Department of Health and Human Servces

OFFICE OF

INSPECTOR GENERAL

HEAD START EXPANSION:

GRANTEE EXPERIENCES

, SERVICEo 
'l1! 
Q3a 
MAY 1993  OFFICE OF INSPECTOR GENERA

The mission of the Offce of Inspector Oeneral (010), as mandated by Public Law 95-452, as amended 
is to protect the integrity of the Department of Health and Human Servce' (HHS) programs as well
as the health and welfare of beneficiaries served by those programs. This statutory mission is carried 
out through a nationwide network of audits, investigations, and inspections conducted by three 010 
operating components: the Offce of Audit Servce, the Offce of Investigations, and the Offce of 
Evaluation and Inspections. The 010 also informs the Secretary of HHS of program, and management 
problems, and recmmends courses to correct them. 
OFFCE OF AUDIT SERVICE 
The OIO's Offce of Audit Servce (OAS) provides all auditing servce for HHS, either by conducting
audits with its own audit resource or by overseeing audit work done by others. Audits examine the 
performance of HHS programs and/or its grantees and contractors in carryng out their respective 
responsibilties and are intended to provide independent assessments of HHS programs and operations 
in order to reduce waste, abuse, and mismanagement and to promote economy and effciency 
throughout the Department. 
OFFICE OF INSTIGATIONS 
The OIO's Offce of Investigations (01) conducts criminal, civil, and administrative investigations of 
allegations of wrongdoing in HHS programs or to HHS beneficiaries and of unjust enrichment by 
providers. The investigative efforts of 01 lead to criminal convictions, administrative sanctions, or civil 
money penalties. The 01 also oversees State Medicaid fraud control units which investigate and 
prosecute fraud and patient abuse in the Medicaid program. 
AN 
OFFCE OF EVALUATION  INSPECTONS 
The OIO's Offce of Evaluation and Inspections (OEI) conducts short-term management and program 
evaluations (called inspections) that focus on issues of concern to the Department
, the Congress, and 
the public. The findings and recommendations contained in these inspection reports generate rapid 
accurate, and up-to-date information on the efficiency, vulnerability, and effectiveness of departmental
programs. This report was prepared in the San Francisco regional offce under the direction of Kaye 
D. Kidwell, Regional Inspector Oeneral, and Paul A. Oottlober, Deputy Regional Inspector General. 
Project staff included: 
SAN FRCISCO  HEQUAR1ES 
Jennifer Mallen, Co-Project Leader  Wm. Mark Krushat, Sc.  , Mathematical Statistician 
Brad Rolln, Co-Project Leder  Alan Levine, Program Specialist 
Elizbeth Bell 
ATLA 
Kathy Dezotte
 CHCAOO 
Robert Gibbons

Deborah Harvey
 Betty Apt  Suzanne Johnson 
Ellen Kotler  Ron Kalil 
Donald Loeb  Chris Koehler 
Brian Pattison 
Alcia Simon  OFFCE OF INGATIONS 
BOSTN 
Baldur Krahl  Jose Munoz-Caro 
Timothy Corbett  AI TO FAMIE Wf DEPENDENT CHRE 
Lori Rutter 
Agustin Quiles-Ocasio 
Irelys Ramirez-Ramos 
For additional copies of this report, please contact the San Francisco office at (415) 556-6830.  Department of Health and Human Servces

OFFICE OF

INSPECTOR GENERAL

HEAD START EXPANSION:

GRANTEE EXPERIENCES

~ SERVICEo

'0 
'l1!~Q30 
MAY 1993 OEI-
09-91-00760  , "
EXECUTIVE 
SUMMAR Y

PUROSE 
This inspection assessed Head Start grantees' and Administration for Children and 
Famies staffs experiences during recent program expansions and their abilty to 
handle future expansions.

BACKGROUN 
Head Start operates on the premise that children are best prepared for 
success in 
school when they and their parents participate in a comprehensive program that 
addresses their educational, economic, social, physical, and emotional needs. In 
addition to providing children with classes and health services, Head Start addresses 
the needs of the entire family. 
Both Congress and the Administration are committed to expanding Head Start. Since 
Fiscal Year (FY) 1990, the total funding for Head Start has increased more than 
$1 billon, and the number of children served has increased by almost 300 000. 
Within the Department of Health and Human Servces (HHS), the Administration for 
Children and Families (ACF) is responsible for administering Head Start. The ACF 
the Assistant Secretary for Management and Budget (ASMB), and the Assistant 
Secretary for Planning and Evaluation (ASPE) requested that the Office of Inspector 
General (OIG) review the implementation and status of Head Start expansion because 
they were concerned that rapid expansion might jeopardize the quality of servces. 
We selected a random sample of 80 regional and American Indian Head Start 
grantees and delegates. From May through July 1992, we conducted either on-site 
visits or telephone intervews with each grantee and delegate using structured 
discussion guides. In addition, we reviewed grantee and delegate agency records to 
coHect management and performance data. At the completion of the fieldwork, we
weighted the data and projected it to the universe of Head Start grantees and 
delegates that had expanded. We also conducted intervews with aH 10 ACF regional
offces as weH as headquarters staff about their experiences and ability to provide 
support for future expansions.

This report, which is one in a series prepared by the OIG concerning Head Start 
expansion, reflects grantee and ACF staff experiences and opinions about expansion. 
A companion report  Evaluating Head Start Expansion through Performance 
Indicators" (OEI-09-91-00762) used file reviews and selected indicators to assess the 
impact of expansion on grantees. While we did not find any statistically 
significant
difference in grantee performance as a result of expansion
, we found that the level of  grantee performance as measured by our indicators was considerably lower than the
level of performance reported by grantees and published by ACF. Because of 
(1) inadequate grantee record keeping, (2) the lack of specificity in the Head Start
performance standards, and (3) the fact that many grantees disregard ACF policy 
, we were unable to determine if the program and performance data 
guidance
weaknesses that we found reflect serious deficiencies in the quality of services 
provided by Head Start. 
FIINGS 
Grantees described increased demands on staff and concerns about their ability to 
provide quality services to families while expanding. They reported problems in such 
areas as child enroHment, facilty acquisition, staffing, transportation, and social 
servces. Nevertheless, grantees told us that they were able to overcome most of these
problems. They are, however, concerned that some of these problems may become 
insurmountable if they are not addressed in future expansions. Our specific findings 
are: 
Some grantees exerienced difculty enrolling children, and few plan to serve all eligile 
4-year-old by 1993 
Despite expansion and the existence of a large number of eligible children, 13 percent
of grantees were unable to enroH all of the additional children they planned under 
expansion, and some grantees saw their waiting lists for enroHment increase. Based on 
their experiences and knowledge about future expansions
, grantees indicated that they 
may not be able to serve all eligible 4-year-olds in the near future, primarily because
of the overwhelming number of eligible children in their service areas. 
Th  greatest challenge grantees faced durig exansion was obtaining adequate and 
affordable faciities

Grantees have had difficulty with the lack of adequate facilities in their servce areas 
the poor condition of available properties, the timing of expansion funding, and the 
high cost of rent and/or renovations. In addition, one-third of grantees believe that 
their current space is inadequate to serve children and families sufficiently. Grantees 
overwhelmingly support purchasing property as a cost-saving, stabilizing measure. The 
Head Start Improvement Act of 1992 contains provisions allowing grantees to 
purchase property. 
Whil almst all grantees hired additional staff 40 percent had difculty fiing qualifed
staff 
Grantees cited the lack of qualified appJicants and their inability to offer acceptable 
salaries and benefits as the major barriers to finding qualified staff.  Exnsn  ' abil to 
hinred grantees provide adequate transportatin 
Larger servce areas and increased enrollment have affected grantees' ability to 
provide transportation, although ACF has been responsive to grantee requests for 
additional vehicles.

