GAO-10-216R Recovery Act

United States Government Accountability Office

Washington, DC 20548 

November 30, 2009 

The Honorable Mitch McConnell 

Republican Leader 

United States Senate 

Subject: Recovery Act: Contract Oversight Activities of the Recovery Accountability and 

Transparency Board and Observations on Contract Spending in Selected States 

The American Recovery and Reinvestment Act of 2009 (Recovery Act) was enacted on 

February 17, 2009, to help stimulate the United States economy by creating new jobs, as well 

as saving existing ones, and investing in projects that will provide long-term economic 

benefits.1

 Estimates show that the Recovery Act’s combined spending and tax provisions will 

cost $787 billion over 10 years—about $207 billion in tax reductions plus about $580 billion in 

additional federal spending. These funds are being provided directly to federal agencies and 

also distributed to states, localities, other entities, and individuals through a combination of 

formula and competitive grants and direct assistance. About $280 billion of the funds will be 

administered through state and local governments. The Recovery Act delineates an important 

set of responsibilities for the accountability community. The inspectors general across 

government are expected to audit the programs, grants, and projects funded under the 

Recovery Act, both within their particular agency or department and collectively. To address 

the collective oversight at the federal level, the Recovery Act established the Recovery 

Accountability and Transparency Board to help prevent waste, fraud, and abuse. In addition, 

the Recovery Act requires GAO to perform bimonthly reviews of the use of funds by selected 

states and localities and to comment on estimates of jobs created or retained in the quarterly 

reports of Recovery Act fund recipients. 

GAO was asked to report on the activities of the Recovery Accountability and Transparency 

Board (the Board), as well as on contract-related information collected from the work GAO 

has completed thus far in 16 states and the District of Columbia. This report provides our 

observations to date on the extent to which (1) the Board is monitoring federal agency 

contract spending on Recovery Act-related contracts and (2) selected states are using 

competitive procedures in awarding contracts using Recovery Act funds. To determine the 

actions taken by the Board, we met with representatives of the Board to discuss the 

initiatives they have taken to monitor the number and types of contracts issued by federal 

agencies for the Recovery Act and their plans to assess the extent to which laws and 

regulations are being complied with or circumvented. We reviewed available documentation 

related to the Board’s initiatives. We also reviewed data reported by federal agencies and 

states through the Federal Procurement Data System-Next Generation and 

www.recovery.gov (Recovery.gov) related to federal contracts awarded using Recovery Act 

funds. To provide observations on selected states’ use of competitive procedures in awarding 

contracts for Recovery Act funds, we met with state procurement officials to discuss the 

contract award process for a sample of contracts in 16 states and the District of Columbia. 

The contracts we discussed with state officials were selected based on a combination of 

 

1

Pub. L. No. 111-5, 123 Stat. 115. 
several factors—such as dollar value, program risk, and project status—that varied among 

the states; therefore, information reported about contracts cannot be generalized. We 

conducted this performance audit from August 2009 through November 2009 in accordance 

with generally accepted government auditing standards. The standards require that we plan 

and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis 

for our findings and conclusions based on our audit objectives. We believe the evidence 

obtained provides a reasonable basis for our findings and conclusions based on our audit 

objectives. 

Background 

The Recovery Act established the Board to coordinate and conduct oversight of covered 

funds to prevent fraud, waste, and abuse.2

 As part of its responsibilities, the Board was 

charged with establishing and maintaining a Web site to foster greater accountability and 

transparency in the use of Recovery Act funds. The Board is required to report to the 

President and Congress any potential problems requiring immediate attention, in addition to 

reporting quarterly and annually. 

The Recovery Act details the Board’s composition, functions, and powers and provides 

employment and personnel authorities.3

 The Board is composed of a chairperson and 12 

inspectors general. To carry out its oversight mission, the Board employs 39 staff, of whom 

20 are detailed from agencies throughout the federal government. In addition, the Board 

established three committees drawn from the 12 inspectors general on the Board: 

• Recovery.gov Committee—focused on creating the technical solution for recipient 

reporting and public reporting via Recovery.gov. 

• Accountability Committee—focused on methods for receiving reports of potential 

fraud, waste, abuse, and mismanagement and referring the reports to the 

appropriate inspector general. 

