committee will come to order this is a hearing on improving oversight and accountability in federal grant programs from the oversight and government reform subcommittee we exist to secure two fundamental principles first americans have the right to know that the money washington  them is well spent second americans deserve an efficient effective government that works for them our duty on the oversight and government reform committee is to protect these rights our solemn responsibility is to hold government accountable to taxpayers because taxpayers have a right to know what they get from their government it appears that there is a void of consistent grant guidelines across all agencies beyond omb circulars currently agencies do not typically disclose to grant applicants the criteria or factors they will use in deciding how to distribute grant funding when agencies do disclose the criteria they may not disclose the weighting of the various criteria because of the discretionary grant process it is impenetrably opaque it is difficult if not impossible for the public or oversight bodies to determine whether a federal grant award was based on merit the discretion of the department or agency past or future employment political or financial interest any of those areas we cant determine gao and ig audits have examined discretionary grant awards decisions typically they reveal that in financial selection the decision was not documented and one cannot ascertain why some grant applications were funded   others were not during this hearing we plan to ask many questions after the funds have been distributed to grantees do agencies have effective oversight and monitoring tools are there vulnerabilities in the system and ways to ensure that the governments limited discretionary grant resources are used effectively if public funds are used to pay for research is the research deliverable publically available should grants release the funds as the work is completed in multiple stages pay at the start or pay at the end of a project are there ways to protect against fraud wast inappropriate pay scales ghost employees work that was never complete et cetera how do we ensure that grant funding is released to entities with the greatest need and ability rather than simply the best grant writing skills is there a way to see the successful and not successful grant  future grant writers can see what was contained in a successful grant application can we improve communication throughout the grant process between the agencies and the grant requesters are grants being written in instances when it would be more appropriate to use a contract is there a need to increase recipient reporting requirements to allow more transparency this hearing will focus on asking the questions to determine if there are new ideas that exist to help all entities involved in the grant process accomplish their goals i look forward to discovering with all parties the ideas that will help us in the questions about the disbursement of federal funding first what is the relationship between transparency of grant disbursement auditing of grant recipients and the efficient allocation of resources to grantees who can make the most of the funding there may be a point at which additional and especially duplicative reporting requirements constrain grantees ability to fulfil their own mission there may be a point at which additional reporting requirements frankly discourage participation by smaller entities finally if we are disbursing discretionary grants to many very small entities which require labor intensive audits then perhaps it is more efficient to spend the money directly through the federal agency itself we should not leave unexamined the assumption that grants necessarily represent the best way to fund a particular program second what is the federal government doing to ensure equitable distribution of grant monies i represent two counties in virginia for example of which one has a very sophisticated grant application staff and one that is less so both of these counties deserve fair merit based consideration of their grant applications but one starts out with a distinct advantage lest grant monies flow disproportionately to wealthy urban counties agencies must go out of their way to ensure that less sophisticated but equally deserving jurisdictions receive fair consideration of their applications this kind of equitable process requires proactive outreach just as selective colleges proactively reach out to underrepresented communities which certainly contain talent but do not always possess the familiarity or expertise with college application processes i am interested in hearing more about the administrations efforts to strengthen www grants gov and whether these efforts include reforms that will make the platform more accessible to all grant seekers third what is the federal government doing to avoid the imposition of unfunded mandates and to reduce the reporting burden on states localities and universities i indicated yesterday that i do have some about the legislation this committee marked up with respect to that subject according to the american association of universities for example fulfilling arra reporting requirements alone costs seven thousand nine hundred dollars per grant award that would translate to hundreds of millions of dollars potentially in cost if arra type reporting requirements were established across the board for all federal spending at a time when states localities and universities are facing dire fiscal challenges we need to be cognizant to ensure that any additional reporting requirements for good reasons for transparency avoid the imposition however of an unfunded mandate and protect those entities abilities to deliver the services that our constituents need the efficiency and transparency of grant delivery is a complex topic i hope that as we develop legislation on this topic we have additional hearings to consider the questions i have raised in a cost constrained environment it is imperative that we consider the efficient delivery of services which must be balanced against the need for transparency and include consideration of all of the tools beyond grants to accomplish a given objective we say we are concerned about the burden of unfunded mandates we have had a number hearings in this subcommittee about them we must make sure we do not even unwittingly add to them i look