Exansn increased the demand on social services 
Social servces components are faced with an increased number of dysfunctional 
familes and children with special needs as well as reduced availability of community 
servces. 
Both grantees and ACF are 
hinered by inadequate planning 
Planning is vital for grantees to expand. More than half the grantees did not receive 
timely expansion funding. Grantees cited the need to add management staff and are 
concerned that their problems wil be exacerbated with future expansions. 
RECOMMATIONS 
Because Head Start has changed dramatically since its inception during the 1960s 
ACF should restructure the way it plans for and implements future Head Start 
expansions. In doing so, ACF should: 
Develop regional expertse and offer grantees better assistance with facilties. 
Guidance should include appropriate safeguards against fraud and abuse in its 
implementation of the facility purchase provisions of the Head Start 
Improvement Act of 1992. Furthermore, ACF should ensure that it provides 
grantees clear guidance and technical assistance when purchasing or otherwse 
acquiring facilities. 
Develop strategic and long-range plan to handle future expanions better. The 
goal of these plans should be to help grantees plan for future funding and 
enrollment increases, to address administrative and management weaknesses 
and to otherwse evaluate and implement program improvements. 
hnprove its traig and techncal assistance and reevaluate the effecteness of 
its technca assistance contracts. The ACF should evaJuate grantees' utilization 
of each resource, the appropriateness of the training offered by each 
organization to the grantees' overall training needs during expansion , and the 
quality of each training resource as measured by grantee evaluations.  ..... .. 
... ...... .................... ..., ..
..............  .. .
, " , "
AGENCY COMMNT 
We received written comments on the draft report from ACF, ASPE, and ASMB. 
The ACF concurred with the first two recommendations but requested that we clarify 
the recommendation concerning training and technical assistance. We have modified 
the recommendation so that it is more directly linked to our finding that grantees 
underutilzed traditional Head Start training resources during expansion. We have 
also addressed ACF's concerns about several details in the report's findings and have 
added language to explain that the report is based solely on the opinions of grantees. 
These opinions shed light on the attitudes and outlook of the individuals who will be 
responsible for implementing future expansions and, as ASPE stated in their 
comments  have direct relevance to policy decisions being made about how future 
expansions are handled... 
The ASPE and ASMB provided useful comments and suggestions, many of which we 
have incorporated in the finaJ report. In response to specific comments from ASPE 
we have added information about the companion report  EvaJuating Head Start 
Exansion through Performance Indicators." We have also modified the executive 
summary and recommendations to reflect ASPE's concerns. In response to comments 
from ASMB, we have further clarified that the report is based solely on the opinions 
of grantees and not on the record-based review that is the subject of the companion 
report on performance indicators. 
The complete text of the ACF comments and a detailed response is contained 
appendix A. The complete text of the ASPE and ASMB comments can be found in 
appendix B. 
u................. .
 . . . . . . . . . . . . . . . .. 
..  ....    ....    ....    ......      .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .......       .....     ...   ...   ...   ..  . . . . . . . . . .. 
TABLE OF CONTENTS

EXCU SUMY

INODUCTON. . 
. . . . . . . . . . .. 1
FIINGS. . 
. . . . . . . . . . . . . . . . . 5
. Enrollment  . . . . . . . . . . . . . . . . 5
. Facilities. .  . . . . . . . . . . . . . . . . 6
. Staffng..  . . . . . . . . . . . . . . . . . 9
. Transportation  . . . . . . . . . . . . . 9
. Social services. 

. Planning ....................................................

RECOMMNDATIONS AN AGENCY COMMNT. . 
APPENICE 
ACF Comments on the Draft Report and Detailed OIG Response 
ASPE and ASMB Comments on the Draft Report  INTRODUCTION

PUROSE 
This inspection assessed Head Start grantees' and Administration for Children and 
Familes staffs experiences during recent program expansions and their ability to 
handle future expansions.

BACKGROUN 
Head Start operates on the premise that children are best prepared for success in 
school when they and their parents participate in a comprehensive program that 
addresses their educational, economic, social, physical, and emotional needs. In 
addition to providing children with classes and health servces, Head Start addresses 
the needs of the entire family. 
The Administration for Children and Families (ACF) is responsible for administering 
Head Start. The ACF, the Assistant Secretary for Management and Budget (ASMB), 
and the Assistant Secretary for Planning and Evaluation (ASPE) requested that the 
Offce of Inspector General (OIG) review the implementation and status of Head 
Start expansion. This report is one in a series prepared by the OIG on this 
subject. 
Head Start Prgram 
Th 
Head Start is a child development program funded primarily by the Federal 
government. At the headquarters level, the Head Start Bureau provides leadership 
and develops legislative and budgetary proposals for Head Start management and 
operations. In each regional office, ACF's Head Start and Youth Branch monitors all 
Head Start programs, except American Indian and migrant programs which are 
monitored by branches within headquarters. According to ACF, Head Start served 
approximately 622 000 children with FederaJ support of $2.2 bilion in Fiscal Year 
(FY) 1992.

Head Start programs are community-based, so agencies can respond to local needs 
and coordinate with other community organizations. As a resuJt, program options
locations, and hours vary. The Federal government awards grants to a public or 
private nonprofit agency (called a grantee) to operate a Head Start program. A 
grantee may contract with one or more other pubIic or private nonprofit organizations
in the community (called delegates) to run all or part of its Head Start program. 
For 
the purposes of this report, we will refer to both grantees and delegates as "grantees
unless specific differences need to be noted. 
Head Start programs consist of four major components:  health, education, social 
services  Specific performance standards for each of these 
and  parent involvement. 
components require, among other things, that grantees:  develop children s intellectual skills by encouraging them to solve problems 
provide children medical and dental examinations 
offer children nutritious meals and snacks, and 
identify familes' social service needs and work with other community agencies 
to meet those needs.

