their own agencies and departments and their subrecipients
                            were informed as well by using various means of communications,
                            including conference calls, webinars, and websites. Finally, the Recovery
                            Board also maintained a help desk during the reporting period.
                            Even so, given the uncertainties and ongoing development of the new
                            systems, there were instances of systems going down and data rejections
                            that frustrated recipients. Some extensions were allowed and provisions
                            made for recipients to report and make adjustments to the data, except
                            for FTEs, after reporting closed.
With OMB Oversight, Agencies Took on the Key Role of Ensuring Data Accuracy and
Completeness
                            After we reported that initially there were significant reporting and quality
                            issues, OMB issued guidance to federal agencies that incorporated
                            lessons learned from the first reporting period and addressed
                            recommendations we had made.12 Specifically, in December 2009, OMB
                            required agencies to identify significant errors, particularly in award
                            amounts, FTEs, federal award numbers, and recipient name. OMB also
                            provided guidance in identifying instances where recipients did not report.
                            As a result, federal agencies that awarded Recovery Act funds to states
                            generally developed internal policies and procedures for reviewing data
                            quality, as OMB required. At the ground level, agencies addressed
                            recipients’ quarterly reporting when performing their oversight of
                            Recovery Act recipients. Further, agencies also reviewed data centrally
                            and performed tests of reasonableness on recipient data by program.




                            12
                             GAO-10-223.




                            Page 8                                                            GAO-12-913T
                           OMB also required agencies to provide lists each quarter of those
                           recipients who did not report. Our discussions with agencies indicated
                           that agencies worked with these recipients to identify reasons they did not
                           report. Lists of those who did not report each quarter continue to be
                           available on Recovery.gov.
                           In our work evaluating recipient reporting under specific programs, we
                           found that agencies put considerable effort into ensuring accuracy and
                           completeness, but while the public transparency of Recovery Act
                           spending improved, the agencies often did not benefit much from such
                           recipient-reported data. Agency officials told us they already had much of
                           the information; their own systems provided information on award
                           amounts, funds disbursed, and, to varying degrees, progress being made
                           by grant recipients. However, officials at one agency, the Department of
                           Education, noted that the information obtained through recipient reporting
                           did provide them a useful indication of jobs funded for education
                           programs under the Recovery Act, information they otherwise did not
                           have.
                           Our work also identified some concerns with ensuring that descriptions of
                           awarded projects were adequately detailed in the information that
                           recipients reported. Data collected for Recovery.gov included narrative
                           information that provided the public with details such as the overall
                           purpose of the award and expected results. We found, for example, that
                           an estimated 25 percent of the descriptions of selected infrastructure-
                           related awards met our transparency criteria of having sufficiently clear
                           and complete information on the award’s purpose, scope, and nature of
                           activities; location; cost; outcomes; and status of work. Another 68
                           percent partially met the criteria; and an estimated 7 percent provided
                           little or none of this information.13 In its September 2010 guidance, OMB
                           added a requirement for agencies to review the narrative fields of
                           recipient reports to better ensure transparency.
Additional Approaches Could Streamline Reporting and Oversight
                           Our analysis of the quality of recipient-reported data showed that
                           recipients made errors in reporting award identification numbers, amount
                           of awards, and other data that agencies already had, and that if those
                           items had been pre-populated for recipients, errors might have been



                           13
                             See GAO, Recovery Act: Increasing the Public’s Understanding of What Funds Are
                           Being Spent on and What Outcomes Are Expected, GAO-10-581 (Washington, D.C.: May
                           27, 2010).




                           Page 9                                                               GAO-12-913T
                            reduced. The award identification number was a particularly key data
                            element, since it was part of the mechanism to link awards across
                            quarters, yet recipient errors as small as leaving out a hyphen could result
                            in information not being able to be linked. Agencies identified other errors,
                            such as incorrect award amounts, by comparing data recipients reported
                            with data they had. It was time-consuming both to perform those
                            comparisons and to follow up with recipients to get them to fix the errors.
                            The Recovery Board eventually enabled recipients to “copy forward”
                            information reported in previous rounds and modify it as needed, which
                            helped prevent some errors. However, some agency officials suggested
                            that pre-populating these fields with agency data before recipients began
                            their reporting would have reduced the number of errors.
                            In addition, our work indicated that recipients sometimes were required to
                            report similar information into both agency reporting systems and
                            FederalReporting.gov. Agencies required more data in some cases to
                            manage their programs than was required on recipient reports and made
                            available on Recovery.gov. For example, Environmental Protection
                            Agency officials said that they needed project details that were not
                            available in Recovery.gov data for their Recovery Act water programs.
                            Similarly, the Department of Transportation preferred using its own data
                            because they were more detailed, and were reported monthly—more
                            frequently than the Recovery.gov data. While the time constraints of
                            implementing Recovery Act reporting made it difficult to consolidate data
                            collection and prevent collecting similar data from recipients more than
                            once, if more planning time was available to solve this issue, the burden
                            on recipients may have been reduced.