forward to hearing the testimony this morning mister chairman again thank you for holding this hearing mister lankford i agree with what you were saying on the additional e you for five minutes i know all of you have been around the hearings before at different times and that you are familiar with your red yellow and green lights there in front of you we would be very honored to receive your testimony thank you good morning chairman lankford ranking member connolly and members of the subcommittee thank you for the opportunity to be here to discuss issues related to improving federal grants processes today i will highlight the results from a range of reports that we have issued regarding weaknesses in federal grants management and accountability including the single audit process the administration also recognizes concerns with these processes and has included improving grants management as part of its initiative to eliminate waste it has various related efforts underway today i will discuss the significance of federal grant funding the related risks and vulnerabilities and improvements needed to make the single audit process an effective accountability mechanism the federal governments use of grants to achieve national objectives and to respond to emerging trends in demographics and threats to homeland security has grown significantly in the last two decades in fiscal year two thousand and ten federal grant awards to states and local governments totaled over six hundred dollars billion according to historical data from the presidents budget also in fiscal year two thousand and ten over one thousand six hundred and seventy grant programs were offered by at least twenty three federal grant making departments and agencies as you mentioned mister chairman the top three agencies in terms of grant dollars are the departments of health and human services transportation and education our work over a number of years has pointed out risks and vulnerabilities that exist in the federal grants process we found weaknesses in the control systems of federal awarding agencies at all points in the grant life cycle specifically in the pre award and award processes our audits found that agencies awarded grants without adequately documenting the selection process in some instances we found agencies did not perform pre award reviews until after the grants had been awarded in other cases the documentation was not sufficient to show key decisions that were made in the competitive award process including decisions about evaluation criteria and selection in the implementation phase we found weaknesses  agency monitoring of recipients use of funds including identifying and managing grantee risks and properly overseeing grantee financial practices and program management we have also reported the need for agencies to assist recipients in improving sub recipient monitoring when federal funds are passed through one entity to another grant closeout procedures have also been a longstanding problem these procedures are used for detecting problems that have occurred in recipient financial management and program operations closeout procedures are intended to ensure that recipients have met all financial requirements provided financial reports and returned any unused funds to the federal government we have also reported on government wide issues related to grants including undisbursed federal funding in expired grant accounts and improper payments in federal grant programs finally i will discuss the audit mechanism for grants which is the single audit over the past several years we have reported significant concerns with the single audit process and have called for improvements to make single audits a more effective accountability mechanism over federal grant funding while possibly  streamlining the process single audit reports are on the financial statements and internal controls over compliance with laws and grant provisions for grantees that spend more than five hundred thousand dollars of federal funding in a given year the grantees subject to these requirements are state and local governments through our work we found that the federal oversight structure is not adequate to monitor the single audit process and results and that the timeframes do not facilitate timely correction of a it findings by grantees in addition single audit stakeholders including the states have raised concerns about the complexity and relative costs and benefits of the single audit requirements as currently designed we also found that federal agencies do not systematically use audit findings to identify risks related to grant programs and individual grantees we also identified concerns regarding the need for omb to issue its single audit guidance in a more timely manner in order to help facilitate audit planning for the many states and local governments that have fiscal year ends of june th it is important to note that complexities and weaknesses in the federal grant management and single audit processes have a serious impact on state and local governments in addition to presenting risks over the effective and efficient use of federal funding enhancing accountability and oversight at all levels is important improvement and modernization efforts should also be mindful of the scarce resources at all levels of government and the shared intergovernmental responsibilities that we have mister chairman this concludes my statement i will be happy to answer any questions that you or the subcommittee members may have  lankford ranking member connolly and members of the committee my name is natalie keegan and i am an analyst in american federalism and emergency management policy at the congressional research service thank you for the opportunity to testify this morning on improving oversight and accountability in federal grant programs i have submitted my full statement for the record i have three observations about how agency discretion influences transparency at the pre award phase of federal grants federal grantor agencies have the discretion to disclose information about the grants administration process yet for most federal agencies and most grants there isnt a clear picture of how grants are selected the specific details of grants applications are not disclosed and it is unclear exactly what is contained in grant formulas used to distribute funds for grant applications and grant applicants lack of transparency