The two major program options  center-based  and  home-based  are both regarded as 
effective means of serving children and families. The center-based mode) focuses on 
the child, while the home-based model focuses on the parent. Home-based programs 
where servces are offered in the home rather than a classroom, must adhere to the 
same policies and offer the same range of comprehensive services as center-based 
programs. 
Head Start Exansn 
Both the Administration and Congress are committed to expanding Head Start. The 
Head Start Supplemental Authorization Act of 1989 and the Dire Emergency 
Supplemental Appropriation of 1990 marked the beginning of expansion for all 
grantees and provided funding for the first two expansions. Since FY 1990, the total 
funding for Head Start has increased more than $1 bilion, to an FY 1993 total of 
$2.779 bilion. The Human Services Reauthorization Act of 1990 continues the Head 
Start program through FY 1994 with the goal to serve all eligible children by 1994. 
The following table summarizes the allocated funding increases: 
HE 
START EXPANSIONS, 1991993 
Fiscal  Announcement  Proposed Number  Funds to  Additional 
Year  Dale  of Additional  Expand Enrollment  Expansion 
Children  Funding 
Exnsion  1990  February 6, 1990  500  $99 980.000  $51 335,000 
Exansion  1990  June 12, 1990  000  $165 315 000  None 
Exansion  1991  undated  51,000  $159 447.000  $240 363,000 
Exansion  1992  February 19, 1992  500  $131 513.000  $118 487 000 
Exansion  1993  December 17, 1992  100 000  $372 706 000  $201 779 600 
TOTAL  $92 961  $611 96, 
The additional expansion funding, identified in the chart above, was set aside for such 
things as quality improvement, salary enhancement, cost-of-living increases, and 
training and technical assistance improvement. Grantees generally use quality 
improvement funding to increase salaries and benefits, strengthen the social servce 
parent involvement, and/or health components, improve servces to disabled children  , "
initiate or improve family literacy programs, and/or otherwse enhance servces to 
children and families. 
For regional grantees (those monitored by ACF regional offices), the Head Start 
Bureau allocated expansion funds in FYs 1990 and 
1991 based on the population in 
each State, as required by statute. It then allocated funds to counties based on the 
proportionate number of eligible children, taking into consideration the amount of 
Federal funding already received by the grantees in each county. The Head Start 
Bureau also set aside a portion of expansion funds for American Indian grantees, who 
could apply for expansion funds if they were not serving all eligible children in their 
servce area. 
The Head Start Bureau also allocated expansion funds to unserved counties based on 
the proportionate number of eligible children. Public and private nonprofit agencies 
(including existing grantees) competed to operate programs in the unserved counties. 
To receive the allocated funds, grantees submitted expansion proposals. These 
proposals specified planned objectives, such as the number of additional children they 
would enroll and the staff they would require to serve these 
chiJdren. The Head Start 
Bureau advised grantees to prepare proposals that would resuJt in high quality servces 
that fully comply with the Head Start performance standards. 
Concer about Exansion 
This report is one in a series prepared by the OIG concerning Head Start 
Expansion.
A companion report  Evaluating Head Start Expansion through Performance 
Indicators" (OEI-09-91-00762) used file reviews and selected indicators to assess the 
impact of expansion on grantees. While we did not find any statistically 
significant
difference in grantee performance as a result of expansion
, we found that the level of 
grantee performance as measured by our indicators was considerably lower than the
level of performance reported by grantees and published by ACF. Because of (1) 
inadequate grantee record keeping, (2) the lack of specificity in the Head Start 
performance standards, and (3) the fact that many grantees disregard ACF policy 
, we were unable to determine if the program and performance data 
guidance
weaknesses that we found reflect serious deficiencies in the quality of services 
provided by Head Start. A 1991 OIG study, "Readiness for Head Start Expansion 
(OEI-02-91-00741), found that grantees were meeting their expansion goals for 
FY 1990. 
METHODOLOGY 
We selected a random sample of 80 regional and American Indian Head Start 
grantees and delegates. We conducted a separate study of migrant grantees because 
of the unique nature of their programs (see "Migrant Head Start Grantees: 
Perspectives and Challenges " OEI-09-91-00761). From a universe of the 50 States 
plus the District of Columbia, Puerto Rico, and the Trust Territories (hereafter  referred to as "localities ), we randomJy selected eight localities with probability 
proportional to size with replacement. As a result, California was selected twce. The 
total amount of Federal funding received in FY 1991 determined the size of each of 
the localities. The following table presents the localities selected, their probability of 
selection based upon their total budget, and the number of grantees, original and 
adjusted, in each location. 
Probability  Number of Grantees 
Total Budget 
State  Original  Adjusted 
All Grantees  Selection 
California (One)  $184 762 665  10.87%  133 
California (Two)  $184 762 665  10.87%  133 
Florida  $57 466 594  3.38% 
Maine  601 468  0.45% 
Michigan  $71 904 040  23% 
Puerto Rico  $70 947 229  17% 
Texas  $95 413 705  61% 
Washington  $24 586 682  1.45% 
Sampled  $697 445 048  41.03% 
All States  700 448 467 
Because not all grantees and delegates received expansion funds, not all were eligible
for selection at the second stage of sampling. At this stage, we selected grantees and
delegates using simple random sampling until we obtained 10 grantees or delegates 
who received expansion funds in FYs 1990 and/or 
1991. 
The adjusted number of grantees in the above tabJe represents the estimated number 
of grantees and delegates that received expansion funds based upon our sampling 
results. Projections used in this report are based upon this adjusted number of 
grantees. 
From May through July 1992, we conducted either on-site visits or telephone 
intervews with each grantee and delegate using structured 
discussion guides. For the 
delegates in our sample, we also interviewed their parent grantees about their 
experiences managing expansion. In addition, we reviewed grantee and delegate 
records to collect management and performance data. We also conducted intervews 
with all 10 ACF regional offices as well as headquarters staff about their experiences 
with and ability to provide support for expansion. 
The following findings reflect grantee and ACF staff experiences and opinions about 
expansion. The quotes reflect the generaJ sentiment of Head Start directors and ACF 
and grantee staff, not just the opinion of one director or staff person. We conducted 
this inspection in accordance with the  issued by the
Quality Standards for Inspections 

President' s Council on Integrity and Efficiency.  FINDINGS

GRAES 
SOME  EXPERINCED DIFICULTY ENROLLING CHREN 
AN FEW PLA TO SERVE AL ELIGIBLE 4- YE-OLDS BY 1993 
Thireen percen of grantees were unable to enroll all of the additional chilren planned 
unr 
exansion 
With the first 3 expansions, ACF funded grantees to enroll 148 500 additional children. 
Grantees enrolled approximately 94 percent of this total. Our projections show that 
181 grantees were unable to enroll 8 700 children who had been funded under 
expansion. The major reasons were (1) obtaining, renovating, or licensing facilities 
(2) planning and management obstacles
, and (3) finding eligible children. Specifically, 
of the 181 grantees

more than 30 percent were unable to obtain facilities, and an additional 
15 percent were unable to complete facility renovations prior to the start of the 
school year; 
approximately half identified management issues, such as the need to 
reorganize, hire management staff, or develop computerized systems; and 
more than a quarter were unable to find eligible children. 
Desite exansn, more than 40 percent of Head Start directors report an increase or no 
efect on the nuber of childen on their waiting lists 
Directors indicated that Head Start s increased visibility and credibility in recent years 
have resulted in more community interest and increased applications. Other grantees 
reported that expanding to previously unserved areas, better recruitment efforts, and 
increased poverty in their servce areas have resulted in increased waiting 
lists. 
Approximately 30 percent of the directors noted only a small reduction on the length 
of their waiting lists. A quarter of the grantees said they have enrolled more 
year-old children since expansion. These grantees were less likely than others to 
experience large decreases in their waiting lists. 
and 
More thn  75  percent of all grantees applied or planned to apply for both the  1992 
1993 exansons 
Almost all grantees believe there are sufficient children to warrant further expansions 
but some grantees are already serving all eligible children in their service area. In 
addition to these grantees who can t expand, other grantees will not apply for 
expansion funds because they cannot locate facilities or they don t believe that they 
can handle another expansion at this time.  ..-...-...-..-........................................_......-...-...-......-..--.....-..........................._...-.----.--.-........-...............-..-.-..-.....-.....--..-.-....-...................-..-...-...-..-.
On one-qrter of grantees inicated that they plan to serve all eligile 4-year-old by 
1993 
At the time that we conducted intervews, which was prior to the 1993 expansion 
announcement
, grantees were pessimistic about their ability to serve all eligible
year-olds by 1993. We specifically asked them whether they planned to serve all 
eligible 4-year-old children in their service areas by the 1993-94 school year, and
, if 
not, when they expected to, given their knowledge of the current and future pace of 
expansion. More than 14 percent of  never 
a)) Head Start directors said they would 
able to enroll all eligible 4-year-olds. These grantees frequently reported that they are 
servng only a very small percentage of the eligible children in their servce areas. 
Only 41 percent of grantees predicted that they would serve all eligible 4-year-olds in 
their servce areas by the turn of the century. The following chart ilustrates their 
predictions: 
When Will Grantees Serve All Eligible 4-Year-Olds? 
Grantees 
Percent  of 
100% 
80% 
80% 
40%  39. 
20% . 
1993-94  1995-97  By 2000 Never  Don  No Answer 
Response  Know
TH GRETET CHNGE GRAES 
FACED DURING EXPANSION 
WAS OBTAIG ADEQUATE AN AFORDABLE FACILIT 
Grantees had to  , or build centers and classrooms 
fi renovate
Approxiately one-third of the grantees cited problems finding and renovating 
facilities as the biggest challenge they faced during expansion. Almost all grantees 
(95 percent) had to obtain additional space, and one-third of these (more than 
450 grantees nationally) encountered major difficulties. More than 70 percent had to 
renovate their newly acquired space. The major difficulties were:  , " , "" "
the lack of adequate facilities in their service areas 
the poor condition of the properties and/or the need for substantial renovation

the timing of expansion funding (e.  , delays until the end of the school year), 
and 
the high cost of rent and/or renovations.