Initiatives to Improve Transparency Can Benefit from Lessons Learned
                            There are initiatives under way in Congress and the administration that
                            look to build on these two transparency efforts now in place. For example,
                            legislation has been passed in the House of Representatives14 and
                            introduced in the Senate15 to improve the accountability and transparency
                            of federal spending. In addition, in June 2011 the President issued an
                            executive order establishing the Government Accountability and




                            14
                               Digital Accountability and Transparency Act of 2012, H.R. 2146, 112th Cong.
                            (introduced June 13, 2011 by Rep. Issa).
                            15
                              Digital Accountability and Transparency Act of 2011, S. 1222, 112th Cong. (introduced
                            June 16, 2011 by Sen. Warner).




                            Page 10                                                                     GAO-12-913T
Transparency Board to provide strategic direction for, among other things,
enhancing the transparency of federal spending.16
There are lessons from the implementation of both USAspending.gov and
Recovery.gov that can be applied to these new initiatives. Foremost,
consideration needs to be given to what objectives are to be achieved
and in what priority. As we have seen with both existing systems, success
hinges upon ensuring the data’s completeness and accuracy. Because it
is resource-intensive to ensure all data are reported and correct, it is
imperative to limit the data collected to only those essential elements.
Clear objectives are helpful in guiding such focus.
In addition, the input of federal agencies, recipients, and subrecipients
should be considered early in the development of both the system and its
procedures. Also, as the system is implemented, communicating
impending changes as soon as possible allows for better planning.
Finally, as a system rolls out, recipients will need help to learn how to
fulfill their reporting responsibilities.
Further related to the issue of involving all stakeholders is the need to
recognize the increased reporting and oversight effort required of
recipients and federal agencies, and to identify approaches that minimize
that effort. For example, pre-populating data from federal agencies to
reduce the need for recipients to input those data could help with
accuracy, although agencies likely will need to continue to play a key role
in checking data quality.
                                     -----
In conclusion, there have been great strides in increasing the
transparency of federal awards since 2006. The USAspending.gov and
Recovery.gov websites offer the public a wealth of information on how
federal funds are spent. However, it is important that ongoing efforts to
improve the data provided to the public continue to evolve. We believe
having a strategic vision, ensuring data quality, allowing for input of ideas,
helping those who have to report, and minimizing reporting burdens can
improve the chances of success.
Chairman Lieberman, Ranking Member Collins, and Members of the
Committee, this concludes my prepared statement. I would be pleased to
answer any questions that you may have.



16
 The Government Accountability and Transparency Board was created by Executive
Order 13576 in June 2011.




Page 11                                                                GAO-12-913T
Contacts and Acknowledgments
                   For further information regarding this testimony, please contact Stanley J.
                   Czerwinski at (202) 512-6808 or czerwinskis@gao.gov or David A.
                   Powner at (202) 512-9286 or pownerd@gao.gov. In addition, contact
                   points for our Offices of Congressional Relations and Public Affairs may
                   be found on the last page of this statement. Individuals who made key
                   contributions to this testimony are Carol Patey and James R. Sweetman,
                   Jr., Assistant Directors, Lee McCracken, and Kevin Walsh.