may result in the inability to direct resources in the most efficient manner when seeking federal grants for congress lack of transparency makes it difficult to measure grant program efficiency effectiveness and economy let me expand on these observations pre award oversight activities include congressional grant program authorizations and appropriations determinations of eligibility and eligible activities review of announcements of funding availability and review of panel scorings of eligible applications while recent congressional debate has involved post award activities particularly recipient and agency reporting requirements consideration of agency discretion for the pre award activities may provide insight into improving oversight and accountability in federal grants my first observation is that there isnt a clear picture of how  federal agencies generally have the authority to establish the criteria for evaluating discretionary grant applications there appears to be no consistency in the criteria within and across agencies agencies are required to provide criteria when they publish the notice of funds availability in the federal register however the information provided generally does not include a concise list of evaluation factors and specifically how those factors will be weighted during the scoring of the application in some cases grant applications are reviewed by a panel and scored on a scale of zero to one hundred the scores are then used to prioritize applications for funding the agencies however are not bound by the review panels scores and the scores generally are not disclosed to either the grant applicants or the public my second observation is that the specific details of grant applications are not disclosed almost always agencies consider some of the information in the grant applications to be proprietary information as a result generally agencies will not disclose details in the grant applications without the permission of the applicant this applies to both funded and unfunded applications my final observation is that it is unclear exactly what is included in the grant formulas used to distribute funds there is currently no single source providing information on gra formulas used to distribute funds including information about the formula factors and how they are weighted this was not always the case the general services administration is responsible for maintaining and providing access to information on federal grants through a computerized information system this access is through www cfda gov at one time the gsa administrator was also required to provide to congress specific information on each grant distribution formula in a report titled formula report to the congress this report is no longer available the report was discontinued under the federal reports elimination and sunset act of one thousand nine hundred and ninety five there is no other comparable federal report that provides this level of detail on federal grant formulas in conclusion a closer examination of agency pre award grant activities and the amount of agency discretion in these activities may assist in the determination of whether increased agency discretion warrants increased transparency i thank you for the opportunity to testify and would be happy to answer any questions the committee may have  typical of those that are described by the other panel members that are found across the government grants management has long been a challenge for the department of justice and the department has faced heightened challenges since two thousand and nine because of the increase in grant funding that it received under the recovery act given the large volume of grant funding traditionally awarded by the department the department of justice office of the inspector general has long focused on providing oversight of the departments activities in this area our audits have found that the department has made a concerted effort in the past three years to improve its regular grant management practices the department has responded positively to recommendations we have made in our audits and in a best practices guide that we provided them called improving the grants management process in particular the department made significant improvements in its monitoring and oversight of grants particularly due to its staffing of its office of audit assessment and management while oaam was created by statute in two thousand and five to improve the departments oversight of its grants programs we reported in two thousand and eight that the department had not devoted sufficient effort to staffing this office so that it could perform its mission however we found in an audit issued in march of this year that they have made significant progress since two thousand and eight that office is now fully staffed and it has implemented a reasonable process for monitoring the high volume of grants that it is responsible for monitoring while we believe that the department has taken positive steps towards improving its grants management practices these changes will take time to fully implement and to incorporate into the departments regular practices our work has continued to identify areas where the department could further improve its management of grants particularly in terms of its process for awarding grants and its oversight for example in recent audit reports we found instances where the department either used incorrect scoring formulas or made scoring errors while reviewing grant applications we also found instances where the department treated applicants inconsistently allowing some grant applications to be given further consideration for awards even though they were missing key documentation while denying other applicants further consideration for the same deficiencies our recent audits also found that some department agencies do not consistently document the rationale for discretionary awards despite recommendations that they should do so and in some instances do not explain why applications ranked lower by peer reviewers received grants over those that were r higher we found that the department should be taking additional steps to ensure adequate screening for conflicts of interest on the part of peer reviewers who are assessing the grant applications the department has agreed with the recommendations we made and is working to implement procedures to help ensure these issues do not