• Recovery Funds Working Group Committee—focused on initiating projects 

agreed upon by the groups’ representatives and coordinating oversight activities 

with federal agencies, inspectors general, and state officials. This committee is 

supported by a larger Working Group consisting of representatives of the 29 

inspectors general. 

The Board began official meetings on March 27, 2009, and began meeting regularly in May 

2009. Under the Recovery Act, the Board will terminate on September 30, 2013.4

Key criteria to help guide oversight of federal agency spending related to the Recovery Act 

are included in various Office of Management and Budget (OMB) policy memorandums. For 

example, OMB’s February 18, 2009, policy, Initial Implementing Guidance for the American 

Recovery and Reinvestment Act of 2009, and its April 3, 2009, update, encourage federal 

agencies awarding contracts using Recovery Act funds to obtain competition and to award 

fixed-price contracts to the maximum extent practicable.5

 Competition is the cornerstone of 

the acquisition system, and the benefits of competition are well-established. It saves taxpayer 

 

2

Pub. L. No. 111-5, Div. A, § 1521, 123 Stat. 289. 

3

Pub. L. No. 111-5, Div. A, §§ 1522-1525, 123 Stat. 289-93. 

4

Pub. L. No. 111-5, Div. A, § 1530, 123 Stat. 294. 

5

Office of Management and Budget, M-09-10, Initial Implementing Guidance for the American Recovery and 

Reinvestment Act of 2009, Section 6.1 (Feb. 18, 2009). 

Page 2 GAO-10-216R Recovery Act 
money, improves contractor performance, helps curb fraud, and promotes accountability for 

results. 

Recovery Accountability and Transparency Board Oversight of Federal Contract 

Spending 

Since it began meeting in March 2009, the Board has acted quickly to bring a number of 

resources and initiatives to bear on oversight of Recovery Act funds, including contract 

spending. It has launched a number of initiatives that are being executed by the Board’s 

executive staff, as well as by the 29 inspectors general responsible for Recovery Act 

oversight. The initiatives include reviewing federal contracts and grants to help ensure they 

meet applicable standards, follow OMB guidance, and satisfy applicable competition 

requirements, as well as identifying risk areas for fraud, waste, and abuse. The Board, with 

the help of the inspectors general, is also assessing the capacity of federal agency acquisition 

workforces to determine if they have sufficient numbers of trained acquisition and grants 

personnel to manage the Recovery Act workload. Because many of the Board’s initiatives are 

in their early stages of implementation, it is too soon to evaluate their success or 

shortcomings for providing sound oversight of Recovery Act funds. 

Board Initiatives Aimed at Monitoring Federal Recovery Act Contracts

The Board uses several approaches to monitor federal contracts, four of which are 

highlighted in this section. See enclosure I for a complete listing. First, each day Board staff 

manually review contract solicitations and awards posted daily on the Federal Business 

Opportunities Web site (FedBizOpps.gov).6

 This review includes (1) ensuring that Recovery 

Act-related Federal Acquisition Regulation is followed—such as ensuring that relevant 

information is synopsized as required when a contract is awarded noncompetitively or on a 

non-fixed-price basis—and (2) identifying contractors that might be on the Excluded Parties 

List System.7

 In addition, Board staff review data on Recovery Act-funded contracts from the 

Federal Procurement Data System-Next Generation to identify the reasons for the 

noncompeted contracts.8

 Table 1 shows that 25,666, or about 92 percent, of 27,774 contract 

actions as of November 2009 were issued competitively. 

 

6

FedBizOpps.gov is the federal government’s Web site where government business opportunities can be accessed 

electronically by the public. 

7

The Excluded Parties List System, which is maintained and posted by the General Services Administration, is a 

database listing the parties suspended, proposed for debarment, debarred, declared ineligible, or excluded or 

disqualified from government contracting. 

8

Our previous work, as well as the work of the federal Services Acquisition Advisory Panel, has identified 

limitations in the accuracy and timeliness of data in the Federal Procurement Data System-Next Generation 

(FPDS-NG). Both GAO and the Services Acquisition Advisory Panel have reported that while FPDS-NG has been 

the primary governmentwide contracting database for capturing and reporting on various acquisition topics, such 

as agency contracting actions and procurement trends, it has had data quality issues over a number of years. 

