Time to “Follow the Money”

Posted: May 02, 2006 5:00 PM

“Follow the money” may be sound advice for encouraging accountability in spending but it has been a most difficult task when that money comes in the form of Federal grants or contracts. Senator Thomas Coburn (R-OK) recently noted that every year the Federal Government doles out $300 billion in grants to over 30,000 organizations, in such a disparate, often stealthy, fashion, that true accountability is impossible. Combine that with a Congress lax in overseeing Federal agencies and an “anything goes” environment is created.

Now Senators Coburn and Barack Obama (D-IL) want to change business-as-usual in Washington. Their solution? It’s very simple and relatively inexpensive: anyone with Internet access would be able to monitor what Washington is doing with his tax money.

Coburn and Obama introduced earlier this month S. 2590, the Federal Funding Accountability and Transparency Act. Their bill would establish an Office of Management and Budget website, listing all entities receiving Federal grants and contracts. Grants and contracts would be posted within a month of award. The recipient’s location, the dollar amount of its grant or contract, and previous grants and contracts would be readily accessible on the database.

OMB WATCH, a non-profit, watchdog organization, has written that databases for grant and contract awards exist now but are flawed. The General Services Administration has a contractor that maintains data on contracts but it is not user-friendly. The Census Bureau provides data on grants but it also is not easy to use. Coburn and Obama seek a truly user-friendly database.

The day the Federal Funding Accountability and Transparency Act was introduced, Coburn stated: “Every citizen in this country…should have the right to know what organizations and activities are being funded with their hard-earned tax dollars.” Coburn, noting how long it takes Federal agencies to answer requests by Congress about funds an organization has received, argues his proposal is a useful and necessary step in ensuring true accountability.

One grant that particularly rankles Coburn was made by the United States Agency for International Development (USAID) in likely violation of Public Law 108-25, which forbids the use of public funds to further the practice or legalization of prostitution or sex trafficking.

USAID, despite a claim by a USAID employee to staff of the House Government Reform Committee Subcommittee on Criminal Justice, Drug Policy and Human Resources, was found to be funding an organization in India called Sampada Grameen Mahila Sanstha (SANGRAM). Funds were funneled through another organization called Avert. Four USAID employees had helped to create Avert and USAID controlled the position of ex-officio Avert Vice Chairman. Coburn said that he had obtained documents which show “the USAID board member of Avert voted twice to award funding to SANGRAM (July 27, 2002 and again on December 3, 2004), the last time being some 18 months after the provisions of Public Law 108-25 prohibited taxpayer funding of pro-prostitution groups like SANGRAM.”

Ironically, SANGRAM blocked attempts by Restore International, an anti-sex trafficking organization, to provide safe refuge for 17 underage female victims of sex trafficking. An unclassified State Department memorandum states that SANGRAM “allowed a brothel keeper into a shelter to pressure the girls not to cooperate with counselors. The girls are now back in the brothels, being subjected to rape for profit.”

Senator James M. Inhofe (R-OK), Coburn’s colleague from Oklahoma, can testify about the importance of requiring accountability and oversight of Federal grants. Inhofe, Chairman of the Environment and Public Works, had his staff scrutinize the grant-making process at the Environmental Protection Agency (EPA). The lack of oversight of EPA discretionary grants had long been the focus of controversy; even the EPA Inspector General had raised concerns.

An exasperated Inhofe held hearings on the subject in 2004. At the time Inhofe stated the Government Accountability Office (then the Government Accounting Office) had identified a “general lack of oversight of grantees, a lack of oversight of agency personnel, a lack of measurement of environmental results, and a lack of competition in awarding grants.”

Inhofe and his staff were persistent in pushing EPA to act and its new Administrator, Mike Leavitt (now Secretary of Health & Human Services), also was interested in instilling more accountability. EPA established a grant awards database to list grants (found by visiting http://www.epa.gov and searching the term “grants” under the center section of the homepage labeled “Quick Finder”). The database lists the grant, the purpose and date of the award. It is a good start but even more accountability should be built into the grant-making process – namely, a strengthening of the peer review process and the defining of scientific criteria underlying the commissioning of the grant.

Inhofe commented earlier this year that EPA had started to reform its grant process, thanks to the close scrutiny supplied by his Committee. He was not pleased with much of what was discovered:

    “We have found taxpayer dollars being used for dubious projects such as funding questionable environmental projects in other countries which included funds to expand the environmental capacity of Moroccan non-governmental organizations and government agencies, including a 10-day US study tour for Moroccan officials to Maryland. Additionally, grants funds have been allocated to implement regional energy efficiency standards for buildings in the Russian Federation and implement an indoor air initiative in the Yunnan community of China. I believe and I know the taxpayers in Oklahoma agree with me that funding for these grants could be better spent at home.”

A bill, H.R. 5060, has been introduced in the House of Representatives to require “data with respect to federal financial assistance to be available for public access in searchable and user-friendly form.” Sponsors are House Majority Whip Roy Blunt (R-MO) and Representative Thomas M. Davis (R-VA). OMB WATCH reports that the Blunt-Davis Bill differs from the Coburn-Obama Bill in that it only covers grants and not contracts.

Coburn asserts that often an agency will try to “camouflage” its awarding of a grant. Such was the case with the money received by SANGRAM through Avert. Achieving more transparency and accountability in the awarding of contracts and grants would require Federal agencies to list them and to make them quickly available to the public. That would be a sound initial step but meaningful follow-through would require agencies to be more descriptive in defining the objectives of the grant.

Government is entering an age of increased transparency. No longer should Federal personnel decide who will receive discretionary grants without strong peer review or measurable results. The Federal Funding Accountability and Transparency Act deserves strong consideration by the Congress, if only because if would help Members and their staffs do their jobs. Too many in Congress are overjoyed to have their pictures taken in announcing Federal grants but shun the tough work of providing determined and exacting oversight. In other words, the failure of Members of Congress to do their jobs permits Federal agencies to avoid doing theirs with the public interest at heart. The result is wasted money, or worse as with the USAID grant. Congress has demonstrated little desire to really clamp down upon spending. The least it can do is to ensure that the money it appropriates is spent correctly and for public benefit. It’s time citizens and Congress really can follow the money!