reoccur in addition our audits of individual grant recipients have found deficiencies such as failing to segregate payroll duties and failure to employ sufficient staff with the training and experience to properly manage the grants we have recommended that the department provide additional training and oversight of these grant recipients we also believe that the department should take further action to address outstanding recommendations to resolve questioned costs from our audits of grantees while the department frequently is able to implement our audit recommendations within a year or two some of our audit recommendations have lingered for years without being resolved despite our frequent reminders for the department to do so while the department works to improve its grant management processes we will continue with our important mission of providing oversight of the departments efforts in this area we also will continue with our leadership of the grant fraud committee which is part of the financial fraud enforcement taskforce through the grant fraud committee we have issued a best practices guide for all federal grants managers we also have developed and are continuing to develop additional training courses for agents auditors grant managers and grantees in conclusion we will continue to work with the department and external agencies to help reduce risks associated with federal grants we believe the department is demonstrating a commitment to improving its grants management process and we have seen significant signs of improvement in this area however further improvements are needed and considerable work remains to be done before managing the billions of dollars that the department awards annually in grants is no longer a top challenge for the department this concludes my prepared statement and i would be pleased to answer any mister werfel thank you chairman lankford ranking member connolly and members of the subcommittee for the invitation to discuss with you today the federal grant management process and how the federal government can improve its oversight and accountability in federal grant programs the federal government annually awards grants totaling roughly six hundred dollars billion which is one sixth of the total federal budget the federal government therefore has a fundamental responsibility to be effective stewards of these dollars the office of management and budget working with federal grant making agencies and non federal stakeholders establishes policies and initiates reforms to ensure that relevant program requirements are being met that strong internal controls for reducing waste fraud and error are in place and that grantees are meeting their responsibilities for performance and accountability for grant awards my written testimony provides background on relevant policies such as cost allocation single audit improper payment review and transparency act reporting all of which are intended to drive accountability integrity and transparency in the use of federal grant dollars for example when single audit conducted effectively the audit results which are available on a public website are instrumental in identifying and correcting noncompliance with laws and regulations including improper payments and other financial management deficiencies a good example of this is in the medicaid program where more than a billion dollars in disallowed costs have been identified for recovery over the past several years as a result of single audit activities in each of the areas i have identified we have initiatives in place to improve the overall impact of these policies i would like to highlight a few of these areas where in some cases recent successes provided a critical foundation for sustained progress moving forward first in the area of improper payments prevention and recapture largest grant program since the president took office eliminating improper payments has been a major focus of his administration in november two thousand and nine the president issued an executive order that initiated a comprehensive approach to improving results in this area including transparency through a new website www paymentaccuracy gov and the appointment of senior accountable officials responsible for coordinating improper payment efforts at their agencies a subsequent presidential directive called for an increase in improper payment recoveries from contractors federal agencies responded by recovering six hundred and eighty seven dollars million in improper payments more than three times the amount from the previous year in two thousand and ten the recently enacted improper payments elimination and recovery act further strengthened accountability on all aspects of improper payments and provided new authorities in particular providing federal agencies new authorities to recover improper grant payments we are now working with agencies to make sure they leverage these new authorities to recover payments that have been improperly paid to grantees second though related to improper payments omb is working with the recovery board and federal agencies to utilize cutting edge fraud detection capabilities to enhance accountability and eliminate fraud in federal award spending as you know the recovery board has initiated very successful and effective solutions for tracking fraud and error we have initiated pilots of these tools with other agencies i would like to highlight that the president recently signed an executive order called delivering an efficient effective and accountable government which establishes a new oversight and accountability board the government accountability and transparency board this board will help us make sure that the tools and lessons learned from the recovery board areas such as fraud detection and transparency are effectively carried forward to the rest of government last in an area of transparency bolstered by the successful transparency initiatives in the recovery act omb has initiated requirements for the reporting of sub award information on all federal spending the website www usaspending gov provides the public with increased visibility into federal spending beyond the prime recipient level as i noted earlier this is just a highlight of some of our work to improve results in federal grants we look forward to working closely with this committee to ensure the effective implementation of current and future transparency and accountability