While FPDS-NG data are useful for providing insight, it is not always accurate at the detail level. However, no 

other viable alternative currently exists for obtaining governmentwide data on federal procurements. See GAO, 

Federal Contracting: Observations on the Government’s Contracting Data Systems, GAO-09-1032T (Washington, 

D.C.: Sept. 29, 2009); GAO, Federal Acquisition: Oversight Plan Needed to Help Implement Acquisition Advisory 

Panel Recommendations, GAO-08-160 (Washington, D.C.: Dec. 20, 2007); and Services Acquisition Advisory Panel, 

Report of the Acquisition Advisory Panel to the Office of Federal Procurement Policy and the United States 

Congress (January 2007), p. 430. 

Page 3 GAO-10-216R Recovery Act 
Table 1: Number of Federal Recovery Act Contract Actions Competed, by Federal 

Agency as of November 2009 

Federal agency or department Competed 

Not 

competed

Agency for International Development 4 2

Corporation for National and Community Service 3 2

Department of Agriculture 509 221

Department of Commerce 123 51

Department of Defense 5,107 1,250

Department of Education 16 1

Department of Energy 537 89

Department of Health and Human Services 296 41

Department of Homeland Security 33 11

Department of Housing and Urban Development 20 11

Department of the Interior 894 90

Department of Justice 11 7

Department of Labor 213 22

Department of State 73 9

Department of Transportation 118 33

Department of the Treasury 13 5

Department of Veterans Affairs 566 35

Environmental Protection Agency 112 35

Federal Communications Commission 130 2

General Services Administrationa 16,741 137

International Boundary and Water Commission: U.S.-

Mexico 38 0

National Aeronautics and Space Administration 62 37

National Science Foundation 6 0

Small Business Administration 6 13

Smithsonian Institution 19 1

Social Security Administration 16 3

Total 25,666 2,108

Source: Federal Procurement Data System-Next Generation. 

Notes: The data are as of November 16, 2009, as reported by the Recovery Accountability and Transparency 

Board. 

a

The General Services Administration data include 16,194 individual vehicle orders. 

In discussions with GAO, the Board offered an example of the types of reviews it performs on 

federal contracting data. In early September 2009, the Board reviewed cost-reimbursement 

contracts because, at that time, the number of contracting actions for this type of contract 

was small as a percentage of overall actions, but the dollars were quite large as a percentage 

of overall contract dollars obligated. The Board staff informed us that they found the 

Department of Energy, which was the leader in federal agency Recovery Act contract 

spending at that time, had issued modifications to a number of existing cost-reimbursement 

contracts that accounted for over 50 percent of the dollars obligated. The Board staff 

discussed this situation with the Department of Energy Inspector General, who informed the 

Board staff that the Inspector General’s office was aware of the situation and is monitoring it. 

The Board staff also regularly post a list of noncompetitive, non-fixed-price contracts on 

Recovery.gov. 

The Board began another key initiative on September 28, 2009, when the Recovery Board 

Fraud Hotline—for reporting potential cases of fraud, waste, and abuse—became 

operational. Citizens can submit referrals via telephone, facsimile, Recovery.gov, or postal 

Page 4 GAO-10-216R Recovery Act 
mail. According to Board staff, the hotline was set up using a previously established 

cooperative agreement between the Department of Justice and Louisiana State University.9

 

This government-managed hotline service maintains a database of all reported incidents to 

identify recurring issues, companies, or participants related to potential cases. The Board 

reviews the complaints and refers potential cases to the respective inspector general or 

agency for further review. As of October 31, 2009, the Board had received 245 complaints. 

According to the Board staff, the majority of these complaints did not contain any actionable 

information; for example, some complaints contained a generalized comment on the 

Recovery Act rather than any specific allegation of wrongdoing. The Board refers those that 

are actionable to the appropriate inspector general when there is a specific allegation of 

wrongdoing or multiple factors indicate a possible area of risk. As of October 31, 2009, the 

Board has referred 29 cases to various inspectors general.10

A fourth key initiative of the Board was the establishment of a Recovery Operations Center, 

which became operational the last week of October 2009. The Recovery Operations Center 

provides two core functions—predictive analytics and in-depth risk analysis. The Recovery 

Operations Center uses software that allows for in-depth analyses of a large volume of 

publicly available data on entities receiving Recovery Act funds. According to Board staff, the 

results provide oversight authorities with information to focus limited resources on cities, 

regions, and high-risk government programs where historical data and current trends suggest 

the likelihood of future risk. Initially, the Recovery Operations Center will screen the 

recipients and funds associated with all contracts, grants, and loans that report data through 

FederalReporting.gov.