Licensing and zoning were problems for approximately 10 percent of the grantees and 
can be major obstacles in some parts of the country. For example, one grantee had 
negotiated an agreement with a church to use a vacant lot for a portable, but the 
county refused to license the facility because "the lot was a foot or two short" of the 
local zoning ordinance requirement. 
Some grantees addressed facility problems by using the home-
based option 
Because they were unable to open classrooms, some grantees expanded enrollment in 
existing home-based programs while others provided home-based servces for the first 
time. The latter viewed the home-based option as a temporary solution. They plan to 
return to center-based servces as soon as the facilities are ready for classroom use. 
On-
thir of the grantees believe their extig space is inadequate 
Grantees complained about sites that are "dismal, drab, and dreary,  contaminated 
with lead paint " and "so cramped for space that there is no place to hold parent 
meetings while classes are in session." The OIG staff came away with similar 
impressions and observed that more than half of the Head Start centers and 
playgrounds they visited were only adequate or poor. The size, safety, and location of 
outdoor play areas was considered a liability at approximately one-quarter of the sites. 
The OIG staff identified only 3 out of 45 centers they considered "models" for others 
to emulate. The OIG' s Offce of Audit Services currently is reviewing Head Start 
foster care, and day care facilities to assess compliance with State and local health and 
safety standards. 
Approximately 45 percent of the grantees who complained about their space said they 
need completely new facilities. The others need upgrading or renovation, more space
and/or improved handicapped access. More than 68 percent of all grantees anticipate 
facilty problems with future expansions. 
Grantees also cite the need for training and technical assistance in obtaining and 
renovating space. For example, they need specific training in working with electrical 
engineers, architects, and general contractors. As one grantee said  They speak a 
totally different language. " Another grantee pointed out  We didn t anticipate or 
understand all the issues that would be involved in setting down a portable (e.  grading, sewers, required clearances, digging weHs for water). The result was that 
things didn t go smoothly, and there was a 4-month delay in opening the site. 
fu 
Fedal prohibitons againt purhaing propert with Head Start  excerbated 
proble 
Since we conducted fieldwork, Congress passed the Head Start Improvement Act of 
1992, which contains provisions allowing grantees to purchase facilities and may help 
resolve grantees' problems upon implementation. Prior to the passage of the 
legislation, approximately 80 percent of the grantees believed it would be 
advantageous to purchase property and stated that there is space available for 
purchase in their servce areas. They believed purchasing property would: 
be cost effective 
improve the stability of their programs 
allow them to custom-build or obtain more suitable facilities, and 
make it easier to acquire space by increasing the number of options. 
Grantees are frequently faced with escalating rents and the possibility of eviction at 
the end of a lease. Rents may escalate for a variety of reasons: gentrification of the 
neighborhood, a school board or other public agency s need to generate revenue 
because of budget shortfalls, or merely a landlord's desire to take advantage of a 
tenant who has invested considerable sums of money renovating a building. One 
grantee summarized the experiences of many, "Owning property would protect us from 
outrageous increases. Rents have been going through the roof recently. The monthly 
rent for our administrative office increased from $275 to $825 in just 18 months. 
Other grantees said that for the amount of rent they paid, they could have purchased 
their centers three or four times. Others complained that they spend a fortune on 
renovations only to be evicted at the end of their leases which tyically run from 
1 to 5 years.

Although it wasn t easy to overcome these obstacles, grantees were usualJy able to 
locate and renovate space without serious delay. Because of their perseverance
, more 
than half the grantees were able to locate new space within 3 months, and almost 
three-fourths were abJe to do so within 6 months. Approximately 9 percent required 
more than a year. Once they received their funding, grantees needed an average of 
4 months to complete renovations. Approximately 13 percent needed more than 
6 months.  , " , " , "
ll 
WH  AI GRAES 
ALOST  ADDmONAL STAF, 40 PERCENT 
HA DIFCUTY FIING 
QUALIFIED STAF 
Head Start staff are not just day care workers. They not only teach children and 
parents, but also handle a diversity of problems from drugs to parenting to 
multicultural and language barriers. As one director stated  With our starting wages 
re not going to attract the kind of person who is bilngual, bicultural, etc." Another 
grantee s recruiting and hiring experiences are typical  Due to the present economic 
situation, we have had plenty of teachers and social workers applying. However, these 
people don t have experience with preschool children. 
Grantees believe the problems in recruiting and retaining staff are mainly two-fold: 
the lack of qualified staff and the inabilty to offer acceptable salaries and benefits. 
Although all grantees face both problems, rural grantees have a greater problem 
finding qualified staff, and urban grantees have a greater problem offering competitive 
salaries and benefit packages. These problems may become more intense as a result 
of the 1990 reauthorization legislation that requires Head Start teachers to be certified 
by September 30, 1994. 
salaries and benefits that were not 
Almost  half of the grantees reported offering 
comparable to similar jobs in the community. Of these, 82 percent said this is a 
barrer to hirig qualified staff. This is mainly a problem in urban areas where 
experienced Head Start teachers are lured away by higher salaries and benefits. Head 
Start competes for staff with the public school system, child care programs, and 
community action agencies. Health insurance, sick days, and vacation time are not 
part of many Head Start job packages. Salaries sometimes as low as half of those 
paid to public school teachers prompted one director to comment  The issues and 
problems Head Start staff have to deal with are very complex. Staff capable of 
handling these get better paying jobs eJsewhere." We did not independently compare 
the salaries and benefits among Head Start and other child care programs, but salaries 
are a great concern to grantees.