efforts to ensure that federal grant programs are accountable for taxpayer dollars thank you again for the opportunity to franzel actually our work in that area was to look at funds that had not been drawn down by the grantees it had been obligated by the federal agencies for draw down and the grant period had passed but for whatever reason the grant amount was not closed out or drawn down we dont know if the grantee didnt finish the program or if there was some kind of a problem et cetera what this indicates and we found this in three hundred and twenty five different federal programs is a grant closeout problem part of getting unused federal funds returned to the federal government would also be part of the closeout process so no i cant answer questions about how much maybe should have been returned and wasnt but i think we are fairly confident in saying that there are some issues with the closeout process that is what would be included in the closeout process  when considering the issue of transparency in federal grants certainly an investigation into what information is available and what information would be useful is something for congress to evaluate the report did provide a circulars out there and executive orders that give instructions to the agencies do you see a need to be able to gather those different circulars together and for consistencys sake administration to administration codify some of those say these have been either through several administrations or through trial and error in our own a variety of different requirements that are out there whether issued through memorandum or circular some of which are pushed into the code of federal regulations and some of which arent i think is an important suggestion that we should consider it is a  complex array of requirements that exists today and i think there would be some benefit in reconciling some of that mister lankford is there the possibility of being able to gather together some of those things so you would say this is a series of maybe fifty different ideas or whatever it may be that these should be looked at and exam question on the one hand we are trying to improve these policies and make them more impactful so for example in the area of single audit we have ongoing working groups that extend across federal agencies and into state governments into both programmatic and audit communities within the state governments they are asking the fundamental questions that gao raised in their testimony in terms of how can we make sure that these single audits are getting to the right issues and the results are being used there are other questions in terms of making sure that we are presenting clear given all of these factors have to go into the background on it let me ask you a quick question has omb done any kind of studies or documents to be able to study the grant process that you have in draft form or in a final form that this committee could get within the federal government for grant giving i mean each agency may have a reason may have its own formula and may have its own process but we have no standardized transparency system we have no standardized set of criteria we have no described in the grant giving system we sort of are juggling it seems to me in this hearing and this committee with two sets of responsibilities one is on the receiving end are they accountable are they using the money for the that that is not very professional but on the other hand what i worry about is that in our desire to be more transparent and to try to make sure that this is a process that is accountable as it think that the interesting thing about your point is that there are a great deal of variations across grant programs i will give you a specific example i cover the department of homeland security grants at crs one of the elements that i mention in my testimony is regarding disclosure of information in the grant applications themselves beyond the issue of proprietary information for the department of homeland security grants it could be argued that some of that information may not  ideally be disclosed in the interest of national security it is really up to congress to weigh that and decide which programs or all programs or just certain selection of categories of programs need that kind of uniformity  committee i almost think you are a member of our staff since you come with such frequency thank you for being so responsive how will the government address the issue of data integrity in federal spending related to acquisition management grant management werfel it is a huge issue because the value of the information that is up on public websites such as www usaspending gov and www recovery gov is so dramatically diminished if we dont have confidence in the quality and the reliability of the information i think in this regard the recovery act really positioned us well to do a better job more globally we had an information collection system that had built in controls over time it got better and better over time to make sure that information reported in by recipients was more valid a good example of that is in the early part of the recovery act when the system would accept any version of congressional district mistakes were made we got smarter and now if you type in the wrong congressional district it wont let you type that in i tell that story to say that the systems that capture the information can be made better the recovery act was a lessons learned there we also had a very dedicated process during the recovery act where federal agencies over a short period of time really focused on data anomalies and mistakes in the data to make sure that the information going on www recovery gov was accurate of course the public was very important in pointing out errors the key is can we do the same thing more broadly on www usaspending gov and learn those lessons we have already started to do that one of the challenges is that you need to invest in systems in order to make those improvements but we have to do investments within our current resource constraints but in particular we are working with agencies to kind of carry forward things that have worked well in the recovery act in terms of data reliability and having them do a better job reviewing their www usaspending gov spending information  to as we are dealing with the requirement to be faithful stewards of government monies i thank you for taking the time