11 Based on the initial screening results, along with input from the 

Fraud Hotline, inspectors general, and Board staff, additional in-depth analysis will be 

performed using advanced software tools. The results of the predictive analytics and in-depth 

risk analysis are to provide input for the work of the inspectors general in two ways: (1) 

providing information for investigations or audits of federal programs and recipients of 

Recovery Act funds and (2) providing information to expand or help focus oversight 

resources. In early November 2009, about two weeks after the center became operational, 

Board staff told us they had two active investigations under way based on the in-depth 

analysis tool. With regard to results of using the predictive analysis tool, Board staff expect to 

start identifying high-risk areas by the end of 2009. 

Board Initiatives Carried Out by Inspectors General

The Board’s Recovery Funds Working Group, which includes representatives from the 29 

inspectors general, meets monthly to discuss issues related to oversight of Recovery Act 

funds. The Working Group representatives also identify specific initiatives that the inspectors 

general are expected to carry out to support the Board’s oversight of Recovery Act funds. In 

 

9

The Department of Justice and Louisiana State University cooperative agreement hotline service is used by 

several other federal entities, including the Federal Bureau of Investigation. 

10This hotline is separate from FraudNET, which is GAO’s automated means for allowing the public to report 

allegations of fraud, waste, abuse, or mismanagement of federal funds. GAO refers allegations to the appropriate 

inspectors general. As of November 12, 2009, GAO’s FraudNET had received 106 Recovery Act-related allegations 

that were considered credible enough to warrant further review. GAO is actively pursuing 8 allegations, which 

include wasteful and improper spending; conflicts of interest; and grant, contract, and identity fraud. Another 8 

are pending further review by GAO, and 13 were referred to other GAO teams for consideration in their ongoing 

audit work. GAO also referred 30 allegations to the appropriate agency inspectors general for further review and 

investigation, which we will continue to monitor. The remaining 47 allegations did not warrant further 

investigation. 

11FederalReporting.gov is the central governmentwide data collection system for federal agencies and recipients of 

federal awards using Recovery Act funds. Federal agencies and recipients are required to submit data on a 

quarterly basis regarding Recovery Act grants, loans, and contracts. 

Page 5 GAO-10-216R Recovery Act 
August 2009, for example, 28 of the 29 inspectors general on the Working Group administered 

a survey to their respective agencies to assess their overall workforce capacity for handling 

the management and oversight of contracts and grants being awarded with Recovery Act 

funds. Specifically, the agencies were asked about the qualifications and the level of training 

provided to individuals overseeing the spending of Recovery Act funds. The individual 

inspectors general were expected to report on their findings in October 2009 and then 

provide a consolidated report to the Board in December 2009. 

Beyond its work in overseeing federal contracts, the Board’s Working Group also began a 

data quality initiative to assess their respective agencies’ efforts to review the quality of 

recipient-reported data. To date, 22 of the 29 inspectors general on the Working Group have 

conducted reviews of their agency’s processes for looking at Recovery Act recipient data. 

The individual inspectors general are expected to report on their findings in November 2009 

and prepare a consolidated report for the Board in December 2009. In addition, 21 of the 

inspectors general have begun or plan to begin a follow-up review of the effectiveness of 

their respective agencies’ review processes. 