                   Page 12                                                         GAO-12-913T
Appendix I: GAO Products Related to Recipient Reporting
                     Recovery Act: As Initial Implementation Unfolds in States and Localities,
                     Continued Attention to Accountability Issues Is Essential. GAO-09-580.
                     Washington, D.C.: April 23, 2009.
                     Recovery Act: States’ and Localities’ Current and Planned Uses of Funds
                     While Facing Fiscal Stresses. GAO-09-829. Washington, D.C.: July 8,
                     2009.
                     Recovery Act: Funds Continue to Provide Fiscal Relief to States and
                     Localities, While Accountability and Reporting Challenges Need to Be
                     Fully Addressed. GAO-09-1016. Washington, D.C.: September 23, 2009.
                     Recovery Act: Recipient Reported Jobs Data Provide Some Insight into
                     Use of Recovery Act Funding, but Data Quality and Reporting Issues
                     Need Attention. GAO-10-223. Washington, D.C.: November 19, 2009.
                     Recovery Act: Status of States’ and Localities’ Use of Funds and Efforts
                     to Ensure Accountability. GAO-10-231. Washington, D.C.: December 10,
                     2009.
                     Recovery Act: One Year Later, States’ and Localities’ Uses of Funds and
                     Opportunities to Strengthen Accountability. GAO-10-437. Washington,
                     D.C.: March 3, 2010.
                     Recovery Act: States’ and Localities’ Uses of Funds and Actions Needed
                     to Address Implementation Challenges and Bolster Accountability. GAO-
                     10-604. Washington, D.C.: May 26, 2010.
                     Recovery Act: Increasing the Public’s Understanding of What Funds Are
                     Being Spent on and What Outcomes Are Expected. GAO-10-581.
                     Washington, D.C.: May 27, 2010.
                     Recovery Act: States Could Provide More Information on Education
                     Programs to Enhance the Public’s Understanding of Fund Use. GAO-10-
                     807. Washington, D.C.: July 30, 2010.
                     Recovery Act: Opportunities to Improve Management and Strengthen
                     Accountability over States’ and Localities’ Uses of Funds. GAO-10-999.
                     Washington, D.C.: September 20, 2010.
                     Participants in SBA’s Microloan Program Could Provide Additional
                     Information to Enhance the Public’s Understanding of Recovery Act Fund
                     Uses and Expected Outcomes. GAO-10-1032R. Washington, D.C.:
                     September 29, 2010.



                     Page 13                                                         GAO-12-913T
Recovery Act: Opportunities Exist to Increase the Public’s Understanding
of Recipient Reporting on HUD Programs. GAO-10-966. Washington,
D.C.: September 30, 2010.
Recovery Act: Head Start Grantees Expand Services, but More
Consistent Communication Could Improve Accountability and Decisions
about Spending. GAO-11-166. Washington, D.C.: December 15, 2010.
Recovery Act: Energy Efficiency and Conservation Block Grant
Recipients Face Challenges Meeting Legislative and Program Goals and
Requirements. GAO-11-379. Washington, D.C.: April 7, 2011.
Recovery Act: Funding Used for Transportation Infrastructure Projects,
but Some Requirements Proved Challenging. GAO-11-600. Washington,
D.C.: June 29, 2011.
Recovery Act: Funds Supported Many Water Projects, and Federal and
State Monitoring Shows Few Compliance Problems. GAO-11-608.
Washington, D.C.: June 29, 2011.
Recovery Act Education Programs: Funding Retained Teachers, but
Education Could More Consistently Communicate Stabilization Monitoring
Issues. GAO-11-804. Washington, D.C.: September 22, 2011.
Recovery Act: Progress and Challenges in Spending Weatherization
Funds. GAO-12-195. Washington, D.C.: December 16, 2011.
Recovery Act: Housing Programs Met Spending Milestones, but Asset
Management Information Needs Evaluation. GAO-12-634. Washington,
D.C.: June18, 2012.




Page 14                                                       GAO-12-913T
Appendix II: FFATA Requirements and GAO’s Assessment of
Compliance as Reported in 2010

                    FFATA Requirement                                 GAO’s assessment of compliance
                    Establish a free, publicly available website      Met
                    by January 1, 2008                                OMB launched USAspending.gov, a free,
                                                                      publicly available website, in December
                                                                      2007.
                    Capture specific data elements for each           Met
                    award                                             The site captured information on all
                                                                      required data elements, such as the entity
                                                                      receiving the award and the award
                                                                      amounts.
                    Allow searches by each required data              Met
                    element, provide total dollars awarded by         The site allowed searches of data by all
                    recipient, and provide downloadable data          required data elements and provided totals
                                                                      for awards made as well as downloadable
                                                                      data.
                    Include awards made in fiscal year 2007           Met
                    and after                                         The site included data for federal awards
                                                                      made in fiscal year 2007 and later, as well
                                                                      as limited data from previous years.
                    Ensure that information on awards is added        Met
                    to the site within 30 days of the award           To facilitate timeliness of data available on
                                                                      the website, OMB guidance required
                                                                      agencies to submit award data on the 5th
                                                                      and 20th of each month.
                    Allow for public input about the site’s utility   Met
                    and suggestions for improvement                   The site included a contact form for public
                                                                      comments and suggestions.
                    Commence a pilot program to test                  Partially met
                    collection of subaward data and determine         OMB commissioned two pilot programs for
                    how to implement a subaward reporting             collecting subaward data, one at the
                    program across the federal government,            General Services Administration that ran
                    beginning no later than July 1, 2007, and         from April 2008 to December 2008, and
                    ending no later than January 1, 2009              one at the Department of Health and
                                                                      Human Services that ran from October
                                                                      2008 to November 2008. Both pilots were
                                                                      begun after the July 2007 date specified in
                                                                      the act.