EXANSION HIERED GRAES' ABILIT TO PROVIE ADEQUATE
TRSPORTATION 
Thrt 
percent of grantees do not provide transportation for children. Instead , they 
are located within walking distance of their service population, encourage parents to 
carpool, utilize public school bus systems, or have worked with the local transit system 
to design bus routes that are accessible. 
Of the grantees that provide transportation, more than one-third report that expansion 
has had an adverse impact on their abilty to transport children. The problems arose 
from (1) expansion into remote, rural areas, (2) increased enrollment that exceeds the 
, and (3) increased salary costs. More than 56 percent of the 
capacity of their vehicles
grantees anticipate transportation problems with future expansions, including the need  for additional vehicles and longer distances to cover new and more remote servce 
areas. 
GeographicaHy dispersed servce areas pose particular problems. One grantee claimed 
that transportation problems in a remote area hampered its ability to maintain the 
required 85 percent average daily attendance. Another grantee thought that it had 
overcome distance, 20 feet of snow per year, and safety concerns by purchasing two 
vans with four-wheel drive and anti-
lock brakes. The grantee was soon faced with 
another problem, however, when the State decided to adopt Federal transportation 
guidelines that specify children must be transported in school buses, not vans. 
Increased enrollments have required grantees to send vehicles on double runs or 
purchase additional vehicles. Several grantees requested funds for additional vehicles. 
The ACF has been responsive to grantees' requests , and only one grantee reported 
that its request for a bus had been denied. 
Grantees that purchased buses have experienced increased salary costs because of 
State bus driver licensing requirements. Some grantees use vans, which carry fewer 
chidren, for this very reason. 
EXANSION INCRED TI DEMAS ON SOCIA SERVICE 
Grantees report that expansion increased the number of (1) families with complex 
needs, (2) children with behavioral problems and special needs, and (3) familes with 
drug and alcohol abuse problems. Not only did the number of these families increase 
but also the severity of their problems. Almost 40 percent of grantees report that 
currently enrolled children come from families who are economically worse off than 
the families they served before expansion. This finding mirrors one from a November 
1989 OIG study entitled "Dysfunctional Families in the Head Start Program: Meeting 
the Challenge " (OAI-09-89-01000). The study found that the comprehensive needs of 
dysfunctional families pose a special challenge for grantees. These 
familes need a 
wide range of servces that place additional and frequently burdensome demands on 
Head Start social service components. 
Almost half of all grantees said that the greater number of children with certified 
special needs increased the complexity and volume of their work as well as their need 
for more supervisors. Certified special needs include children who are hearing 
impaired, speech impaired, visually handicapped, crippled, and seriously emotionally 
disturbed. These children frequently need modified physical facilities, modified 
currcula, new or different feeding skiJs, and continuation of special medical care. 
The diminishing availability of community servces for children and families worries 
grantees. They are concerned about the decreasing numbers of professionals who are 
willng to donate services, the increased burden on publicly-funded facilities, and the 
diminishing number of doctors willing to accept Medicaid.  " '
, "
PLAG 
BOTH GRAES AN ACF AR HIERED BY INADEQUATE 
Lack of adequate planning overwhelm staff impair morale, causes unue stres, and
unnnin 
qulity 
Twenty-five percent of grantees said that adequate planning is a critical factor in their 
ability to expand. Grantees believe that expanding too quickly leads to management 
compliance, quality, staffing, and facilty problems. Both grantees and ACF regional 
staff believe they need time to assess past expansions before proceeding with new 
ones. Long-range strategic planning is crucial. Typical comments included  Head 
Start needs a master plan  'we need to step back and see the impact of expansion 
before moving on " and "our growth has outdistanced our administrative capacity. 
ACF Reginal Ofces suggest a more  allocation system 
Th  flexle and fair 
To simplif and expedite the allocation of expansions funds, ACF decided to award 
grantees a minimum of $50 000, which operationally became the standard expansion 
amount. Both grantees and ACF staff would like a more flexible needs-
based system 
to replace or amend the arbitrary allocation of $50 000. One regional manager 
summarized the views of many: "Allocations should be competitive and based on 
need. 
Regional staff suggested some solutions: allow for more regional flexibility in funding 
decisions, eliminate the $50 000 minimum, and/or use census data to rank needy areas. 
Regional staff emphasized the importance of using 1990 census data, rather than 
updated 1980 census data, as a basis for determining need. Many grantees agreed 
that the current statistical data are too inaccurate to be used for assessing community 
needs and projecting the number of eligible children. As one regional manager said 
The 1980 data do not take into account the massive population shifts from region to 
region." The ACF began using 1990 census data for allocation of FY 1993 funds. 
Approxitely half of  fuing 
the grantees did not receive tiely exansion 
Many grantees were unable to enroll children on time and incurred carry-over 
balances, because they did not receive their expansion money until late in the school 
year. In fact, 47 percent of the grantees were unable to enroll children before the end 
expansion.
of the school year and, as a resuJt, twice as many had carry-over balances than before 
Of the grantees who had carry-over balances, 41.4 percent had balances that exceeded 
the minimum expansion figure of $50 000. Before expansion, only 18 percent of the 
programs had carry-over balances exceeding $50 000. 
Despite their concern about carry-over balances, only 13 percent of grantees requested 
funding delays and only 4 percent refused expansion funding. Some directors believe  , " , "
that refusing expansion funding wil lead to a complete cessation of all expansion 
opportunities rather than the adoption of a more gradual approach. 
Many grantees believe that even with adequate lead time, large expansions should not 
occur on an annual basis. One director summarized  I am afraid to tell my staff that 
we are expanding again. Our days are already 12 hours. 
non-federal matching requiement was a problem for more than one-third of grantees 
Th 
Exansion strained many grantees' ability to meet the non-Federal share matching 
requirement , 20 percent of their total budget. Large expansions, one-time start-up 
, i.e.
funds, the recession, and an increase in two-parent working familes have all 
contributed to the matching problem. Some programs have doubJed in size. The 
recession has limited business contributions. Parent volunteer hours have dropped as 
more parents enter the workforce. 
The matching requirement will become more burdensome in the future. More than 
one-quarter of the grantees who did not consider matching to be a probJem during 
past expansions expect problems in future expansions. To lessen the demands on 
programs, grantees suggested lowering the match, excluding some types of funding 
(e.  , one-time costs for purchasing portables or renovations) from the match, or 
elimating the match requirement altogether. Grantees would then be able devote

more time to servng children and families, rather than spending so much time 
'beating the bushes " and accounting for matching funds. 
Whle the intention of the matching requirement is laudable, some realities are 
suspect. In-kind contributions can be a form of paper shuffing. One grantee found 
another $10 000 just by reviewing its records again. Some grantees have been 
creative " for example, by counting parental transportation to the center and parental 
attendance at home visits as in-kind contributions. 
The ability to match Head Start funds in the future is a particular concern for 
comment is  The public s perception of Head Start 
grantees. A tyical grantee 
expansion is that we have a lot of money and that we don t need anything. We have 
lost a lot of donations. Business put us at the bottom of the pile for donations. 
While 80 percent of the grantees that needed help durg exansion said they receied 
astance, much of it came from in-house or private consultants 
Traditional Head Start technical assistance and training--that offered by ACF regional 
offces, the Public Health Service, or the Regional Access Project, for example--was 
underutilized by grantees. As ilustrated in the chart on page 13, fewer than half of 
the grantees used training and technical assistance offered by these organizations 
during expansion. Fewer than a quarter used that offered by the Head Start Bureau. 
More than half, however, did use the Regional Resource Center.  .............................................................
, " , "
Grantees HavSe tN ot Relied Exensively on Traditonal 
Head  Training During Exansion 
Percentage of Grante.e
100 
hh.. 
h... ......... ... ..... ... ................ 

BO. 
RO: 
Regional Office 
HSB: Head Start Bureau 
PHS: Public Health SelVice 
PHS RRC  RRC: Regional Resource Center
HS8  RAP  Other Dldn l U.. 
RAP: Regional Access Project 
Training Source 
Grantees that used the traditional training sources were relatively satisfied. Almost 
70 percent of the grantees that used any of these sources believe their needs were 
fully met. Many grantees do not use these sources, however, because they consider 
the training to be incomplete, inappropriate, and inaccessible. According to one Head 
They don t have travel money, and I can t afford to send my staff to 
Start director 
them. How can I utilize the training if it's not available to me here?" Another 
director described the Head Start Bureau and regional office trainings as ' 'very limited" 
while stil another said  A lot of helpful information does not get out of the regional 
offce." Furthermore, some delegates complained that their grantees limited their 
access to traditional training and technical assistance.