In addition, the inspectors general are reporting monthly to the Board on the number and 

status of Recovery Act-related audits and investigations they have initiated. As of September 

30, 2009, the inspectors general reported they had 77 investigations and 391 audits, 

inspections, evaluations, or reviews in process. They also reported they have issued 163 

reports on Recovery Act-related issues since the act was passed—70 reports were issued but 

not published because they contain proprietary information that cannot be made available to 

the public, and 93 reports have been published on Recovery.gov. For example, the 

Department of Energy Inspector General had issued 8 reports as of September 30, 2009, that 

addressed aspects of Recovery Act issues—two issued in September 2009 addressed the 

management of the ENERGY STAR program and the management of contractor fines, 

penalties, and legal costs.12 These reports identified the relevance of their issues to Recovery 

Act implementation. As another example, the General Services Administration Inspector 

General has issued two reports since the Recovery Act was passed. The most recent report, 

issued in September 2009, provided observations on the Public Building Service’s major 

construction and modernization projects being funded under the Recovery Act. 

Observations on Selected States’ Contract Spending 

Based on GAO’s initial bimonthly observations of a relatively small sample of contracts 

awarded by state and local governments, the majority of the contracts as described by state 

and local officials were competed and awarded using fixed prices. Only a small portion of 

Recovery Act funding distributed to the state and local governments has been expended. 

While our initial observations provide an early indication that competition is being used by 

state and local governments receiving Recovery Act funds, a more definitive assessment can 

be made by each of the state auditors for their respective states. As a part of GAO’s ongoing 

oversight of Recovery Act spending, we have worked and will continue to work closely with 

state auditors on their oversight of Recovery Act spending and will be reporting on the 

results of their oversight of procurement spending at both the state and local level. 

The Recovery Act requires GAO to conduct bimonthly reviews of the use of funds by selected 

states and localities. GAO has selected a core group of 16 states and the District of Columbia 

(District) to follow over the next few years to provide periodic analysis of the use of funds 

under the Recovery Act. This core group contains about 65 percent of the U.S. population and 

is expected to receive about two-thirds of the intergovernmental grant funds available 

 

12ENERGY STAR, a voluntary labeling program established in 1992, provides energy-efficiency data for a range of 

products, so that consumers can make informed purchase decisions. 

Page 6 GAO-10-216R Recovery Act 
through the Recovery Act. For our two audit cycles that covered the period July through 

November 2009, GAO reviewed various federal programs.13 According to their self-reported 

data, the core group GAO is reviewing collectively awarded 5,860 contracts valued at 

approximately $7.1 billion as of early November 2009. 

GAO teams selected a sample of contracts from a variety of programs and held discussions 

with state and District officials to gain an understanding of the extent to which they believe 

contracts were awarded competitively and chose pricing structures that reduce the 

government’s risk.14 The majority of the contracts covered by our review—specifically 106, 

or 87 percent, of the 122 contracts—was considered by state and local officials to have been 

competed when they were awarded. State and local officials cited various reasons regarding 

why some contracts were awarded noncompetitively. For example, officials reported that 

contracts in some areas, such as the Workforce Investment Act Youth Program, were not 

competed in order to expedite the delivery of services. In other areas, officials explained that, 

instead of competitively awarding a new contract, an order was placed on an existing 

contract. Table 2 shows the number of contracts reported by officials as being competed in 

the various programs we are monitoring across the selected states.

Table 2: Number of Contracts Selected States and the District of Columbia 

Reported as Competed, by Federal Program Area as of November 2009 

Federal program area Competed Not competed

Child Care and Development Block Grant 

Program 0 1

Federal-Aid Highway Surface Transportation 

Program 59 3

Public Housing Capital Fund 20 2

State Fiscal Stabilization Fund 1 0

Title I, Part A of the Elementary and Secondary 

Education Act of 1965 0 1

Transit Capital Assistance 5 0

Weatherization Assistance Program 7 4

Workforce Investment Act Youth Program 14 5

Total 106 16

Source: GAO analysis of information reported by state and local officials. 

Similarly, the majority of the contracts included in our review were reported by state officials 

as being awarded using fixed prices. Specifically, state officials reported that 88, or 73 

percent, of the 120 contracts were awarded using fixed prices.15 Generally, fixed-price 

 

13The federal programs GAO selected for review include increased Medicaid Federal Medical Assistance 

Percentage grant awards; Federal-Aid Highway Surface Transportation Program; Transit Capital Assistance 

Program; State Fiscal Stabilization Fund; Title I, Part A of the Elementary and Secondary Education Act of 1965; 

Parts B and C of the Individuals with Disabilities Education Act; Workforce Investment Act Youth Program; Public 

Housing Capital Fund; Edward Byrne Memorial Justice Assistance Grant Program; and Weatherization Assistance 

Program. 