to point out many of the places where some opportunities arise i think i am stunned by the observation ms franzel in your report of close to one hundred and twenty five dollars billion in improper payments that are made how do we begin to put our arms around that kind of a number and look for ways in which we can capture that before those dollars go out the door ms franzel the estimate that you cite covers various federal programs not all of them are grant programs but in the top ten five of them are in fact grant programs so grant programs are certainly included in the estimate of improper payments government wide we and omb have been certainly working closely on this matter we are really at a point where we need to get to the next step on improper payments over the past several years the government has made a lot of progress in terms of monitoring and measuring the amount of improper payments out there at this  point we really need to get at the causes of those improper payments so that those causes could then be remedied in order to prevent improper payments from happening mister meehan could you give me an example of something you would point to that people would understand is a cause that we arent following up on ms franzel certainly there are many different types of improper payments in fact sometimes something is categorized as an improper payment because there is no documentation available to verify that the payment should have been made in that case we are really not sure if the payment should have been made or not so in those cases it is important to figure out why why is there not documentation in other cases a program might be giving recipients for a program in other cases it could be that the program design is so difficult to implement that in fact sometimes it is not always clear if somebody is eligible so there can be a wide range of causes i think across agencies and programs the federal government needs to get a handle on these causes so that the problems can be fixed and so that improper payments can be prevented mister meehan we were talking just the other  i used to do work as a corporate attorney in a lot of the contract field there would be requirements that would have to be met before we would pay the next installment do we do enough of that  in government contracting now or in other kinds of grant programs where there has to be an accountability that is almost contemporaneous with the release of the next line of funding ms franzel it really is a delicate balance for instance in medicaid the payments do need to get out so that medical services can continue to be provided so there needs to be a good balance of controls up front along with getting payments out in fact  are starting some work in the near future on looking at the medicaid program we are also currently working on foster care to really drill down and take a look at what are some of the causes of improper payments and then matching that up with some of the initiatives that are ongoing there are many initiatives ongoing in government but we really need to match all of this up mister meehan you hear oftentimes from physicians and others that there are late payments for them they perform the service and then they carry for a long period of time let me ask one last question of anybody on the panel when i was a prosecutor in the u s attorneys office we used to make a lot of use of the qui tam laws in which people were awarded a percentage of a recovery that they brought to the attention of the government this goes all the way back of course as you well know to the civil war era do we make use of that in the kind of programs that we have not the big ticket government programs where we have found our benefit how do we use that capacity to be able to have others be eyes and ears to help us opportunity to respond dating back to two thousand and two congress created a provision that enabled federal agencies to basically hire contingency based contractors to go and help them find their improper payments and have to pay that audit firm only pay them out of the percentage of improper payments that they identify were made to the contractor that has been a very successful program it was so successful that the medicare program initiated it so now we are moving beyond contractors medicare can hire these specialized auditors to go into hospitals and pull out these improper payments and get paid out of a portion of that now that has been expanded to medicaid and with the recent enactment of new improper payments legislation we have it for all meehan are we able to utilize current technology to see outliers on what our patterns of payments are i use again a medicare or medicaid situation in which you would see someone who is doing an inordinate amount of billing very good news is that we for the first time have had a significant breakthrough the recovery board took technology that was generally used in law enforcement and intelligence and also by credit card companies to look for payment anomalies and they deployed it for the first time that i am aware of in a very systemic way over all recovery act dollars they have been able to do things that in my fourteen years of federal service i had never seen and a lot of never seen so we are piloting that solution the bad news is that we are in the embryonic phase of this across government and that agencies are going to have to ramp up we are low on the learning curve right now in terms of deploying these types of technologies but the recovery boards deployment werfel it is in my experience one of the more critical ways in which the citizenry can have an understanding of what is going on with taxpayer dollars they way it works is that all payments essentially greater than twenty five thousand dollars are submitted into this warehouse and pulled onto this website so that they are searchable so you can type in yale university or abc company or the state of arizona and see all the payments that these various entities have received you can look at them in different categories and have an understanding with a description of how that money is being used it enables people to understand within their local communities where the federal dollars are going and how they are being used and www recovery gov just took that more of a capture of who got the money and what was the intended use of the money it doesnt necessarily tell you progress whereas www