Grantees need additional management staff to handle future exansons 
Proper planning and implementation of new procedures requires an adequate number 
of experienced and trained management staff. Approximately one-third of grantees 
considered management issues to be their biggest challenge for future expansions. 
Grantee directors and ACF regional staff worry that not enough of the expansion 
funding is spent on management and program administration, including 
computerization.  Grantees antcipate myd problems wih futue exansons 
According to grantees, the problems they faced during previous expansions win not 
only continue but probably win increase with future expansions. The fonowing chart 
summarizes the most common problems anticipated by grantees: 
SIGNICAN PROBLE 
Anticipated Problems  Percent Mentioning  Common Barriern 
Facilties  68.  Availabilty, zoning reuirements 
SeJce For Children  61.7  Overall shortge of servce 
SeJce For Families  59.  Overall shortage of servce 
Transporttion  56.  Need for additional equipment 
Staff  43.  Lack of qualifed sLaff, low salaries 
Matching Federal Funds  41.7  Support agency cUlbacks, fewer volunteer hours  ...
, " , "
RECOMMENDATIONS

Because Head Start has changed dramatically since its inception during the 1960s 
ACF should restructure the way it plans for and implements future Head Start 
, ACF should: 
expansions. In doing so
Develop regional experte and offer  assistance with 
grantees specialed 
safeguards against fraud and 
facities. Guidance should include appropriate 
abuse in its implementation of the facility purchase provisions of the Head Start 
Improvement Act of 1992. Furthermore, ACF should ensure that it provides 
grantees clear guidance when purchasing or otherwse acquiring facilities. 
Develop strategic and long-range plans to handle future expanions better. The 
goal of these plans should be to help grantees plan for future funding and 
enrollment increases, to address administrative and management weaknesses 
and to otherwise evaluate and implement program improvements. 
Improve its traig and techncal assistance and reevaluate the effecteness of 
its technca assistance contract. The ACF should evaluate grantees' utilization 
of each resource, the appropriateness of the training offered by each 
organization to the grantees' overall training needs during expansion , and the 
quality of each training resource as measured by grantee evaluations. 
AGENCY COMMNT 
We received wrtten comments on the draft report from ACF, ASPE, and ASMB. 
The ACF concurred with the first two recommendations but requested that we clarify 
the recommendation concerning training and technical assistance. We have modified 
the recommendation so that it is more directly linked to our finding that grantees 
underutilized traditional Head Start training resources during expansion. We have 
also addressed ACF' s concerns about several details in the report s findings and have 
added language to explain that the report is based solely on the opinions of grantees. 
These opinions shed light on the attitudes and outlook of the individuals who wil be 
responsible for implementing future expansions and, as ASPE stated in their 
comments  have direct relevance to policy decisions being made about how future 
expansions are handled... 
The ASPE and ASMB provided useful comments and suggestions, many of which we 
have incorporated in the final report. In response to specific comments from ASPE 
we have added information about the companion report  Evaluating Head Start 
Exansion through Performance Indicators." We have also modified the executive 
summary and recommendations to reflect ASPE's concerns. In response to comments 
from ASMB, we have further clarified that the report is based solely on the opinions 
of grantees and not on the record-based review that is the subject of the companion 
report on performance indicators.  The complete text of the ACF comments and a detailed response is contained 
appendix A. The complete text of the ASPE and ASMB comments can be found in 
appendix B.  APPENDIX A

ACF COMMNT ON TH DRA REORT 
DETAID OIG REPONSE      ... ...
OIG REPONSE TO ACF'S COMMNT 
GENERA CONCERNS

COMM 
ACF  we do have some concern which stem from the way in 
(page 1): 
which the information for the report was gathered and the presentation of some of the 
findings. As we understand it, the report is based solely on grantee or staff perceptions 
and attitues. These perceptions are very sensitive to the way the questions were asked 
and when they were asked. The result is a report which mixes fact and opinion. On page 
5, for example, the title reads: 'Some grantees experienced difculty enrollng children. ' 
statement is undoubtedly factual and , as noted above, consistent with our 
This 
observations. On page  however, the report states that ' percent of all
more than  14 
Head Start directors said they would never enroll all eligible 4-year-olds. ' The report does 
not state what assumptions were made by the directors in answering this question, nor the 
statitic 
context in which it was asked. It is thus dificult to understand what the  14% 
means, partcularly as we would assume that given suffcient resources all programs could 
eventually serve all eligible 4-year olds. 
OIG REPONSE: We have added the following caveat to the introduction to the 
report: "The following findings reflect grantee and ACF staff experiences and 
opinions about expansion." The inspection was designed to elicit grantees' experiences 
and perceptions about expansion, including their predictions about their ability to 
expand in the future. 
Grantees were highly pessimistic about their ability to serve all eligible children 
regardless of resources. The number of eligible children in some servce areas is 
several thousand, far larger than existing grantees could serve, even with future 
expansions. Therefore, ACF's statement that "  we would assume that given sufficient 
resources all programs could eventually serve all eligible 4-year olds... " is not accurate 
according to grantees. We have, however, revised the section on eligibJe 4-year-olds to 
clarify how we asked the question. 
ACF COMMNT (pages 1- This type of problem is also found in other sections of 
2): 
the report, partcularly the discussion on training and technical assistance, in which a 
distinction is made between 'traditional' and other types of training and technical 
assistance. We do not understand how the chart and  12- help 
discussion on pages  13 
inform future policy decisions about the expansion process or our training and technical 
assistance program... " 
OIG REPONSE: We have revised the report to emphasize that we asked grantees 
about their utilzation of specific training resources, such as the regionaJ offices 
, and Public Health Service. We designated this group of 
regional resource centers
HHS components and HHS contractors as "traditional" sources. Head Start grantees 
have negative impressions of these resources, and a significant percentage of Head  Start grantees are not receiving training and technical assistance from them. 
Furthermore, many of the grantees who use these resources are not receiving quality 
assistance, in their opinion. In this context, the finding and the chart we used are 
intended to provide information about ACF's need to reevaluate its training and 
technical assistance. On this basis, we made our third recommendation. 
We would also suggest that the report provide more 
ACF COMMNT (page 2): 

descriptive information on the methodology used so that the reader wil be aware that, in 
some instances, opinions or 'predictions' were elicited from the interviewees. This is 
especially important because of the selective use of quotes in the report. We are unable to 
judge whether the many quotes throughout the report are truly reflective of the opinions of 
Head Start staff or if they represent the opinion of just one Head Start Director. Our 
concern is that these quotes wil be read as representing the opinions and experiences of 
all Head Start grantees and that conclusions will be drawn which may be inaccurate 
when applied to the greater Head Start community. 
OIG REPONSE: As mentioned above, we have added the folJowing caveat to the 
introduction to the report: "The folJowing findings reflect grantee and ACF staff 
experiences and opinions about expansion." In addition, we have added the statement 
The quotes reflect the general sentiment of Head Start directors and ACF and 
grantee staff, not just the opinion of one director or staff person. " We also have 
clarifed many of the quotes in the body of the report to ilustrate that the quote 
reflected the sentiments of several or many Head Start directors and staff. 
SPECIFIC COMMNT 
On pages 2 and 3 of its comments, ACF made specific, technica1 comments and asked 
that we clarify other statements in the report. We have addressed alJ of these 
comments by making necessary revisions , clarifications, and additions to report. 
RECOMMNDATIONS 
With regard to the first recommendation, the change in authority 
ACF COMMNT: 