14The states and the District of Columbia have varying legal definitions of competitive procedures and contract 

types. Therefore, we relied on state and District officials to verify whether a particular contract was awarded 

competitively and with fixed pricing as defined by that state’s or the District’s contracting procedures. 

15GAO did not determine whether fixed prices were used for two of the 122 contracts in our sample. 

Page 7 GAO-10-216R Recovery Act 
contracting places the maximum amount of risk on the contractor because the government 

pays a fixed price even if actual costs of the product or service exceed the contract price. 

State and local officials gave various reasons why some contracts were not awarded as fixedprice contracts. For example, in one situation, because the amount of work required for 

highway design work was not readily definable, the state awarded a cost-reimbursement 

contract. In another situation involving the Workforce Investment Act Youth Program, a 

program official explained that, because the number of youth that would participate in the 

program was not clear, a cost-reimbursement contract was awarded. Table 3 shows the 

number of contracts reported as being awarded with fixed prices by state officials in the 

various programs we are monitoring across the selected states. 

Table 3: Number of Contracts Reported as Fixed Price, by Federal Program Area as 

of November 2009 

Program area Fixed price Other than 

fixed price

Child Care and Development Block Grant Program 0 1

Federal-Aid Highway Surface Transportation 

Program 43 19

Public Housing Capital Fund 20 0

State Fiscal Stabilization Fund 1 0

Title I, Part A of the Elementary and Secondary 

Education Act of 1965 1 0

Transit Capital Assistance 5 0

Weatherization Assistance Program 11 0

Workforce Investment Act Youth program 7 12

Total 88 32

Source: GAO analysis of information reported by state and local officials. 

In some instances, state officials further identified these contracts as having fixed-unit 

pricing arrangements, where, according to state officials, unit prices for contract items are 

fixed, but total quantities of items may vary, if needed. Some officials characterized this type 

of arrangement as fixed price, while others reported that it was other than fixed price. As 

such, contracts with fixed unit price arrangements are included in both the fixed-price and 

other-than-fixed-price totals identified above. 

Overall Observations 

The Board, both through its staff and through the working group’s inspectors general, has 

implemented a number of initiatives since the Recovery Act was enacted that are focusing on 

issues critical to the success of Recovery Act contracting at the federal level. These issues 

include monitoring the use of competition and fixed-price contracts, targeting high-risk 

contracting areas and programs, and eliciting the help of taxpayers in identifying potential 

fraud and waste in the use of Recovery Act funds. We believe the activities of the Board, and 

in particular the predictive analysis effort, are a positive step in coordinating and marshalling 

the resources of the inspector general community to strengthen the oversight of federal 

spending. While the Board initiatives are promising, much work remains to be done and the 

effectiveness of the initiatives is still to be determined. We will continue to monitor the 

Board’s efforts—in particular, the results of the predictive analysis tool. 

Page 8 GAO-10-216R Recovery Act 
Additionally, the state and local levels of government appear to be emphasizing competition 

and the use of fixed-price contracts in their use of Recovery Act funds. This overall 

observation is based on GAO’s initial observations of a limited sample of contracts, but, thus 

far, the contract awards at the state and local levels of government appear to be consistent 

with the federal goal of using competition. A more definitive assessment can be made by each 

of the state auditors for their respective states. As a part of GAO’s ongoing oversight of 

Recovery Act spending, we have worked and will continue to work closely with state 

auditors on their oversight of Recovery Act spending and will be reporting on the results of 

their oversight of procurement spending at both the state and local level. We will continue to 

focus on these issues in our future Recovery Act work. 

Board Comments and Our Evaluation 

In commenting on a draft of this report, the Board concurred with our observations on the 

Board’s oversight of federal contract spending. The Board also provided technical comments 

that we incorporated, as appropriate. 

As agreed with your office, unless you publicly announce the contents of this report earlier, 

we plan no further distribution until 30 days from the report date. At that time, we will send 

copies to the appropriate congressional committees and the Recovery Accountability and 

Transparency Board. The report will also be available at no charge on the GAO Web site at 

http://www.gao.gov. 