recovery gov goes a little bit deeper into progress points in particular job impacts in terms of job their only responsibility really is to write a report and release it six months from now the data act is going to shed more light on it and be a much better tracking vehicle help me with that a little bit if you would with the board lot of infrastructure technology skills that they have developed we have to figure out how to marshal that through to the future currently the recovery board is set to expire september thirty two thousand and thirteen so as good stewards of the taxpayer  dollar and good public policy personnel we want to make sure that we have a plan for how we are going to transition past september thirty two thousand and thirteen to make sure that these practices dont go to waste and are carried forward this board is going to help us marshal the types of steps that we need to take to conduct that transition the other i think primary purpose of this group is to help us provide more integrated strategic leadership on transparency and accountability by bringing together the best and brightest of the cfo management and inspectors general communities for a dedicated presidentially directed purpose around enhancing transparency and accountability it is going to help give us that strategic roadmap we may need congress help in developing legislation that helps us execute on that strategic roadmap but i think it is important that we get started on planning and figuring out what the right next steps are mister kelly and i think the data act adds an awful lot of credibility to that whole  are the implications of this decision the pre award phase seems to be critical has the financial management capabilities to track the use of the federal funds as well as the programmatic capabilities to actually successfully carry out the program then each grant program also has its own specific requirement is really the up front determination that a particular candidate would be successful in carrying out a federal program with federal funds congressman at one point in my career i was a grants writer as well for local governments it is a challenge when you are trying to direct the resources as best you can as a small entity whether a public non profit and to be able to best identify what the criteria are that are going to be considered what was funded in the past and what the real goal of the grant program is in very specific detail all of that coming and getting a chance to hear you mister werfel i wanted to be able to follow up on something mister kelly mentioned about contracts versus grants how comfortable are you that the agencies are not using a grant when they should use a contract because the grant process is easier than the contracting process but we are receiving a deliverable whether that be a research report or something else we really should be doing a contract rather than a grant on that are you comfortable on that mister werfel first of all i think that there is  sufficient guidance that i have used and helped advise coming out of omb and i think there are some comptroller general positions that are in the literature that help an agency determine whether this situation is appropriately awarded as a grant versus a contract i think congress can often be helpful there in terms of signaling its congressional intent for how the money can be spent mister lankford we just had a dramatic increase in the number of grants i am just trying to probe and see if you are comfortable at this point that we are not just and again what mister kelly was talking about before about trying to get into the details of how it is going also if there is a deliverable at the end of it we need to not only know that it was awarded and how much was awarded but if there was some report or if there was some response back to it is it possible to have that at the end as well so that americans whoever they may be could look over the shoulder in the years to come and say we awarded to this for this amount and this was the deliverable at the end mister werfel absolutely i think an important step that congress recently took was the different world in terms of technology and how information can be provided in more real time our challenge right now as the federal government is to synthesize all of these various efforts and technologies we have more information on where the dollars are going and who is getting them than we have had before the technologies we have to report that information and make it searchable and usable are good we need to improve the quality and as you said we need to figure out how to find the right synergy so that when you are reading this information you are not just learning that x be able to do their research on it i have two quick things and then we are going to switch to the next panel but with the payment time period a couple of you have brought up how we make payments whether it is as we go along or whether it is at the beginning or at the end i have spoken to people that are in very small benefit of it is obviously that they are going to go find fraud the challenge of it is that they are in an adversarial role from the moment they walk through the door immediately when they walk through the door for whatever entity they are evaluating they are going to be paid if they find something wrong so they are going to stay until they find something wrong that puts every single grant recipient in a very difficult position because you will have human error at some point and they will stay until they find it now you have an adversarial role instead of the federal government being your ally now suddenly the federal government is your enemy walking through your doors instead of serving that company we are at odds with them based on the bounty hunter that we said is going to go find something so we have to be able to resolve that process i have numerous people back in my district that are very frustrated with those companies that step in that they know are paid to find the issues and that will stay until they do no matter how small they will find them to the maximum that they can possibly do it so that is just an issue we are going to need to work through in the days to come with that do you have possibility of waste at the front end some more accountability if not standardization within the federal family may very well help us reduce improper payments at the front end