regarding the purchase of facilities has, of course, considerably altered the nature of the 
regional experte and technical assistance that is needed in this area. We 
wil work to 
identify the specifc types of expertise and assistance grantees wil need, and then to find 
ways to provide these. A "Head Start Facilties Manual" (the exact title has not been 
decided) is currently in draft form
, and wil be ready for dissemination to the regional 
offces and to grantees within the next few months. We hope that this manual will be of 
great assistance as grantees explore new approaches to solving problems with facilities. 
OIG REPONSE: No response is necessary. 
We agree with the second recommendation regarding strategic 
ACF COMMNT: 

planning, and wil endeavor to provide regional offce staff and grantees with the 
maxmum time available to carr out future expansions. However, we note that the recent  expansions of Head Start were, in fact, based on a long-term Administration plan for 
universal Head Start that was transmitted to the regional offce staff and to grantees. 
Given the timing constraints on the appropriation cycle, the requirement that funds be 
obligated in the fical year of an appropriation, and the recent legislative requirement that 
guidance on expansion be sent to grantees within 90 days of an appropriation, there was 
not suffcient time for planning of the type described. 
OIG REPONSE: No response is necessary. 
ACF  The third recommendation regarding the relationship between 
COMM: 
technical assistance contracts and implementing Head Start expansion is not clear. We 
would appreciate the opportunity to discuss this matter further with you so that the 
recommendation can be fully understood and any necessary action taken. 
OIG REPONSE: We have revised and clarified the recommendation to more 
directly link the recommendation with our finding that grantees underutilized 
traditional Head Start training resources during expansion.  APPENDIX B

TH DRA 
ASPE AN ASMB COMMNT ON  REPORT  -".
... :....- : -.  ,'  ,!:;= : .j.,  \  ,!,j=j ,_ -"-  
DEPARTMENT OF HEALTH &. HUMAN SERVICES 
Offce of the Secetary 
:t.....o 
Washington. D.C. 20201 
JAN , 3 100  PDIG "'--
AS '
DDIG-IG-EI
TO:  Bryan B. Mitchell  DIG-OI 
Pricipai Deputy Inpecor General
 AIG-MP 
i;-7''';
FROM:  Assistat  EOGC/XIG SEC -
Secetifor Planng and Evaluation 
TJA'TSF 
SUBJECT:  Comments on OIG Dra Report:  Head Sta Expanion: Grate Experiences
OEI-Q-91-O760 
dr 
Than you for the opportty to 
review the  report of this importt inpecon. 
This report
and its companon "Evaluatg Hea Sta Expanion Thugh Performce Indicators
, " both have the
potential to guide HHS policy in the comig month. I believe these are among the most signficant 
report your offce has produced on children s isues in recent yea. I am extremely concerned
however, that the fidings are not cuently 
presented so as to maxime their utiity for futue policy
discussions. I am 
parcuarly concerned with the recmmendatons secon of the report 
and the
executive summar. 
In addition, the two report on Hea Sta expanion are closely related and
should refer to one another more than they do now. 
Below I describe what I consider an appropriat presentaon for this 
reprt If 
cfhain ges such as those
below are not mae, I request that these comments be included at the end of the 
ated  report. I have
also 
notaon of severa mior language clarficaons my 
sta have suggested. 
OIenine- Secion 
The experience of grtee 
reported in this inpecon have 
direc relevance to policy decisions being
mae abut how futue expanions are handled, and in parcuar the disbution of fuds for FY
1993 and beyond. I recmmend that the 
openg secon of this 
this contex in which 
report  eslis 
the fidings should be viewed.

In addition, this report should more exlicitly reference the "perormce indicars
" report. In 
parcuar it 
note that while that report found that 
should  clealy exanion has not yet had an effec
on the quality indicars examed progratc 
, the  weaesses reprted in that report combined
with the loca and federa 
maement concer expresed in this report rae signficat 
about reainess for futue expanion. Improvig quaity and  questions
management in the face of future
expanion must be addresed as the progr 
moves forward. 
Recmmendations Secon 
I am extremely disappointed in the recmmendations secon 
of this report The recmmendations as
wrtten do not reflec the serousness of the ises raed in 
Secet  mag  the findings and are not specific enough to 
guide ACF and the  in  progJmm  rlmini.trative changes which should be
c and

considered. I suggest the recmmendaons 
reflec the following: 
Dwrn
fom 
.M 111S I 
i;J 
i !- DIG OEI IX 
'.""";=0  . .
Page 2 - Bryan B. Mitchell

1. Progra mangement at the fedenll, grntee, and projec level 
- Since your inpectrs found
weaesses overall in the magement of Hea 
Sta grts, and ha\: said inormly that they
believe the cuent federal manement strcte should be reconsidered, a recmmendation for a
form and overal magement review of the program would therefore see 
fidigs of the performce indicars report simarly suggest the nee for suachpp ar opriate. The
review. Given the 
large amount of fuds, grts, and projec involved, contiuing to maage the progr in 
the same 
way as durg the 19705 is questionable. 
2. Matchng requirements and facilities purche - As you note, the Hea Sta Improvement ACt 
pased in Octber of 1992 makes changes in the progr in 
the area of matching requirements and
facilties purchase. Both these area are ones in 
which there is potential for inequitale 
implementation acrss regions as well as for frud and abuse. Parcularly since 
it is likely that the
OIG wil be asked a couple of yea from now to audit implementation of these new provisions 
, we
suggest that this report provide up-front guidance to ACF regarding what guidelines and safeguards 
should be put in place, based on your knowledge of problems in other federa progr. 
det 
3. Strategc planing - I would suggest providing more  regarding the recmmendation for 
long rage and stregic plan. In parcuar, the recmmendaon should briefly, but explicitly,
discus the faCt that choices have been mae and wil contiue to be mae abut how 
to spend the FY
1993 fuding increae as well as any futue increaes. Trae-Qff wil be mae beteen servg
additiona children, increaing the hours of progr operon, strengtenig the  exitig
quality of 
services, and addressing adstrtive and manement weaeses. Ea of 
these choices has
consequence for the direcon of the progr, and should be considered in a systematc faion 
progr 
resultig in a stregic plan that shapes  spendin in the comig yea. 
4. Traning and tecnical asistace on both progtrr agnd  progr maement 
matter - The
Hea Sta Bureau has recgned the weaes in its  and tecca asisce effrt, and is
in the proce of reorganing 
them. Does this effort satfy your concern abut T rr A (in which
cae the recmmendaton should probably support these changes) or are there additional concerr 
that
should be addressed (in which cae more det 
is necessar). 
Exective Summar 
Summ 
The Exective  should include a pargraph on the policy context in which this report should 
be viewed (as descrbed abve) and the relatonsip beteen this report and the perrmance
indicars report. The recmmendations secon of the Exective Sumar 
should reflec changes
mae to the recmmendatons secion as suggested abve. 
Should you have any questions about our co 
ts, pleae contaCt Ann Segal of my sta at
690-7148. 
Attchment  . '
Minor Clarifications in Lan!!Ual!e SUl!l!ested 
Page Ii (and other places) says that the Head Sta Improvement Act "permts grtee
purchase faciities. " This language suggests that the act ::':ady perts faities purchase at grtee
discretion. In fact as we underta it, the law is more circumsec reqg HHS 
approval of
requests for purchase of facilties and alowing the Secet 
to set gudelines for such purchases. 
Relat to this, the discuion of facilties on pages 7-8 is mileag bece it 
presents only the
advantaes, and not the diadvataes, of faciities purchase. While the IG's offce has expresed
concern abut facilties purchases in other conte, this report  fa  to point out such conce and 
leaves the reaer with the impression th such purchases are undoubtey an effecve 
solution 10 
grtee conce. 
Page 2 taks abut "the Admtron." Durg this tie of trition, and depending on
when the report is actally issued, this language nee clarficaon (or omiion). 
conta 
Page 2  the phrae "all eligible children (including four yea olds). 
" Why does
nee the clarfication that eligible 
children includes four yea olds? Was this intended to be
paculaly 
four yea olds, perhaps?  ') 
,. .  . .
(.  . . ,",_. 
t'JJJ.\7 
DIG-A 
DEPARTMENT OF HEALTH &. HUMAN SERVICES  / ul  the Seaetary 
DIG-EI 
DIG OJ 
'...Id  AIG-MP  (\A'  . D. C. 20201 
JAN 25 199  OGC/IG 
EXSEC 
Bryan B. Mitchell 
TO:  T),ATESE 
Principal Deputy Inspector General 