If you or your staff have any questions about this report, please contact me at (202) 512-5500 

or John Needham, Director, at (202) 512-4841 or needhamjk1@gao.gov. Contact points for 

our offices of Congressional Relations and Public Affairs may be found on the last page of 

this report. GAO staff who made major contributions to this report include James E. Fuquay, 

Assistant Director; Noah Bleicher; Ruth “Eli” DeVan; Jean K. Lee; and Teague Lyons. 

Sincerely yours, 

er General of the United States

Gene L. Dodaro 

Acting Comptroll

Page 9 GAO-10-216R Recovery Act 
Enclosure: Recovery Accountability and Transparency Board Initiatives 

Page 10 GAO-10-216R Recovery Act 

The Recovery Accountability and Transparency Board (the Board), through its staff and the 

inspector general representatives that serve on its subcommittees, has embarked on a variety 

of initiatives aimed at coordinating and supporting the efforts of the inspectors general to 

enhance this accountability community’s oversight of spending of Recovery Act funds. Table 

4 provides a description of the main initiatives being carried out routinely by the Board staff, 

as well as some completed activities. 

Table 4: Board Staff Monitoring Efforts 

Initiative Goal Board staff activities (Board comments) 

Coordinating 

oversight 

activities with 

inspectors 

general and 

federal agencies’ 

senior 

procurement 

executives 

Develop and maintain a 

cooperative working 

relationship with and 

among the 29 

inspectors general and 

agencies’ Senior 

Procurement 

Executives to maintain 

a focus on execution 

and oversight of 

Recovery Act-related 

contracts. 

• Facilitating monthly meetings of the 

Recovery Funds Working Group—which 

consists of the 29 inspectors general 

responsible for Recovery Act oversight—to 

discuss issues impacting oversight, and 

overseeing initiatives performed by 

Working Group representatives. 

• Conducting meetings with Senior 

Procurement Executives from all 28 

agencies responsible for awarding 

Recovery Act funds to discuss the 

importance of oversight of Recovery Actrelated contracts. 

• Developed a Recovery Act Contract 

Checklist for use by all federal agencies 

receiving Recovery Act funds. (Some 

contracting offices require the awarding 

contracting officer to initial the checklist to 

verify compliance and maintain it as a 

contracts document in the award file.) 

• Providing contracting “observations” to 

Senior Procurement Executives that 

identify Recovery Act-related contracts 

that do not meet all of the requirements of 

the statute, as needed. (These observations 

are typically administrative in nature, but 

they serve to reconfirm the importance of 

administrating the Recovery Act-related 

contracts correctly.) 

Reviewing 

FedBizOpps.gov 

and Central 

Contractor 

Registration 

information 

Monitor 

FedBizOpps.gov and 

Central Contractor 

Registration data to 

analyze daily postings 

of contract solicitations 

and types of contracts 

being awarded with 

Recovery Act funds to 

produce reports 

regarding specific 

contracting issues 

• Manually reviewing daily postings of 

contracts in FedBizOpps.gov to check 

compliance with Recovery Act Federal 

Acquisition Regulations requirements, such 

as ensuring the word “Recovery” is in the 

title of the contract award and ensuring 

that relevant information is provided in the 

synopsis when the contract is nonfixed 

price or noncompetitive. 

• Reviewing the Central Contractor 

Registration system to determine whether 
Enclosure: Recovery Accountability and Transparency Board Initiatives 

Page 11 GAO-10-216R Recovery Act 

Initiative Goal Board staff activities (Board comments) 

needing further review. each Recovery Act contractor is registered 

in the system and has a DUNS number and 

to identify any contractors that may be in 

the Excluded Parties List System. 

Reviewing 

Federal 

Procurement 

Data SystemNext Generation 

information 

Monitor Federal 

Procurement Data 

System-Next 

Generation data daily to 

review contract award 

factors for contracts 

using Recovery Act 

funds to identify trends 

that need further 

review. 

Analyzes Federal Procurement Data SystemNext Generation information on competition, 

type of contract, reasons for use of sole-source 

awards, type of set-asides, small business 

classifications, solicitation procedures used, 

award types, and reasons for modification. 

Posting a list of 

noncompetitive, 

non-fixed-price 

contracts 

Monitor reports of 

noncompetitive, nonfixed-price contracts 

and post summaries on 

the public Web site 

Recovery.gov. 

