Grants Blog

Archive for the ‘General’ Category

The Government Accountability Office (GAO) released a report on September 25, 2012 entitled “Grants to State and Local Governments: An Overview of Federal Funding Levels and Selected Challenges.” The report provided a synopsis of federal assistance programs, the grant awards process, and funding levels of federal grants over the last thirty years. The GAO did not examine any new issues regarding federal grant programs, and instead summarized previous audit reports focusing on the challenges in implementing and managing federal assistance programs.

While the report did not provide any new recommendations for policy initiatives or insight into grants management, it can serve as an excellent reference for individuals seeking to learn more about federal grant programs. The report provided a concise summation of GAO concerns regarding the lack of appropriate performance measures for many grant programs, overlap and duplication of program scopes and objectives, and the need for more effective oversight and monitoring of grant awards. The report can be found at http://www.gao.gov/assets/650/648792.pdf.

Management Concepts offers two courses designed to address the some challenges in grants management outlined by the GAO. The Monitoring Grants and Cooperative Agreements for Federal Personnel course provides training to federal grant and program officials to develop working familiarity with essential monitoring techniques and gain insight into potential problem areas in grants administration. The Accountability for Federal Grants course is designed for anyone in the grants community, awarding and recipient personnel alike, who is interested in applying performance-based principles to grant projects. Additional information about these courses can be found in our course catalog.

On September 5, 2012, the Second Circuit Court of Appeals upheld a lower court’s judgment finding that Cornell University’s Weill Medical College and Dr. Wilfred van Gorp, a former faculty member, submitted false claims on grant renewal applications and progress reports from 1999 through 2001. The case is U.S. ex rel. Daniel Feldman v. Wilfred van Gorp and Cornell University Medical College.

The National Institutes of Health (NIH) awarded the grant to Cornell and Dr. van Gorp to provide training to post-doctoral fellows researching neuropsychology and HIV/AIDS. In 2003, Daniel Feldman, a fellow hired under the grant, filed a qui tam case under the False Claims Act.  (The False Claims Act imposes liability on persons and companies who defraud governmental programs.  These cases are often referred to as qui tam actions, which are suits brought by an individual, known as a relator, in an effort to prosecute government procurement and program fraud.  Additionally, to help alleviate the potential negative aspects of being a “whistleblower,” the federal government allows the relator to keep up to 30% of the amount the government recovers.)  Dr. Feldman alleged the program misused grant funds and that material changes had been made from the original grant application. After a four-year investigation, the government declined to intervene; however, Dr. Feldman pursued the claim using private counsel.

The Court of Appeals upheld damages in the amount of $855,714 – three times the amount the government paid in grant funds to Cornell after it submitted its first fraudulent progress report.  The lower court also awarded $32,000 in statutory penalties and more than $625,000 in attorneys’ fees to Dr. Feldman.

The Court of Appeals rejected all of the defendants’ arguments and provided a detailed discussion on awarding damages.  The Court found that when no tangible benefit has been received on the part of the government, then the “benefit of the bargain” method would be inappropriate.  The government, the Court said, received no benefit at all and therefore should be made whole again.

We’ll be taking a closer look at this case in our Federal Grants Update 2012 course.

The entire the decision can be found here.

We generally don’t use this space to toot our own horn, but this is a special occasion. Last week, the Grants Management Certificate Program graduated its 5000^th student. On behalf of all of us here at Management Concepts, we’d like to thank all of the Certificate Program candidates who allowed us to assist them with their career development over the years.

Just a quick note regarding the Supreme Court ruling on the health care act and its potential impact on federal grants.

Part of the decision expressly addresses the issue of whether Congress has the authority to set conditions upon the receipt of grants. The short answer is: yes, it can, as long as those conditions do not constitute “coercion.”

The Court said that in this case, the threat of withholding 100% of Medicaid funding from states that did not want to participate in the expanded coverage program was coercion and was therefore unconstitutional. However, it did not clarify if withholding lesser amounts was coercion or simply “persuasion” — which is permissible. (The Court indicated that “persuasion” was permissible when it ruled that Congress had the authority to withhold highway construction funding — which totaled about 5% of state funding — from states that did not raise the drinking age to 21).

So the Court’s health care decision leaves a lot of room for discussion, interpretation and perhaps even future legal challenges. At what point does “persuasion” become “coercion?” Does this logic apply to all grants and cooperative agreements or just certain essential services? And so forth.

We’ll be taking a closer look at this issue in our Federal Grants Update 2012 course.

Earlier this year there was a flurry of activity and far-ranging discussion surrounding a new DATA Act, legislation that would impose strict new reporting requirements on federal agencies and grant recipients.