/7-/ 
zabeth  C'rJ 
FROM: 
es
ting Assist nt se  eme ";  Budget 
SUBECT: OIG Draft Report: "Head start Expansicm: Grantee
" OEI-09-91-00760 
Experiences, 
Head
Thank you for the opportunity to review the draft report 

Start Excansion: Grantee Exceriences . This report as well as 
OIG' s two other companion reports on Head start expansion will be 
very valuable to the program at this point in its history. 

have several general as well as specific comments and

recommendations on this report.

GENERAL COMMNTS 
Grantee Exceriences  Performance
TIhen twdo riecporats,t ors  and
, as currently drafted appear to contradict each 
Grantee Experiences leads the reader to believe

other. 
there are significant problems with expansion, whereas

Performance Indicators seems to prove that expansion alone

has not yet caused significant problems. 
We suggest the IG 
attempts to integrate the findings of these reports so a

reader of both reports is not left confused.

Grantee Excerience is based on the feelings and opinions

that Head Start grantees expressed during interviews.

Performance
HIownevedr, ithce asectonod IrG sre port in the series,

, is based on a statistical analysis done by IG 
investigators. This distinction is important and should be

highlighted in the Executive Summaries.

Grantee Exceriences suggests that all of the problems

grantees are currently having are caused by expansion, when

in fact they may be inherent in the Head Start program and

have only been exacerbated by expansion. For example,

grantees would still have problems finding affordable

facilities even if expansion did not happen. Expansion has 
c:  just made it more difficult. This report should clearly 
.. 0- state that these problems would still exist without 
W'- L"\  expansion. The  Performance Indicators, seems
second report, 
t3 .  C,""  to verify this by finding no statistical difference in pre-
UaJ: c  and post-expansion quality indicators. This should be 
stated when cross-referencing the two reports.

SPECIFIC ISSUES

Page ii and Page 15 - Shaded Box: 
The second sentence in the 
first paragraph is somewhat misleading as the Department never

prepared a FY 1994 policy budget, only a baseline budget.

Suggested replacement sentence: "These findings provided
 Page 2 - Byran B. Kitchell

information to these agencies for preparing future budgets and

planning for future expansions.

Page ii and Page 15 - Shaded Box: The recommendations concerning 
facility purchases and the match requirement have been deleted in

We suggest

light of passage of the Head Start Improvement Act. 
not removing these recommendations, but changing them to reflect

the new legislation. Each issue has numerous implementation

problems and the IG may want to craft recommendations regarding

what types of safeguards ACF should put in place so Head Start ' 
fiscal integrity is assured. Perhaps these recommendations can

guide ACF in developing regulations for each of these issues.

The report states that over 80 percent of grantees interviewed

believed it would be advantageous to purchase property. The Head

start Improvement Act does ease the restrictions on purchasing

facilities. 
P. 1 - Last sentence of first paragraph under "Backqround" -
Recommend changing last clause from "Head start addresses the

needs of the entire family" to "Head start identifies the

families I social services needs and assists them in meeting those 
needs. " 
P. 1 - First sentence under "The Head start Program" header -
Suggest clarifying the statement "Head Start is the only child

development program funded primarily by the Federal governent"

Even Start and Comprehensive Child Development Centers are among

other Federally funded child development programs.

" header - A

P. 2 - Second sentence under "Head Start Expansion
The sentence could 
Supplemental Authorization Act did not exist. 
be modified to read "The Dire Emergency Supplemental

Appropriation of 1990 marked the beginning of expansion for all

grantees and raised FY 1990 total funding to $1. 552 billion. 
" header 

P. 2 - Fourth sentence under "Head Start Expansion
Suggest deleting the phrase "with the goal to serve all eligible

children (including 4-year-olds) by 1994" as no such goal is 
found in the Human Services Reauthorization Act.

P. 2 - Please update the Fiscal Year 1993 information in the
"Head Start Expansion, 1990-1993" table with the Announcement

Date. 
Also, "Funds Allocated to Expand Enrollment" is actually
$372, 706  000. 
P. 2 - We recommend including an additional table to accompany
the existing "Head Start Expansion, 1990-1993" table to show

currently, 
funds spent on cost of living and quality increases. -
the Head Start statute requires 25 percent of the funding

I s adjusted 
increase over the previous year  appropriation to be 
set-aside for quality improvement. The amount of quality funds

that have gone to grantees is significant.
 --------------------------------- -----------
Page 3 - Byran B. Kitchell

Suggested table to insert:

BE 
START QUALITY IMPROVENTS, 1990-1993 
Anouncement  Quality
COLA 
Date  Improvement 
Expansion  14/6/90  $49, 000, 000 
Expansion  6/12/90 
Expansion III  undated  $195, 000  000 
Expansion  2/19/92  $62, 625, 000  $45, 910, 000 
Expansion V  Fortcoming  $61, 945, 000  $127, 883, 000 
P. 3 - First sentence in first paragraph. We suggest clarifying

what a " region  grantee" is. Also, adding the clause " 
required by statute" to the end of the sentence.

Suggest stating in either the first or third paragraph that new

grantees could only apply for funds in unserved counties, and

funding has gone only to existing grantees in served counties.

P. 5 - There appears to be some inconsistency in statements
regarding grantees finding eligible children. The first sentence

of the last paragraph states that "almost all grantees believe

that there are sufficient children to warrant furter expansion"

However, the third bullet, half-a-page above that statement,

finds that more than a quarter of all grantees examined were

Performance Indicators

unable to find eligible children. The 
report shows grantees at 99. 1 percent of full enrollment, a

are 
higher level than pre-expansion. Perhaps these findings 
unclear and are not inconsistent; if so clarification is needed.

Given the apparent inconsistencies regarding finding eligible

children, perhaps the first bullet under "Findings" on page 

"Some grantees experience difficulty enrolling children, " should

be made conditional \ 
P. 6 - section following "Only one-quarter of grantees indicated

that they plan to serve all eligible 4-year olds by 1993" header

- We suggest this be clarified to note that the grantee responses
were recorded well in advance of any specific information about

resource availability during FY 1993.

P. 11 - The second paragraph under the "ACF Regional Offices
Suggest a more flexible and fair allocation system" suggests that

ACF should use 1990 instead of 1980 census data to aLlocate

funding. 
However, the Census Bureau had not released this data 
in time for Head Start to use it in their FY 1991 or FY 1992

allocations. H ad Start now has the 1990 census information and

used this data to altocate FY 1993 funds. Since the 1990 data is

being used, the problem is solved and perhaps this paragraph

paraqrap
h remains, please add the
should be eliminated. If the 
 Byran B. Kitchell

Page  4 -
sentence "Head start began using 1990 Census data for allocation

of FY 1993 funds as this was the first year the data was made

available to ACF. 

If you have any questions or concerns regarding these comments,

please contact Karen Shafer(690-6238) of my staff.