Recovery.gov was upgraded October 30, 2009, 

to provide search capabilities for the list of 

non-fixed-price and noncompetitive contracts. 

The list is now searchable by agency and state 

and identifies contract types. 

Developing 

procurement 

leads for further 

investigation 

Refer potential 

procurement issues 

identified to the 

respective inspectors 

general or agencies for 

further review and 

resolution. 

Potential procurement issues are identified 

through the data system monitoring efforts, 

citizen complaints received through the Fraud 

Hotline, and results of predictive analyses. 

Identified issues are referred to the 

appropriate inspectors general or agencies for 

further review and resolution. 

Operating the 

Fraud Hotline 

Establish and operate a 

contact center to 

receive, track, and 

route reports of 

potential fraud, waste, 

and abuse to the 

respective inspectors 

general or agencies. 

• The Fraud Hotline contact center became 

operational on September 28, 2009. 

• Citizen complaints can be received via 

telephone, facsimile, Recovery.gov, or 

postal mail. The center uses a Department 

of Justice database to track complaints, 

identify recurring issues and names 

involved, and ensure that all relevant 

inspectors general are notified. 

Performing 

predictive 

analyses of 

Recovery Act 

data 

Establish and operate a 

center to perform 

predictive analysis on 

all data available on 

Recovery Act funds and 

activities. 

• The Recovery Operations Center became 

operational in October 2009. 

• The center uses a risk analysis model to 

perform in-depth analyses of a large 

volume of publicly available data on 

entities receiving Recovery Act funds. The 

predictive analysis tool keys on many 

variables—including program risk, dollar 
Enclosure: Recovery Accountability and Transparency Board Initiatives 

Page 12 GAO-10-216R Recovery Act 

Initiative Goal Board staff activities (Board comments) 

values, criminal histories, and citizen 

tips—to identify risk areas that might be 

susceptible to fraud or waste. The data 

results can also be reviewed based on 

geographic region, program, or federal 

agency. The variables in the model are 

continuously reviewed to determine their 

level of usefulness and potential predictive 

nature. 

• The tool also provides in-depth fraud 

analysis capability to identify nonobvious 

relationships between legal entities based 

on a vast amount of public information 

about companies receiving Recovery Act 

funds. These relationships might unveil 

facts that may not have been transparent at 

the time of contract or grant award. 

• The analysis results and relationships that 

are identified might result in identifying 

leads for investigations or audits that are 

then referred to the respective inspectors 

general, additional risk factors to add to 

future analyses, or entities that are on the 

excluded parties list that are receiving 

Recovery Act funds. 

High-risk list of 

federal 

programs 

Develop a high-risk list 

for each agency of 

programs that are 

vulnerable to fraud, 

waste, abuse, and 

mismanagement 

The high-risk list was updated for fiscal year 

2010. Six inspectors general reported no highrisk programs, and the remaining inspectors 

general reported 104 programs as high risk. 

Inspectors 

general 

Recovery Act 

work plans 

Develop and submit for 

posting on the public 

Web site plans for 

conducting oversight 

work for Recovery Actrelated actions. 

• Fiscal year 2009 inspectors general work 

plans were posted to Recovery.gov in June 

2009. 

• Fiscal year 2010 inspectors general work 

plans were posted to Recovery.gov in 

October 2009.These plans include 464 

projects that could each result in multiple 

reports and include plans for 182 

administrative or financial reviews, 152 

performance reviews, and 11 eligibility 

reviews. 

Reviewing 

recipientreported 

information 

Review and analyze 

recipient reporting 

data, and identify 

records that are later 

changed by recipients. 

• Recipient reports regarding contracts 

awarded were posted on Recovery.gov on 

October 15, 2009. Recipient reports 

regarding grants and loans were posted on 

October 30, 2009. 
Enclosure: Recovery Accountability and Transparency Board Initiatives 

Page 13 GAO-10-216R Recovery Act 

Initiative Goal Board staff activities (Board comments) 

• On October 30, 2009, reports that identified 

changes made by recipients during the 

initial reporting process were published on 

Recovery.gov. 

Source: GAO analysis of data obtained from the Board. 

(120855) 
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