                    Page 15                                                                           GAO-12-913T
           FFATA Requirement                                                  GAO’s assessment of compliance
           Include subaward data no later than                                Not met
           January 1, 2009 (An 18-month extension                             Subaward data (e.g., subcontracts and
           can be granted for subaward recipients that                        subgrants) were not yet available for
           receive federal funds through state, local,                        searching on USAspending.gov. FFATA
           or tribal governments if OMB determines                            allows OMB to extend the deadline by 18
           that compliance would impose an undue                              months for some subaward recipients.
           burden on the subaward recipient.)                                 However, according to OMB, there was no
                                                                              official extension in place for reporting
                                                                              subaward data at this time. In addition, as
                                                                              of November 2009, OMB had not
                                                                              developed a specific plan for collecting and
                                                                              reporting subaward data.
           Submit an annual report to the specified                           Not met
           congressional committees                                           OMB had not submitted the required
                                                                              annual report to Congress containing (1)
                                                                              data on the usage of and public feedback
                                                                              on the site, (2) an assessment of the
                                                                              reporting burden on award recipients, and
                                                                              (3) an explanation of any extension of the
                                                                              subaward deadline. According to OMB
                                                                              officials, it was gathering the necessary
                                                                              information and planned to issue a report in
                                                                                     a
                                                                              2010.
           Source: GAO analysis.
           a
           As noted in our statement, OMB issued a report to Congress in July 2010.




(311273)

           Page 16                                                                                           GAO-12-913T
This is a work of the U.S. government and is not subject to copyright protection in the
United States. The published product may be reproduced and distributed in its entirety
without further permission from GAO. However, because this work may contain
copyrighted images or other material, permission from the copyright holder may be
necessary if you wish to reproduce this material separately.
                      The Government Accountability Office, the audit, evaluation, and
GAO’s Mission         investigative arm of Congress, exists to support Congress in meeting its
                      constitutional responsibilities and to help improve the performance and
                      accountability of the federal government for the American people. GAO
                      examines the use of public funds; evaluates federal programs and
                      policies; and provides analyses, recommendations, and other assistance
                      to help Congress make informed oversight, policy, and funding decisions.
                      GAO’s commitment to good government is reflected in its core values of
                      accountability, integrity, and reliability.

                      The fastest and easiest way to obtain copies of GAO documents at no
Obtaining Copies of   cost is through GAO’s website (www.gao.gov). Each weekday afternoon,
GAO Reports and       GAO posts on its website newly released reports, testimony, and
                      correspondence. To have GAO e-mail you a list of newly posted products,
Testimony             go to www.gao.gov and select “E-mail Updates.”

Order by Phone        The price of each GAO publication reflects GAO’s actual cost of
                      production and distribution and depends on the number of pages in the
                      publication and whether the publication is printed in color or black and
                      white. Pricing and ordering information is posted on GAO’s website,
                      http://www.gao.gov/ordering.htm.
                      Place orders by calling (202) 512-6000, toll free (866) 801-7077, or
                      TDD (202) 512-2537.
                      Orders may be paid for using American Express, Discover Card,
                      MasterCard, Visa, check, or money order. Call for additional information.
                      Connect with GAO on Facebook, Flickr, Twitter, and YouTube.
Connect with GAO      Subscribe to our RSS Feeds or E-mail Updates. Listen to our Podcasts.
                      Visit GAO on the web at www.gao.gov.
                      Contact:
To Report Fraud,
Waste, and Abuse in   Website: www.gao.gov/fraudnet/fraudnet.htm
                      E-mail: fraudnet@gao.gov
Federal Programs      Automated answering system: (800) 424-5454 or (202) 512-7470

                      Katherine Siggerud, Managing Director, siggerudk@gao.gov, (202) 512-
Congressional         4400, U.S. Government Accountability Office, 441 G Street NW, Room
Relations             7125, Washington, DC 20548

                      Chuck Young, Managing Director, youngc1@gao.gov, (202) 512-4800
Public Affairs        U.S. Government Accountability Office, 441 G Street NW, Room 7149
                      Washington, DC 20548




                        Please Print on Recycled Paper.