But what happened to that proposed measure?

Apparently, it has died in the Senate.

During a Sunday morning talk show, Rep. Darrell Issa, the bill’s primary sponsor in the House, was discussing the Republican agenda when he said “we want to be jobs and the economy,” Issa said. “The Data Act passed unanimously out of the House, and it’s died in the Senate. That would bring greater transparency and accountability and save money. We have those issues we’re working on.”

If the measure does see any action in the Senate, we’ll let you know.

Deployment of SAM, the new System for Award Management, is being delayed until late July.

SAM is a project sponsored by GSA that will consolidate numerous grants and contracts databases into one location. This consolidation will give users one central point for finding information, and also one login site for accessing data currently housed on sites such as EPLS, CCR and numerous others. GSA originally planned to launch Phase 1 of the project in late May, but is now indicating that it will be late July before it goes live.

For more information, go to www.SAM.gov.

Nearly $800 million in undisbursed federal funds remained in expired grant accounts at the end of fiscal year 2011, according to a new report from the Government Accountability Office. And while some agencies have taken steps to reduce that amount and speed the grant closeout process, more work needs to be done.

In a May 2012 follow-up to a 2008 report, GAO repeated its basic recommendation: OMB needs to establish governmentwide guidance for grant closeout.

In the 2012 report, GAO noted that while the total amount of undisbursed funds in FY 11 essentially equaled the amount reported in its previous study, the percentage of total grant funding that those funds represented was lower – meaning that agencies were doing a better job of getting rid of those unobligated monies and closing accounts.

For example, in February 2011, HHS established an interagency workgroup—the Accelerated Closeout Team—led by the Office of Grants and Acquisition Policy and Accountability to coordinate a departmentwide response in strengthening financial controls and accelerating the number of grant and contract closeouts.

“Our analysis shows that there has been an improvement in closing out expired grant accounts with undisbursed balances in PMS since our 2008 report,” GAO said in the report. Nevertheless, GAO continues “The presence of tens of thousands of expired grant accounts in PMS with no undisbursed funds remaining raises concerns that these accounts are not receiving sufficient attention. Reducing the number of accounts with zero balances remaining would help ensure that administrative and financial closeout—the final point of accountability for these grants—is being completed. It would also minimize the amount agencies pay in potential fees for maintaining these accounts, which can accumulate over time.”

If you are interested in learning about effective grant closeout, Management Concepts’ two-day Closeout of Grants for Federal Personnel will be helpful. This course provides students with a framework and actionable process for overseeing and conducting grant closeouts. Visit www.managementconcepts.com/grants for more information.

The General Services Administration (GSA) is undertaking a federal acquisition streamlining effort that while targeted to contracting, will nevertheless have an impact on the grants community.

On May 29 GSA plans to move the functions currently hosted by the Central Contractor Registration (CCR) and the Excluded Parties List System (EPLS) into a new System for Award Management (SAM). SAM will consolidate nine acquisition databases that track pre- and post-award contract data across the entire federal civilian and Department of Defense acquisition communities. Included in this list of systems are several used by grantees and grantor agencies, such as CCR, EPLS, the FFATA (Federal Funding Accountability and Transparency Act) Reporting System (FSRS), and the Catalog of Federal Domestic Assistance (CFDA).

The intent of SAM is to take each of these systems and their myriad databases – which now have separate login functions (with the exception of CFDA), overlapping data, and various host locations – and move them into one system. Users will have one login, one source for data, and one central host (reducing maintenance and operation costs for the federal government). SAM is not merely a portal into existing systems. It is an integration of current capabilities, information, and functionalities.

The transition to SAM will be done in phases. Phase 1 – which includes EPLS and the CCR (along with other contract-related databases) — is set to go live May 29. According to the CCR website, the CCR site will go down May 23 and from that point on, its functions will be done through SAM. For entities that currently are registered in CCR, this will really not impact them at this moment. However, any entity that is registering for the first time and those that must re-register will now have to go through SAM.

Phase 2, scheduled for deployment from December 2012 through June 2013, will include the FSRS and CFDA. (GSA, through SAM, is planning to assume responsibility for the development and maintenance of the catalog.)

For more info, go to https://www.sam.gov/sam/ or https://www.bpn.gov/ccr/.

Just a quick note: OMB is extending the deadline for submitting comments on its “Advanced Notice of Proposed Rulemaking” relating to the grants management requirements overhaul. The new comment deadline is April 30.

To read the original February 29 Federal Register notice describing OMB’s ideas for reforming grants management, click here.

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